Coffee is one of the most popular and widely consumed non-alcoholic beverages in the world. The NCA report reveals that 62% of Americans drink coffee every day. On average, a coffee drinker consumes about two cups of coffee per day. That’s when the coffee subscriptions come into play. What are coffee subscriptions?
PissedConsumer.com interviewed Jim Fosina, a founder and CEO of Amora Coffee, to find out more about coffee subscriptions and their benefits for consumers. Jim is passionate about bringing quality products to customers and believes that every consumer deserves the best service.
If the consumer doesn't like the product, then you need to be able to give them a product that they like, or give them their money back.
Watch this video to learn more about coffee subscriptions, how they work, how consumers can manage their tastes with Amora Coffee, and why you would like an idea of having a quality coffee or tea delivered to your doors on a regular basis.
- About Amora Coffee
- Advantages of coffee subscriptions
- How to adjust Amora Coffee subscription
- Why choose a coffee subscription
- Challenges during the pandemic
- Tea subscriptions with Amora Coffee
- Customers loyalty to Amora Coffee
- Amora Coffee customer service
- What to look for with coffee subscriptions
About Jim Fosina and Amora Coffee
Jim: I've been in the direct-to-consumer subscription landscape for the last 34 years. I've worked for companies like Kraft Foods and Nestle and Scholastic, before going out and launching my own advertising agency, which I had owned and operated for about 17 or 18 years before selling that about three years ago.
But during that time, we also launched our own direct-to-consumer business, which is Amora Сoffee. So we launched that 10 years ago, we are celebrating our 10-year anniversary just this past October so we're having a good time.
What Are the Advantages of Coffee Subscriptions?
Michael: So coffee subscription, there are other subscription businesses, magazines were extremely successful with subscriptions in the past. Now companies are becoming more of a subscription model. What are the advantages of subscription models for consumers?
Jim: Well, the advantage of a subscription model is generally there has to be a value-add coming back to the consumer. If you're a subscriber and you're receiving your product on an ongoing basis in the cadence that you've determined, then you as the customer have saved the company a significant amount of money in advertising dollars. If the consumer is saving the company advertising dollars, then the company can pass those savings on to the consumer.
One of the biggest advantages is a discounted product to the consumer because they are buying on an ongoing regular basis and that allows us to pass the savings back to the consumer. That's probably the biggest advantage of any subscription business.
How to Adjust an Amora Coffee Subscription?
Michael: As a subscriber how often can I adjust my subscriptions with your service?
Jim: With our service, you can adjust your subscription to whatever your liking is and for any subscription service, you should be able to adjust your cadence.
In our particular business, coffee, we are super aware of what is sitting in a consumer's pantry for two reasons. Number one, is there enough to satisfy their needs so they don't have to go out to the grocery store and subsidize? And, two, are we helping them manage their coffee so that they don't have what we call pantry stuff where they have too much in the pantry?
Two things happen when you have too much in the pantry. One is the coffee's aging, it's getting older, you don't want that. Two is you don't want to take up too much shelf space in somebody's pantry. That becomes a negative.
So it's really important to help your consumer manage to the exact quantities that they need. If they want to receive it every week, every seven days, every 14 days, every 60 days, every six months, you need to be able to give them that opportunity. You need to be able to give them the opportunity to right before you ship that product to skip that shipment, change that shipment and change the variety, or push that shipment out. It has to be the service the consumer controls. Otherwise, in my mind, it's not a true subscription.
Michael: As a consumer, I'll be able to control how much and what variety I am going to get right before the ship.
Jim: You could receive nothing. You could receive one bag, instead of four bags. You can receive six bags, instead of two bags. You can change from one flavor or one roast to another, and you could do this at any time for any reason. If the consumer doesn't like the product, then you need to be able to give them a product that they like or give them their money back.
If the consumer has over-ordered and they need assistance in managing that and if that means you need to bring the product back or have them donate the product and we refund, well, we're going to do that because we're into it for the long haul. We want to be in your home every morning forever.
Why Do Consumers Choose Coffee Subscriptions?
Michael: According to the National Coffee Association, 62% of Americans drink coffee every day. That's a large number, and coffee consumption has increased since 2015 by 5%.
What do you think is happening in the subscription business? Do people buy more into the subscription type of relationship with coffee, or do they still go to the groceries and buy as they need it?
Jim: A couple of things have happened. If we look at the past five years versus the past two years the pandemic is front and center, and the pandemic has changed coffee purchasing behavior. Many of us used to head on to work, stop at our favorite coffee shop, buy a cup or two of Joe, and then when we got to work, there was always some sort of coffee, generally good coffee, available to the team throughout the day.
Now, the pandemic changed all of that. Most people were working from home. A lot of people are still were working from home and so they're not passing their favorite coffee shop, and they're not getting their coffee provided at the office.
What happens? They're looking for alternative ways to purchase products and can they purchase them in the grocery store? Absolutely. But for us, we've seen an uptick, a significant uptick in people buying directly, either through subscription or even as a single order. So the consumer purchase behavior relative to subscription has grown significantly. The pandemic has accelerated subscription marketing five to 10X in the past two years.
How Did Amora Coffee Challenge the Pandemic?
Michael: You have increased the volume of the orders by five, 10 times over the pandemic years. How did you manage to handle such volume and logistics associated with it? How challenging was it for you to accomplish it, and how did you manage it?
Jim: Two things. One is the five to 10X growth is in the subscription space. So to clarify, that growth is in the subscription space.
Amora has grown significantly and it definitely brought on logistical challenges. It brought on challenges with the United States Postal Service, especially during the last fourth quarter, in terms of getting shipments to customers on time. And we had to change our entire communication strategy with our consumers to make sure that we could ship to them a little earlier to allow a little more time in transit.
We were going through a time of remote work for our customer service agents and we have fantastic customer service agents. We call them our customer connoisseurs and they are available 24/7/365. Do you want to chat with them? We're there. Do you want to email them? We're there. Do you want to call them in the middle of the night? We are there.
But we were learning how to work with a remote customer service workforce during a time when there were also labor shortages. So, from that standpoint, there was a learning curve there and I think we did very well.
As far as manufacturing and fulfillment, yeah, everything from the manufacturing side and having to split shifts for COVID-safe purposes to the fulfillment and warehousing, again, splitting shifts, these were all new things that it wasn't just Amora. The whole world was dealing with it.
I think when you really look at it, the whole world did a pretty good job in pivoting. For us, we actually embrace that. Why do we embrace that? Because if more people are buying direct and in a subscription and they're buying coffee and that's how they're looking... or tea, and that's how they're looking to fulfill their needs in their home, well, a lot of these customers roles are going to want to be experimental.
So the larger the consumer base is for direct-to-consumer subscriptions, the larger of a pond everybody has to market within. So, yeah, it brought challenges, it brought logistical challenges, the world pivoted, so did we. It's brought competitive challenges, the world has pivoted, so have we.
A lot of people would say to me, "Well, gee, you've been in the direct-to-consumer space and subscription for such a long time, you must be embracing the pandemic." My response is, no, I'm not embracing the pandemic. We're reacting to the pandemic.
I don't think anybody in the subscription space is really looking to profit off of the world's misfortune, but it is a way of getting products into consumers' hands.
So that has been a fantastic journey for us over the past two years.
How Do Tea Subscriptions Work with Amora Coffee?
Michael: I also know that Amora Coffee, in addition to the coffee, started selling tea. Can you talk a little bit about your tea subscription and how it works, how different is it?
Jim: It's identical to the coffee subscription. With coffee, we have various blends and grind and roast and decaf and flavors. With our tea, we also have black tea and green tea, and herbal tea.
We found that for our consumers, there were two things happening in a household. We had some consumers that were drinking coffee in the morning and drinking tea in the latter part of the day or evening.
Then we had some consumers where one person in the household or multiple people in the household drink coffee, but other people were drinking tea. So we started to listen to our consumers and our consumers were saying, "Why don't you have tea?" So we launched a tea subscription business. We launched that in 2013, I believe it was, '13 or '14, but the two coexist very nicely within the household.
We learned a lesson early on when we launched the business in 2011. We are a super-premium blend, a super premium bean. I personally was highly sensitized to serving or manufacturing any coffee that wasn't a single origin or an incredible blend and not mixed with flavors.
But our consumers were saying, "But wait a minute, we like flavors. We like the hazelnuts, we like the chocolates, we like the cinnamons.” And we did that. So we launched our flavor line as well and we did that in tandem with the tea line.
It was a huge learning experience for us a couple of years after we launched our business that our consumers wanted more. And if they trust your brand, if they trust the Amora brand and they really like coffee and they trust your service, then they're going to buy the tea as well.
Customers Loyalty to Amora Coffee
Michael: Consumer loyalty is important. You attempt to achieve it through the service. What else do you do to achieve customer loyalty? What's important for you?
Jim: What's important for us, Mike, is that every single communication we have with a consumer must end with that consumer being in a better frame of mind than before the communication, whether it was a positive communication or whether it was a negative communication.
Now I'm not going to stand here and say that we don't have some consumers that call us and they have a problem that needs to be solved. Of course, we do. Everybody does. Our number one operating principle in our company…
…in order to not only achieve what we believe is the gold standard of customer loyalty, but also the common sense of treating our consumers the way we want to be treated is simple.
If you communicate with us, you have to leave that communication in a better frame of mind than when you entered it. When we fail at that, and there are times that we do, we look very, very hard at why we failed and then we learn from that. We do that so that we don't fail on that point again.
How Amora Coffee Resolves Customers Issues?
Michael: Over the history of Amora Coffee, you certainly had problems with customer service in the past, and they know you've successfully resolved it. Can you tell us what lessons you've learned and what do you do better right now to satisfy your customer?
Jim: I think the number one thing you need to do is let the consumer be in charge of when they want to be communicated to and when they don't want to be communicated to.
One of the things that we learned is that if you're only going to communicate with a customer when it's time to transact or bill them, that's the old continuity world. That's not a great experience for a consumer.
But if you are going to hold their hand along the way, and you're going to communicate with them at various times during their journey from shipment to shipment, not just at the point of shipment, if you're going to communicate with them, then you're going to establish a different type of rapport with them. And by doing that, that has helped us grow leaps and bounds in making sure that our consumers leave an interaction with us in a better frame of mind. We're a 10-year-old company. We've learned a lot from our consumers.
If a consumer is complaining about something, you have to listen and there's always going to be something new for a customer to bring to your attention.
We may not like it and we have to put on our big boy thick skin clothes, but it's gold. It's the most important thing for us is to hear the negative.
We have lots of great reviews. We love the great reviews that we get on Amora. I read the reviews, but I make sure I read the negative reviews. If there's a negative review, I want to understand why and anybody who says they have a company that doesn't have negative reviews, well, if you spend time looking at where a customer has a concern, that's how you get better.
What to Look For with Coffee Subscriptions?
Michael: If a consumer is interested to try subscription coffee, and as they look at different companies out there, as you said the competition has grown, what advice would you make to a consumer? What shall consumers be looking for in a subscription business, in starting the relationship with a subscription company?
Jim: When you're purchasing coffee or tea, whether it's a subscription or a one-shot, there are two primary sensories that are being addressed, taste and smell. As a business owner of Amora, my co-founder Marina DiDomenico and I, we stake no claim that everybody's going to love our coffee. Maybe they'll try a blend and they don't like it and we'll move them to a different blend, or a flavor and we'll move them to a different flavor, but there are going to be some people that our coffee just doesn't appeal to.
So when you're the consumer and you're buying, you need to be ready to buy with a company that understands that and a company that may be willing to give you your first taste for something much less than what it would cost you to go buy three, four, five bags a coffee.
A company that's not going to ask you to make a commitment to buying some number of shipments. A company that is not going to put a contingency on you tasting your first sip, and then will bill you later for it. A company that's willing to give you your first sip at a very, very low barrier of entry.
So I would encourage consumers to look at satisfaction guarantee policies, return policies. Are you committed? Is there a cancellation fee? I mean, the last thing you want to do is develop a subscription company that sort of feels like your cell phone service.
Michael: Thank you for your participation. We appreciate your input and talking to our consumers about coffee, about subscription business and about Amora.
Jim: Mike, thank you very much. We really appreciate the opportunity to speak with you today.
Coffee subscriptions are not new. Many consumers subscribe to enjoy better-tasting coffee or tea regularly. Before you buy, make sure to check policies and terms. As Amora Coffee founder mentions, you should buy with a company that is “willing to give you your first sip at a very, very low barrier of entry,” and then you adjust your taste to get a great experience.
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