Q&A with Kevin Hydes, head of UK marketing at Costa

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Marketing Week (MW): Why are you moving into the self-service coffee machine market with Costa Express?

Kevin Hydes (KH): The premium self-service coffee market is pretty young. There are about 2000 self-service units out there at the moment. We spotted an opportunity because we can’t reach consumers in some of the locations where they want coffee, so this allows us access to places we couldn’t get to before.

We bought Coffee Nation, which had about 45% of the self-service market share. We think the market in total can reach about 14,000 locations over the next seven or eight years.

MW: Costa prides itself on its hand-prepared coffees in store. Doesn’t this concept clash?

KH: We want to reach people where we can’t have a full store experience. We see potential in hospitals, stations, universities and so on. Chief taster Gennaro Pelliccia has worked on the product a lot, so we can make sure it lives up to the taste we expect.

MW: As well as launching Costa Express, you are using greeters at some of your stores. Why?

KH: We are testing this host role at some of our stores to support the customer journey. Queues come with negative connotations, so we need to make things as easy as possible. The greeter can direct people in the store, or take food from people in a queue and get it grilled, speeding up that process.

Ultimately, the host acts as the voice of our brand, so it’s important to give people a good experience. Sometimes people will want to chat about their weekend, while others just want to get a coffee as quickly as they can. The host has to pick up on that.

We have been testing this since the start of the year in 15 locations, mostly in London during busy periods. We have tried it outside London on peak shifts to aid the process, but on a quiet Wednesday afternoon, it isn’t necessary. That might feel a bit awkward.

MW: You have also launched Drive Thru stores in the UK. Will we see more of these?

KH: Convenience plays a big part in coffee choice. Drive-thru coffee is massive in the States. In the UK, we are familiar with roadside coffee from service stations, so it felt natural to look in that area to build our business.

We built full stores with drive-thru elements attached, while we try to see what the appetite is for this. We’re planning to open six this year and we’ve got three open already.

Our mix of sales ranges between 25% and 40% coming through the drive-thru element. These outlets can break even just through their store sales, so the drive-thru sales are on top. It’s a very low risk strategy.

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