Fast food, soup, bagels and tea. They’ve all tried to steal the limelight in recent years as UK taste buds become more receptive to alternative flavours. But now the time-honoured classic – the sandwich – is making a bid to seize the day and fight off competition from a multitude of pretenders to its crown.
In a market increasingly dominated, particularly in London, by Pret A Manger, Costa – until now a coffee shop chain serving a few sandwiches – is aiming to challenge Pret’s monopoly.
Arthur Collin Architect and Mother creative consultancy have both been appointed to work on the new Costa concept. ACA is creating interiors, while advertising and design group Mother is developing the branding and graphic material. ACA has worked widely in both the coffee and sandwich sectors in the past, designing all 67 stores for Seattle Coffee Company and currently rolling out stores for Ixxy’s Bagels.
“It’s an extremely competitive marketplace,” says Costa marketing director Laurie Morgan, who adds that the new format will be a purely take-away proposition, unlike the chain’s existing offer, which provides both take-away and eat-in areas. “At the moment sandwiches are okay, but they’re certainly not gold standard and it would be egotistical to suggest there is only room for one brand.”
She says the chain’s Italian positioning in the marketplace will be developed through the new concept, which will carry the Costa name in the title. A new Italian range of sandwiches is currently being trialed in Costa’s existing coffee shops and will be fully introduced later this month. The range will be developed further when the first sandwich bar opens later this year.
“The pilot site will be in the City, but ultimately the concept has the legs to go global,” says Morgan confidently. “What ACA does is different and it is very strong at branding.”
Though there are no figures available for an exact amount of planned sandwich outlets, any roll out is likely to be fast, in line with Costa’s current policy of opening two shops a week. “We may convert existing sites into sandwich stores, as you take a piece of property and put the best concept into it,” adds Morgan.
A Pret A Manger spokeswoman welcomes the competition provided by Costa’s future sandwich bar concept, but says Pret will not be changing its own strategy, having built up a loyal customer base over a long period. “There is a danger of losing focus if companies diversify into too many areas,” she claims.
“It’s great to have competition and it’s good that Costa has entered into the sandwich market. But at the end of the day, coffee is still Costa’s prime business and ours is sandwiches. We all do different offerings. We are a sandwich business and that’s what we have built the business on, although we sell a limited range of coffee and we are happy with the coffee offering that we’ve got.”
Such is the success of Pret in the UK, it recently added to its 102 domestic sites with the launch of a first foreign shop, in Manhattan. “New York was a bit of a risk but we’ve been very pleasantly surprised,” says the company spokeswoman. “We know it will be a success over there and we want to open more outlets there in the future. They have the same menu and we are going to concentrate on building New York up and running it,” she adds.
Adrian Kilby, managing and creative director of The Formation, which has worked with Pret for the past eight years, believes Costa’s new brand will be a direct competitor to Pret, since it is producing sandwiches on site, just as Pret has always done. But he warns that any new offer in this market will need to be meticulous in its planning.
“Pret’s main advantage is that its food is fresh and it can monitor exactly what it is selling in each shop, patrol stock easily and respond to changes each day,” explains Kilby.
“The information Costa has got will be incredibly useful as the edges are getting increasingly blurred between sandwiches and coffee bars,” he adds, citing the expanding offers of both dedicated sandwich and coffee chains.
“It’s worth remembering that many people will buy their sandwiches from Pret and their coffee elsewhere because it has now become easier for customers to cherry pick what they eat and drink,” he adds.
Kilby points out that “consumers are innately suspicious”, with some being cynical about the bandwagon effect of operators going into a sector on the tailcoat of others’ success. He says the success of Costa’s new venture will depend on how it is marketed and how honest customers perceive Costa to be.
But Costa’s Morgan is optimistic that consumers will be receptive to her company moving more strongly into the sandwich market and does not think it will need to change people’s mindsets “when you see we have great coffee and great sandwiches”.
Though there is currently a resurgence in the sandwich market, Kilby thinks the variation in the choice of sandwiches, which is not available in the coffee market, has meant the sector has not yet reached saturation point – unlike the coffee market – which has reached a point where there is a coffee shop on every street corner, particularly in the capital.
“Sandwiches seem to have out-survived them all. Bagels never caught on in the same way as sandwiches and tea never caught on in the same way as coffee,” says Kilby. “Coffee has a limited range as they are all the variations of a theme, whereas a salmon sandwich on rye is completely different to a BLT on white bread. There is much greater scope and potential to expand.”
“There is still room for more players, but they need to be sure and careful and maintain consistency of the product, because they are not being innovative. Therefore they will be judged by the best players in the market. Ultimately, it’s down to the quality of the customer’s experience. It has to be about what is being offered in terms of added value, such as ambience, as well as food,” adds Kilby.