Coffee Startup -- How to decide where to spend the marketing dollars?


3

We just opened a coffee store online. This store brings exceptionally good quality coffee to the door steps of every person in every US state. We are based on the Caribbean area. Enough with my own marketing. My question is related to, how to know where to spend my marketing dollars.

Should we focus on specific state? We are already doing adwords and Facebook, but I feel our product has a more specific target?

As a startup we don’t have a lot of marketing dollars, but those that we have, we want to spend them wisely.

Originally I did not want to include my site, just to make sure that the question was not confuse with spam. Please take a look at my site and let me know your thoughts. http://www.ukucoffee.com

Marketing Advertising Market Analysis

asked Mar 19 '11 at 02:47
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M. Torres
51 points

4 Answers


2

Focus, focus, focus. That's the key. It seems that you are a small group of people so don't dilute yourself trying to reach all 50 states of the US. That's impossible. What's your break even point? Have you researched some market reports about coffee? I am sure there are tons of them out there. Who exactly are you targeting? Young professionals, baby boomers,...?

The thing is that here in the US you can find exceptionally good coffee in many stores. Why should I buy from your website and run the risk of it not being delivered properly? Your marketing should answer those questions.

As for marketing, Starbucks never spent one dollar in advertising. Their stores and mugs were their advertising.

Good luck with your project, I wish you all the best.

answered Mar 19 '11 at 03:28
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A. Garcia
1,601 points

1

Try this interesting exercise:

Fact:
Opened online coffee store:

Question:
So what? What's the benefit?

You'll probably get an answer (if you don't you may want to modify 'fact' :)

Continue asking so-what at every benefit you encounter (it's okay to branch out i.e., 1 benefit could lead to 3 more). You may stop when you feel you've reached an 'end goal' and asking so-what further doesn't make much sense.

Now navigate through this model and see "which" path is the most preferable for your business - the best value, both for the stakeholders and the consumers. For each such benefit think of the initiatives that need to be taken in order to help satisfy (or satisfice) them and 'who' should be responsible for those initiatives.

You may also want to note down the assumptions you make (e.g., There is indeed a demand for this kind of coffee in this area). These may require extra marketing dollars to help validate these assumptions.

Now that you have this model, choose your path of benefits that are of highest value (both as a business and as a consumer) - that will give you the initiatives along with the people accountable for (helping) fulfilling them and if you need to conduct surveys etc., to validate your assumptions.

This finer breakdown should give you a better idea of where to spend your marketing dollars, since you'd have nailed down "why/when/where/who" aspects of your business :)

Hope that helps!

answered Mar 19 '11 at 09:29
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Ph D
422 points
  • your answer is very interesting. Do you have an example of such exercise? – M. Torres 8 years ago
  • @M.Torres: This approach is formally known as the benefits chain technique and was originally advocated by John Thorp in his book "The information Paradox" - It has an IT bent to it but the approach is applicable for performing benefits analysis on ANY venture. The book does have it's share of examples, but since it's a book about the technique my description above summarizes the book! The overall explanation is littered in bits and pieces all over. It's a good reference, especially for a business at inception. – Ph D 8 years ago
  • @M.Torres: As for the examples, the book doesn't do much justice and lets the reader figure it out how best to apply the technique. I could run a quick exercise with your coffee store to help you get started, if you wish. All that I'll need is a bulleted list of 'expected benefits' from your venture. 5-10 should be good enough to elucidate the approach and help you try it out for yourself. The book helps in filling in the blanks (I read the book much after I knew the technique). Lemme know if that works! I'll be more than willing to let you try out this technique since it is VALUABLE! – Ph D 8 years ago

0

You should read Pour Your Heart Into It: How Starbucks Built a Company One Cup at a Time It's an amazing and inspirational read about the struggle Howard Schultz went through to bring high-end coffee to the masses. He talks about almost everything you would need to know, including marketing.

Good luck!

answered Mar 19 '11 at 04:54
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Andy Cook
2,309 points

0

the cheapest thing you can probably do is use twitter, search for coffee keywords, develop relationships with the users, don't spam them but actually talk to them. It may be better to first start off with small niche coffee store and give them discounts. Use niche stores are a promotional setting have them refer you and you sell them cheaper coffee.

But the biggest problem is that why should I buy from you? I can buy really good coffee really cheap, so my concern is why would I order coffee online for something I can get from a local store, also most coffee stores Starbucks, and high end coffee stores also sell premium coffee. So you need a good selling point, a hook. Simply saying good coffee isn't enough of a hook, its a saturated market. I think if you're going for a niche website focus on a very narrow demographic, so instead of having just good coffee sell fair trade coffee, because that's something the big guys can't always promise.

It would be nice to see your site, to get a better understanding of what you're trying to do.

answered Mar 19 '11 at 18:36
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Saad
131 points
  • I added a link to the site in the question. – M. Torres 8 years ago

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