Table of Contents:
- Introduction
- About Blue Bottle Coffee
- E-commerce Business Strategies
- Subscription E-commerce
- Content Marketing
- Predictable Revenue
- Social Media Experience
- Â Why choose PROS for your e-commerce business?
- Conclusio
Introduction
W. James Freeman founded Blue Bottle Coffee in the early 2000s in Oakland’s Temescal District. Freeman borrowed the name from one of Europe’s first cafes, The Blue Bottle Coffee House.
A freshly brewed cup of coffee has been used to fuel the lives of everyone globally. This popular beverage has gone from the basic beginnings of a 7-Eleven convenience store to gourmet high-end retail boutique coffee shops including Starbucks which propelled the coffee revolution. A greater emphasis on bean quality, roasting techniques, and refined preparations have significantly altered our perceptions of coffee and coffee culture.
Key Statistics:
- NCA report finds specialty coffee consumption up nearly 50%
- The NCDT further reports that in America, 656 million cups of coffee are consumed per day
- Specialty coffee sales are increasing by 20% annually and account for nearly 8% of the $18 billion U.S. coffee market
- Revenue in the Coffee segment amounts to the US $460 Billion in 2022
Founded in 2002, Blue Bottle Coffee has now moved to global coffee e-commerce from just a small coffee shop in Bay Area, California by converting store customers into online leads. But did they not stop there…they built a $700M e-commerce business by engaging new customers as well.
Blue Bottle sells fast and fresh coffee less than 48 hours out of the roaster that is ethically sourced, sustainable and delivers a brand experience. From seed to cup, they elevate the craft of coffee in everything they do. Now the Apple store of coffee in the US, Blue Bottle created a subscription e-commerce model where customers can get fresh coffee delivered online through apps anywhere globally.
About Blue Bottle Coffee
James Freeman, a freelance clarinetist and coffee enthusiast, founded Blue Bottle and began roasting beans in his garage. Later, Blue Bottle Coffee began selling fresh-roasted beans that were no more than 48 hours old at the Berkeley Farmers’ Market. The company’s shift to e-commerce business was shaped by that relentless push for freshness, and it’s a big part of why they’ve grown into an industry giant.
Over the next 10 years, Blue Bottle grew from a market stand to a kiosk and cafe, eventually establishing a network of Bay Area coffee shops. To kick-start their expansion online and into new markets, the company:
- Secured their first round of funding in 2012
- Raised $20 million in 2013
- Followed by another $25 million in 2014
- And raised another $72 million in 2015
Blue Bottle was a key player in the third wave of coffee, a movement aimed at elevating coffee from a mere commodity to a luxury good like wine or beer. They became one of the most passionate craft coffee evangelists with their in-depth barista training program, brewing guides, videos, etc. Customers who were smarter and more engaged appreciated the availability and quality of their products as their company grew.
E-commerce Business Strategies
From a high-end coffee shop to a subscription e-commerce model was a strategic move that can help grow your e-commerce business. A step-by-step guide to e-commerce business success includes:
1. Subscription E-commerce
Blue Bottle Coffee launched Blue Bottle at Home, an online service that delivers coffee to customers’ homes.
There are three types of services available through the Blue Bottle at Home service:
• Blue Bottle and Tonx find, roast, and distribute a fresh single origin coffee every two weeks as part of the Origin subscription.
• Blend subscriptions include popular drip coffee blends such as Three Africans, Bella Donovan, and Giant Steps, which are shipped on a rotating basis.
• A rotating supply of espresso, including blends like Hayes Valley and 17ft Ceiling, as well as a single origin standout, is included in the Espresso subscription
Coffee is available in 6-ounce, 12-ounce, 24-ounce, and 36-ounce packages, which has been redesigned for subscription buyers. The cost of a subscription ranges from $11 to $38.
Customers can also change their membership on a regular basis, such as switching from weekly to every two or three weeks or switching to a monthly subscription. It is also possible to skip a delivery or pause the subscription at any moment.
2. Content Marketing
When Blue Bottle Coffee launched its e-commerce business, it educated its audience in order to bring the highest level of coffee connoisseurship to customers who had never visited a Blue Bottle coffee shop. It was accomplished through the use of a content marketing network. They created in-depth brewing guides, educational videos, and courses on buying, storing, and brewing great coffee. Blue Bottle was able to move beyond just selling beans as a result of this, and their higher prices were justified.
The content was not only pulling new customers to the top of Blue Bottle’s sales funnel but also it was retaining existing customers with continuing education that turns coffee drinkers into true coffee loyalists. With in-depth keyword search rank, their guides generated thousands of incoming search engine traffic that brought more new customers to their site every month.
Customers came to their site not only to learn about great coffee but also to get everything they needed to make it at home. Blue Bottle Coffee grew into a brand that provided in-depth information on proper brewing as well as the necessary tools. Blue Bottle also uses email automation to put its most powerful emails on autopilot. That list of email automation not only includes welcome emails but their abandoned cart and transactional emails as well.
3. Predictable Revenue
Blue Bottle’s online product offerings grew from wholesale-only to coffee subscriptions and DTC options as the company grew. Introducing a subscription model offered a predictable revenue from operations and a way to scale their business and supply chain to offer more products to the customers.
As the number of people who drink specialty coffee on a daily basis grows, so does the demand for higher-quality, fresher beans. Blue Bottle’s ability to provide this product to a growing market on a consistent basis was important.
By establishing strategic partnerships like with dairy producer Clover and Fort Point Beer Company, Blue Bottle found a way to supply their stores with freshly roasted beans, ship faster from the closest location to the customer, and offer DTC, value-added products on a large scale.
4. Social Media Experience
Blue Bottle used a modern and consistent design experience for their cafes, from the Bay Area to New York, and even the same product packaging. Also, they promoted aggressive marketing on Instagram. Blue Bottle built its design aesthetic to be inviting where people could take Instagram shots of their morning cup of coffee day, resulting in brand awareness. You can also add trending coffee hashtags when using these social media channels.
Reinforcing relationships through the purchase experience
- Blue Bottle has created an online presence that matches its in-store experience.
- Customers are provided with an educational experience when they buy coffee from Blue Bottle’s website
- The company’s design is easily recognizable due to its minimalist approach.
- Blue Bottle’s high-status yet approachable design fits perfectly with social media platforms.
- Whenever a customer takes a photo inside a Blue Bottle cafe, they inadvertently raise their status among their followers. This has a positive impact on how the brand is perceived on social media.
Why choose PROS for your e-commerce business?
With 15+ years of experience in technology, marketing, and e-commerce solutions, PROS has highly skilled web developers and designers to scale and customize your e-commerce business based on your business requirements. We can help you reach millions of customers. Also, we have developed turnkey end-to-end e-commerce business solutions that cut development time by more than 75% saving you time and cost.
Conclusion
Blue Bottle Coffee managed to turn one coffee shop into a $700 million e-commerce business but not overnight. The company leveraged profitable e-commerce business strategies like content marketing, social media, and various others. The key takeaways from their e-commerce business strategies include:
- Use Predictable Revenue Model – Switching to a subscription model can deliver a steady stream of revenue that can be used to scale your business. Based on the predictability of subscription income, your company will be able to make better decisions
- Establish yourself as a Market Expert – When scaling your business online, you’ll be able to acquire new customers for your e-commerce sites easily if you establish yourself as a market expert
- Educate your Customers – Customers will be more likely to rely on your company for the products they require if you educate them about your market and provide them with the tools they need to achieve their objectives
- Build a Strong Brand – It’s easier to reach a larger audience by maintaining consistency in your branding and encouraging customers to share their stories on social media channels.
- Make Strategic Partnerships – Find partners who can assist you in scaling your business intelligently.
Deepak Wadhwani has over 20 years experience in software/wireless technologies. He has worked with Fortune 500 companies including Intuit, ESRI, Qualcomm, Sprint, Verizon, Vodafone, Nortel, Microsoft and Oracle in over 60 countries. Deepak has worked on Internet marketing projects in San Diego, Los Angeles, Orange Country, Denver, Nashville, Kansas City, New York, San Francisco and Huntsville. Deepak has been a founder of technology Startups for one of the first Cityguides, yellow pages online and web based enterprise solutions. He is an internet marketing and technology expert & co-founder for a San Diego Internet marketing company.
