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Colombian coffee in France: a case study.

Often I am asked to explain the reasons for Colombian coffee success in France. Is it a miracle; is it due to huge marketing expenses a smaller producing country could not afford, to Colombian coffee imperialism? My answer is always slightly disappointing; the success is due to long term marketing management.

Obviously, the Colombian Coffee Federation has three main objectives: to sell as much coffee as possible; to sell at the best possible price; and to have it retailed as much as possible as a pure Colombian blend. If we look at the first two - quantitative - objectives, the past few years are indeed impressive. In 1992, Colombia sold nearly 11% of the green coffee imported into France. Eight years ago, Colombia's market share was only around 4%; 30 years ago, it was hardly 1%. Also, a general study made by the Federation has found that Colombian coffee can now fetch an average price differential superior to that for other mild competitive coffees.

As far as the third objective is concerned, for establishing a segment of 100% Colombia blends - eight years ago it was quite difficult to buy a pure Colombian coffee anywhere in France, only the food store chain Casino was offering one under its store brand label. Today, one can find about 90 different 100% Colombian brands in France, whether in own brand or private label. In the out-of-home market, one can observe the same trend. Where once it was nearly impossible to drink a pure Colombian coffee except in exclusive places, nowadays Colombian coffee exists as an everyday sort of quality standard in hundreds of French hotels and restaurants.

These achievements are based on the following reasons. The first one follows a general trend in French coffee drinking preference that benefits all mild coffees. The second relates to the steady strategy followed by Colombia, in France and elsewhere, whose cornerstones are constancy and consistency. Thirdly, Colombia and the French company SACA were able to design a marketing, publicity, and relationship strategy well patterned to their respective abilities, financial means, and commercial objectives.

Changes in the French Market

French coffee consumption has been more or less stable in recent times. Nevertheless, a significant evolution has taken place in blend preferences that has given Colombian coffee a good opportunity for market growth.

Generally speaking, Arabica coffees have improved their market share sharply in what has traditionally been a Robusta coffee drinkers market. Is this due to a Europeanization of coffee tastes, to an impressive price fall, to a diminishing difference between Arabicas and Robustas? Whatever the cause, the French are increasingly drinking Arabicas and this is of general benefit to Colombia.

In the meantime, French consumers as elsewhere have become more sensitive to the nature of what they eat and drink. As regards to coffee consumers, this has helped boost single origin coffees as offering the level of authenticity many now seek. On the roasters part, to answer the evolving market demand with new blends means shouldering heavy advertising expenses (it can cost 10 million dollars to launch a brand) and so the strong and established 100% Colombia product image is seen as an important and basically free market tool that can be of real service.

Yet too, an important factor in our success in France can be traced to the nature of the Colombian coffee organization itself. Characteristics that have meant strength include constancy: Colombia is selling its green coffee every working day of the year, from January to December, and at a mass market oriented price.

Whatever might be the situation on the coffee market or as could be foreseen (feared) in future, Colombia is always offering its coffee. Colombia is delivering a reasonably good standard of quality in volume. Whether it be from a private exporter or from the Federation, roasters get the coffee they require. Furthermore, selling a pure Colombian coffee means something quite precise.

Up until now, Colombia could afford to spend some money for advertising, not a fortune, but rather a steady budget commitment. Marketers know that repeated publicity and advertising can reach targets that even huge expenses cannot. One can understand that in the present price crisis, it is not easy continuing to justify even the relatively modest expense of such intangibles as "marketing" to worried coffee growers - but this is what the Colombian authorities have so far managed to do.

This feat alone exemplifies the nature of the Colombian coffee authority, which is able to speak and advertise on behalf of all the Colombian growers, for the profit of all coffee exporters. Surely it helps to be promoting an entire national production, versus what a single exporter has to offer. The Federation can benefit, for example, from all the media serving a nation's interests, and its representatives around the world have, in time, gained near-diplomatic status.

With such strengths at hand, it can be understood why Colombia chose not to stay in the golden ghetto of so-called gourmet coffees, which in our opinion is about the worst thing that can happen to a major coffee production. You must be present in the specialty and the mass market, even if your better roaster partners would urge you to take position only in the gourmet sector. It is important to explain to them that "chateaux" and general retail are not necessarily mutually exclusive concepts. Colombia is present in both market segments, with a positive image in both.

Not So Easy Access

A brief history of Colombian coffee communication strategy in France will show the stages of a successful market penetration at relatively low cost. In the 1960's, the idea of selling Colombian coffee in France was a mere dream. France was drinking Robusta and/or Brazilian coffees and no one saw the need for introducing pure Colombian. Colombia had to prove to the French - coffee specialists/roasters and drinkers - that it deserved a place in the sun. The only way was to make sure that Colombian coffee appeared on the menu in the best places and to get roasters to use Colombian coffee in their blends.

At that early time, Colombia started an upscale-market drive that resulted in Colombian coffee being served by Air France, by a luxury chain in Paris, and in its own cafeteria above the Champs Elysees.

Once Colombian coffee was more or less commonly used in blends and had become known to consumers as an exclusive coffee, the idea was then to promote more and more pure Colombian brands. Here, the first step was to enter coffee boutiques where gourmet coffees are sold. To help these roasters agree to offer at least one single origin coffee, pure Colombian was supported with distinctive packaging and promotional materials. Now almost every boutique in France offers a 100% Colombia coffee.

The next effort for Colombian coffee was to get onto hypermarket shelves, which control about 85% of the French at-home retail market. To achieve this, a joint-venture cooperation was offered to the leading roasters, but with a negative reply. The only industrial to accept cooperation was Nestle, which then successfully linked its spray dry coffee with the appealing imagery of producing country coffee purity.

To force the blockade on the mass roasted coffee market, Colombia then went directly to the private labels. At that time, it was taken as a gamble. Could we keep our upscale market image while also being present as store brand coffee? The risk was taken because the alternative meant being trapped in the specialty sector which, at that time would have given Colombia access to only 1% of the French market.

Happily, the result was a clear entry to the French market in terms of volume, and from that period forward commenced the real augmentation of Colombian market share in France. With chain store success in a store label, all the weaker French coffee brands were then open to having a 100% Colombian blend to improve their own notoriety.

Having gained a clear presence in the domestic market, the target shifted to the out-of-home market. Once again, initiatives were met with polite but firm refusals from the coffee industry and Colombia coffee was obliged to go directly to the bigger hotel chains. Once again, after gaining the most prestigious sales points, we dared take position in the most popular.

Did Colombia spend a fortune to get these impressive results? No, rather it is that Colombia took the time needed to build a well-respected position. If we consider the typical marketing expenditures of other coffee brands, the Colombian budget is nothing. In the past 30 years, Colombia has probably spent less than half the amount paid by major companies in only one campaign. Rather, Colombia expended the priceless concepts of time and effort; Cafeteros are patient.

Our main marketing initiatives in France over the past decades have included participating in the Tour de France offering cooperation to the major roasters who first accepted a 100% Colombian label, initiating promotional items and sales media for smaller roasters and specialty stores to help them sell Colombia coffee, and organizing a highly efficient coffee service program to cafes/hotels/restaurants that includes sourcing the best possible coffee making machines.

While the Colombian coffee position in France now seems well-established, the future concern is for quality control, not only in Colombia, but far more perhaps, in the consuming nation. Quality control to make certain that the contents of each package measure up to the prestige of the label; quality control at point of service to insure that "Colombia" standards are maintained wherever Colombia coffee is served.

Philippe Juglar is marketing manager of SACA (Societe Anonyme Colombienne d'Arabicas) where he has been in charge of Colombian coffee sales and marketing in France for the past eight years.
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Author:Juglar, Phillippe
Publication:Tea & Coffee Trade Journal
Date:Jun 1, 1993
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