introducing coffee culture in bangladesh: the nescafe way
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Nescafe's Marketing Activities in BangladeshTRANSCRIPT
INTRODUCING COFFEE CULTURE IN BANGLADESH:
THE
TEAM OFFLINEFableeha Bushra Choudhury RH19Rubyat Tasfia Rahman RH29Nishadul Haque Nihal ZR31Aanisha Mahmood RH59WAY
Mother Company Started its journey
in Bangladesh1994Factory
located in GAZIPUR
People employed
directly and indirectly1650
Bangladesh has never been kind to
the coffee industry as far as
popularity or sales are concerned
Since the British rule, the country
has been predominated by the
taste of tea as the warm beverage
required for many during
breakfast, with the snacks or even
as the beverage for socialization
“The ‘real taste’ of coffee is rather appalling”- Sanjeeda Nusrat, Brand Manager, Nescafe
’
2. industry andcompetitor analysis
“ ”
2. industry andcompetitor analysis
Bru, MacCoffee, Coffee Crown and,
Maxwell House and Bean Coffee.
94%
6%MARKET SHARE
Nescafé
Others
Currently, Nescafé has a business of
around 300 tons annually.
3. market analysis
DEGREE OF BUYER INVOLVEMENT
INEXPENSIVEtherefore,
habitual
+
BUYERBEHAVIOR
shelve stocking
+
reminder ads
MARKETING STRATEGY
3. market analysis
WHILE BUYING
perceived brand difference…
Since coffee consumers do not make heavy decisions about what brand to buy, non-stop ads serve the purpose of creating
BRAND FAMILIARITY rather than BRAND CONVICTION.
Accordingly, if this process is followed by a purchase, this behavior is likely to turn into a habit over time due to the reason that coffee taste is suitable to have an addiction towards it.
As a result, consumers act according to habitual buying behavior if they keep buying Nescafe Classic owing to habit formation, a familiarization or a routine.
3. market analysis
WHILE CONSUMING
perceived brand difference…
Significant perceived branddifferences: Consumers could buyNescafé without much evaluationbut they evaluate the quality ofcoffee while consumption.
According to product’s strength ortaste, next time, a consumer mayswitch his/her brand prefer andcan purchase one of thecompetitors of Nescafe Classic.
they may switch brands between Nescafé Classic and Bru. Brand switching occurs because consumers seek variety and want to try a different coffee. Therefore, consumers act according to variety-seeking buying behavior.
For instance,
3. market analysis
TARGETTING A SEGMENT
The focus is urban young professional
cosmopolitans with contemporary
lifestyles.
Taste and aroma of the coffee, accordingly
quality is the important element for them.
Nescafé emphasizes keeping them active
throughout the day.
2ND SEGMENT is the best fit!
3. market analysis
…
The introduction of coffee in a jar was
initially a failure in Bangladesh. Priced at a
premium and sold in only family packs
formerly, the jar coffee had almost no market
share during the times of introduction in the
Bangladeshi market. A handful of consumers
who were passionate about coffee only
purchased the jars and the company check-
listed the launching of Nescafé as a loss
venture.
3. market analysis
…
Nescafé gained some of the expected
market after the launching of the mini-jars,
but yet it lacked a strong customer base to
ensure a good prospect for the future of the
company. The target market of coffee was
never the low income groups, as the
positioning of coffee is to the youth or to the
upper societal class. In order to penetrate
the market, the primary objective of Nescafé
was to get the people used to the taste of
coffee. Because tea is the main competitor of
coffee and the prevalent beverage, the
objective could not be accomplished
overnight.
3. market analysis
The taste of ‘real’ coffee is rather bitter to the
normally practiced tea drinks usually served
and drunk all over the country. That the
vending-machine idea was a penetrating
strategy for Nescafé, the taste of coffee was
lightened with a lot of milk and sugar in the
recipe to deem acceptable by the general
public.
3. market analysis
Otherwise known as the on-the-go coffee
pack, the recipe of this pack is also exactly
the same as of the vending-machines. The
only value migration that occurs here is the
idea of do-it-yourself for the customers, to
have a significant increase in their
involvement.. The target population ages
from 17 to 20 years, which is the adaptive
age for tea/coffee drinking as considered by
Nescafé. This market is desirable in order to
be tapped by Nescafé as it is believed that
once a customer becomes brand loyal to
Nescafé, s/he provides a lifetime of revenues
to the company.
3. market analysis
Nescafé uses a premium pricing strategy to
signal its quality and strong brand attributes.
The pricing strategy is different for each pack
size.
Package pricing is done for Nescafé Classic
Jar, Nescafé “Bondhu” Classic Sachet and
Nescafé 3 in 1 Coffee.
Other than these three products, Nescafé has
some other products like Coffee mate,
Nescafé 200 gm pillow pouch etc. These
products are imported and are available in big
chain stores.
Nescafé 200gm jar460Tk
Nescafé 100gm jar260Tk
Nescafé 50gm jar135Tk
3. market analysis
Nescafé 3 in 18Tk
Nescafé 1.8 gm Bondhu Pack5Tk
Nescafé 0.9 gm sachet2Tk
3. market analysis
pricing strategies…
VALUE ADDED PRICING
This involves attracting value-
added service to differentiate the
company’s offers and to support
charging higher prices.
The price of Nescafé 3 in 1 has a
higher/cup price than any other
Nescafé pack.
Yet people tend to buy it more and 3 in
1 pack is very popular among the
young generation as it is easy to make
without any hassle, and it gives extra
value to that product as milk and sugar
is mixed with the classic Nescafé.
3. market analysis
pricing strategies…
COST BASED PRICING
It is setting prices based on thecosts of production, distribution,and selling the product with a fairrate for effort and risk.
As Nescafé imports their productand raw materials mainly fromabroad, they cannot sell it at a lowprice. So, they sell their productbased on expenses they need tobear after the import
3. market analysis
PLACE AND SALES POINT
Nescafe products, in most cases, are found on
shelves of various departmental stores and
the smaller packs are found even on roadside
tea stalls.
3. market analysis
PLACE AND SALES POINT
Pack Size Target Users
Out of home pack mostly serving the bulk users, i.e. fast fo ods,
restaurants etc.
In- home pack, mainly for the relatively frequent coffee drinkers.
In-home pack, meeting the daily usage need of households in an
affordable way.
Containing right mix of coffee, creamer and sugar to have right taste of
coffee just by adding hot water, convenient pack size of 14 gm allowing
the consumers to carry it with them and have coffee anytime, anywhere.
For 2 persons, affordable pack with broader consumer base.
3. market analysis
PROMOTIONS - TVC
Cholo shobai
Anytime, Anywhere
Get, Set, Rock
Jaago
3. market analysis
PROMOTIONS – Print Media
NESCAFÉ has been advertising in
Prothom Alo, The Daily Star, Star
Weekend Magazine etc. to
generate awareness among the
consumers.
3. market analysis
PROMOTIONS – In Store Communication
Trade posters, Shelf talkers, Bunting, Danglers are
the main elements used for in-store
communication. Nestlé appoints merchandisers for
installing these materials. These are also called Point
of Sales Materials (POSM).
3. market analysis
PROMOTIONS – Outdoor Activities
NESCAFÉ is currently using shop signage as
outdoor promotion. These help shoppers
remember the brand while they are making
purchases.
3. market analysis
PROMOTIONS – Sampling
Sampling is a very useful tool to ensure trial of
coffee. Wet sampling is basically providing samples
to consumers in ready to drink form. It is done
through vending machines and also through
different agencies. NESCAFÉ has yearly budget for
free sampling and is actively utilizing it with a view
to familiarizing people with coffee taste.
3. market analysis
PROMOTIONS – Consumer Promotions
Till now NESCAFÉ has adopted two ways of consumer
promotion. 1. Through sponsoring different events
related to the target consumers, i.e. NESCAFÉ
Unplugged, NESCAFÉ Campus Carnival and NESCAFÉ
Battle of the Giants. 2. Through providing specific
incentives with the pack, i.e. NESCAFÉ mug, NESCAFÉ
branded spoons, T-shirts, Caps etc. Besides, the company
has also tried out some cross brand promotional
activities like promoting NESCAFÉ and Coffeemate
together in the NESCAFÉ dream couples contest.
TO END WITH…
Nescafe has seen a steady growth in market demand for its products.
It has successfully been able to change customers’ attitude towards
coffee and has been able to convert tea drinkers to coffee drinkers…
with the entry of international coffeehouse franchises in to the market
that Nescafe has worked so hard to build, the future of Nescafe
products are at stake
however,
as such,
Nescafe has resort to even more creative means to compete and
gain market share or even retain its current turnover..
Will this be the start of a new era of marketing for Nescafe?