Starbucks Enters South Africa: What’s In It For Consumers

Posted by Patrick Gaincko | June 13, 2016
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End February, Starbucks announced that it will open its first-ever store in Italy early 2017. In the birthplace of espresso and cappuccino, where coffee is at the intersection of culture, heritage and community; the news that an American retail chain would come and sell coffee had the potential to cause derision and criticisms. So Mr Schultz, the Chairman and CEO of Starbucks, travelled to Milan to bolster the announcement with some compelling context: “we are going to come here with great humility” he said.

Similarly, when mid 2015 Starbucks announced the 2016 opening of its first store in South Africa (and first-ever in sub-Saharan Africa), the news was put against the ongoing narrative about the shape of the South African economy – the shrinking growth, the weak rand,  the high unemployment. So Taste Holdings, Starbucks chosen partner in South Africa, not only repeatedly offered reassuring arguments report after report but also opened the first store in the trendy suburb of Rosebank, Johannesburg, with grand fanfare end April 2016.

Early press reviews have been relatively positive, with commentators stressing the long queues of coffee aficionados in front of the store despite chilly temperatures, the wide online circulation of customers’ enthusiastic impressions, the pride collectively shared among South Africans that yet another international brand entered the country, seeing a sign that it is still relevant on the global stage.

But at the same time a fair number of reviewers were perplex, bringing back the struggling SA economy argument and pointing out that consumers lining up en masse on day one doesn’t necessarily mean that success is guaranteed for Starbucks, particularly in a market considered well packed with coffee shops.

So what are the key success factors for Starbucks in South Africa?

  • The competition in the trendy neighbourhood of Rosebank, Johannesburg: here, a menu display at the coffee shop Vida e Caffé.


Price: various reviewers have noted that Starbucks prices are the highest in the Johannesburg market. 27 rand for a latte is still cheaper than prices elsewhere in the world, but it could prove problematic compared to what South Africans usually pay. At this price point, the obvious target is the upper-middle and affluent classes. But even with these targets, attracting them will not suffice. Starbucks will need to earn see their strong, sustained loyalty in the form of both a critical number of visits and critical level of spending.

Product: At most coffee shops across Johannesburg, there are latte’s, cappuccino’s, espresso’s, herbal tea’s, and a few other things. The menus are relatively conservative in terms of ingredients, flavours and recipes. Noticeably, specific consumer groups – students, young professionals  – have showed a great receptiveness to change in their preferences and attitudes towards coffee. There is subsequently a huge opportunity for Starbucks to win a sizeable market share if it can bring in the elements forming the pillars of its valued reputation: the variety of its product offering and the innovation in the flavours, recipes and labels.

Customer Experience: “Our brand equity is built on our customers’ experience and that depends on the quality of our people” Mr Schultz said to the New York Times in March. In South Africa, where poor customer service is notoriously rife, Starbucks has a serious chance to make a difference as it is expected that Taste be the recipient of a skills transfer and invest heavily in employee development programmes.

I enjoyed a latte at two different stores in Casablanca, the Morocco Mall on one hand, the Franklin Roosevelt Villa on the other: the latter – thanks to its emblematic location, its modernist design combining Moroccan identity and European influences, its luscious landscaping – seriously edged up my experience. Iconic store locations, generous rewards schemes, innovative payment solutions have proved to be game changers or competitive advantages for Starbucks in competitive markets. While it is too soon to say whether Taste will develop these initiatives in South Africa, for the company to carry out its ambitious rollout – opening twelve to fifteen Starbucks outlets in two years, it would need to leverage the diverse range of Starbucks customer experience management tactics.


In the trendy district of Rosebank, where Starbucks has opened one its Johannesburg stores, Motherland Coffee Company, a local coffee shop chain, is a well established rendez-vous for grab-and-go, business meetings and co-working sessions.
In the trendy district of Rosebank, where Starbucks has opened one of its two Johannesburg stores, Motherland Coffee Company, a local coffee shop chain, has established itself as a rendez-vous for business meetings and co-working sessions.

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How Made-In-India Courts African Consumers

Posted by Patrick Gaincko | May 18, 2016
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Barclays used to offer fast credit to consumers, OMO claims to remove stains faster, Western Union asserts to be the fastest money transfer provider, MTN promises more speed in the adverts for its online access and payment solutions. “Fast” has become a recurrent sales argument for many brands in Africa as they are trying to attract légions of consumers moving en masse to cities, modern lifestyle, and the middle-class. The conventional wisdom is that these consumers now aspire to live a productive, time-efficient, hassle-free life.

A sector has now just entered the “fast” trend: food and drinks. And various Indian brands are taking the lead, advertising and offering packaged, easy-to-cook, ready-in-5minutes meals from breakfast, lunch to dinner, dessert. But perhaps realizing that shifts in consumer tastes represent a huge challenge, the Indians’ other ad slogan is “Try It”. So here I am in Kinshasa DRC ready to try a full set of instant Indian meals.

“Clean” is another word used by Made-in-India in their aggressive courtship of modern consumers. Sales representatives go door-to-door to demonstrate how to easily make clean water at home or at the office. Result: I find myself installing and trying a water purifier that the Indian giant, Tata Group, has just released in the DRC market (see the picture on my LinkedIn)

How big is the scale of unmet consumer needs and untapped opportunities behind simple words: easy, clean, clear, safe, solid?

This MTN ad reads "Connect to MTN 3G+ and discover its speed"
This MTN ad reads “Connect to MTN 3G+ and discover its speed”

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What’s Fast Food Advertising in Morocco: McDonald’s

Posted by Patrick Gaincko | April 10, 2016
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ADVERTISER: McDonald’s Morocco

MARKET: Morocco


PERIOD: Dec 2015, Jan-March 2016


“Acknowledging our farmers’ know-how is all it takes for them to give us the best of their production. McDonald’s Morocco is a 100% Moroccan company, servicing Moroccans since 23 years. The brand has perfectly adapted to local consumer habits and commits itself to actively contributing to the country’s economic, social and human development. McDonald’s restaurants work with local suppliers for half of their supplies in raw materials such as bread, oil, vegetables among which salads, ice creams, dairy products, confectionery and packaging. McDonald’s Morocco is also a 100% Moroccan staff. More than 2700 men and women strive every day to meet the needs of their customers.”


CHANNEL L’Economiste, a daily business newspaper and Tel Quel, a monthly magazine on current affairs

GOALS To gain long term brand assets, i.e. recognition and validation from specific targeted groups

MESSAGING Emotional and rational

TARGET Agri-food industry, private and public stakeholders, suppliers, partners (franchisees), influencers, affluent consumers

CONTENT This is a statement on the brand’s economic role and the company’s social responsibility in a national context. The tagline is “United in loving, united in acknowledging”.

VISUAL The main character is a farmer. His old age, his rugged hands, the absence of machinery suggest this is a longstanding, small-sized farm and an artisanal production.



In major cities across Morocco, one sometimes sees wall-covering, outdoor billboards containing nothing but flamboyant pictures and catchy names of McDonalds’s hamburgers. These billboards zoom in on the product features, are designed to create mass awareness and to generate augmented footfall in their restaurants in the very short term. What’s in this nationwide ad campaign running over several months is a totally different game.

By populating its message with numbers, McDonald’s Morocco tries to demonstrate that it is no longer a mere outpost of a US brand confined to importing US products. They are re-introducing themselves as an authentic Moroccan company that deeply understands local consumers and only employs local talents. They also wish to be considered as a major player in the Moroccan economy as they source half of the ingredients from local suppliers.

This elaborated narrative not only has powerful numbers, it also has evocative verbs – to adapt to, to service, to commit, to strive. The intention is stress that the brand entered Morocco and established itself with humility.

The text would have been perfect had they 1/ used “partner with” instead of “work” [with local suppliers], 2/ been conservative with what can be defined as “raw materials” (last time I checked, ice cream, bread, packaging, confectionery did not qualify).

By presenting a visual loaded with symbols – the green field, the used hands, the generous smile – and using an emotional tagline, McDonalds wants also to convince that it is a socially responsible company. So the pitch turns into a call to feel for and acknowledge Moroccan farmers. As Moroccans have a very positive view of agriculture, they will hardly resist to respond to this call.

Here also, it would have been perfect had McDonald’s avoided misspelling “reconnaissance” (acknowledgment).

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Ultimately, McDonald’s Morocco is making a substantive, well-articulated case that will greatly resonate with the targeted audiences – corporate and institutional decision makers, influencers, stakeholders. In recent years these groups have gained greater confidence, have been more assertive about the stature, capabilities and prospects of the Moroccan economy at both the national and continental levels.

The advert will also resonate with well-off Moroccans who, as they became more empowered, more discerning consumers, expect brands to court them with sophisticated pitches.

Perhaps the whole advert would have been further incisive had McDonald’s Morocco gone beyond this past-present approach. Inspiring people, taking them to the next level, proposing a mission and a vision has proved to be a successful way to build a brand. For instance, Nike’s vision is to inspire the athlete in everyone, Unilever’s vision is to make sustainable living commonplace.

So what could be McDonalds’s vision vis-à-vis empowered audiences looking to a promising future?

Surprisingly, fruits, of which Morocco is a great producer, are left off the list of raw materials above. Therefore a step forward for the company could be to source 100% of the ingredients exclusively at national level and to use marketing to celebrate partnerships with vegetable and fruit growers, in addition to wheat and milk producers, and cheese makers. This is not only within reach, but it would also represent a decisive milestone in McDonalds’s quest for undisputable authenticity.



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Who’s Recruiting in Morocco: Mc Donald’s

Posted by Patrick Gaincko | March 18, 2016
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Every once in a while you get excited, dazzled by how a chef creates the magic live in an open kitchen at a restaurant whilst you are waiting to be served. In an era dominated by culinary prime time TV shows and highly publicized food safety scandals, transparency has become expected by customers. They say they have a positive perception of a restaurant when they see how the meal is being made. But if transparency is applied to other areas in the customer restaurant experience or in other types of businesses, what would be the impact on their perception? If customers watch how you process their order, how you design your store, how you recruit and manage staffs, does it matter?

In the second episode of the Customer Journey series that I have posted on linkedin, you learn how the perceptions that customers form from watching how a company works, like witness how McDonalds interviews future staffs in Marrakesh, plays out in their decision to buy a product or service.


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What’s a Luxury Retreat in Congo, Pointe Noire

Posted by Patrick Gaincko | February 22, 2016
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Oreo by Mondelez Morocco: The Interview

Posted by Patrick Gaincko | January 8, 2016
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In March 2015 Mondelez International invested $11 million to install the largest production line in Africa of Oreo, the world’s number one biscuit.

Mondelez International is one of the world’s largest snacks companies. It has annual revenues of around $35 billion, a presence in 165 countries, leading market positions in biscuits, chocolate, gum, and powdered beverages. Its portfolio includes billion dollar brands such as Oreo, LU, Tuc, Belvita and Chips Ahoy biscuits; Cadbury, Cadbury Dairy Milk, Milka and Toblerone chocolate; Trident gum; Jacobs coffee; and Tang powdered beverages.

I sat down with M. Aziz Benjelloun, Marketing Director of Mondelez Morocco & Algeria, for an interview in Casablanca. Mondelez Morocco has 39,1% share in the local biscuit market and 64,5% market share in gums.

We address a wide range of topics from production to distribution and uncover what Moroccan consumers can expect from the ¨Made in Morocco¨ Oreo.


Patrick Gaincko: For a start, perhaps would you like to introduce readers about Mondelēz International presence in Morocco.

Aziz Benjelloun: Mondelez Maroc, subsidiary of Mondelēz International is present in Morocco since 2001. It has two production sites dedicated to biscuits, employs about 2,000 people and produces many much-loved brands, such as Oreo, the number one biscuit in the world, Bimo brands, the number one biscuit in Morocco with Tonik, Tagger, Tango, Merendina, Golden, Okey. Mondelez Maroc leads the gum segment in Morocco with Trident, the leader in the sugar free segment and Clorets, the leader in sugared gums.

P.G.: Indian and Chinese consumers have seen Oreo cookies customized with local flavours. Will Moroccan consumers also see Oreo tailored to their tastes?

A.B.: As for Oreo launches, we are starting with our Oreo classic and we will be focusing on it over the first year. We will not hesitate in the future to pursue other possibilities according to the market and consumer needs. In fact, it is too early to tackle importing or producing other variants of Oreo; we need to assess the need of both the consumer and the market before any further launch.

P.G.: Can you elaborate on the targets in the launch stage?

A.B.: We are aiming at making Oreo, the number one biscuit in Morocco. To succeed that, we will be offering it in a range of attractive formats and at pricing that Moroccans can afford. Capitalizing on our large and well-developed distribution network, we intend to make Oreo widely accessible in traditional- and modern-trade stores and widely available to Morocco’s 34 million people. expand the local biscuits market by generating more business for our trade partners with the recommended consumer price of 2 MAD.

We will have the capacity to make as many as 900 million biscuits per year, with the big communication campaign in place, we believe that Moroccans will be tempted to taste Oreo. We are sure that they will love it as the rest of the world.

P.G.: At the price point of 2 MAD, consumers have ample choice between small brands, new brands, white labels, healthy snacks, etc. Beyond affordability, what else can consumers expect from Oreo?

A.B.: Our promise to the consumer is that we are making Oreo according to the highest Mondelēz International standards; that has brought so much joy to billions of people since coming to market more than hundred years ago. We expect, as it does around the globe, Oreo to trigger and magnify great family togetherness /bonding moments through its unique ritual experience coupled with a great tasting experience.

P.G.: Milk consumption in Morocco declined in 2014 and 2015, prompting Fimalait (Moroccan milk producers association) and the Ministry of Health to launch a nationwide campaign to promote milk. How do you adjust, given Oreo’s association with milk?

A.B.: We say Oreo is milk’s favorite biscuit companion. It is coming from a heritage campaign all over the world derived from the ritual of ‘Twist, Lick, Dunk’, which is part of the brand communication since many years. So milk and Oreo are very good friends.

P.G.: Moroccan consumers want to find snacks everywhere – from vendor carts in trains, grocery stores to souks, kiosks, supermarkets and malls.What can you tell us about your distribution?

A.B.: We have a large, structured distribution that covers the whole Kingdom with a presence in a very large portion of traditional and modern stores. Moreover, our portfolio, the expertise of our sales force, the scale of our partners will help drive Oreo distribution extensively in the market.

P.G.: What are the highlights of the marketing campaign?

A.B.: We have based our local campaign on the brand DNA linked to family togetherness moments enabled by the unique brand ritual ’Twist, Lick, Dunk’. This was very well appreciated by Moroccans and we had positive feedback on that.

We have been working to enhance our communication campaign: an example is the Oreo Guinness World Record attempt” we organized July 24th, attempting to beat the record realized in Mumbai in 2013. It was quite an achievement to have grouped 2482 people at the Morocco Mall in Casablanca to taste Oreo at the same time. This record is under study by the Guinness World Record which will come back to us with the exact number in the few coming weeks.

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P.G.: Brands entering or establishing themselves in the Moroccan food market center their campaigns around the health benefits of their products. How do you cater to the rising health conscious consumer?

A.Z.: In order to support our growth strategy, Mondelēz International has launched the Call for Well-being – a call-to-action for ourselves, our suppliers and our partners to work together to drive growth by developing new approaches that have a positive impact on the well-being of our planet.

Our Call for Well-being focuses on four areas of action that are critical to the world and where we, as a company, can make the greatest impact which are: Mindful snacking, Sustainability, Safety and Communities. 

P.G.: As their country is further industrializing, Moroccans expect a positive social change in their life. What are your social-oriented initiatives?

A.B.: We are a company that aims at giving back to the community, for that we have put in place a community involvement strategy of three years starting from 2014 with our local NGO L’Heure Joyeuse. The goal is to renovate canteens in rural schools across Morocco.

P.G.: How do you ensure that your local suppliers use sustainable agricultural or farming practices?

A.B.: We believe strongly that our suppliers need to comply with our quality standards if they want to do business with us; we are proud to have accompanied our local suppliers during eighteen months to be approved according toMondelez quality requirements

P.G.: With an expanded capacity now under your responsibility, you are in a position to supply neighboring countries: is the Algerian market supplied from Morocco?

A.B.: For the moment, Oreo production is made for Morocco. We will in the future be exploring other markets to export our product as we have the biggest biscuit production site in Africa.

P.G.: There are expectations that Mondelez EEMEA divisions will sustain and increase their share in the overall results. How do you see the future?

A.B.: BIMO is the number one biscuit in Morocco; and Mondelez Maroc is among the top 20 producers of biscuits within Mondelēz International. We would like to enhance our Oreo and our local BIMO brands and introduce other global brands into the Moroccan market.


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Trends | More Health Conscious Consumers, Casablanca

Posted by Patrick Gaincko | December 3, 2015
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