Creating a go-to-market strategy for the circular start-up Caffe Inc.

Abstract

This thesis explored the company of Caffe Inc., their offerings and doings and the context that they work in. Caffe Inc. is currently taking the first steps in creating value from spent coffee grounds. They wish to grow as a company and to build the largest biorefinery for processing spent coffee grounds into colourants and oil. With the biorefinery they want to stimulate the circular economy and show to everyone what the possibilities for repurposing are, and to prove that waste does not have to exist. The need for the circular economy is high, due to our current linear economy valuable resources end up on the landfill, the climate is changing and resources are getting exhausted. In addition, the consumer awareness on sustainability is growing and they are pressuring companies into becoming more sustainable and transparent. Additionally, companies also start to care more about the impact they make. The products of Caffe Inc. can be a solution to these companies, providing a circular and sustainable alternative.

The products that Caffe Inc. create offer many possible applications. The oil can be used for personal care products and the colourants to dye clothes. However, Caffe Inc. still needed to establish in market(s) their products are of value and how they should position themselves and their products there. To provide a relevant advice and strategy to Caffe Inc. the following research question was established: How and where should Caffe Inc. position their products in the market?

The answer to the research question is found through extensive market and context research, an analysis of the company, the product and the competitors, interviews with circular start-ups and a consumer questionnaire. The final solution is presented as a go-to-market strategy covering the steps that need to be followed when entering the target markets. It explains which markets to enter and how to successfully enter them.

The research found that the clients buy the coffee oil because it is a circular alternative to their regular materials, and there are not any other circular and local alternatives on the Dutch market.
However, the interviews revealed that circularity is not something to position your products on, the added value is of most importance. This is also confirmed by the consumer questionnaire, Consumers buy products based on quality and price. They are open to the idea of buying products created from spent coffee grounds. The target consumer, who would buy the products created from spent coffee grounds cares about sustainability but more than that, it wants the product to be of good quality and to be fun. They believe all products created from spent coffee grounds deserve an equal chance as long as their quality is equal to that of its alternative. If Caffe Inc. explands their business to other European countries, Germany offers the most opportunities for Caffe Inc..

With this information the go-to-market strategy is created. The go-to-market strategy can be divided into three horizons. The goal of the first horizon, let it sprout!, is to build the biorefinery and sell the oil in bulk on the Dutch market and achieve a proof of concept. The goal of the second horizon, let it grow!, is to expand the product portfolio by introducing a consumer good and expand to foreign markets. The goal of the third horizon, let it flourish!, is to add the knowledge programs to the product portfolio, build biorefineries in foreign countries and start the giving back program.