Nestlé’s Customer Analysis Paper

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Introduction

Nestle S.A. entails to a food and drink company, which offers a variety of products that include medical food, baby food, breakfast cereals, tea and coffee, dairy products, bottled water, frozen food, pet foods, snacks, confectionery, and ice creams. Most of the establishment’s brands include Nescafe, Nespresso, Smarties, Kit Kar, Maggi, and Vittel among others gross over $I.1 billion in annual sales. Established in 1866 by Charles and George Page, the company has grown tremendously throughout the decades to amass a huge customer base from different regions of the globe. Nestle customers benefit from the complete range of quality products characterized by meal components, base products, and high-quality ingredients. Thus, the leading health and nutrition organization is taking care of their customers and families to promote a healthier lifestyle.

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Consumer Analysis

The wide array of products in differing categories implies that Nestle serves the distinct and changing needs of diverse customers from all over the world. In expanding its market, the company aims at providing customers of all age-sets with food items in different varieties. Nestle segment its target market based on demographic, psychographic and geographical differences (Appiah-Adu & Amoako, 2016).

Demographics

Nestle targets its customers based on demographical segmentation based on family size, age, income, and family lifecycle among other factors.

Age

The company caters to the needs of different customers across all age-sets with same products. For example, while the Nestle targets Milo for children, it offers Nescafe to adult consumers. Thus, the entity ensures that every age-set has a Nestle product they can purchase. Consequently, most Nestle products are for everyone, from infant to seniors and all genders (Nestle, 2018). For example, the Nestle bottled water is not a supremely high-quality product and thus everyone can utilize any size of bottle offered by the company. Also, for products such as Nescafe, the entity targets young people (16-24). With “Nescafe Live,” a youth-oriented site, young adults share information and ideas and thus form an important loyal base for the company. Also, it caters to children with product offerings such as Milo milk, Nestle Pure Life, and Garber among others. For example, families can purchase Lactogen 1 and 3 for babies under 12 months, Cerelac for those under 1 year, and Nido for 2-year old children (Nestle Annual Report, 2017).

Family Size

Similarly, the company provides consumers with the same products in different sizes and packaging. This is because distinct packaging and containers seek to fulfill the disparate needs of individuals based on family size and as such, while a small family would depend on a small container of a Nestle product such as Milo, a family with many members would necessitate a large container. Thus, the company’s packaging is designed to fit the needs and necessities of all family sizes and individuals. For example, the entity offers Nestle chocolate in small and large containers enabling families with many members to satisfy everyone while saving money (Nestle, 2018).

Income

Nestle has segmented its target market based on income according to individuals (Appiah-Adu & Amoako, 2016). In comparison to the prices of other brands, Nestle products are relatively affordable to all classes due to its lower and reasonable prices such as the Nestle Milk. Consequently, the company targets some of its high-quality products to quality driven, and higher income customers. For example, Nescafe Gold range incorporates exotic tastes and targets the upscale customers.

Psychographics

Psychographic factors such as lifestyle, social class, and personality play an important role in targeting a particular market segment. Many products seek to satisfy the needs of every social class from lower to upper class evident in the affordability of its product and premiumization strategy of the company. Many customers from emerging markets with lower income populations are purchasing Nestlé’s offerings characterized as PPP (Popularly Positioned Products). Consequently, higher-income individuals can also access premium products. Nestle Products also provides products that fit the lifestyle and personality needs of consumers. Nestle Breakfast cereals and Nescafe 3 in 1 target busy individuals with demanding careers. It is evident that coffee is considered for the affluent class and thus the company sells Nescafe for the upscale consumers. The consumers consider consumption of coffee as an indicator of wealth and affluence.

Change of Consumer Profile Overtime

Throughout the decades, Nestle has seen a strategic shift in perspective in regards to its target market. People mainly perceived various Nestlé’s products as elite commodities such as coffee and bottled water among others belonging to the upper class and targeted the ages of 18 to 40. For example, Nescafe’s target market has traditionally been the young people including university students. This is evident in past advertisements, the price points for price products, and the use of interactive youth-oriented sites such as “Nescafe Live,” wherein the consumers exchange ideas revolving around mass media (Nestle, 2018).

Today, the company has shifted its focus with products such as Nescafe being aimed at every person, from infants to adults. Products like Milo and Nescafe are no longer indulgence products as they have become everyday commodities for every consumer (Espinoza-Orias, Cooper, & Lariani, 2018). Today, the target market characterizing the company’s coffee products among others are similar to that of tea. As such, it becomes difficult to pinpoint the target market of offerings such as Nescafe today since those from six to seventy years consume it. Thus, many of Nestlé’s offerings are penetrating other market segments the brand was not associated with in the past (Appiah-Adu & Amoako, 2016). The shift in perspective has forced the company to focus on functionality as opposed to emotional appeals, with the recent adverts indicate that the company seeks to benefit many consumers from all walks of life. The advertisements include the representation of lower to upper SEC classes than before (Nestle Annual Report, 2017).

Discussion and Conclusion

The introduction of consumer food offerings has led to significant changes in numerous industries and their facets, especially consumer’s food behavior and preferences. Of all companies, Nestle has grown tremendously in its attempt to enhance the loyalty of its. As one of the largest food processing entities, Nestlé’s products rely heavily on their efficiency and experience rather than emotional appeals that guided traditional advertisements. The company segments its customer base in regards to various clusters using multistage segmentation method (Espinoza-Orias, Cooper, & Lariani, 2018). The segmentation process aims at realizing the individual and collective needs of the consumers. The approach segments Nestlé’s market into demographics, psychographics, behavioral, and geographic elements. The market segmentation aligns together groups of people typified by similar needs and intention towards a specific product. It is based on demographics that include age, income, family size, occupation, education, and class. From the discussion, Nestle utilizes psychographics such as value, preference, and lifestyle to attract a particular target market with the need to purchase goods in line with their lifestyle and values.

Since its early days, Nestle has attempted at differentiating themselves for their competitors. However, with a wide array of products, the company has managed to adopt modern technologies and trends to adapt well to the contemporary market. So far, the company has succeeded in identifying and enlarging its target market efficiently evident in the loyalty and satisfaction expressed by consumers. With the different products, it is imperative to conclude that Nestle understands and satisfying its customers.

Nestlé’s Customer Analysis References

Appiah-Adu, K., & Amoako, G. K. (2016). The execution of marketing strategies in a developing economy: A case study of selected market leaders. African Journal of Economic and Management Studies, 7(1), 9-29.

Espinoza-Orias, N., Cooper, K., & Lariani, S. (2018). Integrated product development at Nestlé. In Designing Sustainable Technologies, Products and Policies (pp. 447-456). Springer, Cham.

Nestle Annual Report (2017). Retrieved from https://www.nestle.com/investors/annual-report

Nestle. (2018). “Nestle.” Nestle.Com. Retrieved from http://www.nestle.com/. Last Accessed 30 Sep 2018.