DIRECT MARKETING
By -
Akanksha Vachhani
TYBMM AD - A
Roll No. - 83
ABOUT THE BRAND
'Nes' means Miracle 'café' means coffee; Thus,miracle with coffee
Nestlé began developing a coffee brand in 1930, at the initiative of
the Brazilian government, to help to preserve the substantial
surplus of the annual Brazilian coffee harvest. Max Morgenthaler
led the development project.Nestlé introduced the new product
under the brand name "Nescafé" on 1 April 1938.
Nescafé is a soluble powdered coffee that became an American
staple during World War II. In 1965, Nestlé introduced a freeze-
dried coffee brand called "Nescafé Gold" in Europe. In 1966, Nestlé
developed a freeze-dried coffee brand under the name Taster's
Choice.
BRAND PERCEPTION
Nescafe logotype was always the same since its origin. The logotype
borrowed the same Nestlé format, and the word Nescafe is
combination of the first three letters of Nestlé and café which is
coffee in Portuguese.
The symbol added to convey the brand meaning was the red mug,
Most commercials scenes show someone holding the red mug with
the Nescafe logotype written in the vertical position.
Probably the red color of the mug was chosen to emphasize the
energy of the drink, since coffee is a stimulating drink and red is
perfect to describe this state of mind.
Therefore, the semiotics triangle would display on the sign side, the
red mug, on the object side, the granulated instant coffee, or the
product i itself, and on the interpretant side, the wellness state of a
good cup of coffee.
PRODUCT RANGE IN INDIA:
NESCAFE MARKETING STRATEGY 4PS:
Product – A cup for every need
Nescafe consistently introduced new products to increase both
users and usage in line with its pull marketing strategy. To
emulate the tea drinking experience in the North, it launched
Nescafe 3 in 1, a premix of coffee, dairy creamer, and sugar.
Nescafe Mild was launched to appeal to consumers who did not
like the strong taste of coffee.
In 2012, foaming mixes of Cappuccino, Vanilla Latte & Choco
Mocha were introduced to provide more variety to the youth as
part of the mega campaign. Nescafe Gold was re-launched in
2017 to serve consumers with evolved tastes.
In the South, Nescafe Sunrise went through multiple product
enhancements to closely match the taste of filter coffee. Limited
edition Nescafe Sunrise Rich Mountain blend was launched in
2010 to create excitement. Sunrise Strong was launched in 2012
with a specific coffee-chicory blend specifically for the people
in Andhra Pradesh. In 2016, Sunrise Insta-Filter with dry
decoction granules was launched to offer the authentic South
Indian Filter Coffee Taste.
To maintain coffee leadership, Nescafe
introduced a host of other
complementary products like the
Nescafe vending machines for offices,
stalls, and E Nescafe – a smart coffee
maker to prepare instant hot coffee.
Price – The perfect mix of affordability and
choice
Nescafe has customized and adapted its pricing
strategy to serve the needs of the value-seeking
Indian consumers. It straddles across multiple
price bands starting from the Rs 2 sachet pack.
This helps increase penetration by generating
trials & thus increasing affordability.
Product prices vary based on the variant,
ingredient, flavor, size, and type of packaging
like sachets, cartons, cans & jars. While sachets
help mass user acquisition, Nescafe Gold, priced
at a premium over Classic, serves the discerning
consumer with a more prosperous and
smoother experience.
Place – The strength of a Wide Distribution Network
Nestle’s well-oiled distribution network powers Nescafe. Having
popular brands in the portfolio like Maggi & Kitkat supports the
pull marketing strategy of Nescafe as retailers never want to be
stocked out on products with high demand.
Out-of-home was always recognized as a critical alternate trade
channel for Nescafe. Availability & visibility was ensured in
educational institutions, railways, airlines, offices, food joints, and
restaurants throughout the country.
Plenty of Consumption Zones like Café Nescafe, Coffee Corners,
and multi-brand stalls were set up, and innovative vending
machines were introduced. Product sampling was carried out at
scale to acquire new users.
Promotion – campaigns that set it apart
1990s: Taste that Gets You Started Out (Energetic start to the day)
2010-2013: Switch on the Best in You (make connections)
2014-2016: It All Starts with Nescafe (Cup of resolve in daily
struggle)
2017-2019: It All Starts with Nescafe – Badal Life ki Raftaar (Energy
boost for fast-paced life)
2020-2021: It All ReStarts with Nescafe – Karne Se Hee Hona Hai
(Get started again after lockdown)
Nescafe was losing its point of differentiation globally due to the rising
competition. Hence, for its most extensive global repositioning
exercise under the Name ‘Redvolution,’ Nescafe in 2014 created a new
Tagline – ‘It All Starts with Nescafe.’
The new strategy would bring all the brands under the master brand,
Nescafe, with consistent brand imagery worldwide. The Red Mug
would feature in all communications to evoke familiarity & brand
recall. A master brand strategy helps increase brand equity, lower the
cost of media & forge longer-lasting customer relationships.
For the next two years, Nescafe was positioned as a brand enabling the
youth to fight against all odds to stay resilient. The cartoonist ad in
2015 won hearts again for Nescafe. It highlighted the use of social
media to drive success in a creative career, thus striking the right
chord with the young TG.
2020 was the year for yet another positioning induced by COVID-19
with the ‘Karne Se Hee Hona Hai’ slogan. It urged people to make a
fresh start after re-opening of the economy post lockdown. In a twist
to its global tagline, it created ‘It All Re-Starts with Nescafe’ – an
effective way to stay relevant.
COMPETITORS
Folgers, Starbucks
and Maxwell House
are the three main competitors of
Nescafe that were identified in the
United States. On the other hand in
India, Bru and Barista are the main
brands that compete against Nescafe.
Even though Nescafe was the first one to enter the instant coffee
market and had been a market leader for decades, HUL's Bru has
grown onto become its single biggest competitor in the recent past.
Tata Coffee, though a very late entrant in this market, is also
making strides.
Analysis of Nescafe's biggest competitor - BRU
Seen as strong alternative to filter coffee
Adapted well to consumer lifestyles
Created lifestyle associations by linking brand, category and
consumer habits
Strong presence in Southern India, where consumption of
coffee is higher
Coffee powder available in a lot of variants and price is
marginally cheaper than Nescafe
Influential television campaigns with Shahid Kapoor and
Priyanka Chopra in the past.
Current brand ambassadors are Imran Khan and Anushka
Sharma.
Bru has recently opened Bru World Cafè's in Mumbai as an
entry into coffee retailing.
TARGET AUDIENCE
Nescafé’s target market consists of
coffee drinkers, especially people
who are in the need of instant and qualified coffee that stimulates
body within a day. Due to its convenience, it is a quick solution for
people who want to enjoy it at home, work or school; accordinlgy, it
targets each of them in different ways. Especially for target segments
of working individuals or students, it aims to awake them in the
mornings, sober up in the afternoons, or again keeping awake in the
late evenings. Besides, another target can be assumed which contains
the middle-aged and elderly people who get into the habit of
drinking Nescafé.
. Nescafé’s Target audience comprises of
teenagers and college goers (16-24 years),
who have newly acquired the taste of
coffee and consume around 2 glasses of
coffee each day.
Adults i.e. our already existing customers,
the aim is to promote brand loyalty
amongst them.
The avid coffee drinkers or coffee lovers.
The office goers or the corporates who
have less time in hand and work under
stressful environments.
MBA students or the late nighters who
stay up at odd hours in the night.
People who do not wish indulge in the
time consuming process of making coffee
and rely on easy options such as an instant
mix.
ADVERTISING STRATEGY
Nescafe emphasizes on the promotion of their products in many
different ways , They make sure that they have made all possible
communication for the customers to know what their products are.
Nescafe advertises through radio, television, papers, PR activity,
newspaper, internet, etc. The brand has a huge fan following on
social media, and it engages with its users via web videos ,
campaigns & connects people globally. The company has made one
thing sure that their logo remains the same since the origin. This in
a way has made people recognize the logo and they could recognize
the brand just by the logo, as the logo has been imprinted in the
minds of the people. The advertisement of Nescafe are innovative
and they make sure that they catch the attention of the customers.
Online promotion, digital marketing and PR activity also enhances
the connections with the customers and they get to know the
products closely. This gives an overview of Nescafe marketing mix.
Availability of NESCAFE enhanced through
an expansion of the vending machine
network in India.
Nescafe has been doing 360 degree
promotional activities like Crm, pop,
vending machine network etc in India.
Nestle set up ‘Café Nescafe’ and ‘Coffee
Corners’ across metros and mini-metros of
India.
Price Promotion of Nescafe is also playing a
price game in coffee.
SWOT ANALYSIS
Strengths -
Brand Equity: Nescafe’s brand value is $17.4 billion and is the
largest brand in the Swiss giant portfolio. Also, it is the brand of
Nestle so it also possesses a strong financial backing and
availibility of resources.
Quality: Nescafe is a good quality product and has managed to
stay away from controversies. They have stringent quality control
techniques and have managed to develop a strong bond with its
customers.
Diversity: It possesses a large diversity in terms of tastes, the
strength of coffee content and types of coffee beans used in the
production. This gives them a large variety of products to suit
different tastes of customers.
Excellent Promotional Campaign: Their promotional campaigns
have always remained popular. They gain visibility very quickly.
They touch the strings of heart perfectly. Their advertisements are
meant for common people and resonate with their daily problems.
Economies of scale: They are quite simply the largest coffee brand
in the world. Furthermore, they are from the house of nescafe due
to which they enjoy the enormous resources at their disposal.
They use the same distribution channel which exists for Nescafe
and hence their expenses on distribution is very less also. Due to
this economies of scale, Nestle has a good ROI and margin.
The Nescafe jingle: Nescafe has one of the most loved advertising
jingle.
Weaknesses-
Health Consciousness: People who are more considerate about
health they tend to move away from caffeine content drinks.
Indirect competition: Indirect competition like Tea, carbonated
drinks and other beverages takes a lot of market share from
Nescafe. It is widely accepted in USA because USA is a coffee
drinking country. But there are many other countries where Tea is
preferred over coffee.
Opportunities -
Tie-ups: It can tie-up with different corporates, educational
institutes and other public enterprises to gain market share and
drive profits.
Growth in Public income: The income of people is constantly on a
rise and they tend to move towards premium taste which is coffee
in the beverage category. So they have a potential customer base
who might want to move towards this drink.
Biscuits: Nescafe can plan on biscuits or cookies which can be sold
with the coffee or which goes very well with the coffee flavor. They
can also make these biscuits as premium biscuits in the market.
Threats -
Direct Competition: In India Bru is the market leader in the
beverage category and is giving a hard time to Nescafe. This
competition is getting more and more intense with other brands
growing as well like Tata Coffee etc.
Cocoa Problems: The cocoa farmers are facing serious problems in
cultivation and selling their produce. These problems might hamper
companies like Nescafe which is driven by cocoa cultivation.
EXISTING INTEGRATED MARKETING
COMMUNICATION TOOLS(IMC)
NESCAFÉ uses Advertising,
Interactive marketing,
Publicity/Public Relations tools
for their campaigns.
Advertising -
NESCAFÉ usually interacts with
mass communication medium to
broadcast the product to the
customers. They use different
types of advertising such as
television, radio, all types of print
media and social media
marketing to reach out to their
customers.
Print Ads
Interactive Marketing:
They have an organized website with full of
information about their products. They also
have an official page on Instagram facebook,
twitter, YouTube.
Website
Instagram
Youtube
Publicity/Public Relations:
Nescafe used public relation activities
through arranging a talent hunt show
called “NESCAFÉ Get Set Rock”. Through Facebook
this competition the organizers hoped to
single out the best instrumentalists and
the best vocalist in forming the best band
of the forthcoming generation and
successfully gather a bunch of talented
musicians,who later on formed a band
called “Blue Jeans” and they also released
their debut album.
DIRECT MARKETING
Objective:
To distribute the product samples
Strategy & Tactics:
As India has a large population it is always a potential market for
Nescafe. By direct marketing in India ,Nescafe encourages the
consumers to purchase directly from the manufacturer in a
lower price. Nescafé also distributes their products through
traditional distribution channels.
Direct marketing for Nescafe Classic mostly appears in kiosk,
vending machines. These machines are very important because
they are very fast and used by people who do not have time to
prepare coffee.
EXTENDED PRODUCTS AND
NEW OFFERS
The lockdown induced the purchase of more coffee equipment
like grinders, pots & machines, providing a sales boost for fresh
coffee. Monthly subscriptions of premium coffee are on the rise.
Nescafe should actively ride the premiumization wave due to the
potential of artisanal coffee.
Launching & marketing equipments like French press,brewing
pot , grinders with Nescafé ground coffee and coffee beans not
only for offices or institutions but for households (personal use)
should be explored.
Nescafe has ground coffee beans but it has not promoted it
through any IMC tools since it’s only for professional spaces .
There’s absolutely nothing missing in their marketing strategies
from TVCs to print ads to social media PR but I would like to
suggest Nescafé to launch coffee equipments like French press,
cold brew pot,grinders etc with Nescafé ground coffee and coffee
beans as coffee culture is increasing day by day and people are
really looking for a more premium tast.
NEW IMC TOOLS
Email Marketing -The company can send mails to its existing
customers about the new launch of coffee equipments and ground
coffee beans .
TVCs -Nescafe can launch long campaigns to promote its ground
coffee and equipments.
Print media - Campaigns to promote equipments could be
advertised through newspapers ,billboards ,magazines .
Social Media - Nescafe can conduct live shows on Instagram,
Facebook and YouTube channel to launch its new equipments
and coffee .
Paid Ads -Nescafe could keep offers like “buy our French press
and get 250grams ground coffee free.“ and advertise these offers
through social media .
DIRECT MARKETING PLAN
PR Campaigns - Nescafe could conduct PR campaigns in malls and
super markets (pop up stores)for tasting and sampling of its newly
launched ground coffee and new flavours with demo for it’s
equipments.
Website - Nescafé’s website should have an option to buy it’s coffee
and equipments directly through the website.
Target group: Demographics: Our target group can include
teenagers and college goers (16-25 years ) and existing customers.
Psychographics: Nescafe is aimed for people who are Modern,
Friendly, Social, Adaptive to Change, and Attracted by
Internationalism. People believe that coffee consumption is an
indicator of their rich and prosperous standard of living. Nescafe users
or potential users are assessed to be individuals with active lifestyles
Database generation: Nescafe already has a huge brand loyalty but
Email acquisition and paid ads on social media is the best way to
generate database of the target market.
Direct Marketing methodologies: The company can have have pop
up stores (PR campaign) in malls and supermarkets for testing and
demo for their new equipments and coffee to attract their customers
towards their products.
Overall Budget and Timeline: The budget that will be employed for
this would be around ₹5,00,000-10,00,000 per month.
CONCLUSION
Today NESCAFÉ is one of the world’s leading coffee brands with
more than 4,000 cups of NESCAFÉ savoured every second all
over the world. Nescafe has had a rich and classic history since
1938. Nescafe products are produced by Nestle.
Consumers’ perception of a brand is based mostly on the
satisfactory value the user receives after paying for the product.
In the above case study, we observed that a significant portion of
the user is satisfied with Nescafe products.
Both Nescafe & Bru are locked in a fierce battle for market
leadership today, with each commanding about 36% market
share (as per Euromonitor) by value in the Indian retail coffee
market in 2020.
Launching & marketing its globally popular machines like
Nespresso & Dolce Gusto in India can be explored. Nescafe
Café’s experiences can be further enhanced by opening a new
line of Cafes in metros with a more premium appeal.
THANK YOU
