1 / 26

Peet's Coffee & Tea

…. Peet's Coffee & Tea. Tara Alcantara-Beers Karol Caballero Yizhe Liu Daniel Brockman UC. Berkeley Extension Strategic Marketing Ming Yang May 24 th 2010. Peet's Mission & Vision. MISSION.

lily
Download Presentation

Peet's Coffee & Tea

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. …

  2. Peet's Coffee & Tea Tara Alcantara-Beers Karol Caballero Yizhe Liu Daniel Brockman UC. Berkeley Extension Strategic Marketing Ming Yang May 24th 2010

  3. Peet's Mission & Vision MISSION • "To enable and inspire customers to enjoy the daily pleasure of Peet's Coffees & Teas by providing a distinctive, superior product, superior coffee and tea knowledge and superior service to every customer, every day.” •   “To be the gold standard specialty coffee and tea brand available to the world, with one of the most dedicated and loyal customer followings of any brand.” VISION 1 Strategic Marketing - Spring 2010

  4. General Description of Peet's Coffee & Tea • Peet’s is a specialty roaster of whole bean • coffee & teas based in Emeryville, CA • Peet's founded by Alfred Peet in 1966 in Berkeley, California • Alfred focused on the quality of the coffee • Original store located at corner of Walnut & Vine near U.C. Berkeley • In 1979 Alfred sold Peet's but stayed on as coffee buyer •   Roasting plant is located in Alameda                Peet's Website/Wikipedia 2 Strategic Marketing - Spring 2010

  5. ALFRED PEET-FOUNDER 1920-2007 3 Strategic Marketing - Spring 2010

  6. Peet's Company Info • US Statistics:  • Public Company • Retail Stores: 192 in 6 states • Employees: 3750 • Sales: 311 million • Competitors: Starbucks, Tully's, Coffee Bean & Tea Leaf, local coffee shops in the retail stores channel, and Kraft and J.M. Smucker in the grocery channel • Yahoo Finance 4 Strategic Marketing - Spring 2010

  7. 2009 Sales Breakdown • Retail Sales (stores only) : • Retail stores remained stable          7% comprising 65% of net revenue • Retail store sales were 65% of net revenue • Specialty (consists of grocery, foodservice & office)  • Grocery Sales       22% comprising 20% of net revenue • Sales of specialty coffee was 84% of net revenue • Peet's Coffee & Tea, Annual Report on Form 10-K for 2009 5 Strategic Marketing - Spring 2010

  8. Quarterly Financials Revenues, Thirteen Weeks Ended (dollars in thousands)         APRIL 4, 2010     March 29, 2009           Increase/(Decrease) Grocery                         $ 18,643          $ 13,387                      $5,256        39.3% Foodservice & office                          8,480                6,706                             1,774         26.5 % Home delivery                          4,002                4,029                              (27)          -0.7% Total specialty                      $ 31,125              $ 24,122                       $ 7,003       29.0 % www.peets.com Form 10-Q Quarterly Report Filed May 14, 2010 6 Strategic Marketing - Spring 2010

  9. Grocery to be Peet's Strength • Peet's is focusing on Grocery Growth as Starbucks Shuts Cafes • Revenues growth year over year in the 1st quarter of 2010 • 4% in retail stores • 39% in grocery • Operating margins in the 1st quarter of 2010 • 9% in retail stores • 26% in grocery, office and home delivery • Peet's even has a separate Grocery Website  • http://www.peetscoffee.com/ 7 Strategic Marketing - Spring 2010

  10. Target Customers • Customers who care about quality, variety, convenience: •     Quality: customer values most •      Like strong, dark coffee •       Annual household income: +125,000  •      Peet's drinker buys coffee from specialty (Peets, Starbucks) • Peetniks: •       Strong loyalty customer •       Morning coffee every day •       Members of the Peetniks loyalty program •       Passionate about Peet's products •       Exclusive benefits to active recurring orders • http://www.peets.com/peetniks/about.asp?rdir=1& 8 Strategic Marketing - Spring 2010

  11. Products • Highly selective sourcing: • Carefully chosen beans, taste coffees again and again •    Coffee and Tea Expertise •    Paying the highest prices for quality • Delivered fresh: •    Use the freshest beans within 24 hours of being roasted •    Brewed fresh every 30 minutes or less  •    Never re-steam milk • Artisan roasting style: •    Roast in small batches •    Draw out the depth of flavor Peet's Coffee & Tea Inc, Form 10-k annual report 20100319 9 Strategic Marketing - Spring 2010

  12. Key Success Factors • Expertise in Coffee and Tea • Sophisticated information systems infrastructure • Business Intelligence • ERP, POS and CS • Freshness 10 Strategic Marketing - Spring 2010

  13. Sustainable Competitive Advantage • DSD - Direct Store Delivery system • From Roaster to Shelf in 24 hours • Artisan roasting style • Small batches • Highly selective sourcing • Long-term relationships with exporters, brokers & growers 11 Strategic Marketing - Spring 2010

  14. Taste Test 12 Strategic Marketing - Spring 2010

  15. Promotional Efforts • In-Store Promotions • Partnerships with Foodservice Operators • Online Presence • Community Service 13 Strategic Marketing - Spring 2010

  16. Price Prices of selected medium (grande) drinks                                         Starbucks                Peet's Regular coffee                        $ 1.85                $ 1.85 Espresso                                  1.95                    2.20 Caffe Latte                               3.35                    3.35 Retail stores in Petaluma, California, May 2010, Daniel Brockman 14 Strategic Marketing - Spring 2010

  17. SWOT Analysis 15 Strategic Marketing - Spring 2010

  18. Critical considerations     • Grow the company • Excellent coffee experience • Responsibility • Profitability 16 Strategic Marketing - Spring 2010

  19. Alternative 1: Airborne • The Concept:  • Partner with airline. • Learn to serve excellent fresh coffee at 8,000 feet. • Trials on flights from Oakland Airport, 1 mile from roastery. • Pros: • Creates markets distant from California in travelers' homes • Cons: • Can we train airline crews to serve excellent coffee? • Recommendation: • Conduct a trial and assess. 17 Strategic Marketing - Spring 2010

  20. Alternative 2: Invest in Grocery • The Concept:  • Expand Grocery eastward. • Driver: Customer migration to specialty coffees. • Growing customer awareness of Peet's. • Pros: • Peet's has financial assets to invest • Rapid growth: 39% in 10Q1 vs. 09Q1 • Profitable: 26% operating margin • Better than expanding retail stores • Cons: • What are the limits to Grocery channel growth? • Large competitors • Recommendation: • Invest in Grocery star 18 Strategic Marketing - Spring 2010

  21. Alternative 3: Instant and Canned • The Concept: • Introduce canned and instant lines of coffee. • Pros: • Reach out to new customer segments. • Synergic use for store delivery system. • Cons: • Canned and instant coffee isn't fresh. • Compromise existing standard of quality. • Recommendation: • Let Starbucks do it. 19 Strategic Marketing - Spring 2010

  22. Summary of Recommendations • Try airborne Peet's coffee. • Don't produce Instant or Canned coffees. • Expand distribution through Grocery channel. 20 Strategic Marketing - Spring 2010

  23. Questions? 21

  24. Appendix 1: 22

  25. Appendix 2: Promotional Efforts • Community Service: • Partnerships with International Non-Profit Organizations •   Grounds for Health • Coffee Kids • TechnoServe • Utz and Rainforest Alliance Certification • Global Initiatives • KIMSSA • Las Hermanas • The Butterfly School • International and American Red Cross • Local Sponsorships • Local School fundraisers • Back to the Roots Ventures • Athletic fundraisers • Culture and Arts NPOs 23 Strategic Marketing - Spring 2010

  26. Appendix 1: Pivot of age vs kind. 24

More Related