Marketing Strategy of Nescafe for Latte Coffee in Australia

This report analyzes the current marketing strategy of Nescafe in Australia for latte coffee and provides strategic recommendations for improvement.

Consumer Behavior and
Marketing Psychology
Student’s Name:
Student’s ID:

1
Executive Summary
The report analyzed the current marketing strategy of Nescafe in the context of latte coffee in
Australia. It also evaluated the marketing communication mix of the coffee company. Three
strategic recommendations have been provided to bring more improvements in the current
marketing strategy of Nescafe in the context of latte coffee. Differentiated marketing strategy is
followed by Nescafe, where it can cater to all the segments of the Australian market. This
strategy helps the coffee company to capture high market shares and provide value to its
customers. Nescafe has positioned itself as the top latte coffee company in Australia.

2
Table of Contents
Overview of Selected Product.....................................................................................................................3
Critical Analysis............................................................................................................................................3
Strategic Recommendations........................................................................................................................6
References...................................................................................................................................................8

3
Overview of Selected Product
A latte coffee is a coffee drink which is made up of steamed milk and espresso. A latte coffee is
correctly known as cafe latte although most of the large commercial chains make cafe latte by
default if a customer asks for latte coffee. Most of the restaurants or coffee shops except some
restaurants or coffee shops in Italy or Europe gives a glass of steamed milk after ordering a latte
coffee. In a latte coffee, the milk utilized for the latte coffee is brewed and frothed to make a
velvety and creamy texture which mixes well with the flavorful and strongly concentrated
espresso and create a harmony of flavors (Al Doghaither et al., 2017). The foaming of the milk is
prepared to utilize the steam wand of the espresso coffee machine. A latte coffee is made of 3
ounces of steamed milk, 2 ounces of espresso and a thin layer of froth on the top. A latte coffee
is also sometimes known as wet cappuccino.
The term “cafe latte” means “coffee with milk and is generally made up of steamed milk and
espresso. But several people like to mix sweetened syrups in various flavors. Some famous
flavors of latte coffee are chocolate, caramel, and vanilla (Asioli, Næs, Øvrum, and Almli, 2016).
Few teaspoons of the flavored and sweetened syrup are mixed to the espresso, stirred, and at last
the steamed milk is mixed. These flavored syrups could be bought so that coffee lovers can enjoy
the flavored latte coffee. In Australia, latte coffee is served in a small earthenware cup with the
velvety steamed milk over a single-shot of espresso which holds back the froth at the top of the
cup (Boyd, and Cooper, 2015).
Critical Analysis
Current Marketing Strategy
Nescafe holds a large share of the coffee market of Australia since the year 1947. The coffee
company has the most extensive range of coffee products in the market of Australia and has a
famous brand name, brand recognition customer franchise, and customer loyalty. Latte coffee is
one of the products of Nescafe, which is considered to be people oriented instead of being
system oriented. The marketing strategy of Nescafe has been planned in such a way that
provides significance to the lifestyles and needs of its customers (Clarke et al., 2018). The
product is of superior quality, and the company also try to enhance its distribution channels and
pricing strategy along with the generation of annual profits.

4
Differentiated marketing strategy is followed by Nescafe, where it can cater to all the segments
of the Australian market. This strategy helps the coffee company to capture high market shares
and provide value to its customers. The coffee company has also implemented an aggressive
targeting strategy in Australia. The coffee company in Australia targets those customers who fall
in the age group of 20-30. They are the segment of young café culture and includes young
working professionals and college going, students. The products of latte coffee of Nescafe
consists of various flavors like a vanilla latte, hazelnut latte, caramel latte, coconut latte,
butterscotch latte and crème Brulee latte which are available in the market of Australia to satisfy
to wants and needs of the consumers.
The coffee market of Australia is highly competitive with several local, national, and
international brands targeting different segments of coffee consumers. Nescafe has extremely
effective market positioning strategy in Australia that has been successful in building a brand
image in the minds of the latte coffee consumers of Australia. It has recognized its competitive
advantage, worked on that, and delivered values to its customers. Nescafe is the top coffee
company in Australia, and it has positioned itself as a unique coffee brand which is concerned
about the quality, health, and taste of the coffee drinkers of Australia. The latte coffee products
of Nescafe has already proved that the products are great and have the edge over latte coffee
products of other coffee companies available in the market of Australia and imply that its latte
coffee is excellent in quality and taste.
The coffee firm made different promotional campaigns such as Nescafe Short Film Awards and
won the Nescafe Latte Lounge for promoting its products and build a long-lasting effect in the
minds of the coffee lovers. Another strategy of promotion is its outstanding branding, which is
utilized to create high brand values for coffee consumers. In order to satisfy every economic
section of the Australian society, the coffee company also works on the packaging and make the
products available in various sizes, so that the new consumers could try and even those
customers who could afford low prices can purchase the company’s products. The coffee
company targets its consumers efficiently and helps to generate sales and profits for the coffee
firm.

5
Marketing Communication Mix
Advertising - The liberal democratic values and traditions are reflected through Australia’s
diverse lifestyles and cultures of Australia. As there are multicultural people in Australia, so
attracting customers is difficult in Australia. The coffee firm makes a different promotional
programme based on Integrated Marketing Communication (IMC) framework (Desbrow, Hall,
and Irwin, 2019). These promotional programme has profoundly influenced the purchasing
behavior of the consumers. The company conveys its messages through advertisements in print
and broadcast media and TV, and the strategy is to attract the attention of the customers. As the
target audience usually read newspaper or magazines and watch the news, ads have been made
for the target market on that basis.
Direct Marketing - It is also an effective promotional strategy based on IMC frame work.
Through direct marketing, Nescafe tries to generate a behavioral response in its targeted
consumers. As the target consumers include young working professionals and college going
students, they usually utilize the internet and so Nescafe uses direct print media and direct email
(Hailemeskel and Fullas, 2016). In a direct email, Nescafe sends mail to all the users of Gmail,
Hotmail, and Ymail. In direct print media, the coffee company print on the first page of
magazines and newspapers.
Internet Marketing - Nescafe reaches its consumers through online in internet marketing.
Australia is a developed nation, so it is evident that most consumers work on online or utilize the
internet. Internet marketing includes the official website of the company and social networking
sites like Twitter, Instagram, and Facebook (Kawano, Ando and Izumi, 2015). The coffee
company utilizes pop-ups, pop-under, and banner ads for attracting consumers while they work
through online. Nescafe give ads on the latte product and ask the consumers for their suggestions
for improving the ads. Those customers sent more creative ideas are rewarded with some special
gifts. The consumers can text message on its number or visit its website for sending their
suggestions.
Sales Promotion - The aim of the sales promotion of Nescafe is to directly attract the customers
and offer an incentive or an extra value for the coffee company (Lee, Dang, and Lee, 2019).
Nescafe offers that those who purchase the latte products of Nescafe can get a coupon number
and this number provides an opportunity to the customers to take part in a contest organized by

6
the coffee company known as Nescafe Contest. Anybody can take part in the game irrespective
of age, class, and culture, and the winner gets an opportunity to sing for an ad of the coffee
company along with a reward of $10,000.
Public Relations (PR) Strategy - The objective of public relations of Nescafe regarding the latte
products is to make the people of Australia aware of the new types and variety of latte products
of Nescafe. It also aims to create excitement in the minds of the coffee consumers of Australia
for buying the latte products of Nescafe. Nescafe is a famous brand, so it is easy for the company
to create a better brand image in the minds of the coffee consumers of Australia. The coffee
company organizes several press releases; business shows for PR and seminars to launch its new
products (Millard, 2017). Australia has a unique combination of established and new traditions,
and most people are immigrants in Australia and have a significant impact on every aspect of the
lives of Australians. That is why the PR strategy of Nescafe is based on the bond of various
cultural aspects of Australia.
Strategic Recommendations
 In order to capture the more market shares of the coffee market of Australia, Nescafe needs
to make the partnership with the local organizations for creating the offerings utilizing both
the local and global perspectives. The promotional strategy of the company must not be
entirely based on young coffee drinkers but also for the adult and old coffee drinkers
(Watson et al., 2016). The coffee company can utilize a 360-degree marketing campaign,
which is an efficient method to reach the target customers in the future. The coffee firm has
to know the intention of the consumers for purchasing latte coffee products. In the present
world, everybody wants superior and healthy products for themselves and their family
(Neacsu, 2018). Therefore, Nescafe need to know the buying intensity of the coffee
consumers
It has been evaluated that the coffee firm is utilizing great marketing methods through its
promotion. A recommendation about the marketing of Nescafe is that the company could
make more utilization of social media as several people are present on social media these
days. So, Nescafe can run the promotional campaigns on social networking sites as it will
help the firm to analyze the Australian market more effectively and with a broader reach

7
 Nescafe must attract new consumers those who have never utilized the latte coffee products
before. It could be achieved by building awareness of the latte coffee products among the
consumers. Various promotional activities can be organized and must provide attractive
offers to cover more coffee consumers. A creative marketing strategy can be used by Nescafe
to give proper information to the coffee consumers through different advertisements. For
advertising the new latte products, a suitable and effective tagline must be used for attracting
the coffee consumers. The tagline needs to be appropriate according to the products for
attracting the coffee consumers (Nuševa, Mijić and Jakšić, 2017). This strategy will help to
enhance the brand image of Nescafe and enable the firm to capture the Australian market
Events can also be organized as a promotional activity for attracting the target market. The
coffee consumers must be given opportunities to communicate directly with the marketing
executives of Nescafe. The coffee company must organize the events in the malls and
crowded places in Australia (Ullah et al., 2015). The events will help to know the needs of
the latte coffee consumers of Australia and also enable the attitudes of the customers towards
the latte coffee products of Nescafe
 Nescafe can use more attractive packaging for its latte coffee products as packaging is an
essential part of the marketing strategy to sell its products. Attractive packaging for the latte
coffee products might be selling points for several latte coffee consumers of Australia. It can
help the coffee company to reflect on the brand image of the products and deliver a sense of
quality. Proper packaging designs could attract the customers and make products stand out
among the latte coffee products of other coffee companies (Rezk et al., 2018). Attractive
packaging can be an excellent opportunity for the marketers of Nescafe for communicating
the message of the company and position the same product as a better option than its other
competitors
In the current world, customers are shown a growing number of alternatives, and a 30-minute
session can be sufficient for attracting, impressing, and making the customers buy the
products. With stiff competition in the coffee market of Australia, attractive packaging will
be the best tool of marketing for Nescafe for directly communicating and influencing the latte
coffee consumers of Australia (Richardson and Clarke, 2016). Packaging can be directly
connected with the quality of the goods. The marketers of Nescafe need to include all the

8
buying aspects in the packaging such as brightness, color, and typography so that the
potential latte coffee consumers are attracted towards the products
References
Al Doghaither, H.A., Almowalad, A.M., Shorbaji, A.M., Al-Ghafari, A.B. and Omar, U.M.,
2017. Assessment of the antioxidant properties of the most common Coffee Brews available in
the local markets of the western region of Saudi Arabia. Journal of Experimental Biology and
Agricultural Sciences, 5(1), pp.70-76.
Asioli, D., Næs, T., Øvrum, A., and Almli, V.L., 2016. Comparison of rating-based and choice-
based conjoint analysis models. A case study based on preferences for iced coffee in
Norway. Food quality and preference, 48, pp.174-184.
Boyd, M.A., and Cooper, D.A., 2015. The LATTE study: a provocative brew. The Lancet
Infectious Diseases, 15(10), pp.1116-1117.
Clarke, N.D., Richardson, D.L., Thie, J., and Taylor, R., 2018. Coffee ingestion enhances 1-mile
running race performance. International journal of sports physiology and performance, 13(6),
pp.789-794.
Desbrow, B., Hall, S., and Irwin, C., 2019. The caffeine content of Nespresso® pod coffee.
Nutrition and health, 25(1), pp.3-7.
Hailemeskel, B., and Fullas, F., 2016. The Use of Freshly Roasted Coffee Bean Powder in the
Treatment of Burn Wound: A Case Report. Dermatology-Open Journal, 1(2), pp.42-46.
Kawano, T., Ando, Y. and Izumi, Y., 2015. Natural radiation source fabricated from
commercially available instant coffee. Radioisotopes (Tokyo), 64(10), pp.621-630.
Knox, A., 2016. Coffee nation: an analysis of jobs in Australia's café industry. Asia Pacific
Journal of Human Resources, 54(3), pp.369-387.
Lee, H., Dang, M.A., and Lee, G., 2019. A STUDY ON EVALUATING THE LOGISTICS
SERVICE QUALITY FOR VIETNAM COFFEE INDUSTRY. International Journal of Supply
Chain Management, 4(1), pp.8-19.

9
Millard, E., 2017. Still brewing: Fostering sustainable coffee production. World Development
Perspectives, 7, pp.32-42.
Neacsu, A.N., 2018. Quality management on the coffee market. Bulletin of the Transilvania
University of Brasov. Economic Sciences. Series V, 11(1), pp.109-118.
Nuševa, D., Mijić, K., and Jakšić, D., 2017. The performances of coffee processors and coffee
market in the Republic of Serbia. Economics of Agriculture, 64(1), pp.307-322.
Rezk, N.L., Ahmed, S., Iqbal, M., Rezk, O.A., and Ahmed, A.M., 2018. Comparative evaluation
of caffeine content in Arabian coffee with other caffeine beverages. African Journal of
Pharmacy and Pharmacology, 12(2), pp.19-26.
Richardson, D.L., and Clarke, N.D., 2016. Effect of coffee and caffeine ingestion on resistance
exercise performance. Journal of strength and conditioning research, 30(10), pp.2892-2900.
Ullah, R., Ahmad, S., Atiq, A., Hussain, H., ur Rehman, N., Elsalam, N.A. and Adnan, M., 2015.
Quantification and antibacterial activity of flavonoids in coffee samples. African Journal of
Traditional, Complementary, and Alternative Medicines, 12(4), pp.84-86.
Watson, W.L., Piazza, S., Wellard, L., Hughes, C., and Chapman, K., 2016. Energy and nutrient
composition of menu items at Australian coffee chains. Nutrition & Dietetics, 73(1), pp.81-87.