Nestle's Coffee Portfolio and Sales
Nestle's coffee portfolio, which includes Nespresso, Nescafe, Starbucks, and Milo, constitutes 26.7% of the company's total sales. This growth aligns with the upward trend observed in their portfolio's performance in recent years.
###High-quality performance: Nespresso
In 2023, Nespresso was listed among the top 100 most valuable brands globally as per Interbrand's annual rankings.
– And the Nespresso brand saw a 5.3% increase in organic growth in FY2023 due to its premium positioning and the popularity of the Vertuo system. (The Vertuo system, introduced in North America in 2014, was created to meet the demand for larger coffee sizes in North America compared to the traditional European espresso style, and has since expanded to global markets).
Furthermore, Nespresso has experienced significant growth in the out-of-home sector, such as hospitality and business environments, due to increased adoption of the Momento system, especially within office settings.
The brand has faced criticism for using aluminum single-use capsules, which are recyclable but often do not end up being recycled by consumers. Nespresso introduced its first paper-based compostable capsules for home and industrial use in France and Switzerland in the spring of 2023. These capsules are designed to be compatible with Nespresso Original machines.
Multiple features of the capsule incorporate exclusive technology, including a special biopolymer lining that safeguards the coffee from oxidation.
The capsules hold certification from TÜV Austria, an international body, for composting in both home and industrial settings.
[in France – where there are increasing efforts to make composting mandatory – coffee capsules are accepted in public compost bins.](#)
Other Nespresso Innovations
The Nespresso brand has introduced a unique Arabica variety called Nº 20 as part of its ultra-premium limited edition range.
Nescafé: innovating new coffee experiences
Nestlé is focusing on India for promoting its Nescafé brand and building the coffee market in a country more known for its tea consumption.
That involves a specific focus on creating coffee experiences for younger consumers.
The brand has introduced its coffee to over 30 million Indian households in the last seven years, placing a strong emphasis on at-home consumption. Additionally, 10 million new consumers were added in 2023 alone.
In rural areas, Nescafé processes Indian green coffee beans to create a final product that suits local taste preferences at the Nanjangud roastery.
Thanks to strategic positioning, Nescafé is now more widely accessible and available in approximately three million retail outlets throughout the country.
РWhile initially known for its soluble coffee, Nescaf̩ has found success in markets like North America through innovations such as RTD coffee.
In Vietnam, which is a significant coffee producer and exporter renowned for its coffee culture, Nescafe is expanding its range of ready-to-drink and ready-to-serve options to align with current trends.
Nestle's Financial Year 2023
– Nestle, a Swiss food and beverage company, recorded total sales of CHF 93 billion, which translates to $105 billion USD, showing a slight decline of 1.5%.
– The company saw organic sales increase by 7.2%, slightly below the forecasted 7.4% by analysts.
– Looking ahead to 2024, Nestle anticipates organic sales growth of approximately 4% and a modest rise in the core trading operating profit margin.
– CEO Mark Schneider acknowledged the challenges posed by two years of unprecedented inflation, impacting consumer behavior and demand for food and drink items. Despite this, the company achieved substantial organic growth, improved margins, and boosted investments in marketing and growth initiatives.
