Tesco ventures into coffee shops and gets a roasting in Crouch End

Crouch End probably has more coffee shops than anywhere in London, if not Britain. There are over 30 places to get a real cup of coffee. In the last few years there has been an explosion of artisan coffee shops and almost all are thriving. So it is no surprise that Harris & Hoole, backed by Tesco, has opened their too.

With a population of just 12,000, that’s a lot of coffee, but then Crouch End has a unique profile. It’s not called ‘Nappy Valley’ for nothing – at 9.05, after the kids have been dropped off at school or nursery, mothers (now temporarily retired from their jobs – many ex media) take a break in the coffee shops and chat. Others open their laptops and start comparing their new ideas for small eco businesses. One café has even been nicknamed  the “Mumsnet Café”.

From one end of Crouch End to the other, coffee shops are packed and business keeps booming.

It’s a quirky fact that Crouch End has one of the highest proportions in London of people working in the creative and media industries. To those of us from adland who live there, that’s hardly surprising, you are more likely to run into a fellow media person in a Crouch End pub than a Soho one.

Each coffee shop has it’s own unique characteristic, from the award winning “London Lifestyle Awards 2012 Best Coffee Shop” Haberdashery, run by the charming Massimo to the quirky Coffee Circus. Crouch End even has it’s own Crouch End Roast at the My Kind of Coffee café.

The area is a lab for brands who want to see how the middles class, wealthy, Waitrose style, ethical consumer behaves. So it’s no surprise a Tesco supported venture, a chain of artisan coffee shops, has opened there.

Harris and Hoole is named after characters in Samuel Pepys’ diary who loved coffee and the branding and interior design is very stylish and apt for the area.

The chain positions itself as anything but Tesco’s and is being run by up-market City coffee chain Taylor Street (started y a New Zealander). According to the Guardian, H&H is 49% owned by Tesco’s.

£1 in every £8 spent on the high street now goes to Tesco, and their planned expansion into the lucrative coffee chain market is obviously designed to drive that number up. Of course they have tough competition form Costa, Nero and  Starbucks… well maybe not Starbucks as their recent tax avoidance scheme has damaged their brand reputation and resulted in people boycotting them.

But the problem Tesco faces is trying to pose as a small time artisan coffee shop taking on real local coffee shops. In Crouch End it has already resulted in quite a debate about the ethics of not being open enough about being essentially a Tesco sub brand.  Crouch End consumers are high on ethical values and want to support local ventures. They know that Starbucks and the Costa aren’t, but when brands enter the market in disguise, it creates brand trust issue.

Starbucks is often accused of putting local coffee shops out of business, but in their defense they do use local traders, pay decent wages, sell real Fairtrade coffee, support locals community projects and sell coffee at such a high price it allows others to undercut them and still make a decent margin.

As Harris and Hoole has just opened it will attract a lot of attention and locals will try it. But longer term, its survival may be more at the cost of Starbucks and Costa than the local shops if locals have their way.