Surfing the third wave of coffee

Learnings and opportunities after the 10-month strategic alliance between Innovation Foundries and illycaffè.

Standing on the shoulders of giants

When Carlotta and I founded Innovation Foundries in 2015, we shared the awareness that the next big thing for the Italian innovation should rely on its industrial heritage.

In October 2015, after two editions of the Italia Innovation Program and a clear idea on how the Italian big companies can leverage the strenght of their brands to start successful global and open innovation strategies, we had the chance to tread a 10-month innovation journey with illycaffè.

The Coffee-Hack: illycaffè to meet global innovators in the USA

In November 2015, in just 10 days, illycaffè met 90 students from top U.S. colleges and business schools and together designed new ideas to foster illy’s product innovation, brand and retail strategy.

With two main events staged in Silicon Valley at the Enjoy HQ (Ron Johnson’s newest start-up) and Harvard University, talents from Berkeley, Stanford, UCLA, Harvard, MIT and Wharton School of Business teamed up and worked for one day with the special mentorship of Giovanni Loser — illycaffè General Manager, Bill Burnett — Executive Director of the Stanford Design Program and Mitch Sinclair — IDEO Boston Design Director.

Before this opportunity, I have always been skeptical about the hackathon format: it seemed to me more a PR opportunity rather than a productive innovative experience. After the first two coffee-hacks, I discovered a great value in it for the Italian brands: staging sessions of global hackathons is a great way to gather entrepreneurial talents around a business challenge and to start a more user-centered approach to the business and product development.

I’m really happy that today two of the Coffee-Hack winners are hosted in the Trieste illy HQ to keep up this conversation.

From early adoption to continuous innovation

If we have always seen the opportunity for the young generations to partner with Italian brands to start innovating on their shoulders, why not using the same strategy when illycaffè is looking for digital innovation?

With this idea in mind, we explored several new digital and technological solutions for illycaffè, including the start of new business partnerships like the one that made illy the first Italian brand to adopt the Amazon Dash technology.

And so, this successful outcome led us to design a continuous open innovation strategy for illycaffè, defining methodologies and bigger goals for the innovation within the coffee industry.

Beyond quality: how design thinking can help Italian companies innovate

Masters in the craftsmanship and the product design, with design thinking Italian companies have a great opportunity to extend their creativity towards a user-centered business and product development.

In the last months, with the oustanding help of our friends from IDEO and the Stanford d.School, we introduced this methodology inside illycaffè discovering how this approach could be powerful if held by a brand globally recognized in the era of big data.

One of the most curious example of how the same Amazon Dash Technology is used to develop products and services that match the customers needs comes from Lavazza, that launched its own dash button last June, three months after illy.

As stated in a interview on Fast Company, Michele Abo — chief sales officer in North America for the coffee brand Lavazza “explains that grocery stores don’t share data on what the average customer is buying, how often they’re buying it, or what demographic the customer falls into. At best, manufacturers can get total sales numbers from grocery chains, and then rely on survey panels like Nielsen Spectra to try and understand the demographics. With the Dash Button, Lavazza is hoping to figure out what’s holding back online sales of its soft-pack ground coffee bags, which have sold well in grocery chains but haven’t taken off on Amazon. Part of that process could involve testing different pack sizes to see which ones get a better response” (full article can be read here).

Innovate or die: how creative talents and flourishing start-ups can support corporate disruptive innovation

The hackathons and the relationship with high-tech giants represent a valid starting point to open the corporate innovation strategies.
Then, the speed of nimble start-ups and the bravery of creative talents can help corporates in the implementation of a controlled disruption.

For this reasons, it has been natural to focus the final part of the alliance with illycaffè on two main goals: raise the interest in innovating the coffee industry within the global creative community (more than 160 applications have been collected from all over the World with the illy Foundry project) and connect it with the movement of coffee start-ups (on this, 2 years ago Fast Company published a complete report).

Beyond the brand: a new storytelling for the Made in Italy

Our latest analysis on the third wave of coffee made clear that new markets in the food industry are based on three pillars: rituals, education and sustainability.
Both the finest and youngest consumers are escaping from the mass product and are looking for unique product-related knowledge and experiences.

This dynamic is changing the way Italian companies should foster their quality reputation: extending their storytelling from the excellence of their productive process (craftsmanship) to the excellence in the sourcing (raw materials) and better involving the customer in the preparation and consumption experience (connoisseurship).

With its University of Coffee and its blending science, illycaffè is in the perfect spot to win this challenge. Good luck!