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A Case Study in Nescafe Market Segmentation

Essay by   •  August 13, 2011  •  Case Study  •  1,887 Words (8 Pages)  •  1,918 Views

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A Case Study in Nescafe Market Segmentation

1. Profile of the company

Nestle Philippines is a robust and stable organization, proud of its role in bringing the best food throughout the Filipino consumers' lives. It produces and markets products under some of the country's well-known brands: Nescafe, Nido, Nestea, Milo, Maggi, and Bear Brand. Its product range includes coffee, milk, infant nutrition, infant food, beverage, non-dairy creamer, food, ice cream and chilled dairy, breakfast cereals and confectionery.

Since Nestle first established its offices in the Philippines, the Filipino people have trusted its products and made this part of their daily lives. In gratitude, Nestle shares its blessings with those who need its help the most - the hardworking farmer, the promising student, the malnourished child, the calamity victim, the unemployed, and the other less fortunate people in the communities where the Company operates. The Nestle support takes many forms, from assisting coffee farmers in improving their yield, to livelihood programs that help augment income, to education and manpower development, health and nutrition, environmental protection and preservation, sports development and values formation. Through these efforts, Nestle hope to touch the lives of a greater number of Filipinos and make a positive difference by opening doors to opportunities and to be a better quality of life.

The company has been very active in corporate social responsibility practice and puts premium on programs on agriculture, education and manpower development, community development, health and nutrition, and environmental protection and preservation.

In its origin Switzerland, it is the largest industrial company. Chairman of the board and Chief Executive Officer is Mr. Helmut D. Maucher.

There are 600 factories worldwide spreading over more than 75 Countries and numerous regional and divisional offices. The company markets its products in more than 125 countries. The Global sales rank among the top 10 companies of the world. Its factories and offices employ more than 218,005 people all around the world.

The strength of the company is owned by serving the consumer with quality products and a balanced geographical spread of assets around the globe. The

attainment of this worldwide operating structure has been a key objective of the company. Its selective expansion remains a constant guideline for future growth.

Nescafe is one of the world's most popular coffee brands. Available in many varieties to suit all tastes and occasions. From Nescafé Classic to our newer well-being products such as Greenblend with higher levels of antioxidants.

The rich taste of your favourite coffee reflects its rich history. Nescafé coffee originated in Brazil in the 1930s as an early example of innovation and sustainable development. Building on Nestlé's milk processing expertise, we developed soluble coffee helping thousands of Brazilian farmers avoid hardship and crop waste. True to our heritage, we continue to support and work with farmers around the world.

Having developed a way to make a quality cup of coffee simply by adding boiling water, Nescafé coffee was launched in Switzerland in 1938. It was soon exported to France, the UK and the USA. In 1965 Nescafé brand extended its innovation by offering freeze-dried soluble coffee with the launch of Gold Blend. Over the years, Nescafé product innovation has evolved further to capture even more of the natural aroma and flavour from every coffee bean. Today consumers around the word enjoy the quality, flavour, aroma, convenience and natural goodness of Nescafé coffee in many different formats.

2. Case References

Nescafe's market segmentation starts from the early years where the coffee was crude. On early days, coffee is a luxury; you cannot make a cup of coffee in your home. It can only be bought from coffee shops. That's why they come up to the idea of "instant coffee". From the introduction of this innovative product, it expands globally from the market's favorable reactions.

There are also studies scientific studies that prove that coffee is a healthy drink because of the "anti-oxidants" (enzymes that slows down the human aging). Because of this study, many people patronize coffee.

And as we all know, coffee is a source of caffeine. That's the reason why some people are now treating coffee as a performance enhancer or a mental booster. And for those who don't know it, they are just addicted.

3. How do they identify their Market Segmentation?

Target Market of Nescafe

At the moment the main focus of the product management of Nescafe is to target the upper class high-income people, and they also focus on 18-24 years people as well, probably in this age we find only the students and some young professionals. The emphasis on this segment involves that, at this the people are developing their habits, so Nescafe felt that if they successfully targeted these people they can definitely made these people a permanent user of Nescafe.

Market Segmentation:

Income

As you know that the first target customer for Nescafe is belonged to upper class income people, so primarily there is factor of income involves here, because as you know that coffee actually a costly item, so it can afford only by the rich people.

Age

The age is important, in case of capturing market of 18-24 age young people, as we mentioned above that in this age period people are developing their habits.

4. Benefits on the side of Customers/Company

Strengths:

 It is promoting our own products and has captured the market for several years.

 Nescafe has good personals of CEO and they can manage and use strategy good quite.

 Nescafe has emphasizes internal grow.

 Nescafe has innovating new products.

 Nescafe was a good leadership.

 Nescafe has moved faster.

 Nescafe

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