There is a strangely perfect confluence of factors in the coffee industry right now.
Perfect for what? Starting a coffee subscription service.
The first factor is coffee drinker expectations in the wake of the third wave of coffee. The collective coffee consciousness of American coffee drinkers has soared in the last 20 years. We used to be a country content with our morning scoops of Folgers.
But coffee is no longer an unexciting commodity to be tolerated for its precious caffeine. It’s now an artisanal product in line with wine or cheese. It’s appreciated on numerous levels. From sensory things like flavor profiles and roast styles to human considerations like social responsibility and the betterment of its growers.
The second factor is just how regularly Americans drink coffee. About 400 million cups worth per year. And the average coffee drinker drinks 3.1 cups a day. Anything used that frequently is just begging to be turned into a recurring delivery.
And finally, the third factor. 80% of Americans purchased something online in the last month. It’s how we transact now. And that number is certainly not going down.
So, what do we have here? On one side, we have millions of Americans hopping online looking for a steady stream of high-quality, responsibly-sourced, and expertly-roasted coffee. And on the other side, we have you, leader or manager of a coffee business that has almost everything needed to satisfy America’s demand.
Whether a supplier, roaster, retailer, or cafe, there are only a few missing pieces between you and unlocking the simple recurring revenue of a coffee subscription program.
In this guide, we’ll cover just what those are. But before we do, we’ll give you the lay of the land: what a coffee subscription box is and why they’re so great for coffee businesses. Then we’ll talk about what you need to set one up, how to market it once you do, and some coffee subscription boxes worth taking inspiration from. Each section of this guide provides a brief overview of the topic, then links out to a post that covers it in more detail.
“Coffee is a hug in a mug,” they say. It’s time to embrace coffee-drinking America with arms wide open.
Coffee Subscription Box: The Basics
For a more in-depth treatment of coffee subscription fundamentals, check out our detailed post about just what a coffee of the month club is.
A coffee subscription box is a lot like it sounds. Someone signs up on online with a coffee roaster or retailer to get coffee—whole bean or ground—delivered to their door on a recurring basis. One particularly notable trend is for the subscription to serve a niche, like a coffee subscription specifically for outdoor enthusiasts and campers.
So let’s get the fundamentals down. First, we’ll cover why a coffee subscription is so perfectly suited to today. Then we’ll get into the three ways coffee subscription boxes are typically structured. And finally, we’ll take a bird’s-eye view of how they work.
The Time Is Now for a Coffee Subscription
The past 20 years has turned coffee into an artisanal food to be enjoyed critically. A lot of that enjoyment comes from learning about the bean’s cultivation and processing. That’s in addition to the roast methods and how all those factors create a coffee’s flavor profile and aroma. The more about coffee you know, the more precious the drinking experience.
Approaching coffee like that puts a premium on variety and quality. With a solid coffee knowledge base, people now totally appreciate the huge variety of unique bean cultivars and methods of production. As our expectations and demand has increased, the coffee industry has delivered.
The resulting coffee landscape rivals any other artisanal scene out there. Now consider that 79% of people in the U.S. make coffee at home. That’s why a coffee subscription makes so much sense right now.
Three Kinds of Coffee Subscriptions
We know there’s huge demand for a variety of high-quality coffees. We know, in general, how a subscription model works. So how does a coffee subscription work, specifically? Here are the three most common kinds:
- The chosen coffee subscription. This is the coffee subscription box full of things the customer chose specifically.
- The mixed coffee subscription. The customer chooses some of it, and the rest are surprises. It’s a good way to encourage discoverability of your coffee catalog, but lessen the risk of dissatisfaction.
- The mystery coffee subscription. Daredevil! Anyone who picks this option gets whatever the coffee subscription wants to send them, within limits. They’ll usually ask for some preferences to set guidelines to make sure customers aren’t caught completely off guard.
How Does a Coffee Subscription Work?
They work very simply, and completely online. Here’s how:
- A customer goes to your website
- On the landing page for your coffee subscription, they sign up
- They decide which coffee they want in their box. Or which parameters they’d like you to follow when choosing the coffee for them. If you can integrate a coffee-matching quiz in this step, that’s a big bonus.
- The pick an interval for delivery
- The process their payment
- The coffee is delivered
Seems easy enough, right? But why are we going on and on about how great of an opportunity it is? Read on.
Why Sell Coffee Subscriptions?
For a more in-depth look into the benefits of a coffee subscription, check out our detailed post on the benefits of a coffee bean subscription.
Three statistics prove that a coffee subscription box is a great opportunity.
- 64% of American adults drink coffee every day.
- The average person in U.S. drinks 3.1 cups of coffee daily.
- 79% of people in America make their coffee at home.
What’s telling is that these numbers aren’t about total volume, they’re about drinking frequency. Drinking coffee, for Americans, is not a special occasion. It’s part of everyone’s routine. That means buying coffee is never a one-time purchase.
That opens up the opportunity for coffee businesses to automate all those one-time coffee purchases into an easy recurring coffee subscription. For coffee operations that already have access to top-notch beans, it’s an easy decision. But to belabor the point, here are a few more compelling reasons to start a coffee subscription:
- Recurring revenue. Locked-down revenue you can accurately forecast and depend on makes your business healthier and puts it in a better position for growth.
- Minimal overhead. The two things you don’t have that you’ll need to invest in are an online marketplace or platform and packaging and shipping.
- Perfect timing. Coffee drinkers’ expectations (craft coffee), drinking habits (constantly), and buying behaviors (online) all combine to make a coffee subscription perfectly suited to the environment.
- Increased customer engagement. The more you interact with a customer, the more opportunities you have to surprise and delight them. A subscription model has consistent customer touchpoints built in.
- Product discoverability. Customers are more willing to try something new in a coffee subscription box, making your entire coffee catalog more discoverable.
Statistics and Industry Trends
To see all the relevant coffee subscription statistics we compiled in detail, read our coffee statistics and data post.
It’s important, when considering a new revenue stream or business model, to locate where your version of it will fit within the wider industry. That’s why we compiled a handful of statistics that provide context to any business thinking of a coffee subscription program.
You can check out the post we linked to above to see the full set of statistics. But here are some especially interesting ones:
- The coffee industry makes up 1.6% of the U.S. GDP.
- 83% of people in the U.S. drink coffee, and 64% of them drink a cup daily.
- The average coffee drinker in the U.S. has 3.1 cups every day.
- 79% of coffee drinkers in America drink coffee at home.
- Taste is cited as the main reason for drinking coffee by 42.9% of people in the U.S.
- Americans are ready to pay around 200% more for coffee with a clear country of origin.
Additionally, we picked out a few trends that help coffee companies capitalize on a lot of these numbers. You can read about more in the above linked-to stats and trends article.
- Many coffee subscriptions are now focusing strictly on single-origin roasts.
- Smaller quantities are growing in popularity, mostly in the form of 6- and 9-ounce bags.
- Physical taste tests and online roast-matching quizzes to create a preference profile to start a coffee subscription are now common.
Coffee Subscription Setup: What You Need
For deeper coverage on this topic, read our full post about how to start a coffee subscription business.
It’s not hard to start a coffee subscription box and the numbers prove there’s existing demand. So how do you do it?
Here’s a list of what you need. We’ll first touch on the fundamentals, then we’ll address some unique needs for roasters and suppliers, retailers, and individuals.
Coffee Subscription Fundamental Requirements
- Coffee bag subscription structure. You’ll need to determine the type of coffee in your subscription, whether its whole bean, ground, or both, the delivery frequency options, and the bag size.
- Packaging. Your package should be, in short, unboxing worthy. After settling on measurement, design, and printing, your box should communicate your values. And be a dutiful representative of the most exciting touchpoint your customer has with your business. They’ll look forward to seeing that box every week or month. We recommend using mailer boxes, too.
- The right technology. You’ll need a streamlined, product-focused, clean user flow and the right ecommerce platform. We have an entire section below, and an accompanying detailed post, about choosing the right ecommerce platform for your coffee subscription business.
Coffee Subscription Special Considerations
Depending on the type of business you already run, there are some inherent strengths and areas of opportunity.
Roasters and Suppliers
The strengths of roasters and suppliers is around coffee acquisition, pricing, and shipping. They’ve got the connections to acquire a large variety of coffee cultivars. And their position in the supply allows them to price things a little lower.
They’ve also got established shipping operations. Their areas of opportunity fall around customer-facing packaging and customer support. As B2B businesses, it checks out that they would have some opportunity around direct customer interaction.
Retailers and Coffee Shops
This is the flipside to the supply side. The strengths of retailers are in customer-facing aspects like brand awareness, packaging, and customer support. Their areas of opportunity are in tightening up their supply chain for reliable delivery, along with pricing and coffee acquisition.
A single individual trying to launch a coffee business has very low overhead. They also have a lot of agility when it comes to reacting to data or competitive opportunities and no need to even deal with shipping. They can enlist the help of a dropshipper. On the other hand, they’ll have a tough time creating brand awareness. They’ll also start with low sales and revenue and customer support and coffee acquisition will be uphill battles.
The Right Coffee Subscription Box Ecommerce Platform
Here’s our entire post about choosing the right coffee ecommerce solution.
BlueCart spent years developing the leading wholesale B2B ecommerce solution, and we learned a thing or two while doing it. Here’s what we think are the most important aspects of coffee subscription ecommerce platforms.
- It should customize the transactional experience. A coffee ecommerce platform with recurring payments, online and mobile ordering, and easy, real-time modifications and adjustments is key.
- It should promote product discoverability. 72% of people claim browsing a catalog increased their interest in a company’s products. 84% said they purchased something only after finding it in a catalog. A good coffee ecommerce solution promotes easy navigation through a digital catalog filled with all your great stuff.
- The platform has to have robust data and analytics features allowing for the analysis of user adoption and customer lifetime value. And allowing for targeted deals and promotions based on user sales metrics.
- It should also provide reliable customer support. That means easy refunds and returns and seamless customer relationship management.
- Lastly, it should be able to scale with your business as it grows.
Speaking of, a great way to get your coffee subscription business growing is marketing.
Coffee Subscription Marketing
Read our in-depth post about coffee marketing for subscriptions.
Marketing is a tool to make people understand. You know your business is great, people may not. Marketing is how you bridge the gap. Here are the best marketing methods to spread the word about your coffee subscription and grow your business.
- Word-of-mouth marketing. Tell everyone you’ve ever met about your business, ask every customer for reviews, and—last but not least—have the best product possible.
- Customer service. Great customer service, that is. This is another way to generate word-of-mouth marketing. It also serves as a vehicle to communicate your core values, and it helps boost customer retention and customer lifetime value.
- Memorable content. Use the highest-quality digital catalog possible, share your expertise through a blog, and organically engage in relevant discussions via social media.
- In-store signups. If you have a brick-and-mortar location, you have a captive audience.
- Email marketing. Email marketing shines with a segmented customer base, a light touch, and an iterative approach
- Loyalty, referral, and affiliate programs. 87% of shoppers want loyalty programs. Referral programs are everything great about word-of-mouth marketing along with incentives. And affiliate marketing is an effective way to harness the power of internet marketers. Can’t lose with any of these.
Great Coffee Subscription Box Examples
Check out our full writeup about the best coffee subscription.
Now that we’re familiar with what makes a food coffee subscription box, let’s look at the coffee subscription companies out there doing it well. Because having a theme is so important for your coffee subscription, we scoured the internet and chose the best coffee subscriptions out there. Each with its own theme.
Blue Bottle Coffee: Best Blend Option
Blue Bottle Coffee doesn’t simply acquire their roasts. They roast them. They are roasters. That makes their blends particularly compelling. Before each blend is released, they’re rigorously tasted and tweaked over and over. Until the aroma and flavor profile they’re after are as clear as bells. It’s part science, part art, and all easily and quickly delivered to your door.
Trade Coffee: Best for Coffee Aficionados
Trade Coffee does all the coffee nerd stuff so you don’t have to. They travel around the country, explore local coffee scenes, get into deep discussions over roasting methods and cultivars, and discover the best roasts out there. Then they give it to you. They’re like a really generous coffee nerd friend.
Atlas Coffee Club: Best Single-Origin Roasts
Atlas understands that a big part of the attraction to coffee is in its production. The faraway growing regions, the network of creative people who work together to bring this caffeinated wonder into existence. Their angle is that each coffee subscription box delivery is your plane ticket to another place. You can explore the regions of the world through their coffee. It brings the adventure and mystique of coffee right into your kitchen.
Driftaway: Socially Responsible Pick
Giving a third wave coffee company a social responsibility award is really saying something. They’re all socially responsible. But Driftaway commits to carbon-neutral operations, eco-friendly packaging, transparent pricing, and, perhaps most importantly, giving back to the growers they work with.
Crema: Best for Customizing
Crema gives you all the tools to make your own perfect coffee subscription box. You can choose the size, grind, roaster, country, taste, roast profile, and flavor profile. Though they still start your subscription with a free sampler pack to rate to develop a personal coffee profile.
Mistobox: Best Budget Pick
Mistobox offers a lot of the same things as other subscriptions that start at twice as much. With over 500 coffees from over 50 of the best coffee roasters out there, you’ll get a steady stream of new coffees from unfamiliar roasters, regions, and blends that will be matched to your preference profile.
If you’re a coffee roaster, supplier, distributor, wholesaler, retailer, cafe, or any other conceivable coffee-related business, there’s an opportunity for you with coffee subscription boxes. You’ll have the best chance to succeed if you adopt a reliable ecommerce solution. Book a demo with BlueCart and let us walk you through the benefits of B2B ecommerce and how it helps thousands of businesses do exactly what you’re about to try.
Data gathered from www.myfriendscoffee.com, www.foodandwine.com, www.e-importz.com, www.priceintelligently.com, www.and baristainstitute.com.