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Business Students Provide Recommendations on Coffee Shop Retail Strategy

March 10, 2014
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by Richard Westlund
          
Pictured (left to right): Joseph Ganitsky, senior management lecturer and director, UM Center for International Business Education and Research (CIBER); and Luis Fernando Samper, director of communications and vice president of marketing, National Federation of Coffee Growers of Colombia.

Back in the 1960s, a Colombian character named Juan Valdez and his burro became the face of an innovative global branding campaign to promote the high quality of 100 percent Colombian coffee.  Through the decades, that strategy paid off handsomely for the Federación Nacional de Cafeteros de Colombia – a democratically run organization that represents the interests of about 335,000 small coffee growers in Colombia.

Today, the "100% Colombian" brand is adapting to a changing consumer marketplace, and launching a new chain of Juan Valdez Cafe retail coffee shops. To gain fresh input on its new retail strategy, Luis Fernando Samper, chief of communications and marketing for the growers' association, provided a case study to the School’s undergraduate students in senior management lecturer Joseph Ganitsky's class, and asked for their ideas and recommendations.  

"We really value hearing the students' perspectives on our brand's retail strategy," said Samper following a March 8 presentation on the Colombian growers' organization, which has opened 258 Juan Valdez Cafes worldwide, including one location at Miami International Airport with a second South Florida store due to open later this year. 

Faced with global competition from Starbucks, as well as a fast-growing array of local coffee shops, the Colombian association has several differentiation strategies for Juan Valdez Cafes, according to the School’s students. Among their suggestions:

  • Create a European-style coffee house. "Your best branding would be to offer a high-end classic coffee rather than the sweet, coffee-flavored drinks favored by Starbucks' customers."
  • Open small, intimate cafes in trendy neighborhoods. "Make it a truly local experience, where friends can drink espresso in glass cups while enjoying a conversation. In other words, make it a local meeting destination."
  • Focus on speed. "Business customers want fast service, rather than a cafe experience. Give them the best coffee drinks without delays and you can build a loyal customer base."
  • Cater to working adults, parents and retirees, but not college students. "My friends and I use coffee as an energy drink. We don't care about flavors or aromas – we just want the caffeine. That means we wouldn't be an attractive target market for your stores."

Thanking the students for their concepts, Samper said, "The global coffee market evolves every day. We never cease to learn from others, and this was a valuable exchange of ideas for our organization."

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