Why L’OR Espresso and Ferrari’s partnership is about borrowing prestige to appeal to the masses

espresso and ferrari
  • Ferrari recently announced a global partnership with l’OR Espresso, reflecting a brand borrowing trend among European heritage roasters
  • Lavazza and Cartier, Illy and Gucci, Nespresso and Baccarat, and Starbucks Reserve and Swarovski are all examples of commercial coffee roasters leveraging prestigious brands
  • While this might be “old-fashioned” marketing, it seems to work for the coffee industry’s premium classic brands and products

THE RECENT announcement of a partnership between Ferrari and l’OR Espresso, a brand under the JDE Peet’s umbrella, signals a broader trend of brand borrowing among European heritage roasters. 

As the market pushes for differentiation, they seek to leverage iconic, luxury brands to bolster their image.

At first glance, the marriage of Ferrari’s legendary racing pedigree with l’OR Espresso’s more commercial coffee heritage may seem like an unlikely pairing. Yet in an increasingly competitive coffee market, characterised by commoditisation and price wars, commercial roasters are under pressure to differentiate themselves and command premium prices. 

Large commercial and premium roasters in Europe and abroad are seeking to stand out in an increasingly crowded and competitive market. Some, like l’OR Espresso, tap into the prestige of luxury names.

Lavazza and Cartier, Illy and Gucci, Nespresso and Baccarat, and Starbucks Reserve and Swarovski are all examples of commercial coffee roasters leveraging high-end household names. And for luxury brands grappling with changing consumer preferences and evolving market dynamics, partnerships with coffee brands offer a gateway to new demographics and untapped markets.

Other roasters tap into cultural prestige. Consider Lavazza’s acquisition of Carte Noire. By marrying Lavazza’s Italian craftsmanship with Carte Noire’s French sophistication, the acquisition aimed to exert a powerful influence over European coffee consuming markets.

This is not a new trend by any stretch – it’s been a historical marketing strategy for big roasters. “I remember Segafredo sponsoring Toleman, McLaren and Williams racing teams since the early eighties,” says Maurizio Giuli, Chief Strategy Officer at Simonelli Group

“This new partnership is pretty much aligned with what large roaster brands have always been doing in terms of sponsorship.”

An “international perception of sophistication” 

By aligning themselves with culturally resonant brands like Ferrari, the big European heritage roasters seek to elevate their image and appeal to consumers’ desires for status, exclusivity, and sophistication. 

They want to tap into the aspirational lifestyle and storytelling associated with brands that share similar values or heritage. These partnerships can also help commercial coffee roasters stand out in a crowded market without needing to invest in quality or innovation. 

“For big Italian roasters, the ways to grow in international markets are quite limited,” says Professor Jonathan Morris, Director of Research Culture and Environment at the University of Hertfordshire and Research Professor in Modern European History. “So a prestige collaboration based on an international perception of sophistication might be the best way to make inroads.”

Brand borrowing gives a sense of luxury to these heritage brands, but one that is recognised on a mass market basis rather than at the top end of the third wave. 

By enhancing the perceived value of their products, they can command higher prices and margins. Consumers may be willing to pay a premium for products associated with prestigious luxury brands, leading to increased profitability and revenue. 

Relying on their European heritage is something else these brands can leverage to their advantage, appealing to consumers’ cultural preferences.

“They’ve (l’OR Espresso) got themselves a relationship with a prestige brand (Ferrari) that projects Italian-ness,” says Jonathan. “This adds a premium for the sense of prestige, as well as an association with Italian heritage.”

These partnerships don’t necessarily make that much sense on paper. They’re more about impressing consumers and channelling an image and a lifestyle than about direct sales. 

“It’s a visual partnership rather than a sales one,” says Jonathan. 

Why change a classic?

Higher end third wave coffee brands position themselves on the market with exceptional coffees, innovative processing or disruptive methods of distribution. 

For major established coffee multinationals operating in Europe like Illy, Lavazza, Nespresso and JDE Peet’s that focus on espresso, options are limited. Over the years, they have switched their focus from soluble and ground coffee to capsules and ready-to-drink (RTD), but little else has changed. 

“While the product of choice has changed, the brand strategy remains the same,” says Maurizio.

Rather than trying to capture niche specialty coffee markets, instead they’re focusing on being classic and iconic through more traditional marketing moves.  

“Because they can’t access higher end markets in a meaningful way, they market around heritage in the hope that they can tap into market groups that will see this as traditional or find value in having a large Italian brand,” says Jonathan.

Traditional strategies like luxury brand borrowing and celebrity association are their marketing tools of choice – think George Clooney sipping on Nespresso. While these might be “old-fashioned” methods, they are tried and tested and no less valid than touting a 90 point micro lot for top end marketing. They just reach a different demographic, but no less successfully.

It seems that heritage brands have identified the bigger markets as most profitable, and don’t really care about catering to the third wave. They are going after the “mass premium” segment with fundamentally different messaging and a traditionalist approach to marketing a luxury good.

While it’s nothing groundbreaking, it seems to work, so they see no need to reinvent the wheel. Based on the consistent partnerships between luxury brands and commercial coffee roasters over the years, it’s likely that partnerships like this will continue. 

Coffee Intelligence

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