Renewabrew
Overview
Renewabrew is an e-Commerce brand developed for my digital business course at the University of Sydney. Aiming to reduce the coffee waste that goes into landfill in Australia, Renewabrew collects coffee ground waste directly from Australian cafés and manufacture the waste into reusable coffee cups.
My Role
Solo project
Timeline
April - May 2023
Achievements
Highest mark in cohort! 🕺
Problem Overview
Australians consume around 6.2 billion coffees a year in total (Macdonald, 2019). However, this intense consumption comes with great wastage, with 75,000 tonnes of coffee grounds ending up in landfill yearly (Donut Waste, 2023), emitting methane, a greenhouse gas 25 times more potent than carbon dioxide.
Mission and value proposition
Renewabrew is a sustainable e-Commerce brand aiming to reduce the coffee waste that goes into landfill in Australia, by collecting coffee ground waste directly from Australian cafés and manufacturing this waste into reusable coffee cups. Through the circular economy model, our brand presents an innovative solution to a critical Australian environmental challenge.
Product description
Renewabrew’s reusable coffee mug comes in three different sizes to suit any coffee drinker’s preferences, with a leak-proof lid perfect for on-the-go. The unconventional manufacturing using coffee grounds as the primary material reflects our environmental aim with a coffee-coloured exterior - making it immediately identifiable. The cup can also be customised with a name engraving, making it a perfect gift.
Brewards, an app that functions as Renewabrew's loyalty program is used by customers to claim points by scanning the app’s barcode each time they purchase coffee with our cup at selected cafes. The points can be used to make purchases on our site and redeem exclusive discounts. Overall, our eCommerce site and Brewards app both serve as core elements of our business.
Main customer target demographic
These generations are known as ‘digital natives’, young individuals who grew up in the presence of digital technology (Wang et al., 2013). They are technology-savvy and have a high level of digital fluency (Filho et al., 2021) and are typically most concerned about their carbon footprint, compared to other generations (Statista, 2023).
Persona development
The target customer can be represented through the three personas below.
Common frustrations
From research and persona development, three common frustrations were found.
Addressing the frustrations
Renewabrew’s service would solve such frustrations, by providing a rewards point every time they use Renewabrew’s cup at a café. As points can be spent on purchasing other sustainable products, our offering helps reduce the burden of the cost of sustainable products and the cost-inefficiency of purchasing coffee everyday.
Moreover, Renewabrew promotes a more sustainable lifestyle to customers than competitors; Renewabrew is sustainable not only because it produces reusable products, but also because the manufacturing process reduces landfill.
Porter's 5 forces
I employed Porter’s 5 Forces model to identify the potential threats and opportunities in the growing sustainable keep-cup market.
PESTLE ANALYSIS
I conducted a PESTLE analysis to provide a comprehensive understanding of the macro environment.
Strategic Choice
According to Porter’s Strategic Framework, I chose Narrow Differentiation. This strategy provides us with a niche focus to a tight-knit market that can enable greater focus on service and specialisation. Cost advantages were not enough to differentiate from our competitors as switching costs are low, hence by targeting our customers with our unique brand mission in the circular economy, we are more likely to retain a more stable customer base.
Selected revenue model
Renewabrew will adopt the advertising model, earning revenue by selling products online and monetising ad spaces on the website and app. Products will be sold at premium prices relative to non-eco-friendly coffee cup producers but at competitive prices compared to our competitors, Huskee and Frank Green. Furthermore, selling ad spaces exclusively to our partnered suppliers is another source of revenue.
Expected revenue and expenses
Renewabrew projects a loss in the first year as the costs - predominantly manufacturing and marketing - of entering the high-barrier market will limit revenue. The first year's income is approximately AUD $600,000, generated mainly from selling Renewabrew cups at premium prices of $26 and $38 for the small and large sizes, respectively.
As Australians' estimated annual usage of 1.84 billion single-use cups presents a market opportunity (Clean up organisation, n.d.), Renewabrew predicts cup sales of roughly 15,000 in the year. Acknowledging Facebook's dominant market share and average pay-per-click revenue of $1.70 (Schenk, 2022),
Renewabrew is incomparable and has estimated to earn $1.2 per click on ads in our growth phase. Regarding expenses, we expect a cost of around $1 million, deriving from the first-year expenses Huskee incurred, which was $100,000 monthly. Unlike Huskee, Renewabrew will manufacture locally to omit logistics and travel expenses, rendering lower expenses than Huskee's (Qantas, 2022).
Renewabrew forecasts to reach a break-even point in its second year. Renewabrew's intensive marketing strategies to increase sales and market share will allow us to achieve economies of scale and increase barriers to entry, solidifying our position.
Business Strategy
Acquisition
Conversion
Retention
What makes Renewabrew Special?
What did I learn through this project?
Thank you for reading!
