Nespresso: Successful design capsules

Not only George Clooney loves it: With turnover of 2.77 billion CHF and a sales increase of over 22 percent in the crisis year of 2009, the Nespresso international fan club is constantly growing. The recipe for success for the pioneer in portioned top-class coffees: the best quality coupled with refined, sophisticated packaging, marketing and design strategies.

Despite the economic downturn in 2009 and in the meantime more than 20 competitors worldwide, Nestlé Nespresso S.A. has announced a powerful turnover result and since 2000 has been able to maintain its average growth of 30 percent. Last year the company introduced a completely new machine series, extended its boutique network to 190 stores and, for the first time, the number of Nespresso club members worldwide exceeded the seven-million mark. The magic word is portion coffee and it has triggered a veritable lifestyle movement. And the fact that this been achieved given the sober calculation that one pound of coffee in individual portions can easily cost 5-6 times that of its counterparts on the supermarket shelves, does not deter the Nespresso fans at all. It's all about the feeling - not reason.

The Nespresso trilogy

Nespresso was already founded in 1986. Since 2000 business has been really booming and the fastest growing division at the Nestlé Group has experienced an unprecedented rise in consumer demand for its high-quality portioned coffees. The company introduced the highest quality "Grand Cru coffees" to the market, which consumers can enjoy both at home as well as in luxury restaurants, cafés, hotels and offices. The unique Nespresso trilogy consists of coffees, intelligent machines and a very special after-sales service.

Everything connected with Nespresso is accompanied by a touch of luxury and exclusivity. That is what consumers love. The stylishness is now in every detail and feature. The product’s advertising icon George Clooney does the rest to maintain and promote the image. The packaging design also comes across as exquisite and elegant. Smart, coloured capsules and elegant dark-tinted folding cartons. They are exclusively sold at stylish Nespresso boutiques at selected locations or mailed to customers via the Internet.

Growth necessitates investments

For all the trendy chic and style, the company does however attach the greatest significance to the fact that absolute priority not only lies in satisfying customer demand, but also in maintaining the highest quality standards for the products and processes within the company. An expansion of the existing packaging line was realized by the Cama Group, which has been cooperating with Nestlé on diverse projects for many years. In this case the project was realized in collaboration with Rockwell Automation. In order to double capacity a robot folding packaging machine was developed with a loading system specially tailored to Nespresso’s requirements. The Nespresso line manufactured by Cama consists of a robot feeder system, a cartoning machine with sideways loading and a wrap-around machine. The feeder system consists of a 2-axle robot with order-compilation heads, which have been developed and tailored to requirements. The sideways-feed cartoning machine loads the coffee capsules into packets containing up to 10 units. After filling, each packet is sealed and coded. The wrap-around machine transfers the packages to shipping packaging, which each contains 20 or 25 packets. The paletizer system then collects the packaging and takes it to the outbound line. All production data is conveyed via the Ethernet to a central data registration system.

"In future Nespresso will also continue to make considerable investments in high-quality production facilities in Switzerland", says Richard Giradot, CEO Nestlé Nespresso S.A. Because growth needs space: This May Nespresso announced the expansion of its production and sales/marketing centre in Avenches, Switzerland. Following the completion of the already launched project, total investment in the programme is set to reach more than 400 million CHF. The work is expected to be completed in 2012.

Safe aluminium capsules

There is also special focus on the primary packaging used for the valuable coffee: the aluminium capsule. The airtight capsule prevents oxidation, offers perfect protection against the air and light, and thanks to the food lacquer coating, every type of coffee has its own separate colour. In the machines a special blade system then ensures the exact perforation of the capsules, optimum water supply and distribution coupled with fast extraction of the coffee. A further, really important aspect: the 100-percent recyclability of the aluminium. As every country has its own recycling legislation, the company for example uses the existing return systems in Switzerland, Austria, Germany, France and Portugal. Similar systems are also set to be introduced in other markets, as the company is seeking to treble capsule recycling capacity by 2013.

Promising sustainability

Nespresso has therefore also discovered the theme of sustainability for itself. As early as 2002, a partnership was founded with Rainforest Alliance, which is actively committed to more sustainability in agriculture. It continues to be an important partner within the "Nespresso AAA Sustainable Quality Programme". In this connection, the prices which Nespresso pays, are, according to the company, 10% above coffee’s highest market value. In addition, firm directives are set to ensure that 75 percent of the export price goes directly to the farmers. Apart from this, the quality of the farms is being constantly improved, which has meant a reduction in the percentage of rejected beans from fifty to five percent. Numerous other projects round off the programme.

Last year the company presented its platform for sustainable innovation entitled "Ecolaboration". The company’s self-imposed obligations up to 2013 are as follows:

• 80 percent of the coffee is obtained from the Nespresso AAA Sustainable Quality Programme farms with Rainforest Alliance certification.
• The used capsule recycling capacity is being trebled to 75 percent worldwide.
• CO2 emissions per cup are being reduced by 20 percent.

Outlook

For 2010 the company is once again aiming for double-figure growth and hoping to exceed the turnover milestone of three billion CHF. The boutique network is being expanded to include a further 30 stores, among others in Brussels, Munich, Miami and New York (Soho). They are being joined by new locations, for example Shanghai, Cape Town and Johannesburg.