Case Study: Espresso Consumer Demographics and Psychographics

Project Background

The research, conducted during the first quarter of 2020, aimed to deepen understanding of espresso consumers, focusing on the distribution and marketing of Papuan coffee.

Research Objectives

To explore effective strategies for distributing and marketing Papuan coffee, particularly through specialty shops, considering the unique characteristics of Arabica beans grown in Papua, Indonesia.

Methodology

• Data Sources: Utilized various databases including the American Community Survey of Demographics, Economic Census, Consumer Expenditure Survey, Mosaic® USA Consumer Lifestyle Segmentation, and Simmons National Consumer Survey.
• Tools: Alteryx business intelligence software, ArcGIS, Excel, and Tableau were used for data analysis and visualization.
• Approach: The study was conducted in multiple phases, analyzing demographic variables, creating density maps for potential delivery services, forecasting sales, and identifying lifestyle segments for targeted marketing.

Key Findings

• Demographic Insights: The study identified specific demographics associated with espresso/cappuccino consumption, such as a preference among individuals aged 25 to 29, single households, and those with a taste for gourmet foods.
• Market Analysis: Top U.S. zip codes for marketing the product were identified, revealing areas like Orange County, particularly near the University of California Irvine, as potential hotspots for espresso/cappuccino demand.
• Sales Forecasting: Various sales forecasting models were explored, considering factors like local competition, consumer lifestyle segments, and geographical areas.
• Consumer Preferences: Lifestyle segments like ‘Cosmopolitan Achievers’ and ‘Silver Sophisticates’ were identified as key target groups, with specific preferences and consumption habits that could inform marketing strategies.

Recommendations

• Product Differentiation: Emphasize the unique qualities of Papuan coffee, focusing on organic, gourmet, and exotic aspects to appeal to the identified consumer segments.
• Targeted Marketing: Use online advertising and promotions tailored to the lifestyle preferences of ‘Cosmopolitan Achievers’ and ‘Silver Sophisticates’, leveraging platforms like Google and Facebook for targeted outreach.
• Location Strategy: Consider setting up specialty coffee shops or delivery services in high-density areas with a significant presence of the target demographic, particularly near university campuses or affluent neighborhoods.

Impact

Projected Economic Impact

• Local Communities: The promotion and distribution of Papuan coffee can significantly benefit the local economy in Papua, Indonesia. By focusing on this unique coffee variety, the project contributes to the economic empowerment of local farmers and communities, ensuring sustainable livelihoods.
• Market Expansion: Introducing Papuan coffee to new markets, especially those identified in the study, can lead to increased demand and market expansion. This growth can stimulate further investment in coffee production and processing facilities, fostering economic development in both the source and target regions.

Environmental and Social Impact

• Sustainable Practices: Emphasizing the organic and natural cultivation methods of Papuan coffee aligns with growing consumer preferences for sustainable and environmentally friendly products. This focus not only appeals to a specific consumer segment but also promotes environmentally conscious farming practices.
• Cultural Exchange and Awareness: Bringing a unique product like Papuan coffee to international markets facilitates cultural exchange and increases awareness of Papua’s rich cultural and natural heritage. This can lead to a greater appreciation and understanding of different cultures, fostering global connectivity.

Impact on Consumers

• Health and Well-being: The promotion of gourmet, high-quality coffee options may contribute to enhanced consumer well-being, offering a superior and potentially healthier alternative to conventional coffee products.
• Consumer Education: This initiative can educate consumers about the diversity of coffee products, cultivation methods, and the significance of supporting sustainable and ethical farming practices. Educated consumers are more likely to make informed choices that align with their values.

Industry Influence

• Innovative Marketing Approaches: The case study sets a precedent for using advanced data analysis and targeted marketing in the coffee industry. It showcases how businesses can leverage consumer data to refine their marketing strategies and effectively reach niche markets.
• Trendsetting in Specialty Coffee: By successfully introducing and establishing Papuan coffee in new markets, the project can influence industry trends, encouraging other producers and marketers to explore unique coffee varieties and innovative distribution methods.

Conclusion

The case study demonstrates the potential of targeted micro-marketing strategies in the specialty coffee industry. By leveraging detailed consumer data and sophisticated analysis tools, businesses can effectively identify and cater to specific consumer segments, enhancing their market position and capitalizing on niche market opportunities.