After Nespresso, this could be Nestle best product -Nescafe Alegria!
by chee Leng (on coffee makers)
Nestle recently launched the Nescafe Alegria in Europe. This small coffee machine can serves the coffee needs for small and medium offices across Europe -potentially in the millions!
The Nescafe Alegria is small, portable, expandable (you can change to a bigger water tank), and it uses Fresh ground coffee (top up right from a cartridge consisting of fine coffee ground and soluble blend).
This is a machine that is meant for the office sector and falls under the Nestle Professional division, out of home channel.
The advantage of this machine is rightly summed up by Nestle Professional Chief Executive Officer Marc Caira -previously coffee machine is either too big or too small, but the Nescafe Alegria size is just right.
Personally, I think the Fresh coffee that it is using would win for them many customers.
Nestle already have an advantage with their penetration of the table top vending machine -Lioness. And the Nescafe Algeria offers an opportunity for offices that want to upgrade to a better quality coffee.
With the entrance of Nescafe Algeria, the competition is really heating up. But, personally this machine works to the favor of Nestle and really sharpens its edge.
We all know that Keurig has partner with Starbucks and anytime now would be launching in different markets. This meant that the office sector that Nestle has a lot of presence in might be compromised.
Then, there is the potential revival of Senseo, and then there is the growth of Flavia, and even within Nestle, their own Dolce Gusto is en roaching into the office sector.
If Nestle do not have a creditable fresh coffee machine, it would lose some market share to companies such as Keurig that have also been doing office coffee solutions in the US for years.
Dolce Gusto is too small for most offices, so that cannot be used to effectively ward off Keurig. Nespresso is facing problems on its own including eroding of coffee capsules sales from companies such as ECC, L'Or and many others and there is nothing much Nestle can do to stop it.
With Alegria, Nestle now has a solution to capture new customers that want better quality coffee or upgrade their current customers.
They have indeed fill a gap that Keurig could effectively en roached on.
How effective would this machine performs in defending and capturing new market depends on the marketing and sales strategy that Nestle is executing.
Keurig together with Starbucks are very marketing savvy and Starbucks has the distribution and network to leverage on.
From what I see, the variable that could hinder the effectiveness of the Nescafe Algeria would be Nestle itself.
It is too big and can it really rally and market it to its many market and make its presence felt before the arrival of the competitors?
Video on how Nescafe Alegria works
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