Digital Coffee … Nespresso is driving digital innovation to bring people’s coffee experiences to life

January 2, 2019

Nespresso might never have existed if we hadn’t set ourselves the challenge of making the ultimate espresso. In 1986 the first Nespresso capsule-based system was launched … “Gamechanging” innovation that answered this important business question: “How can we provide people premium coffee at the touch of a button?”

This intrapreneurial spirit thrives at Nespresso, where, in the words of Vincent Leroudier, Digital Customer Innovation Manager: “We’re in a competitive business climate. It’s not only about working with edgy startups – although we keep tabs on what’s happening – but about delivering fast innovation to solve immediate consumer needs.”

Nespresso has always led the market in coffee quality. But today’s consumers want more, and digital innovation is one way in which the brand can, in Leroudier’s words, “share the Nespresso experience, build stronger relationships with people, and lead – in terms of offering them new products and services, and innovative ways to access them”.

Chatbots and voice

This is why Nespresso is on a mission to use algorithm-rich technology to create a variety of ‘conversational marketing’ experiences, from asking a smart speaker to trace your coffee order to telling a barista-like chatbot that you’d like a no-foam, fat-free, extra-hot latte.

Launched in the US and Germany last year on Facebook Messenger, ‘Nespresso Assistant’ delivers everything from special offers and information on recycling, to cleaning your machine and suggesting new coffees to try.

Early results are promising – 70% of users report a positive experience – and by 2020 consumers around the world will be able to order their coffee via the app without leaving Facebook Messenger. Nespresso plans to scale the platform globally over the next two years.

“We think the bot will work because it’s easier than a website or proprietary app,” says Leroudier. “People want simplicity, and a messaging app is up-to-date 24/7, on mobile or desktop. Conversations follow you, from the office to the home, for example. And bots are more personal, interactive and entertaining.”

“What type of coffee would you like to try?” Nespresso Assistant might ask you, with a cheeky smile emoji, before answering your question on machine descaling using easy-to-follow GIFs. If the bot fails to deliver, and its artificial intelligence is improving all the time – there’s no coffee jolt here. A human being is just a click away.

Or just a simple voice request. Nespresso Voice Assistant is launching in France via a pilot with Google Home, and offers people similar services to the chatbot. From 2020, people will also be able to say: “OK Google, Ask Nespresso to reorder my coffee!” Your weekly coffee order just got a whole lot easier, and more fun.

Augmented reality

If Nespresso broke new ground in 1986 with a revolutionary new machine concept, then two years ago, the brand digitized it, creating an augmented reality (AR) app that allowed people to see what Nespresso’s new Essenza Mini would look like in their kitchens, then share the results with friends and family.

As a marketing tool it’s interactive, enjoyable and above all, useful. So much so that this year B2B sales teams began using the same technology. Want to see how a Nespresso coffee machine might sit in your hotel or restaurant? A salesperson can show you using a special app, then share the image with you, or print it out.

In future, augmented reality might enable you to overlay an image of your coffee machine on your smart phone with graphics showing you how to change its brew settings, descale it, even suggest new coffees to try. Forget hard-to-follow instructions – this makes the fiddly jobs fun, and the easier ‘jobs’ (drinking coffee) easier.

Whether we’re talking augmented reality apps, chatbots for Facebook Messenger or platforms like Google Home, Nespresso is meeting people on their own turf and adding value to their coffee drinking experience in ways that feel natural and easy.

The result? Happier customers who are a step closer to the Nespresso coffee they crave.

Step back … Let’s take a look 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.

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