• QA 131
    How to differentiate between the mainstream and the specialty industry?
    Many people and articles, as well as the Coffee Guide, differentiate between what they call the Mainstream and the Specialty coffee industry. But it is not entirely clear where the one stops and the other begins so to speak. For example, if Nestlé is considered to be mainstream, what then is Nespresso? Alternatively, if the criteria are size or turnover, where then does one place Starbucks?
    Asked by:
    Exporter - Uganda

    Your question touches on a fairly recent development: mainstream roasters moving into the specialty market, for example by offering organic coffees or by establishing their own specialty operation, sometimes under a different name. Such moves reflect the growing importance of the specialty segment but yes, it somewhat blurs the distinction between the two. It is therefore better perhaps to ask what causes different retail products to be classified as mainstream or specialty… 

    The term 'mainstream' simply reflects the fact that an estimated 85 to 90% of all coffee roasted is of fair average quality, mass-produced and marketed. Such coffees are available in quantity and are usually presented as blends, often through supermarkets etc. Roasters who are predominantly active in this market segment are therefore known as 'mainstream roasters'. Their buying capacity is huge and there is strong concentration in this market with Nestlé currently the world's leading roaster.

    The term 'specialty' usually refers to individually presented coffees, often but not always of somewhat limited availability. With the exception of the Starbucks Company the turnover of most specialty roasters is limited but, in recent years the number of small roasters worldwide has shown strong growth. However, the term specialty increasingly also refers to coffees that are different, for example in the way they are presented. This is part of the specialty attraction although it is fair to say that for the average latte one does not require top grade coffee. A simple blend will do.

    However, there is no denying that the output of some of the larger European and Scandinavian roasters has always included top quality coffees, far superior to the average specialty coffee one encounters. Yet such roasters are usually classified as mainstream because of their size and conventional marketing methods. Their products are not perceived as being 'different'… On the other hand, a retail product elsewhere may be classified as specialty but, in fact, it may be based on plain old mainstream type coffee… *

    Therefore, we would rather classify individual roasters by the products they market than by the coffees they may be buying. 

    On this basis we would maintain that both the Nespresso and Starbucks Companies are part of the specialty market segment.

    The Nespresso Company combines technical innovation (special home brewing equipment) with high quality coffees. It stands alone from the Nestlé Group and, it and its products should definitely be classified as being part of the specialty segment.

    The Starbucks Company in a way does the same: it relies on innovative retail and presentation methods that have set it apart from other roasters/retailers. This includes the constant promotion of high quality origin coffee but, it is increasingly also selling blends. However the company firmly belongs to the specialty segment because it is marketing specialty type coffees.

    The Swedish roaster Gevalia is a different example. The company ranks amongst the major specialty sellers (mostly by mail order) in the US, yet is owned by the multi-national firm of Kraft Foods.

    * Indeed, the specialty market itself is divisible in three sub-segments: Exemplary coffees, usually presented as single origin or single source; High quality coffees that may include blends; Average quality coffee that is presented 'differently', for example lattes.

    Posted 16 January 2007

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    QA 110, QA 114