Mkt 362

Topics: Coffee, Caffeine, Tea Pages: 7 (2063 words) Published: February 16, 2013
MKT362 Pricing
Assignment 2 – Group-based Assignment January 2013 Presentation


Assignment 2

Group-based Assignment This assignment is worth 30% of the final mark for MKT362 Pricing. The cut-off date for this assignment is 20 Feb 2013, 2359hrs. This is a group-based assignment. You should form a group of 3 members from your seminar group. Each group is required to upload a single report to MyUniSIM via your respective seminar group. Please elect a group leader. The responsibility of the group leader is to upload the report on behalf of the group. Guidelines for the Group-based Assignment are as follows: 1. 2. Cover page: Include group members’ names and PI number. Word limit for the report is between 3,000 – 3,500 words (excludes cover page, bibliography and appendices). Please DO NOT exceeds the word limit. Reports that fail to conform to the word limit will be penalised. Font size 12, Times New Roman, 1.5 lines spacing. Referencing: Use either the Harvard/APA/MLA referencing style. You must acknowledge and reference all sources used or it will count as plagiarism. A maximum of up to 5 marks will be deducted for improper referencing. You will need to conduct additional secondary research to support your answers adequately.

3. 4. 5.



What's brewing at home?
A steaming, full-bodied cup of coffee in seconds, in the comfort of your own kitchen. Caffeine lovers have taken to coffee machines in a big way. While most people bring home designer bags and shoes from Europe, Ms Lew Shi Yun stuffs her suitcases with coffee. As she downs two to three cups a day, she tries to load up on coffee capsules from Nespresso when she travels. Her record haul was 500capsules from a single trip. As one of the most recognisable brands in the coffee drinking industry, Nespresso pioneered the single-use capsule coffee machine system. Instead of dealing with loose coffee powder and expensive espresso machines, Nespresso machines use pre-filled coffee capsules that fit neatly into special machines. Like espresso machines, these systems work on pump-driven devices, where a motor pushes heated water through the pods at high speed. Compared with classic espresso machines, these are a cinch. Users do not have to bother about packing the coffee powder onto espresso levers, or figure out the correct temperature for the water. Nor do they have to clean up after each use. Convenience at a low cost. These days, many other vendors, including Caffitaly, Tassimo and illy, offer the same convenience to coffee addicts and make machines for other brands. An example is the CBTL machine from The Coffee Bean and Tea Leaf chain, which uses the Caffitaly system. Each


Assignment 2 – Page 2 of 6


Assignment 2

machine and its coffee pods are unique and not interchange- able with other systems. The food giant Nestle owns two systems – Nespresso and Dolce Gusto. Courts started selling the machines here in April last year and brought in more brands three months later, because of a spike in demand. It now sells systems from Nespresso, Dolce Gusto, illy and CBTL, among others. Their key selling point is convenience, said Mr Tim Luce, regional director of sales at Courts Asia. Sales have risen by more than 200 per cent in the past 12 months, he says. "The machines offer the ease and immediacy of a perfectly brewed coffee in a matter of seconds, compared to conventional drip coffee machines," Mr Luce explained. While the coffee capsules, which start at 90 cents each, are more expensive than a cup made from regular coffee powder, it still costs less to brew your own cuppa than to go to a coffee shop. That has not escaped the food and beverage industry. Some restaurants here and elsewhere are already using capsule coffee on their menus. Capsules are cheaper overseas. In Spain, a tube of 10 Nespresso capsules starts at 3.50 euros (S$5.64),...
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