Nespresso targets the corporate market

The Nestlé Group has never regretted launching its subsidiary Nespresso SA, twenty years ago. For those not yet in the know, the system, which is unique on the market, is based on three elements: hermetically sealed capsules, attractively-designed machines, and the Nespresso Club – of which each buyer becomes a member – that offers a range of personalised services. World leader on the expresso machine market, Nespresso SA is part of a booming sector. In France, the number of households possessing a machine that prepares individual cups of coffee has passed from 15 to 27%. During the subsidiary’s international press conference held in Paris last January, Chairman and Managing Director Gerhard Berssenbrügge announced the latest results with the greatest of satisfaction.

« With more than 4 million machines sold, 2005 has been an exceptional year for the company ». This success can be explained in part by the importance placed on advertising, as Roberto Eggs, International Sales Manager explains. « We consider that each media has a specific role to play, and we try to maintain a strategic presence in each of them: television, department stores (Harrods for example), billboards in the street, etc. ». Another advantage is the subsidiary’s international outlook, present from the outset. Today, Nespresso has 1.7 million members throughout the world, 200 head offices, 140 production sites and 1,500 employees. This year more than ever, the company’s directors are putting the accent on innovation in order to « strengthen the Group’s number one position », explains Roberto Eggs. After the success of its Essenza and Concept ranges, next June, Nespresso is launching the Cube, a retro design with cup-warming tray and storage space.

The professional division takes off
At the same time, the subsidiary of the world’s leading food industry group intends to give fresh impetus to its professional division. Formerly known as Nespresso Professional, the Nespresso Business Coffee Solutions (NBCS) division was created in 1996 with the aim of offering companies, cafés, hotels and restaurants (CHR), functional systems and services adapted to their needs. Despite its ten years of existence, the professional division only represents 15% of the subsidiary’s clients, that is 200,000 companies and CHR. « During its first years, Nespresso wanted to focus its growth strategy on the sale of machines and services to individuals. But today, the professional branch is considered by the Group to be a real factor for growth in the medium-term », explains Régis Durand, General Manager of NBCS France. To further this ambition, Nespresso is encouraging its professional division to invest on all fronts. Its communication strategy and working methods have been redefined.

« Nespresso owes its success in the household market to its three-part offer that combines smart design, capsules containing Grand Cru coffee and its upmarket client service. Adapting this commercial approach to the professional market should allow our department to expand, notably in the five years to come », says Durand. The objective is clear: increase sales and extend Nespresso‘s image of «coffee expert » to the corporate market. To achieve this, the company is trying to create a ceremonial atmosphere around the workplace coffee break. For example, the « welcome program » for new clients, and the idea of « limited editions » of capsules will be offered to professional targets. Besides, the Nespresso Business Coffee Solutions’ range of accessories is now as wide as that of the Home Division. Still with the aim of using the classic model as a reference, a help-line has just been opened. Available six days out of seven, it manages orders, gives information and takes requests for maintenance services. Opening this month, the new Internet site is just as ergonomic as that designed for individuals.

Inspired by the Home Model
« The salaried client and the individual client both have the same need for quality, » said Mark Leenders, International Manager of NBCS, during Nespresso SA’s international press conference. The distinction between the two key targets lies mainly in the area of services. In exchange for a yearly fee, the « business » department guarantees to repair equipment within 48 hours and offers a special Professional Coffee Service (PCF). The PCF covers two repairs a year, the loan of extra machines for special events, a dedicated hotline, and free water filters and descaling kits on demand. To meet the Division’s objectives, the heralded strategic development would be incomplete without the launching of a new product. And here it is. The Gemini Range. Made by the subsidiary’s historic partner, Eugster (Switzerland), it is adapted to Nespresso Business Coffee Solutions’ segmented approach to the market. Offices, hotels (four and five stars), upmarket restaurants and cafés, airlines (first and business class), prestige caterers and luxury boutiques are the five segments targeted by NCBS.

Unlike the three other ranges of professional machines, the Gemini « responds to a wider range of our targets’ needs. It is robust, and above all, has a dual head that accelerates flow », explains Nadine Kheirallah, marketing manager of NCBS France. Two models will hit the market in the weeks to come, one of which has a « capuccinatore », a device that produces bona fide foam. « Up until now, offices were the lifeblood of our clientele. Gemini represents alternative business growth as the new name of our division indicates », explains Régis Durand. To succeed, Nespresso Business Coffee Solutions is also counting on a « plus » that is common to the two branches of Nespresso – and that is the quality of the coffee. In view of the latest tests carried out by Nestlé on an independent panel of consumers, the future looks bright. More than 60% of those questioned preferred Nespresso coffee to another, rival brand. Another good omen is the partnership agreement NBCS has signed with the luxury Radisson SAS chain of hotels. Since February, Nespresso has been the exclusive supplier of coffee machines for 170 hotels, in 48 countries in Europe, the Middle East and Africa.