Coffee Merchandising: The Dream Set

When coaches have the opportunity to create a “Dream Team” for an All Star game or the Olympics, they need only focus on top performance, with no limits around pay, location or logistics to govern what may be…

No one seems to argue against the so-called “premiumization” of the coffee industry over the past decade. With the rise of the $4 latte, and subsequently the rise of the fast food latte, there is little doubt that coffee consumption habits are changing – and for the better, quality-wise (with NCA data supporting fewer cups consumed, but notable increases in average price paid).

At retail, we must expect that changing consumption habits will lead to changes in how coffee drinkers shop for coffee to brew at home. So, free from restrictions from other partners or their square foot analyses… without the conventions or norms, what might the ultimate coffee aisle look like? And what could a “dream set” accomplish?

By and large, the grocery coffee aisle now caters to the shopper looking for coffee by brand. The curious retailer may begin to construct what the next generation “dream set” for specialty coffee may be, and may look beyond a traditional set. Inspired by shoppers becoming increasingly educated about the coffee they drink and aware of its origins, and innovations in sustainability, could pushing the merchandising envelope further serve to encourage consumer education, and ultimately drive sales? By looking to other specialty categories, we find cues as to how other specialty products are distinguished on the shelf.

Consider the wine aisle. Say you love pinot noir. In many stores, you can push your cart right to the pinot noir section, and have in front of you a wide selection of pinot noir to choose from. You may be tempted to reach for an old reliable, but with a half dozen choices in front of you – from Oregon, New Zealand and France’s Burgundy region – you might be tempted to select one from a different country, same vintage, just to see the difference. This sort of merchandising seems to encourage experimentation among related products, even among a complex category. Today’s wine consumer understands the categories, unified by recognizable grape varietals (such as pinot noir, chardonnay, merlot), or by the regions (Italy, Australia, Napa Valley), enabling the category to be more readily understood and explored.

As consumers continue to experiment and try new coffees, this may be a model for a new “dream set.” In an innovative move, a leading national retailer recently re-set their private brand selection sorted by light roasts, medium and dark roasts and flavored coffees. This move lets the French Roast die-hard quickly locate their favorite, but also guides her to other selections that may also suit her palate. This format not only encourages experimentation within a pre-selected category of her preference, but serves to educate as it may broaden her dialog, shaping the way she thinks about coffee’s categories.

Another category which distinguishes specialty products from more commodity counterparts – often within the same store – is cheese. We see dramatically different merchandising treatments of the different product tiers. The “commodity” cheeses – in blocks, shredded and sticks – are typically in the dairy section, surrounded by eggs and other dairy, and are primarily sorted by brand. Yet in the same store, specialty or gourmet cheeses can be found in a stand-alone cooler, near the front of the store. In this case, different cheeses are grouped by type (à la the wines). Soft goat cheeses, semi-softs, bries and different types of parmesans are typically grouped together, again, allowing direct comparisons between the origins, ages and price levels.

A comparable coffee set could group coffees by their regions, inviting experimentation across different coffee styles. By grouping together all  Central American coffees, with their delicate cocoa flavors and vibrant acidity –a consumer who knows they enjoy a Costa Rica would be encouraged to go for a Guatemalan on a subsequent visit. Next to single origin coffees would be the blended coffees grouped by roast level, forcing consumers to think about coffee on a more advanced level.

In short order, such a classification of the coffee aisle would evolve buying behavior, and allow coffee to be priced according to the quality of beans in the bag, not simply line-priced by brand. Brands would be deconstructed to individual recipes that would have to stand out on their own.

Further, this merchandising could be a great step in not only educating the consumer about the distinctiveness of coffee, a path she is on already, but also in building confidence and loyalty in a retailer as a specialty coffee destination . With the “dream set,” shoppers are encouraged to explore more brands and types of coffee and the category would grow… which is never a bad dream to have!

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