The Hindu Business Line : Nestle India to focus on mass market in coffee

New Delhi, Nov. 20 FMCG major Nestle India, having catapulted its business with the launch of its probiotic range of frozen dairy products, is now all set to grow its coffee business.

While coffee chains such as Café Coffee Day and Barista target the upper middle class youth segment, Nestle India through its ‘Cafés’ is going all out to woo the masses.

Mr Martial Rolland, CEO, Nestle India, said, “The idea is to create a sustainable model that is scalable through these cafes.

“In fact, we use these outlets as our laboratories to try out new products and gauge the reaction of consumers to the newer variants of coffee.”

Not deterred by the competition the coffee chains could present, he added, “We are pleased that there are more players in the competition as it will expose more consumers to coffee.

“The difference between the coffee chains and us is affordability. No one knows coffee the way we do.”

Nestle, however, plans to continue its cafes pan-India under the franchisee model. “We are focusing more on product delivery vis-À-vis the ambience,” said Mr Rolland, refusing to divulge the size of the company’s café business.

However, he said it was far larger than some of the others who claim to have the maximum number of outlets in the country.

Nestle has cafés across schools, colleges and offices.

Perfect blend

Affordability, in fact, is a major criterion for Nestle India as far as products are concerned. The company’s motto to target the lowest denominator is clear through the pricing of its brands in the category as well as the blends used in the products.

“India is predominantly a tea drinking country.

“Therefore, the harsh and strong flavour of coffee is not preferred by most people.

“So, the blends we use in our brands here are also very specific to consumer tastes,” said Mr Rolland.

New product

Based on consumer insight, the company has just launched its new product ‘Nescafe Mild’, targeted specifically at the mass market of tea drinkers.

“Our long heritage in the country helps us understand people better.

“Also with the understanding of coffee that we have acquired globally, we want to leverage our expertise here as well,” he said.

Cold coffee category

The company is also examining several possible segment forays under coffee, however, moving away from hot to the cold category.

“Though the market for products such as cold coffee is still very small in India, experiences from our Café outlets have made us realise the growing demand for it.

“We are examining possibilities of launching such products in India,” Mr Rolland said.

“In fact, the coffee market in India in itself is rather small with great opportunity for growth.

And, as a company, we will focus more to grow our coffee business here,” he added.