Marketing Analysis of Nespresso for the University of Westminster Marketing Management module. By 3rd year students.

1. Marketing Management
Jelizaveta
Nazrin
Joachim
Aura
Haider
WBS - Integrated Marketing Agency London

2. Contents
● Introduction to company
● MACRO environment
● MICRO environment
● Competitors analysis
● SWOT
● Conclusion
● Recommendations
● References

3. Introduction to company
The nespresso concept, - “to deliver the perfect cup of coffee cup after cup”
● Founded 1986
● present in over 60 countries
● More than 9,500 employees , compared to 331 in 2000
● Over 320 boutiques worldwide
● 50% of new consumers experience Nespresso for the first time
through friends and family

4. MACRO environment
PESTEL analysis
T Development in machine production
Pods: biodegradable, washable, recyclable
Digital revolution (advertising, database)
New channels of distribution (e- commerce)
E Environmental concerns (waste per cup, water
consumption, pollution, climate changes,
recycling)
Fair trade coffee, sustainability
L Supremacy of UK laws (eg. labelling of products,
food hygiene, GM-free policy)
Intellectual property
P/E UK politically stable nation, encourage business
growth(corporate tax rate change) 23% -
21%
S Coffee increasing in popularity, instant coffee
consumption declining, artisan coffee
demanded. Coffee pod machines meeting
the needs of modern coffee consumer.

5. MACRO environment
Industry analysis - Market size
● 2013 sales have
reached £ 1,330.4
million, rising by 7%
from previous year
● Average 12% growth
rate since 2008
● Forecast growth 2014-
2019 +15%
Source: Passport,

6. MACRO environment
Industry analysis - Categories
● Instant coffee: market leader (75% of
sales in 2013)
● Pods: rapidly growing segment
○ Reached 7% retail sales
○ +300% sales in 5 years
○ Rising star (BCG Matrix)
● 600,000 coffee pod machines sold in
2012

7. MACRO environment
Perceptual map
Source: Aura lazzarini,
2014

8. Competitor analysis in 6 steps
Competitor Analysis
Competitor Analysis in 6 Steps:
Source: Michael Porter, Competitive Advantage; Thompson & Strickland, Crafting & Implementing Strategy n.d.

9. Competitors analysis
Identifying Competitors
Industry Analysis - Layers of Competition
Source: Source: Lehman and Winter. Analysis for Marketing Planning appearing in Cravens 9 2009 Joachim Schweier 2014

10. Competitors analysis
Assess Competitive Performance - POP vs. POD
● Eco- Friendliness
● Technical aspects
● Price
● Variety
● Lifestyle
Source: David Aaker n.d.
Pod/ Pads coffee machine manufacturers

11. Competitors analysis
Perform Strategic Group Analysis
Strategic Cluster
Source: Joachim Schweier 2014

12. Competitors analysis
Identifying Key Success Factors
The Strategic Clock Bowman´s Strategic Options
Bowman´s Strategic Options
Source: Christodoulou I. and Patel Z. (2013). BKEY 601 Strategic Perspectives, McGraw Hill editions – second edition

13. Competitors analysis
Benchmark Competitors - 4P´s
Source: Joachim Schweier 2014
4 P´s - Competitors Performance

14. Competitors analysis
Profile Competitors Objectives & Strategies
Porters’ 5 Forces
Source: Joachim Schweier 2014 Coffee Industry Attractiveness

15. MICRO environment
Marketing Mix
Source: Jelizaveta Parsina, 2014

16. MICRO environment
Segmentation
● Upper to middle class ABC1
● Home use & Office use
● Have disposable income

17. MICRO environment
Value Chain Analysis
Source: Jelizaveta Parsina, 2014

18. MICRO environment
Customer Journey
Source: Jelizaveta Parsina, 2014

19. Micro environment
Business Model Canvas

20. Micro environment
Product lifecycle
Source: FPPT.COM, 2014

21. MICRO environment
Financial Analysis: Gross Profit margin

22. MICRO environment
Financial Analysis: Current Ratio

23. MICRO environment
Financial Analysis: Return on Shareholders Funds

24. SWOT analysis

25. Conclusion &
Recommendations
Diversifying current product range
Brand collaboration
Improve the recyclability of pods
New distribution channels
Assess business profitability
Growing coffee industry
Strong brand image
Premium positioning
PLC - growth stage
Highly competitive market

26. Thank You
Any Questions?

27. References
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Bain.com, (2014). Management Tools - Benchmarking - Bain & Company - Publications. [online] Available at:
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Breville, (2014). Breville Brita Filter Hot Cup | Free Delivery. [online] Breville.co.uk. Available at: http://www.breville.co.uk/vkj367-
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Coca-Cola.co.uk, (2014). Home of Coca-Cola UK : Diet Coke : Coke Zero. [online] Available at: http://www.coca-cola.co.uk
[Accessed 19 Nov. 2014].
Dolce-gusto.co.uk, (2014). Coffee Machines | NESCAFÉ® Dolce Gusto®. [online] Available at: https://www.dolce-gusto.
co.uk/coffee-machines [Accessed 10 Nov. 2014].
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28. References
Illy, 2014. Macchine a capsule iperespresso. [Online] Available at: http://shop.illy.com/online/store/Prodotti_macchine-caffe-iperespresso_
it [Accessed 15 November 2014].
Jura.co.uk, (2014). Home Products - JURA United Kingdom. [online] Uk.jura.com. Available at:
https://uk.jura.com/en/homeproducts [Accessed 7 Nov. 2014].
Lavazza, (2014). A modo mio. [Online] Available at: http://www.lavazza.it/it/a-casa/espresso/amodomio/ [Accessed 15 November
2014].
Miele.co.uk, (2014). Coffee Machines | Miele UK. [online] Available at: http://www.miele.co.uk/coffee-machines/ [Accessed 5 Nov.
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Milka.co.uk, (2014). MILKA CHOCOLATE. [online] en. Available at:
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10 Nov. 2014].
Mintel, (2014). Coffee – UK – August 2014. [online]London: Mintel. Available from:< http://academic.mintel.com/display/623708/>
[Accessed 15 November 2014]
Monsterenergy.com, (2014). Home. [online] Available at: http://www.monsterenergy.com/gb/en/ [Accessed 10 Nov. 2014].

29. References
Nescafe.co.uk, (2014). Home - NESCAFÉ UK. [online] Available at: http://www.nescafe.co.uk [Accessed 5 Nov. 2014].
Nespresso.com, (2014). Nespresso UK - Coffee maker range for espresso machines, latte and cappuccinos. [online] Available at:
http://www.nespresso.com/uk/en/pages/buy-coffee-maker [Accessed 10 Nov. 2014].
Nestle.com, (2014). [online] Available at: http://www.nestle.com/brands/allbrands/nescafe-dolce-gusto [Accessed 15 Nov. 2014].
Passport, (2014). Coffee in the United Kingdom. [online] London: Passport. Available from:<
https://www.portal.euromonitor.com/portal/account/login> [Accessed 18 November 2014]
Philips.co.uk, (2014). Coffee. Discover the full range | Philips. [online] Available at: http://www.philips.co.uk/c-m-ho/coffee [Accessed 15 Nov.
2014].
Senseo.co.uk, (2014). Senseo Viva Café HD7825. [online] Available at: http://www.senseo.co.uk/appliances/senseo-coffee-machines/senseo-viva-cafe-
hd7825/ [Accessed 15 Nov. 2014].
Siemens-home.co.uk, (2014). Coffee machines. [online] Available at: http://www.siemens-home.co.uk/store/category/coffeemachines [Accessed 7
Nov. 2014].
Store.starbucks.co.uk, (2014). Coffee Makers Brewing Machines | Starbucks Store UK. [online] Available at:
https://store.starbucks.co.uk/equipment/equipment,en_GB,sc.html [Accessed 10 Nov. 2014].

30. References
Tassimo.co.uk, (2014). Cadbury Hot Chocolate. [online] en. Available at:
https://www.tassimo.co.uk/Drinks%20Range/Cadbury%20Hot%20Chocolate?eshopProduct=950697 [Accessed 17 Nov. 2014].
Tassimo.co.uk, (2014). Machine Range. [online] Available at: https://www.tassimo.co.uk/MachineRange [Accessed 19 Nov. 2014].
Twinings UK & Ireland, (2014). Tea. [online] Available at: http://www.twinings.co.uk/tea?gclid=CImxroOQ-sECFauWtAodohAAPA
[Accessed 19 Nov. 2014].
vitaminwater.co.uk, (2014). design a bike & win it. [online] Available at: https://www.vitaminwater.co.uk/competition/ [Accessed 10 Nov.
2014].
White, A., (2013). Start-up rivals Nestlé with coffee capsules - Telegraph. [online] Telegraph.co.uk. Available at:
http://www.telegraph.co.uk/finance/festival-of-business/10486175/Start-up-rivals-Nestle-with-coffee-capsules.html [Accessed 5 Nov.
2014].
Tassimo.co.uk, (2014). Cadbury Hot Chocolate. [online] en. Available at:
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