George Clooney's coffee break secrets
publication date: Dec 7, 2007
Hi, my name is Nick and I'm a caffeine junkie.
My first coffee of the day is a 4 shot cappuccino,
followed by at least another couple of 3 shot
hits. I know I know, it's probably not
good for me, but I've got used to it.
But do you remember the good old days . . .
. . . when coffee was instant, granulated and
tasted a bit like stale cardboard?
. . . when a host bringing out a cafetiere at
the end of a meal was greeted with oohs and
aahs and deemed to be the height of dinner
party sophistication?
Now, an average coffee in a central London
Starbucks costs around £2.50. If I'd told you
that 15 years ago, you'd have thought I was
having a laugh!
But things have changed . . . good coffee
was once the preserve of the French and the
Italians. But the Seattle company figured out
that there was a market for creating a
premium coffee experience that people
would happily pay for.
Well, now it looks like one company has
taken premium coffee to a whole new level
and I think there are some great lessons we
can all take from their success that can be
applied to ANY business - big or small -
online or offline.
No you might have seen the magazine ads,
where film star George Clooney stares out of
a page in his best Cary Grant pose, holding
up a glass of espresso. Well, he's endorsing
Nestle's premium Nesprsso range of coffees.
You may have seen them already. If not, the
idea is that you get a range of gourmet
coffees in individual capsules which are
loaded into specially designed coffee
machines.
Ok, so on one level it is a design that saves
on the hassle of measuring out coffee and
the washing up. You just load and press a
button and out comes a perfect espresso
shot.
But this is a whole lot more than functional
time-saving design . . . the marketing guys
have figured out that there is a market for
top-end luxury coffee. And they have
managed to turn what is essentially a very
familiar commodity into an added value and I
presume highly profitable - sales have grown
by 30% per year since the 2001 launch and
their goal is to reach sales of $1.8 billion by
2009. Now that's a LOT of coffee! So how
have they achieved this and what can we
learn from it?
- HIGH-PERCEIVED VALUE: When you
buy a Nespresso machine you also get
a sleek folder (no instruction manual
here) with full colour glossy pages
selling the Nespresso 'experience'. Of
course, the machine would have
worked just as well but the whole
experience of leafing through a smart
folder keeps the. And every month or
so I get a mailing from Nespresso with
extra inserts to go into my folder
telling me about the latest additions
to the range of coffees.
- RARITY justifies the premium price:
Nespresso capsules can only be are
NOT available in supermarkets - this
seems to be a conscious decision to
create rarity and higher perceived
value. How does the customer feel?
- HEIGHTENED EXPERIENECE: this isn't
just a coffee maker - this is a lifestyle
choice (at leas that 's what Nespresso
would like us to believe). They are
targeting the DEEPER EMOTIONS. They
want their customers to feel more
sophisticated, discerning and . . . well
. . . just that little bit better than
their neighbour.
- GO FOR THE UPSELL: The back end is
incredible: not only can you buy more
than a dozen premium coffees, but
designer cups, capsule holders
(including leather pouches and wooden
boxes), milk frothing kits and even
protective travel cases for those
people who can't leave home without
their Nespresso fix! The company
realised that if someone is prepared to
spend money on the machine and
gourmet coffee capsules, then it is
highly likely to buy other accessories
to further their Nespresso experience.
I know it may seem counterintuitive,
but when someone has decided to
buy, they are at their most open to
adding to that sale. It makes sense as
the customer has already
psychologically paid for one product
and any additional expenditure will
meet less resistance. Just take a look
at Amazon to see how they offer
similar products at the checkout.
- GET REPEAT SALES: what better
business to be in than one that
requires the customer to make repeat
purchases of the capsules. And as you
cannot buy from any high street
outlet (apart from a few luxury retail
outlets like Selfridges), you are buying
direct from the manufacturer via mail
order or online. To be honest, I'd they
offered a direct debit feature I'd
probably sign up to that too!
- BUILD A CUSTOMER LIST: You have to
give your full details for some kind of
warranty when you buy the machine.
Of course, these details are also being
used to promote the back end. I am
getting direct mail at least once a
month from Nespresso. Buyers are by
far the best names. So if you are
selling ANYTHING - online or offline, a
products or a service - make sure you
are capturing details and permission to
contact them in the future. Anyone
who has email or postal addresses of
customers who is not offering further
opportunities to buy are literally
leaving money on the table!
Right, I'm off to grab a coffee . . . we work in
serviced offices and there's a Bulgarian lady
in the café who makes coffee so strong you
can chew it!
Oh an before I forget, make sure you check
your inbox tomorrow - it's the world
premiere of a very exciting and proven home
business focused on starting your own
Family Tree Research Service! Get started this
weekend and you could be making a tidy £600
a week by the start of 2008!
Cheers
Nick
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