Green Mountain Coffee Roasters Brews Up the Best Marketing Strategy
Green Mountain Coffee Roasters, Inc., is a leader in the specialty coffee industry. Founded in 1981 as a small café in Waitsfield, Vermont, Green Mountain quickly gained a reputation for its high quality, and demand for its freshly roasted coffee grew among local restaurants and inns. Incorporated in 1993, the firm today markets $162 million worth of coffee and related products through a coordinated multichannel distribution network with both wholesale and direct-to-consumer operations. This distribution network is designed to maximize brand recognition and product availability. Green Mountain derives the majority of its revenue from more than 7,000 wholesale customer accounts located primarily in the eastern United States.
The wholesale operation serves customers such as supermarkets, specialty food stores, convenience stores, food-service companies, hotels, restaurants, universities, and office coffee services. Many of these wholesale customers then resell the coffee in whole bean or ground form for home consumption or brew and sell coffee beverages at their places of business. Green Mountain Coffee roasts 40 varieties of high-quality Arabica coffee beans and offers more than 100 selections of coffee such as single-origin, estate, and certified organic coffee, as well as proprietary blends and flavored coffees sold under the Green Mountain Coffee Roasters and Newman's Own Organics brand names.
It has made a point of marketing certified Fair Trade coffees that help struggling coffee farmers earn fair market value for their efforts. It carefully selects its coffee beans and then roasts them to maximize their taste and flavor differences. Green Mountain coffee is delivered in a variety of packages, including whole bean, fractional packages, and premium one-cup coffee pods. Green Mountain's objective is to be the leading specialty coffee company. It aims to achieve the highest market share in its target markets while maximizing company values.
To meet these objectives, Green Mountain differentiates and reinforces the Green Mountain Coffee brand by distributing only the highest-quality products, providing superior customer service and distribution, stressing corporate governance and employee development, and implementing socially responsible business practices. Through these strategies, Green Mountain believes that it engenders a high degree of customer loyalty. The company employs 600 people but has a flat organizational structure, which makes all employees responsible for implementation.
Although it has functional departments that vary across the company, there are typically about four layers of hierarchy in each department. There is openness in all aspects of communication that allows employees to have regular access to all levels of the organization, including CEO Bob Stiller. The company urges each employee to voice his or her opinions and ideas. This encourages passion and commitment so that employees get to the heart of issues and challenges instead of playing office politics.
In this way Green Mountain has fostered a culture that involves its workers in decision making and challenges them to find solutions to problems. Empowering employees to this degree means that the company sometimes may appear chaotic, but the communication across channels in what is sometimes termed a constellation of communication ensures the collaborative nature of getting things done. In addition to growing sales and a reputation for quality, Green Mountain Coffee Roasters has been ranked among Forbes magazine's list of 200 Best Small Companies in America for six consecutive years.
The company's commitment to social responsibility-not only to secure Fair Trade prices for coffee growers but also its support of social and environmental programs in coffee-growing regions-earned it a first place on Business Ethics magazine's annual list of 100 Best Corporate Citizens in 2006, up from its 2005 position of second.
Questions for Discussion
1. Describe Green Mountain's marketing strategy.
2. How does Green Mountain use implementation to achieve success in a very competitive market?
3. How does empowerment work at Green Mountain?