The Coffee Bean & Tea Leaf’s (CBTL) primary target market is men and women aged 18 to 40 as they tend to be frequent coffee & tea drinkers. The main appeal to this consumer age group is through quality roasted coffee and excellent service.
The Coffee Bean & Tea Leaf (CBTL) is owned by International Coffee & Tea LLC. The table below shows global brand owner shares (by %) compared with other cafes and bars. As we can see, Starbucks Corp and International Coffee & Tea LLC are leading with a higher & value compared to the other cafe outlets. Although Harry’s International was on average (8.4%-15.4%) compared with Spinelli’s, we chose to compare Spinelli as another significant competitor in Singapore as it is more prominent as a cafe (serving tea & coffee rather than Harry’s, which serves beer) and is competing in a different market of consumer moments and experience.
Our competitor analysis thus compares Starbucks and Spinelli as CBTL’s 2 main competitors in terms of similarity of variety, pricing strategy, and target market.
Global Brand Owner Shares of
Chained Cafes/Bars (2006 – 2010)
The graph above shows data of the % value of global brand shares for the recent years. As seen above, the value of brand shares of CBTL is on par in comparison to Starbucks, with both competitors competing for first place in the latest few years. The % value of brands shares for Starbucks in 2010 overtook CBTL to 15.4% compared to CBTL’s 14%. Spinelli’s % brand share is significantly lower than both Starbucks & Coffee Bean.
Here is a summary of a comparison of CBTL with its 2 main competitors in terms of its distribution channels, mission, points of parity, and points of difference:
What does Coffee Bean & Tea Leaf have that differentiates itself?
1. Coffee Joint… with Meals
Initially starting with just breakfast set meals, Coffee Bean & Tea Leaf recently introduced 1-for-1 lunch sets, mainly pasta, with a 10% tie-up discount with certain credit cards. Our group feels that this is a Point of Difference within CBTL’s category of a cafe as it is differentiating itself from its competitors by offering whole sit-down meals (breakfast and lunches) in addition to its cakes and pastries, rather than its main competitors Spinelli and Starbucks that offers only pastries and light meals.
2. CBTL Cakes
CBTL differentiates itself as a brand as it is not merely just a dine-in cafe, but also a brand that allows consumers to order pastries and custom-made cakes online. They have a specialized cake section as well. Click here to see its online shop.
3. CBTL™ System
Coffee Bean & Tea Leaf has recently introduced its own brand of multi-beverage machine: CBTL™, which its main competitors Starbucks and Spinelli do not have. Our group has spotted several of its advertisements on buses since its launch in December 2011. The CBTL™ System is an easy to use, single serve beverage system that combines the handcrafted taste and quality that is the hallmark of The Coffee Bean & Tea Leaf® with the finest Italian technology and design perfected by CAFFITALY SYSTEM. This differentiates them hugely from their competitors as they are branching out to a wholly new product category. The CBTL system is sold in most Coffee Bean & Tea Leaf outlets in Singapore.
However this particular POD does not seem to add value to Coffee Bean & Tea Leaf as a brand as it is essentially still a brand known for its coffee joints. Moreover, single serve beverage systems are not a new thing as they have been around for ages as seen by the machines from Nespresso. Venturing into this new market may not be such a wise idea for them.
Points of Parity (POP)
1. Quality Coffee
In the cafe business, particularly CBTL’s “coffee-cafe” market, which coffee is their speciality beverage, there is a minimum standard of quality coffee that consumers expect. Coffee Bean, Starbucks and Spinelli all offer quality coffee to their consumers – what matters is… who do consumers choose to patronize at the end of the day?
Ice blended coffees are also POPs in the “coffee-cafe” market. One of the signature series on their extensive line-up of drinks, The Original Ice Blended was launched in 1989 and has been a big hit with consumers. However, the rise of Starbucks over the past decade has seen a very similar offering by this big competitor – Frappucino. Spinelli too has a similar range of drinks as seen in their Spins.
2. Corporate Social Responsibility
For CBTL, Caring Cup initiatives are planted and nurtured domestically in communities served by the company, as well as internationally in communities from which their products originate.
To further support these valued partnerships, CBTL raise money through the sale of certain products which is then donated to vital programs such as Aid Lanka Kids in Sri Lanka and Education For Growing Families in Columbia. However such initiatives are also done by its main competitors such as Starbucks, with it also having socially responsible campaigns such as Starbucks™ Shared Planet™.
3. Loyalty Card
In similar fashion to the Starbucks Card and Spinelli Friend’s Card, The Coffee Bean Card is a value-stored card with exclusive privileges that are unique to the store only. The reward points that can be earned from purchases with the card are cheekily and smartly named BEANS, drawing an immediate recall to the brand.