I guess that most people know this, but I heard about an interesting talk given by Bobby Kerr of the Insomnia Coffee chain recently that gave great insight into how much coffee chains actually make on selling a cup of coffee.
We all (should) know that we can buy a jar of coffee in the supermarket for the same price as we’d pay for one coffee in a coffee shop. Yet we’ll still sometimes (maybe frequently) spend that money.
Mr. Kerr was talking about the success and failure of the special offers they’ve been offering recently. I’ve mentioned them here in the past.
The first offer was their “coffee and a sandwich” for €5 which at the time was pretty successful. Insomnia then moved on to offer “3 for the price of 2” in all their stores, and according to Mr. Kerr they got hammered.
When you think about it, it makes sense. So much so, that you’d wonder why they actually went ahead with that offer.
If most people go into coffee shops on their own, offering a 3 for 2 deal means that they’ll most likely get an extra piece of food or snack rather than a second coffee.
When your profit margin is mostly on the coffee rather than the foods and snacks, you’d rather that they take the coffee where the loss can be more easily absorbed. But to their cost, Insomnia hadn’t considered the reality, and the offer didn’t last very long.
Hence you’re seeing the 3 new offers offering a “coffee plus….” deal instead where the large markup on the coffee can absorb some of the losses more comfortably, but also increasing appeal to customers. According to Mr. Kerr, these offers are likely to go on for some time given their success.
From yesterday, Centra will be renewing their recent Smart Savings Meal Deals that have already been running throughout their 480 stores nationwide for the past two weeks.
The offers, Breakfast for €2, Lunch for €3 and Dinner for €5 seem like great value if you just want to nip out to top up at any time during the day. From yesterday, a whole new set of offers are being provided to customers. Details from the Centra press release are as follows:
Following on from the recent wrap/pasta salad/water lunch offer, Centra is offering a lunch deal of Centra Good to Go Lasagne + Centra Good to Go Wedges + Can of Coke for just €4 across its stores.
For consumers in search of an evening meal which is both quick and tasty but don’t want to spend more than €5, Centra is offering Centra Steakhouse Chips + Centra Cheese Pizza/Pepperoni Pizza + Centra Garlic Toasties for just €5 for the lot.
There’s also a little treat on offer in Centra stores over the next three weeks. For just €2 Centra customers will be able to pick up a freshly brewed Centra Good To Go tea or coffee and a pack of Maltesers.
I’m not a big fan of the “cut out the coffee and latte” brigade. While you can save money if you normally buy them every day, or a couple of times a day, but as a special treat or filling a space if you’re caught short, there’s nothing wrong with looking after yourself every now and then.
What I like more about this campaign than the prices is the fact that businesses are trying things to keep their customers happy. Some businesses just expect their customers to keep coming not matter what. But today, when everyone is watching their cash a bit more, it’s a great sign that businesses can, and more should, do in order to keep their customers happy and to try to attract new ones.
David McWilliams tells us that the “Breakfast Roll” man is no more, but I guess we could have the “Scone and Coffee” man taking over soon if he’s going to be able to stock up every morning for €2.
This e-mail came through last week in response to my comment about the specials being offered by a particular coffee shop in Dublin 2.
I notice your recent reference to insomnia and the great value they offer.
Well, we offer much better value but never get any recognition and it really pisses me off. I only use ORGANIC coffee and offer a free ” chez emily” irish handmade chocolate with each coffee – all coffees now only 2.50!!!!!!!!!! that’s 12oz by the way.
We have same deals as insomnia – sandwich + coffee 4.95 and coffee and pastry/scone 2.95, coffee+pannini 5.95 but we also have a sandwich + 500ml water 2.99!!!!!!!!!!!!!!!
Two water for one euro!!!!!!!!!!!!!
Also you can choose your fillings on the sandwich, pannini + coffee deals. [two fillings and two salads] and the bread.
ALSO we use really good ingredients- gm free -free-range eggs and real ham and a small family run bakery.
We also offer a free banana when you buy a sandwich [most days] we also offer student discount on sandwiches and panninis.
I am sick of hearing about multiples offering good value – what about the small independents that offer real choice, real value and REAL SERVICE -that seems to be something that’s never mentioned these days.
Any chance of a little publicity to help us or are we doomed to having boring impersonal coffee shop chains as well as supermarkets everywhere?
The above is from the owner of the RunnerBean Cafe on Nassau Street. I’m familiar with the place so I’m only too happy to publish this.
You really have to hand it to Insomnia the coffee shop for their current marketing campaigns. They’re currently on my boycott list, but their in store advertising caught my eye earlier today.
I wrote before about their sandwich offers, but today I notice they’ve added two more features to their offer.
Now, as well as being able to get coffee and a sandwich for €5, you can now get coffee and a muffin in the mornings for €3 or coffee and a Panini at lunch time for €6.
All very simple, and pretty much covers most of what they sell.
But unfortunately, if you’re on the list, you’re not getting my business.
Irish News of the World
Sunday March 29th, 2009
Where’s the cheapest coffee in Ireland?
With everyone looking at costs at the moment, many visitors to ValueIreland.com are keen to find out where the cheapest cup of coffee can be found.
The obvious answer is “at home”, given that a jar of coffee will set you back €4 or €5 and you’ll get multiple cups from it.
And that makes it more ridiculous that we’re immune to the fact that we’re all used to seeing coffee for €3 or €4, back in the good old days.
In the past few weeks I’m getting reports of some coffee shops trying to attract business by cutting the cost of their coffee.
I myself saw one shop in Wexford selling coffee for €1, and a reader sent us details of a shop in Dublin 2 selling their coffee for 99c.
In the last week, the great value website GoodBuy.ie told us of an offer in a shop in Athlone selling tea and coffee for 89c.
Can you beat that? Where have you seen the cheapest tea or coffee in the country?
I wrote about this before, but I think it’s worth mentioning again. The Insomnia coffee shop lunch deal is hard to beat at the moment when it comes to competition for lunch business in the Dublin 2 area at least.
For €5, you get your sandwich and any sized coffee. The best thing about this particular offer is that it’s any sandwich they sell, not “special” (read plain and boring) sandwiches that are on offer from Café Sol for example.
This week, my sandwich was €5.25 on its own, and I still got my coffee on top of that for €5 – normal cost €8.50. Obviously there are cheaper ways to have lunch, but if this is your thing, then it’s pretty good value in my book.
That said, the 3 cheese and ham sandwich in the new Costa Coffee on Dawson Street is really taking my fancy these days. Yum yum!
I was in Wexford last weekend and came across a Centra where their coffee was on sale for €1. Which got me thinking about the ridiculous prices for coffee in Dublin (and the short measures as well).
Then today, I get an e-mail in with details of a 99c coffee on sale in Dublin – and even with a picture attached as well. I don’t know the shop – I don’t even know where Stephen Street is, but for 99c, if you’re in the market for buying your coffee out, then it’s a great offer.
According to the detail that came with the e-mail release:
Dan Killalea standing outside his shop in Stephens Street News just 2 minutes from Grafton Street. Today he introduced the 99 cent Coffee – Freshly Ground top notch finely roasted Italian Coffee at that. Business tripled for the day. Herbal Teas and plains teas also 99cent.
This madness must end soon.
Now, before you get me wrong here – spending money on buying coffee out is probably not the best way to spend your money. It’s one of the most popular money saving tips given whenever any newspaper articles are published advising us on how to spend our cash.
I’m mostly in agreement if you normally buy coffee every morning, and lunch time, but if it’s just a special treat every so often, then no harm there – we still need to treat ourselves!
There was an interview on Morning Ireland this morning with someone from Topaz who confirmed that they would be improving the experience for customers at their forecourts. They would be changing the act of buying petrol from a “grudge purchase” to a more pleasurable experience.
The interviewer remarked, confirmed by the Topaz representative, that Topaz was the largest seller of cups of coffee in Ireland. Apparently, 4m cups of coffee sold per year, representing about 10% of the turnover of the Topaz company.
Just as a quick check this evening, I bought a litre of coffee in the Statoil on the North Road in Finglas.
A litre of petrol would have cost me 118c. A litre of coffee cost me 430c. Over 3.5 times as much. No wonder Topaz is improving the shopping experience in their forecourts – much more money in that than selling petrol.