Things I’ve learned from Nespresso
This is actually a smart move, the global coffee industry has actually been way back since before the first world war, even to the time of colonialism. I think the very condensed condition of the coffee market and the lack of high quality coffee has forced Nespresso to reposition themselves as premium or elite, there’s not really much to be changed or tweaked or customized in a coffee bean other than how you treat or grow it that will contribute to slight changes to the flavor, so instead of selling a lot of wholesale coffee Nestle came up with Nespresso that do real experiment with the human psychology. It is trying to be the Apple in the coffee industry.
Coffee machine itself has actually been around for long so what makes Nespresso machine so unique is its ability to brand itself as different than any other machine, in the ads they will tell you how sophisticated and precise the machine is and how every Nespresso cup is different and very environmentally friendly. But, what actually happen is Nespresso tricks the customer’s mind into feeling like they are contributing into the making of high quality coffee that they can make or do it yourself (DIY) at home instead of buying one at Starbucks. This feeling of contribution plays an important role in the human brain, by adding a customer aspect into the making of a simple coffee that you can get ready anywhere especially in Europe will actually stimulates the release of dopamine in the human brain, the customer will actually feel more satisfied and happier after completing a small task such as brewing by him/herself, this feeling is actually normal but this hormone is highly addictive just like caffeine, cocaine or likes. This is why people are getting hooked into doing more of it, the same principal applied in other industry, such as social media like Facebook or Instagram, or IKEA with its assemble yourself furniture. Also there is this expensive machine sitting around on your kitchen table and every time you see it will only makes you want to buy more cups and make another Nespresso coffee.
Now this is interesting, it is like the era where Apple is trying to beat the Microsoft. This is the underdog trying to beat the giant. Jacobs Douwe Egberts (JDE) actually is of two very old retail companies that somehow merge in the late 2000, with new modern and relatively young employees that they value so much. This Dutch company is likely and slowly going to disrupt the Nespresso’s market share. Even the biggest supply chains of this two companies are actually next door to each other, JDE in Peru and Nespresso in Colombia. Both of these companies are after premium class segmentation, JDE with the approach of changing the future like providing many scholarships, taking care of the farmers community, and really emphasize on accountability and discipline, on the other hand Nespresso approach is subtle, with George Clooney as its ambassador, it is trying to embody elegance & prestige to the Nespresso’s name while still taking care of the environment with its famous carbon neutral cup.
I think this kind of friendly competitive is good for the customers and also the farmers, it reduces the chances of monopoly of the coffee price and rises up the living condition and competitive wages of the farmers. Great competitive spirit often leads to great and more innovative technology in the future.
