A masterclass in F.M.C.G. loyalty
You have to admire big coffee brands - some of them have really nailed the concept of loyalty with consumers but what were the steps to success and what further innovations can they bring?
Step 1 - The need for a better coffee experience
To be fair, this is a global phenomenon where the world has largely sought out a more personalised and better coffee experience - in short, consumers just wanted better tasting coffee and this desire led to a much bigger cafe society lifestyle.
Step 2 - Creating the best coffee experience you can
Lavazza's mission statement is "A passion for excellence that makes every cup a unique experience". When Whitbread acquired and grew Costa Coffee their marketing was focussed on simply making the best tasting coffee.
In any walk of life, if you make the best and most consistent product or service - then you are going to experience high level of loyalty from your customer base.
Step 3 - Here's were things really get interesting - owning the environment
By having the technology to ensure customers can enjoy great if not superior tasting quality coffee in their home, easily, conveniently and affordably - then you have something pretty unique.
Brands have been deploying this kind of approach to owing convenience stores - Like Coca-Cola installing branded drinks fridges into stores, Walls Ice Cream with freezers and of course coffee chains like Costa installing stand alone machines into shops and petrol forecourts.
Step 4 - Seamless operation and enticing subscription models
I have a Lavazza machine in my kitchen, I also have a subscription so I don't have to worry about running out of coffee. But my engagement with the brand is really based on my continued love for their coffee and their level of service in supplying me with capsules.
Of course there are other related products that they offer such as milk frothers (in my opinion the best I have ever tried - highly recommended, much better than the steam arm solutions) and anything else coffee related like cups or mugs etc.
The biggest compliment I can give Lavazza is that when friends and family visit us from Italy - they often comment on the fact that its the best cup of coffee they have tasted during their stay in London.
Step 5 - Expanding your reach through other membership based organisations
Once your operation is set up to efficiently own home or office environments and to supply these environments seamlessly with your product then you can take this model into any membership organisation where there is a high level of following or loyalty - Like football clubs.
The Arsenal and Liverpool branded Lavazza machines are a perfect example of this - the race between Lavazza and their competitors to get their machines into the homes and offices of their consumers is well and truly on! Bottom line - If you don't get your machine into someone's home - then they will be buying your competitors capsules and not yours.
So harnessing a football club following is a great way to get your machine into a home (not necessarily an office environment) and after the first few cups of coffee tastebuds will be acclimatised and the customer is yours.
How I would innovate things differently?
Well if I had an open brief from Lavazza this is what I would suggest.
Step 1 - Maximise the current global opportunity
We are currently in the midst of a global pandemic and millions of people have been, and will continue to work from home for the foreseeable future. Going forward, the workplace will no doubt change with more people working from home in the future.
Although the world is working from home, the need for constantly, great tasting and convenient coffee hasn't disappeared in fact we might be consuming even more.
So right now if Lavazza were my client - I would be recommending a whole load of options and strategies to get ALL of the machines they have in stock (and through their distribution channels and retailers) into the homes of the nation as soon as possible - because if they don't, then their competitors will.
Step 2 - Don't just own the environment - own the coffee occasion in the environment
Today, we have many coffee occasions from breakfast to nightcaps and everything in-between - so I would analyse what the main and "own-able"coffee occasions are in the home and then look at ways of partnering with brands that can supply content to make these much deeper and more rewarding coffee occasions such as digital magazine downloads based on their interests, music or YouTube video's (again based on their passions). Allowing them to take deeper pleasure in their coffee moments, by making them personally more rewarding.
These ideas, are just the tip of the iceberg in terms of potential partnerships that can enhance their drinking pleasure and possibly even drive deeper consumption.
Step 3 - Extending your brand reach in more innovative ways through commercial partnerships that share similar passion points
Whilst football clubs are a great example, there are a multitude of ways in which Lavazza can partner with other similar membership models across food, travel, publishing, special interests and of course sport. For me there a number of big partnerships opportunities to be had here - the right strategy and partners will drive initial purchase considerably. Driving more customers into their subscription model.
Step 4 - Harnessing out of home experience to drive in home
Not suggesting that Lavazza necessarily start opening up coffee shops, but I'm sure there are a whole manner of ways to cost effectively apply techniques and learnings from their subscription model in order to take ownership of the independent coffee sector (and other channels) or to partner with retailers in certain sectors to build brand awareness and drive in home purchase.
What if your F.M.C.G brand doesn't have a technology / machine piece to enable you to own the home environment?
Coffee is lucky in some ways, that you need a machine to ensure that the product is delivered consistently within the home environment as it leads consumers in gently to a subscription model.
However, there are plenty of other F.M.C.G. brands that aren't equipment led or reliant on anything other than the product itself, who can achieve similar results by simply going through the same process to understand and enhance the experience by making that "occasion" just so much more rewarding.
So owning the home occasion or creating subscription models aren't out of scope to any F.M.C.G brands, as long as you make the experience or user occasion more rewarding.
Coffee brands are in many ways leading the way in terms of owning the home environment.
They have, however, got a long way to go in order to drive deeper engagement with customers beyond "taste".
Key focus in the short term has to be acquisition. If you don't get your machines into the home then your competitor will.
Those who make "in-home" coffee occassions more rewarding will engender the deepest level of loyalty and commercial success.