Retail Refugees


Coffee Wars are Brewing
November 5, 2009, 1:20 pm
Filed under: Advertising, Market Info | Tags: , ,

The reigning king of premium coffee establishments- Starbucks, of course- has a new contender with some interesting tricks up its sleeve…  Italian giant, Illy, is planning to enter the US market in a big way but rather than starting by spending millions on advertising and marketing, they have chosen to go after the independent coffee giants of the country.

Its art-inspired cups are a favorite of Italiaphiles (a good friend whose husband is Milanese was my introduction to the designer series of tiny espresso cups and saucers). And, after three years of success in Italy, the company has expanded its Artisti del Gusto (Artist of Taste) certification to the U.S., with 28 shops around the country serving Illy coffee, and about 100 more planned by 2012.

Illy’s Artisti del Gusto certification works this way: independent coffee shops with “relevance in their market” are selected to use only Illy coffee beans and agree to do so for a three-year period. Baristas are trained to pull an Illy-quality espresso and given recipes for other drinks common to Artisti del Gusto shops. Illy provides art work, coffee machines, glassware and other branded touches, such as the red Illy umbrellas. Certified coffee shops are periodically monitored for consistency, and the certification can be pulled if the lattes aren’t up to snuff.

Not only is this is a proven way to expand with minimal investment, it’s also a way to increase the reach of a brand, and indoctrinates a much wider audience to the superiority of your coffee beans. In other words, it’s a great way to market your product in grocery stores and online outlets, without a national advertising campaign. A coffee shop on your corner is far better than a billboard, since it’s a place you already trust and whose coffee you are conditioned to love by association. Starbucks sells the majority of its packaged coffee through grocery stores; a whopping two-thirds of its ground and whole bean sales take place outside of its coffee shops.

Personally, I do not think that Starbucks (or McCafé, for that matter) have anything to worry about in terms of volume.  However, this positioning will do wonders for Illy´s brand recognition as a premium product and ultimately benefit its grocery store sales.

https://i0.wp.com/www.artimino.at/images/ILLY.jpg

http://wwff.files.wordpress.com/2007/10/illy.jpg

(via AOL Daily Finance)

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