Costa Teams With GEP on Digital Transformation
As of February 2024, Costa Coffee is the largest coffee shop in the UK, with over 2,700 establishments across Ireland and the UK – along with 1,300 plus across the globe. Founded in 1971, Costa is also the second largest coffeehouse chain in the world.
The coffee giants have gone live with GEP, a leading provider of AI-driven procurement and supply chain software, services and strategy to Fortune 500 and Global 2000 enterprises worldwide, announcing the businesses have successfully gone live on GEP SOFTWARE, the industry's premier procurement platform.
Present in 50 countries, Costa, as part of its digital transformation, picked GEP Software in 2023 to transform and automate its procurement process for all its direct and indirect spend globally.
Last year, Procurement Magazine reported that Costa had linked with GEP to transform indirect procurement. Forming as part of a digital transformation plan, the coffee shop chain is elevating its supporting functions, which includes procurement.
The team at Costa is responsible for buying everything the company needs, ranging from the beans to make its coffee, chemicals used to flavour and all the way through to the IT system used to power its business.
Forming part of the digital transformation, Costa is using GEP and its software to transform and automate its source-to-contract procurement process for all indirect spend, encompassing sourcing, contract and supplier risk management.
Xavier Martinez, Chief Supply Chain Officer at Costa Coffee, adds: "Going live on GEP's procurement software is a key step in our strategic digital transformation to deliver greater efficiency, value and growth to our shareholders and customers."
Costa's continuing digital transformation
At the heart of Costa's continuing digital transformation is MACH ambassador, Gordon Lucas, the company's former Global Digital Technology Director. Formerly of Whitbread, a leading hospitality business which owns Premier Inn, the UK's biggest hotel brand.
Whitbread also owned Costa Coffee, before in 2019 selling it to The Coca-Cola Company, which brought Gordon to this role. As Global Digital Technology Director, he works closely with the Coca Cola team on behalf of Costa to scale digital and loyalty for the brand across the globe.
Along with the transformation, one was the Costa Club, the loyalty programme, which is one of the largest non-grocery loyalty programs in the UK with millions of members. With its perks from free sweet treats, to cake on your birthday, Costa Club has created hype around it and leap to this popularity.
Speaking to MACH Alliance, Gordon said: "Working on the mobile app at Costa has been one of the most rewarding elements of my work. Coffee is something you look forward to everyday. It's habitual. It's personal. People open that app and expect a smooth experience. We're relevant and on people's minds when they think about their daily pick-me-up, and that means a lot to us. Delivering a good experience for them every time is critical."
Changing with the times
Gordon's interview with MACH Alliance was published in February 2024. There he explained how moving away from its legacy foundation and now keeping up with the speed and cost of change was a challenge. But this was viewed as short-term pain to long-term gain.
"Some of our big legacy systems are outsourced to partners, and they're enterprise platforms that we've purchased, so we don't have control over the roadmap," added Gordon.
"We have influence but not control. You're always waiting for the next thing.
"For example, in Costa, we have a data warehouse with a ton of information including retail transactions from across our stores and Costa Express machines (which are our self-serve machines using the same coffee beans as Costa's retail stores and fresh milk) plus data from our app and loyalty suite.
"With it, we can make models and infer things about a consumer that might make their experience or communications more relevant, but it's difficult to access some of that data in the legacy marketing systems we used previously. That was a consideration in our decision to begin to transition more to MACH solutions that have allowed us to access and share data more freely and act on it to drive more relevant engagement."
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