DISTRIBUTION CASE(5 questions)

Created by a Nestle employee in the 1970s, Nespresso is a system of brewing coffee that had modest success in Switzerland until Nestle began licensing the technology to other manufacturers. In the 1990s the Original Line of Nespresso machines was introduced in Canada and the US to moderate acclaim.

In February 2014 Nespresso launched their VertuoLine in the United States and Canada. With several high-tech features including a barcode system that rejects pods from their competitors, the VertuoLine was widely promoted using George Clooney in long-format television commercials, supported by print ads, stimulating a strong increase in sales of the machines and the pods required to use them.

Nespresso machines can be purchased by Canadians in a number of ways: online at Nespresso.ca, via Amazon.com or Amazon.ca. The pods, however, can only be purchased in a Nespresso Store and Cafe. A recently-renovated location at a downtown Vancouver store saw the cafe move from the underground level to occupy a large portion of the main floor, where it is visible from the street.

While initially Nespresso had no plans to carry the Vertuo in Europe, they began selling the machines in France, the UK, and Australia, in late 2016.

Question 76(2 points)

Saved

What level of coverage is Nespresso currently using in their distribution strategy for their machines?

Question 76 options:

Intensive

Exclusive

Selective

Market

Question 77(2 points)

Saved

What level of coverage is Nespresso currently using in their distribution strategy for their pods?

Question 77 options:

Intensive

Exclusive

Selective

Market

Question 78(2 points)

Saved

When a Canadian finds out that they can order a Nespresso machine from Amazon that is less expensive and ships faster than from the Nespresso corporate site, what kind of conflict does this create?

Question 78 options:

Vertical channel

Horizontal channel

International channel

Channel frequency

Question 79(2 points)

Saved

If Nespresso were to decide to also sell pods to consumers through a print catalogue and monthly email, they would be said to be using _______.

Question 79 options:

a multichannel marketing system

an electronic marketing channel

direct marketing

all of the above

Question 80(2 points)

Saved

What type of locations are optimal for Nespresso cafes, where their pods and machines are sold?

Question 80 options:

Discount supermarkets

Category killers

Department stores

Off-price sellers