1. Profile of the company If necessity is the mother of invention then profit may be the mother necessity.

As the Great Depression gripped the United States in the 1930's and coffee sales plummeted there was a definite need for the coffee growers to find new ways to sell their product. Nescafe came to the rescue. In 1867 Henri Nestle, a German chemist living in Switzerland, had invented a baby formula for women who couldn't nurse. By 1900 he had set up production facilities in several countries, including the United States, where he also made condensed milk. Over the next thirty years the company expanded their products to include powered chocolate milk mix and other confectionary products. In 1930 the Brazilian government approached Nestle to create a new instant coffee that would give the consumer another option and at the same time increase the dwindling coffee exports of Brazil. It took eight years but in 1938 Nestle introduced Nescafe. Instant coffee was not a new idea; it was originally invented by a Japanese chemist named Satori Kato in 1901 and had been marketed and sold by various companies with disappointing results. Nescafe revolutionized the way instant coffee was made. Early methods of making instant coffee involved brewing a batch of high-strength, concentrated coffee and then boiling it dry in stainless steel drums; the residue left behind was instant coffee. The heat involved in the boiling process destroyed most of the aromatic and flavorful properties of the coffee. When reconstituted in water the result was a pungent, bitter decoction that little resembled coffee. Nestle developed a new process for dehydrating the concentrated coffee which vastly improved the quality. In entailed spraying a fine mist of the solution into a heated tower where the droplets turned to powder almost instantly. They then added carbohydrates in the form of dextrose, dextrin and maltose which helped preserve the flavor. Nestle struggled to come up with a name for this new product which would inspire the public to buy it. They combined the word Nestle and the Italian word for coffee, caffee, or caf in hopes that the Italian inference would create an aura of romance and capture the imagination. Apparently it worked; through an aggressive, and expensive, ad campaign

that targeted the American housewife Nescafe became a huge success for Nestle and doubled its global market share. WWII rebounded the country from the depression and did much to further the Nescafe name as instant coffee became a staple of the soldiers' ration kits. While instant coffee accounts for only about 25% of coffee sales world-wide. Nescafe is bar far the dominate player in the arena. Nescafe remains the second most recognized brand name in the world, second only to Coca-Cola. The company dates to 1867, when two separate Swiss enterprises were founded that would later form the core of Nestl. In the succeeding decades, the two competing enterprises aggressively expanded their businesses throughout Europe and the United States. In August 1867, Charles and George Page, two brothers from Lee County, Illinois, USA, established the Anglo-Swiss Condensed Milk Company in Cham. Their first British operation was opened at Chippenham, Wiltshire, in 1873. In September 1867, in Vevey, Henri Nestl developed a milk-based baby food, and soon began marketing it. The following year, 1868, saw Daniel Peter begin seven years of work perfecting his invention, the milk chocolate manufacturing process; Nestl's was the crucial cooperation that Peter needed to solve the problem of removing all the water from the milk added to his chocolate, and thus preventing the product from developing mildew. Henri Nestl retired in 1875, but the company, under new ownership, retained his name as Farine Lacte Henri Nestl. In 1877, Anglo-Swiss added milk-based baby foods to its products, and in the following year the Nestl Company added condensed milk, so that the firms became direct and fierce rivals. In 1905, the companies merged to become the Nestl and Anglo-Swiss Condensed Milk Company, retaining that name until 1947, when the name Nestl Alimentana SA was taken as a result of the acquisition of Fabrique de Produits Maggi SA (founded 1884) and its holding company, Alimentana SA of Kempttal, Switzerland. Maggi was a major manufacturer of soup mixes and related foodstuffs. The companys current name was adopted in 1977. By the early 1900s, the company was operating factories in the United States, United Kingdom, Germany and Spain. The First World

War created new demand for dairy products in the form of government contracts, and by the end of the war, Nestl's production had more than doubled. After the war, government contracts dried up, and consumers switched back to fresh milk. However, Nestl's management responded quickly, streamlining operations and reducing debt. The 1920s saw Nestl's first expansion into new products, with chocolate-manufacture becoming the company's second most important activity. Nestl felt the effects of the Second World War immediately. Profits dropped from US$20 million in 1938, to US$6 million in 1939. Factories were established in developing countries, particularly in Latin America. Ironically, the war helped with the introduction of the company's newest product, Nescaf ("Nestl's Coffee"), which became a staple drink of the US military. Nestl's production and sales rose in the wartime economy. The end of World War II was the beginning of a dynamic phase for Nestl. Growth accelerated and companies were acquired. In 1947 came the merger with Maggi, a well-known manufacturer of seasonings and soups. Crosse & Blackwell followed in 1950, as did Findus (1963), Libby's (1971) and Stouffer's (1973). Diversification came with a shareholding in L'Oral in 1974. In 1977, Nestl made its second venture outside the food industry, by acquiring Alcon Laboratories Inc. Coffee Legends It is believed that Ethiopias Oromo people were the first to discover the stimulating character of the coffee bean plant. There is actually a legend that dates coffee back to the 9th century, when an Ethiopian goatherd in the named Kaldi, who noticed his flock jumping like kids after nibbling on bright red berries from an inconspicuous bush. Curiously, the goatkeeper tried it himself, and shared his discoveries with An Islamic holy man from a nearby monastery. However, the holy man rejected the use of the berries and threw them into a fire, from where an alluring aroma arose. They raked the roasted berries, ground them, and dissoled them in hot water. The curious solution seemed to help the holy man stay awake.

While many other legends deal with the origins of coffee, its actual discovery remains a mystery which is hardly surprising, given that coffees known history dates back thousands of years. Arabic Origin Legends aside, the earliest credible evidence of coffee cultivation can be traced back to the fifteenth century, in the Sufi monasteries of Yemen, in Southern Arabia. For a long time, coffee trade in the area was kept exclusive, with Arab farmers making serious efforts to stop other countries from acquiring the precious beans. However over time, coffee spread from Mocha (a port city on the coast of Yemen), to Egypt, Syria, and Turkey, where coffee became known as the wine of Araby. From Arabia to the rest of the world It wasnt long before coffee houses opened in every city in the Near East. When the first shipment of coffee beans landed in Europe, the popularity of coffee spread faster than gossip which actually helped get the word on coffee out. Towards the end of the 17th century, coffee houses branched out, carrying the coffee trade across Austria, France, Germany, Holland and Britain. Coffee drinking was finally extended from the Muslim world to Italy, and Europe. Soon thereafter, young coffee trees were transported by the Dutch to the East Indies and to the Americas. After the Dutch started growing and cultivating coffee in the Far East, it didnt take long before Britain and France followed, introducing coffee to their colonies. In colonial America, coffee grew in popularity after the famous Boston Tea Party of 1773, when Americans revolted against outrageous taxes on tea, by drinking coffee as a sign of protest. In the 18th century, missionaries, traders and colonists carried coffee to Central and South America. The natural environment proved ideal for cultivating coffee, making it a

popular industry within a short period of time. By the late 1800s, coffee had become one of the worlds major exports, especially in developing countries. Today, coffee is one of the worlds largest trading commodities. Coffee is estimated to be worth more than $12 billion dollars every year. The global trading involves growing and cultivation in developing countries, and export and consumption in industrialized countries. Most of the worlds coffee crop is produced in Southern and Central America, Asia and Africa. Since cultivation depends primarily on natural conditions, coffee supply can be sometimes erratic. This is why the price of coffee remains highly inconsistent. Next to water, coffee is the most consumed beverage in the world. The largest importer is the United States, comprising a sixth of the worlds annual yield. However, the nation that consumes the most per capita is Finland, with the average Finn drinking around 1400 cups each year! Thats almost four cups of coffee everyday! From its discovery, coffee has surely evolved into more than just a stimulating beverage. With one little cup comes a special moment. We wake up with coffee, we refresh ourselves with coffee, and coffee keeps us going during the day. Coffee can be a break, a chance to relax and reflect, and most especially, a moment shared.

Coffee Trivia 1. There are only four varieties of coffee that grow in the Philippines. These are Robusta, Excelsia, Arabica and Liberica. Its very easy to remember. Think REAL. 2. There is no such thing as Benguet Barako. Coffee growers in Benguet only use the name for marketing purposes. 3. Instant coffee has a 90% market share in the Philippines. Hooray for big companies like Nestle who manufacture instant coffee. 4. A coffee tree can bear fruit in as early as 18 months and as long as 5 years. 5. Contrary to popular belief, Batangas is not the largest coffee growing area in the Philippines. This distinction belongs to Sultan Kudarat. (For the geographically challenged, thats in Mindanao.) 6. The city of Lipa, Batangas became a very rich town because of coffee. It became so rich that our ancestors in Lipa used to wear diamonds in their slippers. 7. There is such an area called coffee belt. The Philippines belongs to this area. 8. The Americans brought the convenience of instant coffee to the Philippines in the 1950s. 9. Coffee only grows in elevated regions like Batangas and Benguet. 10. Coffee doesnt expire. As long as you store it properly in an air tight container it can last for years. 11. The Philippines used to export coffee. Now, we import coffee from nearby Asian countries and Brazil. 12. "Coffee should be black as hell, strong as death, and as sweet as love" - Turkish Proverb 13. 52% of Americans drink coffee. 14. A acre of coffee trees can produce up to 10,000 pounds of coffee cherries. That amounts to approximately 2000 pounds of beans after hulling or milling. 15. A scientific report from the

University of California found that the steam rising from a cup of coffee contains the same amounts of

antioxidants as three oranges. The antioxidants are heterocyclic

compounds which prevents cancer and heart disease. It's good for you! 16. Adding sugar to coffee is believed to have started in 1715, in the court of King Louis XIV, the French

experts believe that certain beans improve with age, when stored properly. 24. Before the first French cafe in the late 1700's, coffee was sold by street vendors in Europe, in the Arab fashion. The Arabs were the

monarch. 17. Advertisements for coffee in London in 1657 claimed that the beverage was a cure for scurvy, gout and other ills. 18. After the decaffeinating process, processing companies no longer

forerunners of the sidewalk espresso carts of today. 25. Brazil accounts for almost 1/3 of the world's coffee production, producing over 3-1/3 billion pounds of coffee each year. 26. By 1850, the manual coffee grinder found its way to most upper middle class kitchens of the U.S. 27. Caffeine is on the International Olympic Committee list of

throw the caffeine away; they sell it to pharmaceutical companies. 19. After they are roasted, and when the coffee beans begin to cool, they release substances about that 700 make chemical up the

vaporizing aromas. 20. An Arabica coffee tree can produce up to 12 pounds of coffee a year, depending on soil and climate. 21. Australians consume 60% more

prohibited substances. Athletes who test positive for more than 12 micrograms of caffeine per milliliter of urine may be banned from the Olympic Games. This level may be reached after drinking about 5 cups of coffee. 28. Citrus has been added to coffee for several hundred years. 29. Coffee as a medicine reached its highest and lowest point in the 1600's in England. Wild medical contraptions to administer a mixture

coffee than tea, a six fold increase since 1940. 22. Beethoven, who was a coffee lover, was so particular about his coffee that he always counted 60 beans each cup when he prepared his brew. 23. Before roasting, some green coffee beans are stored for years, and

of coffee and an assortment of heated butter, honey, and oil, became

"Use a tablespoonful ground to a pint of boiling water [less than a quarter of what we would use today]. Boil in tin pot twenty to twenty-five minutes. If boiled longer it will not taste fresh and lively. Let stand four or five minutes to settle, pour off grounds into a coffee pot or urn. Put fish skin or isinglass size of a nine-pence in pot when put on to boil or else the white and shell of half an egg to a couple of quarts of coffee." 37. Coffee represents 75% of all the caffeine consumed in the United States. 38. Coffee sacks are usually made of hemp and weigh approximately 132 pounds when they are full of green coffee beans. It takes over 600,000 beans to fill a coffee sack. 39. Coffee trees are evergreen and grow to heights above 15 feet but are normally pruned to around 8 feet in order to facilitate harvesting. 40. Coffee trees are self-pollinating 41. Coffee aromatic, trees produce highly flowers

treatments for the sick. Soon tea replaced coffee as the national beverage. 30. Coffee beans are similar to grapes that produce wine in that they are affected by the temperature, soil conditions, altitude, rainfall, drainage and degree of ripeness when picked. 31. Coffee is generally roasted between 400F and 425F. The longer it is roasted, the darker the roast.

Roasting time is usually from ten to twenty minutes. 32. Coffee is graded according to 3 criteria: Bean quality (Altitude and Species) Quality of preparation Size of bean 33. Coffee is grown commercially in over forty-five countries throughout the world. 34. Coffee is the most popular beverage worldwide with over 400 billion cups consumed each year. 35. Coffee lends its popularity to the fact that just about all flavors mix well with it. 36. Coffee Recipe from: 'Kitchen

short-lived

producing a scent between jasmine and orange. These blossoms produce cranberry-sized coffee cherries. It

Directory and American Housewife' (1844)

takes four to five years to yield a commercial harvest. 42. Coffee was first known in Europe as Arabian Wine. 43. Coffee, along with beer and peanut butter, is on the national list of the "ten most recognizable odors." 44. Coffee, as a world commodity, is second only to oil. 45. Commercially flavored coffee beans are flavored after they are roasted and partially cooled to around 100 degrees. Then the flavors applied, when the coffee beans' pores are open and therefore more receptive to flavor absorption. 46. Dark roasted coffees actually have LESS caffeine than medium roasts. The longer a coffee is roasted, the more caffeine burns off during the process. 47. During the American Civil War the Union soldiers were issued eight pounds of ground roasted coffee as part of their personal ration of one hundred pounds of food. And they had another choice: ten pounds of green coffee beans. 48. During World War II the U.S. government used 260 million pounds of instant coffee.

49. Finely grinding coffee beans and boiling them in water is still known as "Turkish Coffee." It is still made this way today in Turkey and Greece or anywhere else Turkish Coffee is served. 50. Flavored coffees are created after the roasting process by applying

flavored oils specially created to use on coffee beans. 51. Frederick the great had his coffee made with champagne and a bit of mustard. 52. Hard Bean means the coffee was grown at an altitude above 5000 feet. 53. Hawaii is the only state of the United States in which grown. coffee is

commercially

Hawaii

features an annual Kona Festival, coffee picking contest. Each year the winner becomes a state celebrity. In Hawaii coffee is harvested between November and April. 54. Hills Brothers Ground Vacuum

Packed Coffee was first introduced in 1900. 55. Iced coffee in a can has been popular in Japan since 1945. 56. If you like your espresso coffee sweet, you should use granulated sugar, which dissolves more quickly,

rather than sugar cubes; white sugar rather than brown sugar or candy; and real sugar rather than sweeteners which alter the taste of the coffee. 57. In 1670, Dorothy Jones of Boston was granted a license to sell coffee, and so became the first American coffee trader. 58. In 1727, as a result of seedlings smuggled from Paris, coffee plants first were cultivated in Brazil. Brazil is presently by far the world's largest producer of coffee. 59. In 1900, coffee was often delivered door-to-door in the United States, by horse-pulled wagons. 60. In 1990, over 4 billion dollars of coffee was imported into the United States. 61. In early America, coffee was usually taken between meals and after dinner.

62. In Italy, espresso is considered so essential to daily life that the price is regulated by the government. 63. In Japan, coffee shops are called Kissaten. 64. In Sumatra, workers on coffee plantations gather the world's most expensive coffee by following a gourmet marsupial who consumes only the choicest coffee beans. By picking through what he excretes, they obtain the world's most

expensive coffee -'Kopi Luwak', which sells for over $100 per pound. 65. In the 14th century, the Arabs started to cultivate coffee plants. The first commercially grown and harvested coffee originated in the Arabian Peninsula near the port of Mocha.

2. What is the case all about? The case is all about the study of market segmentation of Nescafe in which the handouts shows the market segmentation of Nescafe as well as the description of their products. 3. How did Nescafe identify their market segmentation?

4. What are the benefits of market segmentation using SWOT analysis? Strength 1. Nescafe celebrated its 100 year in providing beverages especially coffee that is really love 2. They had made of in they coffee as an their efficient use resources. by Filipinos 2. The Nescafe is made in three different styles which their emphasize drinkers attitude health. well as their Weaknesses 1. Opportunity 1. Nescafe was able exploit to the Threats

opportunities arising from our love of coffee.

5. What is the future of Nescafe? 6. What is the positioning of Nescafe in the market? The positioning of the Nescafe in the market is considered as first choice of young consumers like students who are doing their paper works and assignments the whole day as well as those who are working in the office and other business establishments who needs to have an overtime work. It is proven by its tagline, Kasambahay sa habambuhay 7. What concept in the marketing concept is used in this case? 8. Conclusion 9. Recommendation