Since the start of the Covid-19 pandemic, many coffee shops and specialty roasters have experienced a sharp decline in sales. The forced closure of premises and reduced footfall has had a significant impact on profits, with some businesses deciding to shut for good.
However, for others, setting up an online store is a solution that’s been met with considerable success. Not only has it enabled businesses to continue serving customers, it has allowed them to extend their market reach.
STiR magazine reported that during 2020 smaller online coffee businesses saw an increase in orders by size or frequency for over 15% of customers, while coffee subscription services have grown too. During 2020, these services rose by an estimated 109% in the US alone.
Setting up an online shop for specialty coffee is relatively simple, but there are a few things you need to get right if you’re to make it a success. To find out more, I spoke with 2018 World Barista Championship finalist and MTPak Coffee Brand Ambassador Michalis Katsiavos.
Why Should You Open An Online Store?
The concept of selling products online has existed since the mid 1990s. Convenient and economical, it has become the preferred revenue stream for millions of businesses worldwide. According to market research company eMarketer, ecommerce has grown exponentially over the last decade and will account for around 16% of US retail sales by 2023.
Widespread lockdowns as a result of Covid-19 have only sped up the growth of online stores, as the vulnerability of brick-and-mortar businesses have been exposed. For many, setting up an online store has been the only way to continue trading, with 95% of all out-of-home coffee businesses forced to close their doors at one point or another in 2020.
“The pandemic has showcased that roasters must utilise online stores to maintain sales – online sales of coffee rose significantly as physical stores closed last year,” Michalis says. “At-home consumption increased as consumers continued to support coffee businesses.
“Buying coffee online is the safer, easier, and faster option in this current global pandemic situation. Minimising social contact is an important health and safety factor to consider.”
However, even before the outbreak of the pandemic, the benefits of an online store for specialty coffee roasters and cafés were clear. It can extend market reach, develop brand identity, improve customer relations, and provide a more flexible service. With an online store, roasters are no longer limited to a single geographical location, giving access to a wider and more diverse range of people.
For specialty roasters who are just starting out, the main benefit is lower startup costs. According to Parrot Creative, an ecommerce website can cost under £1,000 per year, significantly less than a brick-and-mortar location.
Michalis tells me that online stores can also provide a competitive edge, particularly when targeting millennials and Gen Z consumers.
“Younger generations who use smartphones seem to buy almost everything online,” he says. “If your coffee business has a website or an ecommerce platform, you’re immediately putting yourself ahead of those who don’t have one.”
In addition to coffee, online stores present a good opportunity to sell branded merchandise, such as mugs, t-shirts, and tote bags.
What To Consider Before Opening An Online Store
Before developing your own online store, there are a few factors to consider. One of the most important is the impact an online store will have on the day-to-day management of your business, particularly if you also own a brick-and-mortar premise.
Running an online store can take up a large proportion of time and may cause some roasters to lose focus on their physical business. For example, during Covid-19, many roasters experienced a surge in online sales while continuing to serve takeaway coffees. Making sure they had enough supply to serve both became difficult, particularly at a time when shipping delays were prevalent.
“Roasters need to ensure they have the infrastructure to cope with increased demands from online sales,” Michalis explains. “I suggest assessing the size of your facilities for both green and roasted coffee storage space first. It’s imperative that your roasting machine can deal with bigger batches.”
When consumers order products online, they expect quick and affordable delivery. A recent survey found that nearly a fifth of consumers abandon online purchases if they involve long delivery times, while 73% have been put off by additional delivery charges. Michalis explains that before setting up an online store, roasters must be able to provide super fast delivery at low costs.
“Make sure you’re capable of providing excellent shipping services,” he says. “It has to be affordable, with no delays, and, if possible, available worldwide. Increasing your market reach as much as possible is essential: there should be no limitations on who can order your products.”
But quick delivery isn’t just about catering to the immediacy of online consumption. It also means that the coffee will arrive at the consumer as soon after roasting as possible. This helps to maximise freshness and ensure customers are enjoying your coffee at its best.
Michalis suggests that roasters may need to completely redesign their packaging for online orders to protect the coffee during long journeys in transit. Flexible multilayer packaging that prevents exposure to light, oxygen, and moisture is recommended, while roasters should also fit degassing valves to allow built-up carbon dioxide to escape. Packaging should be compact and lightweight to reduce the cost of transport.
How To Set Up An Ecommerce Site For Coffee
As you start to build your online coffee store, it’s important to remember that it will be an extension of your physical location. That means that in addition to looking professional, it must also reflect brand identity at every juncture.
For example, your colour scheme, typeface, and tone of voice should all be consistent. This is to help customers immediately recognise your brand and assure them that the coffee they’re buying is the one they’re familiar with.
Michalis points out that user-friendliness should also be at the forefront of your mind when designing an ecommerce website for your coffee business.
“Your online store needs to be easy to navigate for the customer’s convenience,” he says. “Product menus should be simple to scroll through and provide all the information that the consumer needs to know before purchasing, including origin and processing information.”
Using an online store builder, such as Wix or Shopify, is the most cost-effective way of creating a simple ecommerce platform. They allow you to set up an attractive website in a matter of hours with straightforward step-by-step guides to help you along the way.
Once you have made your website, you will also need to pay for hosting. The cost of this depends on factors such as capacity and traffic, but at a basic level it’s typically between £150 and £250 per year. Shopify tends to charge a monthly fee. You will also need to buy the domain name of your website, which starts as low as £1 per year.
For a more complex website, you may wish to hire a website designer who can build your ecommerce platform from scratch. This is an option for larger coffee roasters who want to customise their preferences and include features that may not be available on conventional website builders. As expected, this is considerably more expensive than using Wix or Shopify, but it tends to generate a slightly more professional and unique website.
A website designer may also be able to advise on leveraging your packaging to attract attention. Equator Coffees is an example of one company that does this to great effect. By using high-resolution images of their distinctive red-and-white packaging on a white background, they make their coffee clearly stand out on the screen.
“Packaging is the first impression consumers have of products, so it has to be attractive,” Michalis explains. “The customer can’t pick up your bag of coffee as they would do in a café or roastery. Therefore, you need to grab their attention and convince them to buy it using clever imagery.”
Coffee subscription service Hasbean, on the other hand, uses photos taken at coffee farms to promote their different single origin options. This places the consumer at the source of the coffee, making them feel even more connected with the brand.
Online stores have become increasingly important revenue streams for specialty coffee roasters and cafés. During the Covid-19 pandemic they have been a vital way for businesses to continue trading, while many have even been able to expand their customer base.
At MTPak Coffee, we can help you find the perfect packaging for online orders of your coffee. Whether selling takeaway filter coffees or bags of whole bean, our range of sustainable packaging solutions can be fully customised to suit your needs.
For more information on our sustainable coffee packaging, contact our team here.
Stay updated about MTPak Coffee’s products & services. Sign up to our free newsletter.