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Nescafe India: localization Strategy

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The world’s most famous coffee brand , Nescafé, has ensured a steady impact on Indian consumers. With its strategy to focus on values and a rather modest market penetration using a 360-degree promotion campaign, Nescafé has now become a household name, with its influence extending to even the remotest minorities in India .

localization Strategy

source: Nestle

In India, there are approximately 5000 different products manufactured by Nescafé. With its different variants, Nescafe aimed to leverage the vast consumer base and cater to the needs of all segments of the market.

  • Nescafe uses both mass-targeting and differentiated-targeting strategies. For instance, for corporate customers, the brand made a vending machine that has several inbuilt variants of different kinds of coffees, perfect for coffee breaks. While for the consumers, the brand has various types of products like Instant Coffee powder and ready-to-drink coffee cups adapting to the taste of the Indian consumer. Thus, the marketing strategy of the brand was generalized into usage and value-based.
Source: Indiamart
  • Considering that India is a tea-drinking nation, Nescafe aimed to switch consumer behaviour and preferences and set up coffee as the favourite morning beverage. The idea was to connect to youngsters, specifically on a “social” level. The campaign aimed at influencing them to identify Nescafe as the essential drink to “kickstart the day.”
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Source: The digital zarda
  • On average, about 80% of mobile users in India start their mornings by looking at their phones. Nescafe observed these analytics , and partnered with RockeTalk, a social networking app. RockeTalk allowed its users to not only text but also communicate through other media like audio, video, and voice messages. Executing this strategic campaign, Nescafe intended to make coffee an essential part of every consumers’ morning routine. It wanted to create a strong correlation between coffee consumption and mornings.
Source: Facebook
  • Over the years, it hired prominent faces for their advertisements and conducted various campaigns on social media. These ads and social media campaigns were target-specific and highly successful. Nescafe built a significant brand image in India. It hosted giveaway contests as well as conducted a sustainable project in which they taught coffee farmers to use the latest techniques for coffee production in order to generate awareness.
Source: MyGreatSales

Threats

The Indian coffee market is quite competitive, with a large number of local, national & international players targeting different consumer segments.

Increasing labour costs, dynamic climatic conditions, deteriorating farming methods, migration of people from coffee farming to cities, rising costs of raw material, and changing lifestyle are some of the factors affecting the industry.

The Indian Coffee Market is a duopoly of two firms- Nestle and Hindustan Unilever Limited. The respective corresponding brands Nescafe and Bru, are quite popular in the country. There is a high level of competition between the two, especially in the instant coffee segment. Nescafe has a larger market share in Northern India and has established itself as a youth-centred brand. Bru’s market share is concentrated in South India and is considered to be a more family-oriented brand. Other significant competitors include Tata coffee and global players like Starbucks, etc.

By Simran Arora
Team Loc-N-Apps

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