Tesco gives CaféPod a shot in the arm

The arrangement with Tesco was the result of a two-year process after the grocer approached CaféPod at the 2013 London Coffee Festival.

“Tesco recognised that we were the first coffee capsule brand to the UK multiples market. At the time we were the only brand listed at Waitrose, and so the leader in our field,” said Grainger.

“In addition to the 600 Tesco superstores we are listed in, we identified an additional 100 Tesco Express stores in London and the surrounding areas, targeting affluent shoppers who own Nespresso machines with impactful display stands, which ensures continued exposure across all Tesco formats.”

The pair, formerly of fund manager GLG Partners, judged that the consumer appetite for espressos, lattes and cappuccinos in the home could accommodate another player in the UK capsule market and are now looking overseas.

CaféPod has its eye on expansion into Europe and beyond, with current exports to the UAE, Hong Kong and Thailand as well as Scandinavia and Ireland.

Over the past year, the total value of the hot beverage market has risen 2.93pc to £1.93bn with total coffee sales up 2.38pc to £1billion. Sales of pod coffee rose by a staggering 51.9pc.

The team, which includes marketer Kate Peers who helped launch Starbucks in the UK, is planning the release of two new premium Origin Inspired coffees — the Colombia Huila and the Sumatra Lake Tawar single origin varieties.

Sampling is the small company’s main marketing tool, said Despite its rival status for the market, as Nestlé’s Nespresso machine sales rise, so too do those of CaféPod. During a pop-up breakfast event in Manhattan this February, the giant beverage conglomerate unveiled its latest extension, the VertuoLine system — new machines which are expanding Nestlé’s capabilities into the large-cup coffee market.

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