Coffee consumption, especially in-home, has surged during the pandemic in almost every market.
Pod coffee capsules, once the reserve of First Class and celebrities have become mainstream. In the large European markets and Australia up to 30% of households have a machine. The global pod coffee market is worth over $8bn and predicted to exceed $14bn by 2027.
Cleverly, Caffitaly has ridden piggy-back on Nespresso’s success; and hasn’t invested heavily in machines nor building customer club databases.
The product is good and there’s a decent range of varieties.
Positioning wise, who doesn’t believe the Italians make good coffee?
Caffitaly is private equity owned. Alpha Group, a French firm specialising in leveraged buyouts, acquired a controlling stake in 2017. Given the 5-8 year horizon PE tends to work on, and the favourable market dynamics, a trade sale has to be on the cards.
So it’s no surprise Caffitaly has launched a major new ad campaign. Ostensibly the target is Italian coffee lovers but I suspect the investors are hoping other corporates take note too.
“It’s not coffee. It’s Caffitaly,” (Non è caffè. È Caffitaly) campaign kicks off this spring.
Over 80% of Caffitaly’s $150m turnover is International and there’s a new CEO. Giuseppe Caserato is an ex-PG veteran who has worked in a clutch of markets.
Certainly here in Asia-Pacific there is mountains of growth upside. I can think of several businesses who’d love to learn more about ‘it’s not coffee, it’s Caffitaly.’