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Mystic Monk Coffee Case Study | Mystic Monk Coffee and Tea

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Mystic Monk Coffee

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Background of the company 

The Carmelite Monks have become synonymous with roasting and selling gourmet coffee, under the brand name Mystic Monk Coffee. The brand of coffee has won numerous awards from a variety of coffee reviewers and has gained traction in the market due to its quality and freshness. The story of Mystic Monk Coffee is centered in a mountain valley in Wyoming, where a small group of monks was seeking ways to support their growing community and to afford the maintenance and operations of their monastery (Mystic Monk Coffee, 2018). 

In fact, Mystic Monk Coffee was initially established for the specific goal of funding and maintenance of the Carmelite Monk’s monastery located in the mountains of Wyoming. The monks settled on roasting coffee and selling the coffee beans online. The first samples of the Mystic Monk Coffee were roasted in the monastery kitchen over a cast-iron skillet in 2007. It is on this day that Mystic Monk Coffee was born (Mystic Monk Coffee, 2018). 

Since these humble beginnings, Mystic Monk Coffee has enjoyed greater demand for its product as more and more people have taken to its brand. This has resulted in more of their customers becoming regular drinkers (Mystic Monk Coffee, 2018). Approximately 85% of orders for Mystic Monk Coffee come from repeat customers, which has largely been driven by their superior quality and their positive and high reviews from CoffeeReview.com. To date, Mystic Monks Coffee has 25 of their gourmet coffee ranked 90 points or above. The company has quickly expanded to offering more than bagged coffee, offering a variety of products including single service Monk-Shots, premium Mystica teas, and more. 

Issues/problems being analyzed 

The main issue under investigation is whether the strategy adopted by Father Prior for the Mystic Monk Coffee is sufficient to meet his vision. Accordingly, Father Prior Daniel Mary has a mission to convert small brotherhoods comprised of 13 monks in a makeshift structure, into a monastery sitting on 500 acres that would be able to house 30 monks, but this would require substantial financial resources to the tune of $8.9 million. Father Prior hopes to achieve his vision through profits derived from the Mystic Monk Coffee brand, which earned approximately $75,000 in its first year of operation (McGraw Hill Education, 2014).

Accordingly, one of the main components under investigation is the strategic use of focused differentiation adopted by the company in order to gain a competitive advantage in the coffee industry. While primarily founded to raise funds for ambitious new monastery facilities, the case study offers valuable insight into how a small group of 13 Carmelite monks was able to raise over 57 million from the sales of the Mystic Monk Coffee brand. In order to fully appreciate the effectiveness of the strategy adopted by Mystic Monk Coffee, it is important to first assess the humble beginnings of Mystic Monk Coffee. 

In the beginning, 13 Carmelite monks lived near the Rocky Mountains in Wyoming. The monks lived in a very small house where they ardently pursued their religious life, which is anchored on dedicating one’s life to silence, a life of prayer, and worship. The Carmelite Monks are also guided by vows of poverty, obedience, and chastity. The community was transformed by a sudden influx of young men in the hundred who expressed their interest in joining the community. Father Daniel Mary observed that these large numbers would necessitate a much larger location (OSV, 2011).  Father Daniel Mary required a property that would accommodate a monastery, and following a period of searching, he found a 496-acre ranch which was valued at $8.9 million. 

The Carmelite Monks had a donation amounting to a quarter of a million which could be diverted towards purchasing a property. Additionally, from roasting coffee for one year, they had been able to raise up to $75,000 (OSV, 2011). Given the current sales figures, the Carmelite Monks are on course to raising enough funds for their monastery. The major business question that comes into how the small group of Carmelite monks was able to grow such a notable Coffee brand. This has become a critical topic of debate in business circles. Accordingly, below is a review of the areas of strengths that propelled the growth of the Mystic Monk Coffee brand. 

Analysis 

Overview of the Coffee Industry

The number of coffee consumers in the United States is estimated at around 150 million coffee consumers in the United States alone. The majority of these – 89%, brew their coffee at home as opposed to buying the coffee ready-made in coffee shops (Turnipseed, 2010). This notwithstanding, coffee is still the preferred beverage (hot) in the US, with the average amount of money spend per week on coffee being $21 (Mordor Intelligence, 2017).  Furthermore, there is supporting data that notes that on average, between 21 and 26% of coffee drinkers drink more than two cups of coffee per day, with consumption rates in the United States expected to grow even further. 

Coffee is especially a dominant player in the non-alcoholic drink segments in the United States, which has become very competitive and dynamic (Mordor intelligence, 2017). However, Coffee is ranked third, as health and wellness products, coupled with flavored drinks, are dominating the demand for nonalcoholic drinks in the United States. Accordingly, coffee is ranked 3rd after carbonates and bottled water, in the list of the dominant nonalcoholic products in this segment.  In fact, according to Mordor Intelligence (2017) data, coffee held a market share of 38% in the non-alcoholic drinks segment in 2017, and that over 80% of American adults consume coffee.

 

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