Nespresso is a company that specializes in the production of high-quality coffee machines and coffee capsules. The Nespresso target market includes affluent coffee lovers who are willing to pay more for quality coffee that they can quickly and easily make at home.
They have developed a successful business model by licensing their technology to different coffee machine manufacturers who now make Nespresso-compatible machines under different brand names.
Thanks to its focus on high-quality coffee and a wide range of coffee types & tastes, Nespresso has been a hit amongst the coffee-loving community and has been able to maintain a high level of customer loyalty.
Who is the Nespresso Target Market?
One of the best ways to understand the Nespresso target market is to understand people’s motivations for using a coffee maker like a Nespresso machine to make coffee by themselves instead of going to a cafe or a coffee shop.
Once we understand the customers’ needs and motivation, we can segment the market and study each segment to see what attracts them to a coffee maker.
Such an analysis gives us the following segments of the Nespresso target market:
- People who want to save money by making coffee at home
- People who appreciate fresh, high-quality coffee
- People who have time constraints and don’t have time to go to a cafe
- People looking for consistency in their coffee
- People who want to experiment with different coffees and brewing methods
- Offices and businesses that want to provide coffee for their employees
- People looking for a gift for someone else
Let’s look closely at the needs of each of these segments.
1. People who want to save money by making coffee at home
The quickest way to see the financial benefit of saving money by making coffee at home is to do a return-on-investment calculation.
Let’s say that an average Nespresso machine costs $200. Most Nespresso capsules (or other Nespresso-compatible capsules) cost around $0.30 each.
Let’s also say that the person who buys this machine has a cup of coffee each morning. Let’s assume that this same coffee costs them $3 at their local coffee shop.
To see the ROI with a Nespresso machine, we’ll compare costs between using a Nespresso machine with capsules and the coffee shop over a period of 3 months.
Over 3 months, or about 90 days, the coffee shop will cost the person 90 days X $3 = $270.
Over the same 3 months, or 90 days, the coffee at home will cost 120 X $0.3 = $36 in Nespresso capsules. To this, we add the cost of the machine which was $200. That gives us a total cost of $236.
What this calculation shows is that within 3 months, a person who has just 1 coffee per day can recover their investment in a Nespresso machine.
And so clearly one of the key segments of the Nespresso target market is people looking to save money!
2. People who appreciate fresh, high-quality coffee
Money aside, people also buy coffee machines like those from Nespresso because they can have fresh, high-quality coffee anytime they want, without leaving their homes.
Of course, they can also get this same coffee from a cafe. But what if it’s late at night and they want a coffee? Or, what if they want to enjoy a quiet cup of coffee in their own home?
For people who appreciate fresh, high-quality coffee, a Nespresso coffee machine can be the perfect solution making these people a segment of the Nespresso target market.
3. People who have time constraints and don’t have time to go to a cafe
Many people just don’t have the time to go out for coffee making them an ideal Nespresso target market. They might be busy with work, taking care of their family, or have other commitments that mean they can’t leave their home.
For these people, having a Nespresso machine at their disposal means they can have a fresh cup of coffee without having to leave their homes or offices.
Many busy people will put a Nespresso coffee machine in their offices for this very reason.
4. People looking for consistency in their coffee
Each time someone goes to a cafe, they might get a coffee that tastes different. This is because each barista makes coffee slightly differently.
Sometimes, people don’t get the chance to go to the same coffee shop each time. In this case, they are almost sure to get a coffee that tastes different.
Some people like this variety. But prefer to have a consistent coffee taste. For such people buying a Nespresso machine and using the same type of coffee capsule each time is the answer.
5. People who want to experiment with different coffees and brewing methods
While some people cherish consistency and predictability in their coffee, others like to experiment.
For these people, a Nespresso machine can be very practical because it gives them the ability to experiment with different coffees and brewing methods. Some might use their Nespresso machine to make an espresso. Others might use it to make a cappuccino.
Some people might want to try a new coffee type each week. Others might want to experiment with different brewing methods to find the one that works best for them.
There are people who appreciate different tastes and textures of coffee, perhaps from different parts of the world and one of the easiest ways for them to try different coffees is with a Nespresso machine at home.
6. Offices and businesses that want to provide coffee for their employees
This segment of the Nespresso target market is office managers who are generally responsible for stocking the office kitchen with supplies.
They might not be looking for a specific coffee maker but they will want to provide their employees with good quality coffee while saving money for the company.
One of the easiest (and cheapest) ways to provide coffee for employees is to have a coffee machine in the office. And Nespresso can be a safe bet in this case.
Many businesses choose to do this because it is a cost-effective way to keep employees happy and productive. It’s also a good way to show employees that they care about them and want to provide them with amenities that make their lives easier.
And if employees don’t have to leave the building or even their offices to get coffee, they will stay in the office longer and perhaps be more productive.
Some businesses use sell coffee in addition to other food items. For instance, bakeries try to improve their profitability by offering high-margin products like coffee. As we saw earlier in this article, the unit cost of a coffee can be as low as $0.30 but can be sold for $3 – that’s 10X!
7. People looking for a gift for someone else
Finally, a coffee machine can be a perfect gift for someone who loves coffee but doesn’t have a machine at home. And Nespresso machines, with their beautiful designs and excellent coffee, can be a great gift.
Most good Nespresso machines are reasonably priced and so giving one as a gift is not a huge financial investment.
It’s also a practical gift that the recipient can use every day. So, for coffee lovers, a coffee machine is a gift that keeps on giving. And many modern coffee machines can last for many years.
Conclusion
The Nespresso target market generally includes those who love coffee and don’t always have the time or desire to get to a coffee shop when they feel like a coffee.
One of the interesting reasons why people buy Nespresso coffee machines is to save money. A coffee made from a coffee machine costs a fraction of what it costs in a coffee shop and sometimes even tastes better. And sometimes even in a few months, the investment in a Nespresso machine can be recuperated.
Another segment of the market includes those who love fresh, high-quality coffee and want it when they want it. Regardless of the reasons why they cannot go to a coffee shop, a Nespresso coffee machine can give them great coffee on demand.
People who look for consistent taste in their coffee also prefer to use Nespresso. Similarly, those who like to experiment with different coffees also find a Nespresso machine an attractive solution.
Offices that want to provide coffee to their employees will often put a coffee machine, like one from Nespresso, in the common area or the company kitchen.
And finally, a Nespresso machine can be a great gift for someone who loves coffee. And best of all, it’s a reminder of who gave the gift each time someone makes coffee.