1) The document provides an overview of the coffee and Nespresso industries. It discusses Nespresso's positioning within Nestle and its focus on innovation, quality service and variety. 2) Nespresso has a well protected market position due to high barriers to entry for competitors. It targets high-income customers with luxury coffee machines and capsules. 3) The document analyzes Nespresso's marketing strategy using the 7 P's framework, covering elements like products, pricing, placement, promotion, and an emphasis on customer experience.

1. The Art of Coffee Marketing
Marketing Essentials
September 29th, 2011
Adriana Nagy

2. A quick introduction
Adriana Nagy
Full Time student
Russian & Hungarian
Worked for Publicis Paris

3. Content
I. What I got myself into
A quick overview of the coffee industry
II. The Chanel of Coffee
Nespresso within Nestle
III. Nespresso’s well protected playground
Competitors overview
IV. Nestle + Nespresso = “Nespresso Mix”
The 7P’s
V. Nespresso. What’s next…?
My recommendations

4. I. What I got myself into
A quick overview of the coffee industry

5. I. What I got myself into…
A quick overview of the coffee industry
2.25 billion cups /day
Necessity product
Effects on health

6. I. What I got myself into…
A quick overview of the coffee industry
US, Germany, Italy, Japan and France

7. II. The Chanel of coffee
Nespresso within Nestle

8. II. The Chanel of coffee – Nespresso within Nestle
Sub brand of the world’s leading nutrition,
health and wellness company, Nestle
1986, Lausanne
Jean-Paul Gaillard, 1988
“Nespresso is a rough diamond handled with the left
hand by people with no vision”
50 countries and 190 boutiques, more than 7
million Club Members

9. II. The Chanel of coffee – Nespresso within Nestle
Branding
Logo
Color Palette
Luxury sector inspired graphic and visual
design
Poly-Sensorial Marketing Concept in boutiques

10. III. Nespresso’s well protected
playground
Competitors overview

11. III. Nespresso’s well protected playground
Positioning and 5 competitive advantages
I
N
I
N
N
O
V
A
T
I
O
N
TI
O
N
Best
Service
Smart Machines
Optimum Convenience
Variety / Choice
Best-in-Cup Quality

12. III. Nespresso’s well protected playground
Target Segments & Customers
2 main target customer segments
In-Home
Business
30 and above
Offices
Quality and style
conscious
Hotels
Upper middle and upper
class epicureans
Satisfaction of selfesteem need
Airline Companies
High-end event
caterers
Luxury Boutiques

13. III. Nespresso’s well protected playground
Competitors overview
High entry barrier till 2012 for direct competitors
Ethical Coffee Company (Jean–Paul Gaillard)
L’Or Espresso by Maison du Café (Sara Lee)
Nexpod (Swiss start-up)
Caps-Cup (Hong Kong)
No brand “attacking” the same market segment
with similar technology and customer service
Senseo (Sara Lee+Philips)
Tassimo (Kraft Foods)
Dolce Gusto (Nestle), Lavazza
Flavia (Mars Inc.)
Keurig (Green Mountain Coffee Roasters)
Caggia-Illy
Malongo.
25%

14. IV. Nestle + Nespresso = “Nespresso Mix”
The 7 P’s

15. IV. Nestle + Nespresso = “Nespresso Mix”
The 7P’s - Product
Same product range all over the world
Machines are elegant, design awarded, innovative,
user friendly and convenient
Gemini, ES + 8 Grand Crus + Accessories & Aguila
Nespresso Business Club
Essenza, Pixie, Citiz, Lattissima + 16 Grand Crus +
Limited Editions + Accessories + Confectionary &
sugar
Nespresso Club

16. IV. Nestle + Nespresso = “Nespresso Mix”
The 7P’s - Product
Nespresso Club
Creation and nurturing of
personalized client relationships
database marketing
development of tailored sales strategies

17. IV. Nestle + Nespresso = “Nespresso Mix”
The 7P’s - Price
In-home: 99€ - 500€ Business: 275€ – 1495€
Capsules: 0,35€ - 0,39€
Accessories: 13€ - 110 €
Confectionary & Sugar: 5€ - 19€
Growth life-cycle
Value based pricing method
Luxury sector profit margins
Low threat of substitution

18. IV. Nestle + Nespresso = “Nespresso Mix”
The 7P’s - Place
Nespresso Site
Phone
190 Boutiques in 50 countries
Distribution of coffee machines is a bit more
“democratized”
Direct customer contact in order to maximize brand impact
and
assure high quality standards

19. IV. Nestle + Nespresso = “Nespresso Mix”
The 7P’s - Promotion
Print and TV participative Ad campaign
Nespresso Magazine
Social Media
Very little promotional and direct marketing
activities
Sponsorship

20. IV. Nestle + Nespresso = “Nespresso Mix”
The 7P’s – Physical Evidence
Based on the core values of the brand
Top Quality
Elegance
Innovation
Customer Delight
WOW Effect
Simplicity
Aestethics
Excellence

21. IV. Nestle + Nespresso = “Nespresso Mix”
The 7P’s – Process & People
Process
Highly customer focused
People
Boutique employees -> true ambassadors of brand’s
image and reputation
Thorough employee selection process and intensive
training
Employees and management are proud to be part of the
winning team

22. V. Nespresso. What’s next…?
My recommendations

23. V. Nespresso. What’s next…?
My recommendations
Limited collections
A more intensive communication
on the different participative
marketing tools
“Nespresso Moments” CD
More sponsorship activities and
presence on worldwide events
Brand Ambassador Era Change

24. Thank you for your attention