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Nespresso: Redefining the experience of coffee lovers

Some turn to coffee just to relax, unwind, and have a little 'me time', looking to indulge in crafted, specialty cups of java. But for someone like me, coffee is more than just a beverage that helps in kick-starting the day. 30+ years ago Nespresso pioneered the portioned coffee segment with the idea of allowing anyone to make the perfect espresso at home. Hence, today the company continues to be the category driver of innovation, customer experience and quality. The coffee pods and capsules global market is predicted to record a CAGR (compound annual growth rate) of 7. 1%, during the forecast period (2019 - 2024). The market is highly driven by the increasing usage of single-serve coffee in households, especially in North American and European regions.

The Nespresso Story As explained by the Nespresso website: The Nespresso story began more than 30 years ago with a simple idea: enable anyone to create the perfect cup of espresso coffee - just like a skilled barista. Building on the earlier work of Luiggi Bezzera, who first invented the espresso machine in the early 1900s, a new system was developed that would allow anybody to craft, and enjoy, a perfect Italian espresso: the world's first portioned coffee system. From the beginning, the Nespresso brand concept has redefined and revolutionised the way millions of people enjoy their coffee today and has shaped the global coffee culture. Nespresso's business model is built on delivering high-quality espresso and building long- lasting relationships with its customers along with sustainable business growth. Nespresso has expanded its business model and is now present in over 76 countries and counts over 13,500 employees worldwide with more than 700 boutiques. The coffee beans are harvested from the best coffee-growing regions in the world like Brazil, Guatemala, Colombia, and are 100% sustainably sourced. Marketing Strategy of Nespresso is based on establishing luxury as a lifestyle Nespresso does not sell its coffee as normal coffee; it sells it as experience, making a lasting mark in people's minds. The company prioritises a vocabulary linked to the luxury universe with its range of capsules called 'Grand Crus' (linked to the vocabulary of the wine). Moreover, Nespresso's stores are 'boutiques'. Within the boutique, there is a showroom, a tasting area, and also a machine gallery. What else? A powerful marketing communication strategy at Play by Nespresso Probably everybody has heard the world-famous slogan "Nespresso. What else?" With meaning that this coffee is everything that a human being can desire ever. That is the force of Nespresso's slogan - it remains associated with Nespresso in your mind even if you do not buy capsules. It represents the pleasure of tasting a high-quality coffee and needing nothing else. So, what marketing strategy has really contributed to the success of Nespresso's business model? Nespresso's overarching goal has always been to deliver the perfect experience. Here is a rundown of exactly how the coffee-meets-tech brand provides great customer experience for its aspirational customers. Leverages digital channels to release content, with actor George Clooney as the face of Nespresso since 2006. Videos were shared to showcase Nespresso's premium brand positioning. Existence of both online and offline channels, that allows customers to engage with the brand via the website, mobile, airport vending machines, Nespresso boutiques. Seamless e-commerce experience, where consumers can order any combination of capsules that would be delivered within 2 days. In summary, Nespresso has focused on 360 degrees marketing strategy. As per Forbes, a 360-marketing plan is an integrated campaign with focused messaging spread across multiple points of customer contact. Nespresso providing premium experience through an innovative business model Nespresso Cube, a digital and fully automated boutique, offers consumers state-of-the-art personalised shopping experiences. After placing their order on a digital screen, consumers can also watch robots process their orders at incredible speeds. Accessorising- The question is not 'Do you want a Nespresso machine?' rather 'Which machine? Which capsules?' Accessories include (deep breath) glasses, capsule holders, a shaker, trays, bowls, spoons, carriers, scented candles, sugar, a cleaning kit, various chocolates, and biscuits. Amazingly, accessories are given their own hierarchy or ordering system, divided up into the Glass, Ritual, Citiz, Pixies and Premium collections. The club: When you buy a Nespresso machine, you automatically qualify for membership of the Nespresso Club. Benefit from quick easy ordering whenever, wherever. You can learn more about the Nespresso product range at the club and enjoy fast access to Coffee Specialists for questions or advice. You can also read the online Nespresso Magazine. In addition to the permanent collections, Nespresso typically introduces several extraordinary and rare limited editions each year. Leverages a cloud-based customer engagement solution that synthesises all consumer data (web and app orders, in-store orders, behavioural analytics, interactions with Nespresso kiosks). Hence providing all in one unified customer view. It surely takes a lot of effort to create a product that locks in and upsells the consumers over their lifetimes with multichannel, tech-fuelled, aspirational cups of coffee that everyone wants in their home and is all about the experience.

Question: Analyse the case study and practically explain how Nespresso has achieved growth through the use of digital channels. Practically, provide (2) reasons as to how Nespresso has used each strategy to increase sales.

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