The Hagen Project wants to do coffee differently: it has no menus on the walls, no customer facing fridges or retail products, and often no seating.
Sometimes it is “the coffee machine and nothing else”, founder Tim Schroeder said. “You want to sell an experience, you want to sell an emotion, you want to sell a sense of occasion… the only thing we’re focused on is delivering a good cup of coffee.”
“When you look at the High Street, everyone… wants to sell more and more and more”. Hagen is a success because “people feel it’s real”, Shroeder added, before joking that they’ve managed to create an uncommercial commercial brand.
From other chains this would be a bunch of platitudes, but you get the impression Schroeder is telling the truth. Raised in Denmark, where coffee was “always around”, he created Hagen after fifteen years in finance. He describes it as his “passion project”.
Five to ten years ago, it was “impossible to get anything else but Starbucks”, Schroeder said, adding that he “didn’t have a lot of great coffee experiences” in London (now, of course, the scene is a little different).
Denmark ranks in the top 10 countries for coffee consumption globally – each person goes through around 7kg of coffee every year, about three cups a day. It’s also a culture which strongly values quality and community, in the form of Hygge.
“Hygge in Denmark is not a fireplace, hygge is not a cosy blanket, hygge is [conversation], it’s that when I see my sister later this week, we’ll see each other and talk,” Schroeder said. “We design [Hagen] first and foremost for the interaction.”
Hagen’s focus on hygge has – somewhat incidentally, according to Schroeder – managed to appeal to some of the key trends driving modern customer behaviour like community, quality and authenticity.
The lack of seating or commercial decor, as well as a minimalist focus on quality coffee, has brought in customers from across the city. At the start of last year, it had just eight sites – now it has 13.
“[We’re] anchored in that Danish approach of let’s be a little bit less commercial and more focused on storytelling and quality,” Schroeder said.
Putting a price on a cup of coffee
In coffee, it’s a fine line between prioritising the consumer’s wallet and maintaining a price point which suggests premium.
“[Coffee] is one of the highest margins products to sell other than Class A drugs… that elevated margin is mainly driven from an investor base or a capital market investor,” Schroder said.
“It’s one of the highest margin products to sell other than Class A drugs,” he added. If you can sell a premium product without an elevated price anchor, “then you’re delivering real quality”.
Hagen prices coffee at around £3.50 – just about inbetween Greggs and Starbucks. Having been able to resist price rises for a while during the tough pandemic years due to low overheads and a focus on tech, Hagen “had to reflect [inflation] a little bit… everything got very expensive”, Shroder said.
“But we’re still trying to say, can we hold it off a little bit? I don’t want coffees to be the first thing people drop if we’re in a recession,” he added.
It’s likely the average coffee will only get more pricier. Wage and rent rises will push up producers’ costs, which will naturally be handed down to the consumer. Schroeder suggested the UK coffee market will follow the path of high-wage economies in Scandinavia, where coffee has reached £5-6.
Hagen x Earnt
Hagen have partnered with the social platform Earnt, which works to connect brands with causes and consumers.
The partnership has seen Hagen customers volunteer at local London schools in exchange for a month of free coffee (and free coffee for the person behind in the queue when you use your Earnt cup, too).
“We knew that it was going to have to be a brave partner to give away [so much] coffee,” Earnt founder Lauren Scott-Harris said.
The last volunteer programme Earnt and Hagen launched, with room for around 50 people, sold out in two minutes.
Many schools are severely struggling with cost pressures, Scott-Harris added, making pitching the idea to headteachers “the most wonderful thing to be able to say”.
“When you can go to them and say: not only are we going to bring this army of volunteers, but it booked out in two minutes… [it’s] really cheering”, she added. “We threw around what the concepts would be, but the schools were just such a tangible and easy way for people to help and their community.”
Consumers now want brands to give something back, Schroeder said. “[And] we want to give back to the community, too,” he added.
“I feel very fortunate to be in the position [to] we find brands like [Hagen] that have this cult status… and we go look, we can convert that into action – we see the best side of people,” Scott-Harris said.