The digital transformation made Nespresso possible

How can a coffee brand revolutionize the industry?

As Nespresso continues to grow, there’s a lot to be learned from the progress this brand has made on the road to digital transformation.

Nespresso created a truly transformative experience for its customers in recent years. Overall, they’ve enabled simple digital transactions, drove personalization and customization across channels, leveraged digital media to craft and deliver a compelling brand, and blended digital and physical for a meaningful omnichannel experience.

Nespresso’s overarching goal is the same as it has always been: to provide customers with the perfect coffee experience. What has changed is Nespresso’s incorporation of technology to achieve this, allowing for an even greater focus on the experience aspect of its products.

Olivier Van Duüren, Founder of The Dualarity, is a leader in personal and business transformation that participates in the Digital Business Global Master as a professor. In the article below, Olivier explains the Nespresso success by implementing the digital transformation in its business model.

The Digital Transformation at Nespresso’s Business Model

Like many industries, the coffee industry has changed over the last years. Single-cup coffee brewing is on the rise, and Nestlé holds almost 30% of the global brewing market systems. Nespresso was founded in 1987, is present in more than sixty-four countries, employs 12,000 people, has annual revenue of four billion dollars, more than 450 boutiques in premier locations, five million Facebook fans, and 340,000 unique online customers every day. Since 2012 they sold close to 28 billion aluminum capsules.

Nespresso transformed coffee from a simple product to a sophisticated coffee drinking experience by enabling personalized and engaging connections, blending the physical with the digital to act as one. The company wants to deliver the perfect coffee experience, while you take your time to enjoy the moment. It has a very clear why: ‘Coffee is at the heart of all we do. Yet consumer pleasure is why we do it.’ And through this shaping the global coffee culture.

The company surrounded the coffee brand with machines, capsules, accessories, online/ offline shops, smart distribution, great design, premium boutiques and a Nespresso Club. When you order capsules, they are delivered within two days to your front door. The company leverages all its digital channels to release specific content, reinforcing its brand perfectly. Hiring George Clooney as a high profile brand ambassador for its commercial, ‘Nespresso, what else?’, filled with subtle humor was a master move.

Nespresso has created a single efficient view of its customers across all channels and systems, leveraging the power of the Cloud with its modern customer engagement platform. It handles the complete customer journey, connecting all its internal data with all its external data across every touch. According to the Digitalist Magazine, ‘It encompasses customers who engage via the website, via mobile, at an airport vending machine, or those who plan to meet George Clooney in a flagship store’. And it is into big data, personalizing and enabling real insights about its customer behavior and intentions. They managed to create an emotional connection with their customers and everyone can now serve a premium coffee at home.

'Nespresso is the Apple of the coffee'

They are working hard, as part of their sustainability efforts, on limiting the impact of its aluminum capsules through recycling, to source aluminum in a responsible way and to enable fair trade.

And they state ‘Our people represent the heart and soul of our success story’ and this powered by more than 90 different nationalities. They foster values like Integrity, honesty, respect, fair dealing and full compliance with the law.

Outcomes

Nespresso was able to win new customers, increase sales, understand its customers in-depth, deliver a personalized customer journey and shorten innovation cycles to less than four weeks. And while the competition is not standing still, Nespresso continues to grow and break new frontiers on what an end-to-end coffee experience means. It is balancing between healthy and mature, a Dualarity hero with the customer at its heart and digital as its oxygen.

Moving Forward

They had an average 30% growth since 2000 but some recent estimates show that this might be slowing down. The competition in coffee pods – Starbucks, Senseo or Nestlé’s cheaper internal brand Dolce Gusto – has grown since Nestlé introduced Nespresso in 1986 so they will need to re-invent themselves and continue to innovate to stay ahead and avoid any complacency.

Digital Business Global Master

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