Marketing Report on Nespresso

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Marketing management and Strategy
A case study on the Nestlé sub-brand: Nespresso
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1. Introduction

Nestlé is a global company who recognizes that to be a successful company you have to be competitive and cost efficient. They put their customers first, and wish to create long lasting relationships with them, creating a luxurious exclusive experience to their coffee customers through their sub-brand Nespresso. Having positioned themselves as a luxury good, the Nespresso brand faces several weak points in their positioning during the current recession. Communication and marketing are therefore key factors in the international competition for a company such as Nestlé, and it is important to have a clear and concise view of how Nespresso functions in its current market, and how the future marketing plan and positioning could look for Nespresso. With this in mind we will suggest a 5-year plan as to how Nespresso can improve their marketing communication skills and recommendations for the future for the Nespresso brand and image. 1.1 Delimitations

The global market for Nespresso is very large; this report will therefore only be looking at the French market, giving a more detailed account of the French market rather than a superficial overall account. 2. Executive summary

3. Background

Nestlé S.A is the world’s biggest food maker in the world (Norton, 2006). The company was founded and headquartered in Vevey in Switzerland. Nestlé originated in a 1905 merger of the Anglo-Swiss Milk Company (established in 1866 by brothers G.Page and C.Page), and the Farine Lactée Henri Nestlé Company (founded in 1866 by Henri Nestlé). The company grew drastically during the World War I and after World War II, when Nestlé begun to expand its offerings beyond its condensed milk and infant formula products at the outset ( In 2009, 283,000 people worked for Nestlé in 83countries around the world. In 2009, Nestlé’s total revenues amounted CHF 107.6 billion, and CHF 10.43 billion for total profit (Anon, 2009). Nespresso is the brand name of Nestlé Nespresso SA, one of the most famous Nestlé’s brand portfolios. Its products are based on a single-serving capsules system, protected by patents. Every capsule contains ground coffee, of which content is brewed in a specialized machine (made and sold by Nespresso) ( The company is based in Paudex, Switzerland. Nespresso's brand ambassador is George Clooney, and the brand's slogan is “What else?”. The sub-brand develops an image of quality and luxury. The quality image is supported with descriptions of the capsule fabrication chain on; and the luxury image with television advertisement, presenting George Clooney in a devoted store. Nespresso and Nestle are linked not only by the capital but also by the corporate communication. On Nestle wants to show that a strong ethical communication has been developed (or seems to do so) with the following Business Principles, taking into account local legislation, cultural and religious practices in all countries: * Nutrition, Health and Wellness

* Quality Assurance and product safety
* Consumer Communication
* Human rights in our business activities 
* Leadership and personal responsibility
* Supplier and customer relations 
* Agriculture and rural development 
* Environmental sustainability 
* Water
Despite these principles, Nestlé is implied in a scandal for the infant formula product in Africa, which would cause the death of thousands of children, (Brisset 1997). Nevertheless, it does not seem to impact Nespresso’s brand image, because of it’s own communication strategy, independent from Nestlé. Nespresso has created it’s own brand image, which is not associated with it’s ‘mother’ Nestlé, creating a strong independent brand. Going into the analysis of Nespresso this report will...
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