The UK Coffee Shop Market

Transcription

1 What s happening?

2 I ll be covering The Current Market The Branded Chains Current Market Trends Iced drinks Design trends Bill s Cafe

3 It s nothing new..

4 THE CURRENT MARKET

5 Total UK Coffee Shop market

6 Market Size Total UK coffee outlets

7 Branded Coffee Shops Leading European Markets Estimated at 15,626 outlets & 16 billion Euros turnover Growth of 4.9% with addition of 732 stores in 2013 Turkey has overtaken Germany and is now the second largest market after the UK, with 2,055 outlets

8 Top 10 European Branded Chains The four leading branded chains have 40% of the market

9 Dominant Costa Part of the Whitbread Leisure Group, which includes Premier Inns Consistently strong sales growth Want 2,200 branches in the UK by 2018 Andy Harrison, CE, believes coffee shops are now the new Pubs!

10 Another Dominant Brand Over 900 Pubs & 33,000 Staff! Tim Martin set up J D Wetherspoon in Why J D Wetherspoon? Because J D from the initials of Sheriff JD Hogg, from The Dukes of Hazzard TV series, of course, while Mr Wetherspoon was one of Tim s teachers in New Zealand!

11 But, who provides the best coffee experience? 55% 40% Composite loyalty score from 4,500 consumers in January 2015 Friendliness of staff, cleanliness, food quality, speed of service, curb appeal, atmosphere, value for money, healthy food options

12 We re drinking less coffee!!! It s now lower than in 2006, when we drank, on average, 3.0kgs of coffee per head Last year, kilos per head were: UK - 2.8kgs per head Germany - 7.0kgs Sweden - 7.1kgs France - 5.5kgs

13 Some Facts 80% of consumers visit a coffee shop regularly Over half of the espresso consumed in the UK is drunk in the South East On average, men drink more coffee than women (1.7 cups per day vs 1.5 cups) 37% of coffee drinkers drink their coffee black; while 63% add a sweetener such as sugar 57% of coffee is drunk at breakfast; 34% between meals and 13% at other meals Espresso contains less caffeine than any other roast Our sense of smell, more than any of our other senses makes our final judgement on coffee

14 CURRENT TRENDS

15 Key Consumer Trends Industry perceptions

16 Factors Encouraging Revisits Industry perceptions

17 Key Success factors Industry perceptions

18 Customer Value Staircase

19 Decent Gross Profit Cappuccino 12floz Customer Tariff Gross Profit excl. VAT Gross Profit %age Cup costs Coffee (Double Espresso) Fresh Milk - Semi-skimmed Brown Sugar (1 stick) Total excluding disposables (Crockery) % 12oz ripple cup Paper cup lid Wooden stirrer Total including disposables %

20 Global Local Nuances In Hungary, customers take pictures of their names on Starbucks cups, because it s a luxury In Germany, bakery is critically important Longer opening hours and a degree of religious sensitivity are essential in the Gulf region NYC Starbucks opening hours are 5am to 12pm In Thailand, 80% of beverage sales are cold In the US, Pret A manger offers ice to customers to add to their beverages understanding the US love for ice

21 So, are coffee shops the new local? Consumers are having their coffee out of home Women have more independence & spending power Pubs are more about males and the evening Coffee shops are open all day, more female & family orientated On-line shopping means Saturdays are to meet friends, not shop Pubs are closing at a rate of 31 per week (CAMRA) Though they re fighting back with improved food and serving breakfast & coffee

22 Artisan Coffee Shops Driving interest, in much the same way that craft beers are helping to revive the brewing industry Dog D pours like dark matter into your glass, with a deep tan head. The nose is subtle but powerful, and on the palate, there s a treacle toffee backbone, supporting the spicy hop flavour and naga chilli heat. Dog D is like eating chocolate ice cream and drinking cognac in a leather armchair.

23 Aim for perfection

24 ICED DRINKS

25 Top 10 Flavour Choice Thinking about the last time you had an ice blended beverage, what flavour did you have?

26 Factors Influencing Purchase Which of the following contribute the MOST to your decision to buy a handmade ice blended drink (e.g. frappe, fruit smoothie, etc.)?

27 Preference for New Flavours I look for new and interesting flavours to try

28 DESIGN TRENDS

29 Casual dining restaurants have attracted an extra 47 million visits each year, compared with 5 years ago Recent statistics from the NPD Group, global information specialists

30 Design Trends for 2015 More focus on the all day offer Welcoming throughout the day More hand-held easy-to-eat foods More relaxed, though the industrial & artisan style will remain for a while The aim is to communicate a humble existence which shouts it s all about the coffee & the food Function before form Exterior branding & design must shout this is our offering & this is our personality Think street-food operators coming indoors Big & bold there really are no boundaries Pantone s colour for 2015 is Marsala, a naturally robust & earthy wine red Customers are bored of sharing tables and now want their own space plus a choice of seating options Mix & match crockery is going wooden boards & mini flower pots are out!

31 An example - Bill s Cafe Up cycled furniture, well worn and welcoming. Makes a new cafe look like people have been eating there for years. Gives confidence to the customer that the site is well loved and established. Products used within the menu available on shelf within the cafe to give the impression you re sat in a deli. Makes good use of shop space as storage, where space is limited.

32 THANK YOU

33 Copyright All figures relating to the commissioned research remain the copyright of Allegra Strategies and Beyond the Bean: UK Iced Beverage Market Strategic Analysis Any reference should be clearly credited as: Allegra & Beyond the Bean: UK Iced Beverage Market Strategic Analysis 2014