Home: Issue 2 2008 › Cover Story › Full of beans
Full of beans
21/04/2008 | Channel:
Hotels - Restaurants, Drinks, Retail
David Hutchinson talks to Libbie Hammond about how great coffee will always be at the heart of Costa
A s the global marketing director for the Costa Coffee brand, David Hutchinson has an awesome responsibility. Competing with global giants such as Starbucks means he has to apply all his marketing skill to grow the brand and find ways to keep attracting customers to Costa to enjoy a hot mocha or icy Frescato. David however is not daunted, and when speaking about his job is incredibly enthusiastic. “Costa is undoubtedly the best job I have ever had,” he told me. “We are now firmly the largest coffee shop business in our home market of the UK and one of the more broadly distributed on the international arena. Rarely does a marketer get to work on such a great and successful brand.”
A Business Studies and Marketing graduate, David has spent much of his career in the marketing arena. “I was very fortunate in my early career to spend time in Operations which has grounded my marketing career and served me very well,” he continued. “I have also previously worked on other great brands, such as Beefeater restaurants, Carling Black Label and Tennants Pilsner.”
He continued: “I have all the brand marketing responsibilities for the Costa brand wherever we operate in the world. This is currently 20 countries outside of the UK, and is likely to grow to over 30 in the next few years. We also operate the business on a wholly owned, joint venture and franchise basis in different markets. The role is therefore very broad and complex. It ranges from setting strategy on new market entry and opening, to developing the brand in emerging markets, to driving the sales, awareness and performance in large existing markets. So, my remit will cover many broad aspects of marketing, sometimes through a directly managed team and other times through long distance persuasion and influence.”
It might be easy to think that Costa would be content to sit back and enjoy its leading position, but instead the company is driven by very ambitious aims. “Our mission is to be the most successful coffee business anywhere in the world,” confirmed David, “and to deliver an unbeatable coffee shop experience. This means that in all of our current and future markets we are obsessed with delivering on these objectives. We can only do this if we truly understand the consumer of our product in all of our markets, so customer obsession and insight lay right at the very heart of our plans. This means that we will adapt and flex our brand to suit the local needs and tastes.
“At the same time we also want to grow to be the most successfully exported UK retail business - most tend to be American. So, we also have a real focus on growth in all existing and potential markets as well.
“Finally, we also need to raise the profile of the Costa brand. We have a great story and message. The brand has existed for over 36 years, we are an ‘authentic’ coffee shop business and we roast our own coffee. I often believe that Costa is one of the ‘greatest stories never told’. So, finding a platform for brand awareness and communication in a genuine way that reflects our core values is very important.”
Costa has already been voted as one of the strongest UK brands by experts and consumers and has been awarded ‘Superbrand’ status, so I asked David what the company was planning on doing to continually increase global awareness of Costa. “This is driven primarily by advertising/PR and unit distribution,” he explained. “The most important challenge is to open more sites in more locations - we will soon be opening stores in Moscow and Beijing, and we have plans to continue to expand Costa stores across the world. We then work with our partners in all of our markets to execute initiatives like the Costa Foundation and the Book Awards.”
The Costa Book Awards programme was in fact started by Costa’s parent company Whitbread back in 1971, the same year that Costa first started roasting coffee. David explained: “It is actually considered as one of the top four most prestigious literary sponsorship awards in the UK. It’s a bit like fate – a literary award and a coffee shop brand that were destined to be together, it just took until 2006 for it to become the Costa Book Awards! We are working very hard to add our weight to what is a very important issue, so we also use the Awards as a springboard to get more involved with other key literary initiatives, such as the Six Book Challenge and the Reading Agency.”
Alongside its literary work, Costa also addresses ethical issues through the Costa Foundation, a registered charity set up in 2006 to put something back into coffee-growing communities from which the company sources its coffee beans. The Foundation helps the communities in a variety of ways, from building new schools or extending existing ones, to investing in water wells or developing land for families to grow crops. “Coffee farmers have specifically told us that the best way to help them is by improving the education of their children and that this is the best long-term solution to support the growth of their communities,” said David. “And we recognise that without the farmers and co-operatives who grow our beans, we have no business and that they therefore are an integral part of Costa’s success.”
As part of this approach, Costa was also the UK’s first high street coffee shop chain to offer a fairtrade option and offers its very own blend of fairtrade coffee. Another aspect of Costa’s ethical stance is its attitude to the environment. “This is a key trend that I believe is very important for my brand and this sector. The green agenda, in particular how to minimise the negative impact on the global environment, will increasingly be something that we have to drive at a strategic level,” said David.
But of course, at the very heart of the Costa brand is the coffee. “We hold a deep belief that we make the best coffee in a coffee shop environment,” he said. “That is why we choose to own our own supply chain and production capability and insist of the highest quality traditional Italian made coffee machines. That is why we put so much resource and energy into the Baristas who craft our hand- made coffee.”
‘Barista’ is a term derived from the Italian use of the word ‘bar’ and refers to one who has acquired a high level of expertise in the preparation of espresso based coffee drinks. “Coffee is not only our business, it is our passion!” David reiterated. “Each of our Baristas is trained at our very own world-class production facility, The Costa Roastery in Lambeth, London. The Barista Maestro Programme lasts up to six weeks, which includes a course that teaches Baristas to make the perfect coffee with speed and efficiency in a confident and engaging manner.”
But every Barista begins with the beans, and it is this ingredient that lies at the heart of a great cup of coffee, and indeed in the original foundation of Costa Coffee. “Costa was founded by two Italian brothers, Sergio and Bruno Costa in 1971, who noticed that there was a demand for high quality roasted coffee beans,” said David.
“The brothers started a wholesale operation supplying roasted coffee to caterers and specialist Italian coffee shops in and around the UK. “The brothers’ experience of roasting and blending coffee soon determined Costa’s unique roasting style. They used a traditional Italian drum roaster, making only small batches of coffee each time and using a special espresso blend using seven different beans. The beans were roasted slowly at reduced temperatures to give a fuller, less bitter, flavour, and the blend ensures the perfect crema and a perfect end result. It’s the roasting that turns a relatively odourless, tasteless and indigestible coffee bean into something aromatic and flavoursome,” explained David.
Of course, the perfect Italian coffee should be accompanied by a delicious Italian snack and as David explained: “Food is an intrinsic part of Costa’s offering and we are constantly investigating new opportunities. Our customer is at the heart of any food development we undertake in the brand, which means we are continually trialling new products, new methods of cooking food and new ways of merchandising in our stores. Generally there are at least three to five different trials going on in our UK stores at any one time.”
March saw two new products launched in Costa stores, both of which sound very tempting. “We are introducing an Apple Crumble Slice and a less than five per cent fat Red Berry Muffin. They are both trans fats free as are all of our own brand products. We will also be launching some exciting new additional fruity/indulgent Frescato flavours early summer time,” David revealed.
The fact that these options are both free of harmful fats and one is low fat is also significant, as David explained. “I think that consumer awareness of healthy eating is going to continue to grow,” he said. “So our role is to provide great food and drink, and help customers make the right choices. So for example, Costa customers can request their coffee be made with skimmed milk or soya milk at no extra cost, and choose a low-fat muffin.
“Our research has shown that there is definitely an increasing trend in consumers purchasing more healthy foods (Allegra Nov 07) and we have noticed an increase in demand of Costa customers requesting to see nutritional information on our products. As a result, we have these details onto the Costa website and full nutritional information is available in every Costa store. We also continuously review our offering and use extensive research to understand what customers want.”
Going forward, David believes there is more growth to come in the UK coffee shop sector. “I think there will be an increasing move towards the better operated and more recognisable brands, and a reduction in poor quality independents. But I believe that the good independents will continue to thrive in the UK market. Competitive players in the coffee sector can only help to drive the frequency of coffee consumption in the UK – this is positive for any coffee brand with a well-liked proposition for customers.”
A company that thrives on its passion for coffee should have a global marketing director with a passion for the business and that’s exactly what Costa has. From his interview it was clear that David loves working in this industry. “It’s a great industry and a phenomenal brand to work on,” he confirmed. “It’s simply the best job I have ever had.”