How An Insane Idea Becomes Perfectly Reasonable

We're still working on the point of sale process and accounting end of executing this idea, but we like it.

This is somewhat a mashup of two things we want to do.  The first is to have a lower end dark roast (roughly just around 80 points, the cutoff for "specialty", but perhaps on the high end of "premium" grade) that we'll serve each morning in an airpot so the dark roast commuters can get their cup and be on their way.  

The second thing is something we're always pushing for - more ways to talk about coffee to customers.

Now, the dark roast consumers are the least likely to want to talk about coffee.  They know what they like, just give them that roasty flavor goodness and save your breath on the coffee education.

But what if the price for that cup was directly tied to the closing price of the NY Coffee Exchange (C-Market)?

This week coffee has been trading in the $1.80 range.  So it's about the same price as you'd pay for a small cup of our house coffee (lighter roast but better quality) right now ($1.87).  The market has also been in the $1.30 range this year.

What's more important to us than the profit is the conversation and increasing awareness about coffee, coffee futures, climate issues, the role of speculators, the whole shebang. 

If we can get the person who doesn't want to think about coffee at all to HAVE to think about coffee for a few seconds, it's a win.

So far, the only downside we can think of is that if the market were to take a nosedive back below $1.50, we might have some of our specialty-grade coffee customers take a walk on the wild side because of the price. 

We're wondering if anyone industry folk out there have heard of another shop doing this.  We haven't, but we also don't want to take credit for something if it's already out there.

Add your thoughts/comments. We'd love to hear what you think.  Both industry people and coffee drinkers.

And before some barista chimes in with, "Well NO coffee should ever be served in an airpot!," this isn't about you.

Comments

[John Piquet]

The only thing that is often hard to convey is that the customer is paying for the skill it takes to properly roast and brew/prepare X coffee. It's not solely about the price of the bean. I am sure you know many roasters and barista in your own neck of the woods that would dark roast a micro-lot Kenya and in that case, the value of that particular coffee has now gone down. So in educating those who you educate - it's not just smoke and mirrors; it's both quality of ingredient AND level of skill from farmer to roaster to barista that results in the tasty beverage before them.

[Rich]

John,
Thanks for the comment. You're preaching to the choir with that. With this plan, we're trying to talk to people who won't look at the hymnal.

There are only two roasters around here who'd even think of buying a microlot and to their credit, the roasts would be good. But they too have a hard time finding a market for those coffees.

FWIW, the Fetco brews have been Mojo'd. The blend in question and how its brewed isn't an afterthought. Wouldn't be our choice to drink, but it's not bad.

[John Piquet]

Rich,

And as far as the idea of trying to retain and/or appeal to "dark roast commuters" I would say, "Trying to keep every branch on a tree isn't healthy. Sometimes you need a good pruning, y'know."

[Rich]

John,
We did prune the french roast folks awhile back. But this group is pretty big. Our biz model and cost structure (physical and labor) are built on 2004 assumptions and we have to work around that. We've grown the small drink and pourover biz through quality and education. If we can succeed with the "bridge" coffee idea, it's a bigger win than just lopping off a quarter of the tree.

[craig brooks]

Rich, I like the idea of tying your retail cup price to the C-market price in that I do believe it will stimulate discussion about where the consumors coffee comes from. My concern about this concept is twofold: Is your plan to change the retail price daily? If so, it could become an annoyance and a possible turn off to the customer who has to pay $1.87 today and $1.89 tomorrow, etc...From my retail experiences, the customer really likes predictability and consistancy from day to day and sometimes they get weird about their pennys. The other concern I have about the plan is that the C-price really reflects so many other market factors outside of the world of coffee, quailty and availability being just a small part of the price equation. As a small roaster/retailer the green price you(and I) pay seems to have much more to do with weather or not coffee happens to be a good place for speculators to make a profit at the moment. Absolutely a good conversation to have with customers, but sort of off the point of building an understanding of high quality specialty coffee.

[Peterb]

"So far, the only downside we can think of is that if the market were to take a nosedive back below $1.50, we might have some of our specialty-grade coffee customers take a walk on the wild side because of the price."

Wow, that statement betrays a stunning lack of confidence in the quality of your coffee.

Look. You don't want to sell airpot coffee. OK. I can respect that. There are people out there who sometimes want a cup of airpot coffee. You should either sell to these people, or not sell to these people. What you should not do, for god's sake, is sell to these people while secretly despising them. Because you know what? They will be able to tell, and they will not come to your coffee shop again. Because life is too short to give money to people who don't respect you.

Sometimes, when I'm in Toronto, I visit the street vendor sausage and hot dog carts. These guys sell italian sausages, polska kielbasa, spicy links, and plain old hot dogs. It's unquestionable that their specialty sausages are "better" than the plain old hot dogs. But I have yet to have one of these guys give me grief (even unvoiced or merely psychic grief) because, one day, I just wanted a plain old hot dog. When I buy a hot dog, I don't want a "conversation" about whether I have tried polska kielbasa. I want a darn hot dog.

You could learn a lot from the hot dog cart guys.

If you want to sell conversations instead of coffee, that's certainly your right. But I, personally, frequent coffee shops that sell coffee, instead.

[Rich]

Peterb:
"Wow, that statement betrays a stunning lack of confidence in the quality of your coffee."

Not at all.
a) economy
b) local market

I'll assume that the hot dog is less than the kielbasa in your example. So if I show up with $1.50 and that's all I can afford, it's still some kind of sausage from the really good sausage guy. And I recognize it's not his best offering, but it's something relatively close. He wouldn't have it on the menu if he didn't believe it wasn't good enough to serve or that in doing so he'd hurt his reputation.

We serve airpot coffee. Always have. We get criticized for it by other uber-specialty shops constantly. But it makes sense for our morning business and our Fetco is tuned to make a damned fine cup.

So there's nothing in anything we do or say that suggests we don't want to do coffee in airpots.

But we can't have 9 airpots going for different coffees as it's not economically feasible. And we enjoy having a selection of great coffees to experience. So to get people to experience our single origins, we offer those by the cup only.

We also have only offered 80+ coffees (specialty grade) in airpots, but the two choices are generally a city roast and city-plus. Where you're suggesting we don't have confidence, we're saying that we recognize the possibility that many customers who order light roasted airpot coffee are fairly recent converts to a lighter roast (from dark) and may easily go back to dark if the price difference is signficant.

We are not suggesting that customers who order single origins brewed by the cup will jump at a less expensive dark roast. Different audience all together.

To your bigger point, yes we want to get people to move up the ladder to both lighter roasts and single origins because we believe those offer more unique taste experiences they'll come to enjoy. And we can uniquely offer those.

We can also offer dark roasts that are similar to what other shops offer, but then what's the difference in coming here vs. someplace else other than sourcing?

That said, we certainly want people to know that the way we source is superior economically and sustainably to pretty much any other method out there.

Regardless of what we're offering, there's something to be proud of and talk about.

That said, we've learned to not force conversations when they're not wanted. But there is a contingent of people who come in already geared up to be confrontational - as in, "I just want REGULAR coffee."

There is no such thing. There's specialty, premium, exchange, below-grade and off-grade.

And we hope to increase awareness of that through this priced-per-market idea.

P.S. We buy growlers from a tiny local microbrewery in town. If we're there to get some growlers filled and the personnel doesn't want to talk excitedly about their beers, we'll leave disappointed.

Just a different perspective. When we're spending our own money we don't want to waste a lot of time on the "average". Give us your best shot.

[ChrisR]

There seems to be a level of disdain you seem to have for the guy that just wants a cup of dark roast. Personally, I like dark roast. I've had really good dark roasts, light roasts, and everything in between but that's my preference. So being told that you wouldn't waste your breath on talking to me is... well, it's insulting. Peterb is right about that. Personally, I don't care if you think less of me for liking dark roast, I just don't want to know that you think less of me. After all, I want coffee not disdain.

I'll give you a counter example - I know of a bar that prides itself on having an excellent selection of microbrews on tap which are frequently rotated. The one tap they never rotate is the one that dispenses Miller Lite. One would think in a bar that focuses on microbrews they'd give the mass produced swill that is Miller Lite short shrift. However, it is and always has been their top selling beer. While they love to introduce customers to new and exciting beers they love money even more. If you want to give them money for Miller Lite they serve it up with a smile and make you feel good about ordering it. Why? Because they made a decision that making money and having a profitable business was more important to them than educating the unwashed masses. They're always willing to answer questions and help people that want to move past Miller Lite but if that's what you want there is no judgement passed.

More importantly, they don't play games by fluctuating the price of Miller Lite in some sort of attempt to push people into 'better' beers. Which is exactly what you are suggesting. If you don't want to serve dark roast then stop serving it. If you are going to serve it don't play some idiotic game with the pricing. It's disrespectful to the customer.

[Rich]

Chris,

What are you reading?

We clearly stated that it's the dark roast people who generally don't want to talk to us, not the other way around. They're the ones who tell us to save our breath. They often come in girded to not have any conversation, being very specific in that they know exactly what they want ("bold/dark") and will not be talked out of it.

The whole point of this idea is to START and HAVE a coffee conversation with this group of customers.

Hopefully that makes our original point clearer?

And the pricing isn't about connecting to better coffees. It's to connect the concept of a more "regular" coffee with the coffee economy. MOST coffee is priced too low, IOO, not just the specialty grade.

But your beer analogy with Lite is a good one (noting that if there's 1 light beer and 150 microbrews, obviously the lite is going to be the single biggest seller among 151 different beers).

It's also one of the reasons we're bringing back dark in the first place.

[Brad Fisher]

Good for you for reaching out to the Miller Lite drinkers of the coffee world. Don't forget that a lot of them are also slow-brew drinkers who don't want to focus on subtleties as they head for the office, but might care (and pay) when they have the time. From what I've read above, I'm not sure why or whether your dark roast is going to be better than SBux or the guys up the road ... but if it is, let us know, in strong, clear, simple messaging in store, on your cup jackets, your napkins, your aprons, your cash register, your web site, wherever.