Cherie lunghi nescafe

KENCO / BRAND SPOTLIGHT This article appeared in Contagious Magazine issue 50

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Brand Spotlight / Kenco 38 / 39Brand Spotlight / Kenco

Kenco’s revitalisation starts in the murder capital of the world, where the instant coffee brand set out to reignite its ethical credentials. Its Coffee vs Gangs initiative goes beyond marketing, changing the lives of the people who grow Kenco’s products. The programme not only gives

Kenco a purposeful story to tell, but has also dramatically improved the brand’s revenues

By Emily Hare

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Brand Spotlight / Kenco 40 / 41

W hen marketers talk about taking risks, they are usually referring to something relatively mundane, like a shift in strategy or an unusual media spend. When Kenco talks about taking risks, however, it involves danger, significant investment and circumstances well out of the brand’s control. The brand’s Coffee vs Gangs project was developed with agency J. Walter Thompson, London, in 2014 and took place in Honduras, where some of its beans are grown. Helping individuals escape a life of crime placed the brand in opposition to violent gangs who would not hesitate to destroy the farms that Kenco was working so hard to support.

Such was its belief in the programme, and the capacity to build a UK advertising campaign around it, that Kenco took a second risk, to focus the entirety of its marketing efforts on Coffee vs Gangs. As Neil Godber, head of planning at the agency, said: ‘The risks and threats that this brand and the people involved faced were high. The number of variables at play was incredible... This was all in, or nothing.’

The daily grind Kenco has always been a challenger in the instant coffee market, competing with category leader Nescafé, which dominates not only share of voice, but also outspends Kenco in terms of its advertising and undercuts its rival through price promotions. According to Mintel, Nestlé makes up 40% of the UK advertising spend in the instant coffee market, which totalled £26m($32m) in 2015, with its f lagship brand Nescafé outspending Kenco by around three to one.

Marketing budgets in the category are not typically spent on emotive campaigns. Instead, the work tends to focus on the smooth, rich, refined taste of coffee. Kenco’s advertising and its actions have long set the brand apart, pushing the needle across topics such as equality and sustainability. Paul Kirkley, global partner at Kenco’s agency, said: ‘Ethically viewed brands and sustainably produced coffee did have a marked impact on how people viewed and pur- chased the brand, so we leant on that as our point of difference.’

Purposeful measures Kenco established itself as a leader in the ethical space through its early commercials promoting gender and racial equality, by cutting back on packaging and establishing partnerships with bodies such as the Rainforest Alliance. In addition to this, it communicated these actions in a way that resonated with customers, at a time when movements such as Fair Trade were gaining momentum in the UK.

But being a first mover comes with its costs. The rest of the industry was quick to catch up with the initiatives Kenco introduced and so the brand’s original point of difference no longer provided the advantage it once had. ‘When you set the norm and educate consumers, the rest of the market follows, so the competitive difference over time disappears,’ says Martin Andreasen, marketing director at Kenco parent company Jacobs Douwe Egberts. But Kenco continued to push things forward, with initiatives such as introducing coffee that was 100% sustainably sourced.

Another threat to Kenco’s instant coffee stems from coffee drinkers in the UK becoming increas- ingly sophisticated in their tastes. Chain coffee shops and independent rivals are common on the high street and nearly three in 10 UK households also own a pod-based coffee maker, such as Nespresso or Tassimo, according to Mintel. Although Kenco does supply branded pods for Tassimo machines, changing drinking habits are an ongoing concern in a highly competitive mar- ketplace. Both the state of the coffee market and

Kenco’s position in that marketplace meant the brand had to take meaningful action.

Bold briefing By 2013, Kenco’s hard-won price premium compared with rivals and its long-standing ethical point of difference was in jeopardy. The brand challenged its agencies to reassert its ethical credentials. Kenco wanted the work to have a substantial impact and brought a level of ambition to the project that meant a standard campaign would not answer the brief. ‘They didn’t want to produce run-of-the-mill, generic, mainstream coffee advertising; they wanted to produce com- munications that were dramatically impactful, both in the category and beyond,’ said Kirkley.

For Godber, key to the brief was to ‘do some- thing that we can talk about’ as opposed to ‘talking about Kenco’s ethical message’. That led to a thought process that considered where Kenco could make the biggest, most dramatic difference in a way that was fundamentally linked to the brand and product.

Coffee has a huge effect on the economies of many of the countries from which Kenco sources its beans. For example, many of the farms in Honduras are smallholdings, run by around 110,000 individual coffee farmers. In a country with a population of around 8 million, Andreasen says it is estimated that the farms ‘create the livelihoods of around 1 million people’ when employees, their families and related industries are taken into account.

If Coffee vs Gangs were to go viral in Honduras, some gangs are not going to hesitate – they would take out the farm Martin Andreasen, Jacobs Douwe Egberts