Coffee Industry Research, Focus on Starbucks
Once again on this semester we had to gather around as a team and brainstorm on what we should research for the course of “New Media Marketing & Research Lab”. We were called to choose a product/brand that is presence on the greek market. We tried to think of a well-known industry that we ourselves would have an interest on reading a publication of the findings.
We had narrowed down our choices to the coffee industry. We went on to analyze the competition in the coffee industry while also focusing on the brands of ”Γρηγόρης” and ”Starbucks”. We set out to conduct both a qualitative and quantitative research and our main objective was to learn more about said market. Also, we examined which are the most important criteria that a customer considers when selecting a brand and which are the consumption habits of the average greek coffee drinker.
As far as the qualitative research is concerned, 7 people were asked in order to collect the information needed. We created two mappings to further analyze the data of the industry. Our first mapping was created based on the answers that were collected from our focus group and regarded the categorization of coffee products taking into account factors such as popularity and aftertaste of coffee. The second mapping, which was created due to the quantitative research results, was based on the criteria that people deemed most important when it comes to coffee consumption.
Regarding the quantitative research, 120 people were asked using the SurveyMonkey platform. By random selection, 40 of these answers were taken into consideration and were further analyzed. There was a total of 10 questions with 82.5% completion rate.
In addition to the research we made a PEST Analysis to dive into the coffee industry in the greek market. Few remarks stood out in this analysis. On the political sector there is an increasing pressure for businesses to trade ethically and become more responsible. For the economic one, there is a useful insight on populations in growing economies which reveals that they are now able to view coffee as a luxury item that they can afford, thus enabling the sale of premium grade coffee. On the social sector there is the worldwide health consciousness trend, in which many consumers are choosing to give up caffeinated beverages for improved mood, sleep and more. Last but not least, on the technological sector there is the Hi-tech equipment and premium ingredients that are now easily accessible and are used to make a variety of hot and cold beverages that are sold in coffee shops.
Furthermore, before asking questions we had to carefully scan all the parameters of the industry such as Market Growth, Key Players, Threats and Opportunities. For Greece, the findings on those sectors were rather surprising. State revenues from coffee in 2017 amounted to 90.4 million euros and one year later to 122.7 million. According to the World Coffee Organization, our country is ranked 17th in the world with per capita consumption of 5.4kg per year. The key players are the following: Flocafe, Coffee Island, Starbucks, CoffeLab, Coffee Berry, Γρηγόρης, Everest and Mikel. These brands are currently dominating the coffee industry market by far. When it comes to the threats of the industry, more and more countries, that are usually top coffee suppliers, are becoming avid coffee drinkers, which means fewer beans available for export. Additionally, there has been a trend for independent coffeehouse movements and climate change regulations can also affect the industry. In terms of opportunities, the vast expansion of the industry in developing markets, the business diversification and the introduction of new products are becoming increasingly crucial.
Generally, there were interesting findings and many verdicts in our research. Since the conducted research was focused on Starbucks, we generated some constructive feedback on the brand. When we asked the audience which brand they would most likely suggest to a friend, only 2 out of 36 people choose Starbucks (6%). The price is one of the lowest rated factors that drive customers away (1.67 out of 5.0). Furthermore, during the last 3 months only 1 out of 10 people has bought from Starbucks. However, leaving aside these negative aspects, we should also mention that “Starbucks” has a strong brand awareness and is mostly perceived as an overall experience rather than a coffee brand.
It is really important for us to highlight some of the strongest points of our findings. These are considered the following:
- Coffee Island is shown to be the most dominant brand when it comes to awareness and preferences.
- Only 5% of the total answered stated that they do not drink coffee.
- Covid — 19 has indeed affected the coffee consumption in a mostly negative way.
- Every company that we added on the list of choices had more than 80% brand awareness.
- Surprisingly, customer service was voted as one of the top three criteria when selecting a brand along with taste and quality.
- More and more people root for the coffee industry to go green.
- Customers are not interested whether the coffee companies are international or greek, even though it is heavily advertised.
Panteion University, Social and Political Sciences — AD&PR LAB
Professors: Betty Tsakarestou, Dimitra Iordanoglou
Coordinator: Konstantinos Ioannidis
Team: Mark The Future
Members: tselepidhs, Ναταλία Γεωργουλοπούλου, Manolis Kritikos, Anastasia Liakou, Konstantina Mountaki, Stavriana Orfanou, Renata Stav
