The New Age of Consumer Loyalty
When baristas remember consumers’ names, it adds to their experience because they feel acknowledged. All images courtesy of Brewpoint Coffee unless noted
The term value is often associated with price, especially in periods of economic strife. However, the cost of products will not secure a long-term relationship with consumers. To gain consumer loyalty, companies need to focus on connections. Becoming that go-to coffee or tea brand can feel like a battle
as companies strive to make space in industries saturated with products and brand messaging.
What is Driving Today’s Consumers?
In September 2022, London-based global consultancy Euromonitor International led a virtual coffee chat titled The New Era of Consumerism, which shed light on consumer patterns and their key drivers. The discussion emphasised that political, societal and environmental influences have shifted consumers’ buying habits, resulting in them gravitating toward products that reflect their values. Health and wellness continued to be a key motivator for consumers responding to the need of both an aging population and those individuals simply opting for healthier living.
“Despite the fact that we are living longer, the healthy life expectancy has remained stagnant at around 62 years, globally for the past decade,” said An Hodgson, head of consumer research, Euromonitor International. “This means that we are living longer but are not necessarily enjoying our old age years.
Jana Rude, population and household manager, Euromonitor International, shared that the rising
incidence of chronic diseases and the lingering effects from the pandemic have encouraged individuals to stop and consider the actions that will preserve health and longer life. This continued motivator provides an opportunity for tea and coffee brands to deepen a connection with consumers by sharing the health benefits and the research that supports those claims. The shift towards smaller households, including more single-person households and childless couples, has changed both the size and type of products that consumers are seeking. Single serve products and solo experiences, including introducing consumers to pour overs and loose leaf teas, could respond to these consumers’ needs.
Value is no longer just about price; consumers want intangibles, including quality, convenience, experience and authenticity. Each of these areas provides an opportunity for tea and coffee companies to communicate their mission statements and, in turn, build and strengthen these connections. “Cutting back on spending is not just lower income houses; consumers are much more selective about their spending,” said Hodgson. “So yes, there is the lipstick effect (where consumers are indulging in smaller products), but there is also the trading down and hunkering down for a long inflation and an economic recession.”
Today’s consumers are increasingly critical and will not hesitate to abandon brands that aren’t aligned with their values. Hodgson said that companies need to stay in touch and communicate with consumers every step of the way, “this includes both listening to their needs and providing them with guidance on how to make better decisions.”
Over the past decade, there have been significant initiatives towards developing both a sustainable
and regenerative infrastructure. Communicating these initiatives, and the reasons behind them, can help strengthen connections with consumers who hold similar values. “Peet’s commitment to responsible sourcing is central to the Peet’s story and the trust our customers place in the brand, said Mary O’Connell, communications director, Peet’s Coffee, Emeryville, California. “This year, Peet’s became the first coffee company to be verified for achieving 100 percent responsibly sourced coffee, according to the standards set by sustainability non-profit, third party Enveritas.” By sharing its initiatives with its consumer base, Peet’s Coffee demonstrates how it is putting its values into action.
Brewpoint Coffee, Elmhurst, Indiana, prides itself in being a value-oriented company, taking every opportunity to share its story and the values that drive it. This includes not being afraid to promote the company in a way that showcases who they are. “I think that connection to a person and a mission really resonates with people,” said Melissa Villaneuva, founder and CEO, Brewpoint Coffee. “Loyalty is built on trust, and trust is built from connection to connection.”
Making Strategic Investments
The coffee and tea markets are saturated, making it increasingly challenging for brands to stand apart from the crowd. “It’s such a crowded space out there, it’s hard to create a brand that sticks in someone’s head,” said Mark Plumlee, senior content manager, Must Have Menus. “The key is to differentiate yourself from the other brands in your space, and then build your marketing around that.”
Innovative strategies, including social media and promotions, may drive consumers into your space, but the critical element is finding ways to build that connection (and in turn loyalty) once they are there. Plumlee shared that marketing is often the first thing that companies abandon in times of stress and financial strain. However, there are simple techniques that brands can implement to continue to foster those connections with their consumer base. Loyalty cards, specifically the paper version of them, are an inexpensive way that brands can facilitate these connections. He stressed that the cards provide an opportunity for employees to connect with their consumers, helping further develop that loyalty.
“Coffee shops have this massive opportunity to convert their consumers from one-time visitors to loyal consumers; the key is finding the way to make your space a part of their routine,” said Plumlee. “Any amount of marketing capital that you put up front to both develop and strengthen those connections, will pay off.”
Revisiting the Lost Art of Conversation
Fostering consumer connection, whether it’s remembering the customer’s name or beverage, helps ensure that customers feel acknowledged. “We are known for our expertise and our craft, from our coffee roasters to our store teams,” said O’Connell. “Everyone at Peet’s is passionate about coffee and coffee lovers and it shows. Walk into your favourite Peet’s and it’s likely your barista will know and recognise you and start prepping your order. “This included developing a loyalty program, with mobile order ahead, exclusive member-only items and special offers, all elements that help affirm that the customer’s loyalty is valued. Peet’s Coffee has also expanded its at-home offerings in both grocery and retail locations in the United States, providing consumers with multiple touchpoints of their brand.
Embrew Tea was developed to fill a gap, providing consumers with a convenient option while retaining elements of the specialty experience. “I wanted to create something that emulated a loose-leaf experience but with the ease of a tea bag and having something lightly sweetened because that was my preference,” said Ashley Haywood, founder and CEO, Embrew Tea, Asheville, North Carolina. “I came to realise that there were thousands of individuals who also had that same need.”
However, she quickly recognised that it was not just about the product. Her customers resonated with her experiences, and through sharing these experiences she was able to strengthen the connections with her customers. “Nothing replaces relationships,” said Haywood. “Having those conversations with people is critical, and if you can’t have them face to face, then find other ways to do that.”
One strategy that has been particularly effective for Haywood was personalising her email communication, which included providing insight into her personal experiences. By making this shift,
the emails became more conversational instead of product focused, increasing both engagement and
open rates. “I will take something that happened during the day or week and use it for both entertainment and to foster connections, but I will always bring it back to tea,” said Haywood. “It’s about creating that relatable story.”
The Power of Story Telling
Nurturing those human connections is the glue that adheres the customer to the brand and often
brings them into the space. “What ultimately creates a more solid loyalty is sharing stories; because story is not just about what we are making up, but instead making sure that we are messaging who we are and what we want to become,” said Villaneuva. “This alignment with our values will end up attracting people with similar values, and the loyalty will become much stronger than those individuals that simply like your product.”
Conversations, whether in person or online, are a great way to share not only your company’s story, but also learn the stories of your customers. Each transaction that customers choose to make (or not make) provides insights into their needs and wants. “Numbers and data are storytellers; it’s not always about the money. It’s about what did people get really excited about, and sometimes numbers can tell you that,” said Villaneuva. The key is committing the time to explore the data and feedback and adjusting your offerings accordingly.
However, storytelling, shared Villaneuva, on its own is not enough. Customers need to also have a
positive café experience, including being served quality products and having a smooth transactional
experience. “When it comes to loyalty programs, how easy is online ordering in, how easy is it to
order in shop, how long are your wait times,” said Villaneuva. “That whole operational experience,
is a key piece of the puzzle and if you can do all three – product, storytelling and transactions –
really well, then that is where you gain customer loyalty.”
- Anne-Marie Hardie is a freelance writer, professor and speaker based in Barrie, Ontario. She may be reached at: [email protected].