NPD Watch: Gourmet coffee blended from cat droppings

Author: Rob Walker

Date published: 24 Apr 2008

Well-heeled coffee connoisseurs will be keen to sample Caffe Raro (De Longhi), blended from two of the most expensive and rare beans in the world - Kopi Luwak and Jamaican Blue Mountain.

The unique selling point of the brand is that the Kopi Luwak beans are passed through the digestive system of an Indonesian wild cat, making Caffe Raro the world's first dung-based gourmet coffee.

Coffee blended with cat droppings is a headline-grabbing concept, but do not expect to see this product in your local supermarket. If you want to buy a cat dung espresso or cappuccino you should head to the Espresso Bar in Peter Jones department store (Chelsea, London), and one hit will set you back about the same price as a decent bottle of champagne. This is believed to be the most expensive coffee in the world and is off the radar for most consumers. However, there is an important point to be gleaned here in that niche-focused premium gourmet brands are likely to become an important driver of on-trade fresh coffee consumption over the next five years and could sharpen the growth curve of the category as a whole. According to Euromonitor International, the global fresh coffee market posted value growth (US dollars) of 3.9% in 2007, its weakest performance of the past five years. Given that café culture is set to grow in some of the world's key emerging markets of Eastern Europe, Asia and Latin America, there has never been a better time to invest in premium gourmet coffee and push this growth rate north. Equally, some of the world's under-performing developed markets, such as France, Germany and Italy, would welcome an injection of upscale innovation and novelty.

The contagion of the credit crunch is likely to spread over the coming year; however, top range brands tend to be more recession-proof than other price categories. Companies, therefore, should not be afraid to invest in this high-end arena, because quite simply there are enough fat salaries in urban centres from Moscow to Mexico City to ensure a market for super-premium beverages. Indeed, the issue is less about price and more about the quality of the innovation and, in many markets, the kudos of the sophistication credentials. Companies need to look at the new generation of upwardly mobile professionals in specific emerging markets (such as Russia, Mexico, China and Ukraine) and leverage from their growing taste for Western-style sophistication and all-things premium. In that context, novelty is a viable strategic route for new product development in the fresh coffee category provided that it is synchronised with fast-evolving fashions and lifestyle choices. The problem with novelty is that it can be high risk, and by definition it is also transitory. But the fresh coffee market has an opportunity to build on the momentum created by coffee parlour chains such as Starbucks and it needs to embrace it. Cat dung coffee is ultra-niche and at the very top of the super-premium ladder. While it is unlikely to appear on the menu at Starbucks, it is relevant as a unique and exclusive brand concept. The crucial point is that there is growing demand for high-end brands in the fast-growth emerging markets and coffee manufacturers need to stake their claim.

Note: All profits from the sale of Caffe Raro at Peter Jones in Sloane Square, London, will go to Macmillan Cancer Research.

Related Research Reports

Hot drinks reports in 52 countries