Consumers around the world and in the UK have in recent years more than upped their game when it comes to the coffee they drink. The quality, where the coffee is from, tasting notes and much more besides, more people than ever have become discerning coffee connoisseurs and in the comfort of their workplaces and homes.
Gone are the days where coffee at home or at work consisted of mud-like instant coffee. Nowadays, more people than ever are enjoying and appreciating barista-like and high-quality coffee more than ever in more places that ever
This has led to the explosion in companies supplying high-end and ethically sourced coffee, straight to us all in the comfort of our workplaces and homes. Pact Coffee has been one of those companies at the forefront of this coffee revolution and TechRound sat down with Paul Turton, CEO of Pact Coffee to find out more.
Who are The Brains Behind the Pact Coffee Brand and Company?
The brains behind the brand and the man that brought Pact Coffee to life is Stephen Rapoport, who as many people will know, is a serial entrepreneur and a very creative thinker.
Stephen saw a problem in the UK market which needed solving. Simply put, at the time people were not able to get delicious coffee, freshly roasted, directly to their homes. Stephen therefore set out to deliver a solution which would provide the very best coffee to consumers at home, in the most convenient manner possible.
He also looked at the wider outdated global coffee supply chain which exists and wanted to truly ‘do it better’ than anyone could: by going direct to origin; sourcing the coffee itself; building relationships with the farmers themselves; and crucially, paying a fair price for their beans.
By building and nurturing those relationships with the farmers and their plantations directly, the whole process is so much more efficient, cutting out the middlemen like exporters, importers, traders and so on. Off the back of this, Pact Coffee’s promise is to pay a minimum of 25% above Fairtrade base rate, making us a truly unique company.
We were set up initially as a coffee subscription service and after three rounds of funding raised more than £5.5 million.
Stephen loves coffee and drinks it every day, so naturally it is a real passion of his. He realised that coffee’s optimal freshness is 3-4 weeks and thus, when it comes to generic, off-the-shelf supermarket coffee, it is of a lower quality and is far less specific to different brewing methods; it will just be marked as ‘ground,’ rather than taking into account specific brewing methods for coffee.
How is the Coffee Market Changing in the UK and What Does This Mean for You?
Independent coffee shops and cafés have really taken off in the last few years and we have a lot to thank them for at Pact Coffee. They’ve really helped educate people about true, high quality speciality-grade coffee in the UK and specifically its variety of flavour profiles.
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Furthermore, as a consequence of demand, we’re now supplying over 150 independent coffee shops themselves throughout the UK and we can even boast Geraint Thomas OBE, the Welsh cyclist, as a brand ambassador whose ‘Gran Fondo’ collaboration blend is available in many of these sites.
Also, since the Covid-19 pandemic a lot of B2B coffee providers have been compelled to make the move to the B2C space, to serve consumers the specialist coffee they would otherwise be bringing to independent and expert coffee shops and cafés.
This has meant we’ve had to be razor sharp with our consumer proposition to ensure customers didn’t jump ship to alternatives. Happily, our subscribers have grown from just under 40,000 to almost 60,000 today.
Finally, we’d built our ‘office coffee’ proposition into an offering worth more than £2 million before Covid hit. With offices sadly closing, much of this business has been on hold albeit is now starting to reactivate as lockdown releases.
Happily, the net overall impact on Pact has been a business that grew by almost 50% to £10.5m over the course of 2020
As a Growing Coffee Subscription Business, What Are the Unique Challenges You Face and What do You wish You Had Known from the Start?
Pact Coffee has been very lucky to have seemingly taken good decisions at the right times on our journey. Our goal is always to be the very best at what we do in our market on behalf of the loyal consumers and B2B customers we serve.
For example, at Pact we’ve invested heavily from the outset in bespoke technology enabling customers to have complete transparency and control of their plans and have also designed our own algorithm to ensure our customers only get sent coffees they are likely to like based on ratings they’ve given.
Our systems allow you to precisely tailor the coffee you want, when you want it and how you want it. You can also very easily update the details and requirements of your plan in a way we believe no one else does. An imperative for any subscription business is that you need to make it as clear and easy as possible for customers to pause or cancel their subscription.
We use truly bespoke technology, which allows you to totally tailor your plan and what you receive. For example, you may go for a decaf plan to brew by cafetiere or a whole bean plan for machine based / cafe style espresso coffees.
Or, you may wish to have a particular style of coffee (i.e., fruity floral from Rwanda); everything is fully customisable for the customer who has ultimate control over their subscription or plan. This flexibility and the bespoke nature of what we do makes us unique.
There are however, a large section of the population who do not want to sign up for plans or subscribe to something. Therefore, we also allow people to simply purchase our coffee in a single transaction without subscribing to recurring deliveries too, although about 1 in 4 eventually sign onto a plan within 6 months.
What Roles do the Likes of Branding, Positioning, Marketing, Pricing, Packaging Play in a Subscription Business Model Like Pact?
Pact Coffee was set up with a letterbox delivery and craft angle. On marketing, we started with paid channels and PR and went hard with these, utilising channels like paid social, PPC and traditional PR. In 2019, we felt that we were due a refresh and switched to focusing on marketing and branding.
Thus, today, the Pact Coffee logo reflects our values and the relationship between Pact, the growers and our customers. We have, from our start, never changed our ethos and who Pact Coffee are. We remain focused and consistent when it comes to the quality of our coffee, how you drink it and true flexibility for our customers.
What we try to do is not overly talk about the sourcing of our coffee as that just isn’t what customers want and we understand them and their preferences; they want a great cup of coffee.
Pact pay a premium for the beans we use and have outstanding relationships with all the farmers we work with. If as a business you shift what you do and how you do it, you need to be very clear to customers why you are doing it.
What Does the Future Hold for Pact Coffee?
We’re going to continue promoting and growing our market leading subscription offering as more people than ever are understanding the benefits of signing up to one of our plans. We do however recognise there is a massive addressable market of consumers not wanting subscription so we will continue to invest in our technology for our store to make the experience for buying the very best speciality coffee for the home even better than it is today
We’ll also be working on improving our B2B offering, for both offices and the hospitality market with a pioneering digital self-serve offering to help SMEs in their coffee journey. This is coming in the autumn.
There are around 10 million people in the UK who work for companies with twenty or fewer employees, who’ll soon be back in the office and we want to cater for them.
Pact Coffee continues to invest in brand and ‘above the line’ activity.’ We want to be the most popular, most trusted and most familiar brand in our space. We want to be known for our mission at source and the fact we are challenging the thinking surrounding an outdated and anachronistic supply chain.