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Coffee is still Canada’s first beverage choice, but how can OCS get more sales?


April 30, 2008
By Stacy Bradshaw


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Dig a little deeper into the 2005 Canadian Coffee Drinking Study and,
alas, you will find some tangible and relevant data the OCS industry
can really get into.

18Dig a little deeper into the 2005 Canadian Coffee Drinking Study and, alas, you will find some tangible and relevant data the OCS industry can really get into.

When the nine coffee companies that sponsor the report asked the Coffee Association of Canada to commission an additional study in 2006, president Sandy McAlpine was all for it.

Although 2006 was planned to be an “off-year” for the study, usually completed every two years, McAlpine said the interim report offered the chance to gain more insight into some of the unique Canadian coffee markets. The office coffee service market was one of the three markets the association chose to further explore.

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McAlpine shared some of these findings with office coffee service operators at the recent Ontario Coffee and Vending Service Association annual conference in Niagara-on-the-Lake.

Operator attendees were happy to hear coffee is still the number-one beverage choice of adult Canadians, far surpassing tea, milk, beer, fruit juices and soft drinks. And more than 60 per cent of adult Canadians drink coffee on a daily basis, reported McAlpine.

More specifically, 75 per cent of these cups are being consumed sometime between morning and noon. That’s a significant change from years past, when coffee was known only as a breakfast-time staple. According to McAlpine, the increase can most likely be attributed to the one phenomenon that has already posed itself as a real threat to OCS … the drive-thru.

This “in-transit” trend is huge and growing, warned McAlpine. In-transit coffee consumption is now double what it was five years ago. Quality and better taste were the reasons cited most often for choosing drive-thru over office coffee. McAlpine was surprised to learn that smoking, which was number-one in past years, didn’t even make the list of reasons for leaving the office for coffee.

There just seems to be a pattern of, “I want to get out of the office,” said McAlpine.

The additional study went so far as to determine just how much time workers are taking to source their mid-morning treat. Of all the employees who purchase coffee from outside the office, 56 per cent travel by car; 18 per cent are back in less than two minutes; and 24 per cent say they only take two to five  minutes. However, 24 per cent recorded taking a liberal five to 10-minute break; 13 per cent said they are gone for 10 to 15 minutes; and 12 per cent admitted they’re away from the office for more than 15 minutes when they hit the road for a cuppa java.

McAlpine added that if he were an office manager, he would be pretty motivated to put a stop to this behaviour. That’s something OCS operators need to educate their customers on.

Perhaps the most alarming finding for OCS operators is that the heavy coffee drinkers are typically the ones leaving the office. This is either a difference in preference, which can only be remedied with improved product, or it’s a behavioural phenomenon, which is a more difficult issue to tackle.

People are definitely making personal statements with their coffee, McAlpine said. Walking in with a Starbucks seems to say something about you. And it’s that perceived value or quality that is taking those customers away from the office.

Brian Martell of Heritage Coffee Canada, who also presented at the OCVSA conference, explained that perceived value often carries more weight with customers than the value of the actual product sold. In other words, whether the coffee tastes better or not, doesn’t seem to matter … it’s the purchasing experience they’re looking for.

Assuming the product available for OCS is of similar quality across the board, the service is the only thing that can make a company stand out.

A variety of choices and a well-serviced machine increase the perceived value of the end product. Brian also suggested operators consider some additional services that may lie outside the realm of OCS, but will help increase the level of service to the customer.

Consider special events management, he said. If it fits into their business model, operators can offer clients their services for big meetings and corporate events. With the help of a temporary or part-time staff member, operators can take care of the coffee, the snacks and anything else required. It’s not for everyone, but it’s an increased value that meets a need for the client.

Many operators are offering paper products like napkins and paper towels. It’s a logical fit for an operator who is servicing the account on a regular basis.

And operators should definitely pay attention to the increasing popularity of bottled water. The 2006 study revealed that bottled water is becoming a significant part of the OCS business, with over one third of the population purchasing it on a daily basis. It’s the fastest growing trend in Canada, said McAlpine.

But rest assured, coffee is still king.

For more information regarding the 2006 Canadian Coffee Drinking Study, visit www.coffeeassoc.como


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