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Case Study - Nestle

Case Study - Nestle - The power of love A Nestl case study...

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The power of love A Nestlé case study On the 7th December 1992, 30 million viewers watched episode 12 of the Nescafé Gold Blend saga in which the hero Tony told Sharon – ‘I love you!’ This was one of the high points of perhaps the most successful advertising campaign in this country in recent years. The success of the campaign rested on the fact that advertising had become drama and that the audience had become hooked on the storyline. More importantly, the audience was able to identify the advertising with the product and increases in sales could be clearly related to the campaign - for example, within a year of the romance going on air in November 1987, sales had risen by 12and over the next few years, Nescafé Gold Blend was able to grow its sales volume by 60 creating a £100 million brand by 1996. This case study charts the success of the Gold Blend television saga in achieving the marketing aim of making the product accessible to the majority of coffee buyers. The case study then goes on to show how the packaging of Gold Blend and the product itself have both been improved to add to its enviable market success of today. There are two parts to the television success story: The first part started in November 1987 and involved the development of an extraordinarily successful campaign. The second part started in November 1993 and shows how the success was broadened to attract a younger target audience. It shows how Nestlé understood the nature of the highly segmented coffee market and was able to broaden the appeal of the brand to fresh segments of that market at the right time. QUESTIONS: 1. WHAT IS A HIGHLY SEGMENTED MARKET? 2. HOW WOULD YOU SEGMENT THE COFFEE MARKET? Strengthening the position of Gold Blend Positioning is a key aspect of marketing. The position of a product is the way it is perceived by consumers in terms of the key features they want to get out of the product i.e. those aspects which they see as giving value for money. For example, in purchasing instant coffee, consumers may weigh up value for money in terms of price, the quality and taste of the coffee. An individual business producing coffee needs to decide where it will position itself in the market, for example it could choose position: high price combined with high quality and taste of coffee - an ‘up market’ position.
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middling price combined with middling quality and taste of coffee - a ‘mid market’ position. relatively cheap price combined with low quality and taste of coffee - a ‘down market’ position. Organizations identify a range of segments in the markets in which they operate e.g. a younger audience of drinkers who may be trying out coffee for the first time, people who, because of the long-hours they work, need coffee to 'pep them up' at regular intervals during the working day, older more sophisticated drinkers at dinner parties etc. It is important to have a good understanding of these segments and how your product can meet the needs of different segments in the overall market.
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