Blue Bottle’s Lucy Dana on Using Data to Drive Digital Innovation and Connect More People to Coffee

Like the majority of Americans, you probably started the day with a cup of coffee at home or your local coffee shop.

Coffee is big business in the U.S.— and abroad— as more people choose to get their caffeine fix from the beverage than ever before. So it may come as no surprise that the market size of the United States coffee shop industry reached $47.5 billion in 2019.

What may surprise you is the increasing role that data analytics plays in the global expansion of the coffee shop industry. As more retail coffee companies take an omnichannel approach to attract and retain customers, data—and analytics—help drive essential business decisions across retail locations, websites, and apps.

Oakland-based Blue Bottle Coffee has made some significant investments in data analytics over the last two years. And the results are paying off. Blue Bottle has expanded its retail and online footprint worldwide—and analytics have helped inform some of its most important business decisions along the way.

I recently had the chance to sit down with Lucy Dana, Blue Bottle’s Product Manager of Growth, to hear more about this rapid expansion, and the role data has played in the process. Not only has Blue Bottle started collecting and analyzing its data at a fast clip, but it has also successfully democratized data access across the organization’s headquarters, cafe leaders, and coffee buyers with the help of Sigma.

PROFILE

Blue Bottle Coffee

Blue Bottle Coffee was founded in Oakland, California, in 2002 with a simple, yet revolutionary idea: serve delicious coffee, roasted fresh and brewed to order, sourced from the finest, most sustainable coffee farms. Today, Blue Bottle is a global network of cafes in the U.S. and Asia with more than 1,300 employees.

FOUNDER: James Freeman

FOUNDED IN: 2002

What should everyone know about Blue Bottle Coffee?

Blue Bottle Coffee was founded in Oakland, California in 2002 with a simple yet revolutionary idea: serve delicious, fresh-roasted coffee brewed to order and sourced from the finest, most sustainable coffee farms. Our belief is simple, and our goals are unchanged. We want to connect the world to delicious coffee because coffee makes life more beautiful.

Today, Blue Bottle is a global network of cafes in the U.S. and Asia. We are the leader in specialty coffee, driven by our obsession for quality and our commitment to environmental health.

We want to connect the world to delicious coffee because coffee makes life more beautiful.

Lucy Dana Product Manager, Growth at Blue Bottle Coffee

Can you share a bit about your work at Blue Bottle Coffee?

I work on the digital team, which is responsible for two main things. First and foremost, we help our daily operations run smoothly. We have a variety of internal tools that our cafe teams and our production teams use every day. We also use digital innovation to connect more people to Blue Bottle Coffee. Beyond our retail locations, we have an eCommerce website where you can get coffee shipped to your house—and we just launched our mobile app to help speed up the cafe process.

What’s it like being a product manager at Blue Bottle?

It’s a fun and unique time to be at Blue Bottle. As we top 80 cafes globally, we’re at an inflection point. We are now outgrowing many manual systems that worked when Blue Bottle only had a handful of cafes in the San Francisco Bay Area, and turning to more sustainable data-driven solutions which I get to help shape.

The entrepreneurial spirit at Blue Bottle also inspires me. One week, I am optimizing shipping for our e-commerce guests, and the next day I’m improving the cafes’ ordering of croissants.

When people think of data analytics, coffee may not be the first industry that comes to mind. How do you use data analytics to solve challenges at Blue Bottle Coffee?

Our data is unique! We’re not just a retail company—we collect omnichannel data every day across our cafes, our web-store, and our mobile app. The fun comes when we tie these data points together to make decisions.

Here’s a recent example: the percentage of our espresso drinks prepared with whole milk has decreased over the last two years as oat and almond milk have increased in popularity. We’ve used these trends to shape our consumer packaged goods (CPG) strategy for new products. Hint: Look out for New Orleans-style Oat Milk Iced Coffee coming soon!

How are you using Sigma to improve data analytics at Blue Bottle?

We’ve invested significant engineering effort into building new data sets in our data warehouse the last two years. Having the data exist is a great first step, but getting people to use it was our latest challenge.

We brought on Sigma to help democratize data across our headquarters. My goal was to enable anyone—from our VPs to our green coffee buyers—to pull data and make informed decisions without having to be a SQL guru or ping our Business Ops team.

Sustainability is a big part of Blue Bottle’s mission. How are you using analytics to help Blue Bottle meet its sustainability goals?

As I mentioned, we’ve outgrown a lot of the manual systems that we once relied on. In our early years, an extra croissant here or there didn’t lead to much waste. But with 70+ cafes across the U.S. alone, an extra croissant at each cafe can add up quickly!

Our cafe leaders were spending hours each week struggling with this manual ordering process. They were trying to look at their historical sales numbers, guessing what their demand would be, and then placing pastry orders on that information. We’re now using data analytics and machine learning to help reduce food waste. We recently partnered with a machine learning consultancy to help us build an algorithm to predict our culinary demand. They were able to look at past sales, future demand, weather, and holidays to predict how many pastries each cafe should order.

We rolled this out to our cafes in July, and now we use Sigma to measure the delta between the orders and our model predictions. We then work with specific cafes to coach them further and reduce the waste gap. So far, the results have been exciting. We have increased our order accuracy by 8% since July.

8% The increase in pastry order accuracy since deploying Sigma.

How has Sigma made an impact on your work?

Sigma has proved to be priceless in helping us make more informed decisions and empowering all employees to think like analysts.

One of my favorite decisions we’ve used Sigma to inform over the last few months is our retail real estate strategy. It stemmed from a simple question, “where should our next cafe open?” Using the map chart feature in Sigma, we charted the zip codes of our subscribers who live outside of our core markets—these are our most loyal guests who get coffee shipped to their house each week. This analysis helped inform our next real estate investments as we try to bring Blue Bottle to new markets and connect our coffee to as many people as possible.

Sigma has proved to be priceless in helping us make more informed decisions and empowering all employees to think like analysts.

Lucy Dana Product Manager, Growth at Blue Bottle Coffee

I know you want to make data accessible to everyone at Blue Bottle. Do you have any future ideas on how to further increase data literacy at Blue Bottle?

Data is increasingly part of everything we do at Blue Bottle. I’d love to make Sigma training something all employees go through when they’re onboarded. The first day they learn to taste the differences between our coffee blends. And then, on day two, they would learn how to group and filter a worksheet in Sigma.

When you aren’t crunching data and building products at Blue Bottle, what do you do for fun?

I love board games. My friends and I recently started a Mahjong club, actually. We get together every other week to play the tile-based game. I am making my grandma proud!

I also like to play tennis and cook at home. I am currently making my way through Alison Roman’s new cookbook, “Nothing Fancy”.

So, I have to ask: drip coffee or espresso?

I am more of a cappuccino fan, myself.

ABOUT

Lucy Dana

Lucy Dana is a Product Manager at Blue Bottle Coffee in Oakland, California. She uses data analytics and digital innovation to expand Blue Bottle’s global footprint, connecting people around the world to delicious coffee.

HOBBIES

Board games, Tennis, and Cooking

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