Nescafe Gold

WELCOME TO WELCOME TO

THE WORLD OF COFFEETHE WORLD OF COFFEE

20052005

GOLDENGOLDEN

Marketing PlanMarketing Plan

Nescafe GoldNescafe Gold

Best Drinking MomentBest Drinking Moment

Premium Segment is in introductory stage : Pioneer Marketing Strategy

Regular Segment

Mixed SegmentPremium Segment

R&G Segment

BCG Matrix Model

2

3

12

7

10

6

8

24

12

26

16

13

25

34

41

6

8

2

7

5

9

15

4

18

5

18

28

31

41

36

UHT/Bottle/Canbranded fruit juice

Milo/ Ovaltine UHT

Energy drink

UHT/Bottle soya milk

RTD Coffee

Iced coffee hawker

Milo Ovaltine

Alcoholic drink exceptbeer

UHT/Pasteurized /Sterilized Milk

Beer

3 in 1 coffee

UHT/Pasteurizeddrinking yogurt

Bottle water

CSD

Instant Coffee

Male Female

Source : Coffee U&A study, 2003

Instant Coffee 39CSD 38Bottle water 28UHT/Pasteurized drinking yogurt 203 in 1 coffee 17Beer 15UHT/Pasteurized / Sterilized Milk 15Alcoholic drink except beer 14Milo Ovaltine 12Iced coffee hawker 8RTD Coffee 8UHT/Bottle soya milk 7Energy drink 7Milo/ Ovaltine UHT 6UHT/Bottle/Can branded fruit juice 4

Coffee is the most popular drink nowadays.

Coffee is more popular day by day ,52% of Hot Drinks Value

� Market is growing every year.

� Coffee consumption is booming.

(esp out of home)

� People lifestyle is westernized &

modernized.

� People have less time / work harder.

� Coffee is the part of image enhancer.

� More players jump into coffee market.

� Coffee is their part of life.

+11%

+14%

+6%

3,372 3,410

266

1,341 1,777

2,421

3,504

206200

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

2002 2003 2004

+6%

+14%

+11%

Mio. Bht

Coffee Market Size by segment

More opportunity to grow premium segment

266

206200

0

50

100

150

200

250

300

2002 2003 2004

+3%

+29%

+1%

Mio. Bht

Premium Coffee Market Size

� Consumers are more sophisticated.

� Premium Coffee is well adopted.

� People spend more on coffee (per

transaction & consume more)

� Consumers are still looking for and

willing to pay for coffee great taste.

� Opportunities is there but HOW?

How about the premium segment today?

� Few players with less competitive

degree.

� No one owns this market.

� No one invested the market before,

Nescafe Gold starts in 2004

� Market size can be doubled in next

3 years!

266

206200

0

50

100

150

200

250

300

2002 2003 2004

+3%

+29%

+1%

Mio. Bht

Premium Coffee Market Size

+ Nescafe Brand is highly accepted.

+ N. Gold is highly recognized and get

success in 2004

+ High barrier to enter the market

- Green Tea Booming.

-“Health Concern” Perception- Substitute product

We need to understand where we are today!

Understanding

Competitor

Ourselves

Consumer/Shopper

Main competitors today ...

� Sara Lee Trading –Moccona Royal Gold, Moccona Espresso

+Key competitor with total >30% market share.+Price is a bit lower.+Before 2004, they lead the market.

-They focus mix segment.-Brand Image-Not good product taste

Main competitors today ...

+High product image.+High flexibility.

-Low corporate image.-Product Supply Fluctuation.-Not invest in the market.

� Trading companies – Taster Choice, Maxim, UCC etc

Nescafe Gold is one step ahead the others!

Nescafe Gold

Moccona

Imported

PromotionProduct DistributionPrice Brand Image

Nescafe Gold Key priority is to drive the total category

Techo.

Strength Weakness

ThreatOpportunity

Let’s review where we are ....

• Positive brand image & product.• Big investment to drive.• Endorsed by Nescafe / Nestle• Various pack size to serve• Uniqueness • High technology in the business

• Coffee is booming.• Consumer is more sophisticated.• Needs for premium coffee exist.• Premium coffee is more popular.• Changing in people lifestyle

• Low flexibility

• Substitute product : Green Tea, Tea• Health Concern.• Smuggling Product

13%

37%

19%17%

12%

43%

21%

12%

18%

13%12%

12%

13%

13%

45%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

2002 2003 2004Nescafe Gold Moccona Royal Gold Tasters Choice green

Moccona Expresso Others

N. Gold market share shows promising trend...

0

50

100

150

200

250

300

2003 2004

Market

N. Gold

2699

206 266

(Mio Bht)Market is growing by +29%While N. Gold sales is about 4 times higher!

Having a good start in 2004

Premium Market Size vs Nescafe Gold sales 2003-2004

24% of population : 15,462,944 People

SEGMENTING

60 Up

46 - 60

31 - 45

16 - 30

0 - 15

Age

5.8% of population : 3,736,878 People




Targeting : Product Specialization

60 Up

46 - 60

31 - 45

16 - 30

0 - 15

Age

• At certain age• Educated, Modernized• Socialized, Dynamic • Out going, Trendy• Cool• Confident, Unique

Demographic + Psychographic

Getting to know consumer is vital

Youth : 16Youth : 16--3030

HomeHome

School/Office School/Office

EntertainmentEntertainment

•• Have a nice place Have a nice place

for lunch for lunch

•• Shopping at MallShopping at Mall

•• Playing sportPlaying sport

•• Going to cinemaGoing to cinema

•• Hang out with friendsHang out with friends

Spend 70% of their time out of homeSpend 70% of their time out of home

KEY INSIGHTKEY INSIGHT

•• 19 yrs old is the age of having the first cup of coffee19 yrs old is the age of having the first cup of coffee

•• Do not appreciate the taste and Image of NescafeDo not appreciate the taste and Image of Nescafe

•• New Coffee Shops are changing the way they look New Coffee Shops are changing the way they look

at coffee. Coffee is becoming more of a at coffee. Coffee is becoming more of a social drinksocial drink

•• Key Need states are Key Need states are Quick/energy boost/kick startQuick/energy boost/kick start, ,

Thirst QuenchingThirst Quenching

Snacking (Iced coffee)Snacking (Iced coffee)

•• Key PsychographicsKey Psychographics

Want to Experience life &Want to Experience life &

Want to GrowWant to Grow themeselvesthemeselves

Work hard, Play hardWork hard, Play hard

Family builder : 31Family builder : 31--4545

HomeHome

Office Office

Key activities :Key activities :•• Business DinnerBusiness Dinner•• Going to fitness / sportsGoing to fitness / sports•• Going to theatersGoing to theaters•• Socializing with friend ;Socializing with friend ;at lunch or drinking in at lunch or drinking in evening before go homeevening before go home

•• Have a nice place for Have a nice place for meal with familymeal with family

•• Shopping complex with Shopping complex with familyfamily


•• The age of adapting hot coffee The age of adapting hot coffee

•• Coffee is becoming a part of their everyday lifeCoffee is becoming a part of their everyday life

•• Key Need states are Key Need states are Kick startKick start, ,

Refreshment during the dayRefreshment during the day

Mental renewalMental renewal


Career and success are the key focusCareer and success are the key focus

Now they have goals that they want to pursueNow they have goals that they want to pursue

•• Coffee ignites their spirit, Coffee ignites their spirit, gets them ready, bring gets them ready, bring

their confidence, lets them focus, settle their their confidence, lets them focus, settle their

thoughts, initiates social bonding thoughts, initiates social bonding

No time to dream: 46No time to dream: 46--6060

HomeHome

Office Office

Key activities :Key activities :•• Business DinnerBusiness Dinner•• Deliver / pickup sons Deliver / pickup sons from schoolsfrom schools

•• Going to public parkGoing to public park•• Socializing with friend ;Socializing with friend ;

mostly at lunch mostly at lunch •• Have a nice place for Have a nice place for meal with familymeal with family

•• More traveling; personalMore traveling; personalbusinessbusiness


•• Heavy users : More coffee appreciationHeavy users : More coffee appreciation

•• Coffee is a part of their everyday lifeCoffee is a part of their everyday life

•• They spend relatively more time at home with familyThey spend relatively more time at home with family

•• Key Need states are Key Need states are Kick startKick start, ,

Mental renewalMental renewal

Relaxing and Rewarding oneselfRelaxing and Rewarding oneself


TheyThey’’ve accomplished certain things and now looking ve accomplished certain things and now looking

for lifefor life’’s small pleasuress small pleasures..

Appreciate good things in lifeAppreciate good things in life

They have much more focus on the familyThey have much more focus on the family

All 16-30 yrs 31-45 yrs 46-60 yrs 60 yrs upThose consuming Instant Coffee yesterday % % % % %Before breakfast 54 29 54 52 57During breakfast/as the breakfast 33 43 26 34 34After lunch till dinner 10 0 5 11 11

Those consuming 3 in 1 coffee powder % % % % %

Before breakfast 42 13 22 42 52During breakfast/as the breakfast 31 37 31 35 25After lunch till dinner 20 10 30 20 17

Those consuming Hot coffee at hawker % % % % %Before breakfast 23 18 20 11 36During breakfast/as the breakfast 23 10 0 41 17After lunch till dinner 15 0 0 20 20After dinner till before bed time 22 9 66 10 25

- Regular at home- Big opportunity : office

- As breakfast- Convenience oriented

Understand consumer is the key to succeed.

All 16-30 yrs 31-45 yrs 46-60 yrs 60 yrs upBas : Instant Coffee % % % % %At home 92 97 89 91 93Office 8 3 6 11 6In car/on the way 1 0 5 0 0

Base : 3 in 1 coffee % % % % %At home 79 85 69 79 82Office 17 5 23 17 15School/Education institution 1 10 2 0 0

Base : Hot coffee at hawker % % % % %Street vendors/hawker 63 50 64 76 56At home 17 43 23 4 20Office 12 0 0 6 25

0

CIRCUMSTANCES OF CONSUMPTION

INSTANT COFFEEINSTANT COFFEE

HOME (93%) OUTSIDE (10%)

As breakfast 55With breakfast at home 15Having snacks at home 8Before breakfast 6Watching TV/ VDO /listen music/ radio / reading 4After meal 4

During break 3As breakfast 2Working 2Hanging with friends 2

3 IN 1 COFFEE3 IN 1 COFFEE

HOME (80%) OUTSIDE (23%)

As breakfast 48With breakfast at home 10Relaxing 7Before breakfast 6Watching TV/ VDO /listen music/ radio / reading 4

During break 10As breakfast 4Having snacks 4

Base: 617

Base: 270

POSITIONING: Place product in consumer’s mind.

Nescafe Gold ...

make you sense the real coffee feeling

POSITIONING: Place product in consumer’s mind.

Nescafe Gold ...

bring out the best in you.

We do not sell Coffee,

We sell Best drinking moment

More room to grow the business

206266

345430

525

0

100

200

300

400

500

600

2003 2004 2005 2006 2007

Market

(Mio Bht)

Market Size of Premium Segment in next 3 years.

+22%

+24%

+29%

Are you ready for 2005?

Our VisionOur Vision

Lead and Grow the Premium Coffee Market and Lead and Grow the Premium Coffee Market and

Become The Most Preferred/Aspirational Become The Most Preferred/Aspirational

Coffee Beverage BrandCoffee Beverage Brand in Thailandin Thailand

What to achieve ...

2005 Objective

� Achieve 145 Mio. Bht Sales ( 42% market share)

� Lead and profitably grow the total premium coffee market

Long Term Objective

� Own the premium segment : Think of premium coffee, Think of Nescafe Gold

� Achieve 65% market share in next 5 years.

How to achieve ...

� Recruit new user : Regular Segment

(by 15%) : Out of Home

: New new user

� Increase consumption : As Breakfast

: 2 cups a day (or more)

� Turn competitor user : Expect 20% conversion rate

3 main strategies

Every single element is ready to strike ..

� Great product on earth

� Right pricing to tempt the consumers

� Full distribution to ensure product availability

� Communication and Promotion to drive success

Success is in the arm reach!

Nescafe Gold is ready ...to rock the market.

Nescafe Gold Army

New Affordable Range with Proprietary Packaging

70g 70g 35g35g

DoypackDoypack w/ zipperw/ zipper EdenIIEdenII jarjar

200g 200g 100g 100g

Stick in boxStick in box

8 sticks x 2g 8 sticks x 2g

120 120 Bht Bht 65 65 Bht Bht 420 420 Bht Bht 230 230 Bht Bht 35 35 Bht Bht PricePrice

Nescafe Gold Nescafe Gold

Right product at right time!

� Highly accepted brand with positive image – Nescafe Gold.

� Premium&Modern Look with reliable quality at proper price range.

� Attractive pack size to serve various group & purpose.

Jar Line

Loyal Shopper-100g & 200g-X-Citing shape-Premium / Modern

Pouch

Recruit new user-70g & 35g-Trial pack size-Zipped Lock -New Design

Stick in box

Increase Consumption-2g. -Out of Home/Convenience-Modern/Cool

X-Citing to drive $ALES

Innovation : Limited SKUs

Renovation : Packaging Modification – Special Packaging

� Valentine’s , X’ Mas

� Recipe Application – Nescafe Gold Frappe’

� Nescafe Gold 3 in 1 in Q3 : Out of home

� Nescafe Gold Decaf in Q3 : More cups a day / Health Concern

� Nescafe Gold Mocca in Q4 : More cups a day

Pricing reflect high image & reliable quality.

135Maxim

74 Taster’s Choice

124UCC

125Others

77Moccona Royal Gold

100Nescafé Gold

IndexBrand

� Skimming Pricing to build business both

retailer & vendor.

� Price is less sensitive.

� Establish Price&Quality Relationship

� Build Image and Perception while deliver

promised quality

Where to find our product : Distribution Channel

HypermarketHypermarket SupermarketSupermarket ConvenienceConvenienceStoreStore

Modern Trade contributes 95% of business

Alternative trade channel to widen the distribution

� Out of home / Food Service Channel- Restaurant, Hotel, QSR

� Alternative channels- Entertainment section, Book store

360 degree of communication to bomb the town!

Quality coffee

TVC

In-store activity

Sampling OOH

$ Market Growth $$ Market Growth $

Cinema

Print

P/R

Rapidly increase AwarenessRapidly increase Awareness through through Mass MediaMass Media

TVC : Prime Time (Throughout the year)


TVC : Prime Time (Throughout the year)

Prime Time

� Channel 3 / 7 / 9

� Soft Opera after news

� News Program

� Morning News Program

+ Increase awareness

+ Direct to target group

+ Induce Trial

� Hit > 9,000,000 people


Alternative but Attractive Media

Magazine Ads& Internet

Cinema

TieTie--in Programin Program

+ In line with target lifestyle+ Increase awareness+ Build positive image+ > 800,000 people

Unique and strong communication


PRINT

Event to create excitement.

- Excite consumer- Create Loyalty- Nescafe Gold consumer > 1,000 peoplejoin the activities

Promotion to drive sales

Get free Gold Mug when buy Nescafe Gold in July

Merchandising at point of sales to activate the purchase.

Impactful Merchandising drives sales & visibility : Home shelf & Out of shelf.

Dominate VisibilityDominate Visibility on Shelf and in Storeon Shelf and in Store

Product TrialProduct Trial by continuous Sampling by continuous Sampling

In store

350,000 Wet sampling 350,000 Wet sampling -- in Modern Trade : AM / PM Consumption in Modern Trade : AM / PM Consumption

In OfficeIn Office

Dry Dry Sampling Sampling 200,000 wet and dry sampling - in offices

: AM / PM Consumption


Cinema


- Fit to target group lifestyle.- > 120,000 people

Attract Opinion Leaders through targetedAttract Opinion Leaders through targeted

PR and CRM activitiesPR and CRM activities

PR CRM Activities

Special Gold kit sent

to 400 opinion leaders

(CEO, government officer, celebrities)

Ensure product availability by sales incentives

• Achieve stretched target

• Make sales team having more focus in Nescafe Gold

• Drive distribution to ensure having no OOS in store

• Part of total integrated campaign to ensure success

Special Incentive in Q1

Achieve 145 Mio sales and grow the category

Recruit new userIncrease

ConsumptionTurn Competitor’s

User

- Create awareness by TVC, Magazine Ads, other Media

- Sampling in store, office, cinema

- P/R and CRM Activities

- New Product Launch : Decaf, 3 in 1

- In store Promotion

- New product Launch : Decaf, Limited Edition : Mocca

- No OOS in store


- Create awareness by TVC, Magazine Ads, other media


- Impactful merchandising at store

- New Product Launch

- New packaging

Action & Strategy to drive the businessAction & Strategy to drive the business

Type Detail Jan Feb Mar Apr May Jun July Aug Sept Oct Nov Dec Total Cost

Media TVC 29,800,000

PRINT 2,700,000

Cinema 2,400,000

Sampling In store 17,000,000

Office 13,000,000

P/R 600,000

Promotion 6,000,000

Innovation Limited/New Product 700,000

Packaging 600,000

Incentives 1,200,000

Others 3,000,000

Total 77,000,000

It is time to drive great beverage on earth.

Integrated activities to ensure the success

0 5 10 15 20 25 30 35

TVC

Sampling

Promotion

Other Media

Innovation

Incentives84% of investment is spent to ensure awareness & Trial.

Awareness & Trial are the key driver!

TVC & Sampling are key to succeed.

Investment grouped by spend type

We invest for the future .....

2005 Monthly sales & Spending

0

2

4

6

8

10

12

14

16

Jan Feb Mar Apr May Jun July Aug Sept Oct Nov Dec

0

1

2

3

4

5

6

7

8

9

10

Sales

Spending

(Mio. Bht)


858277554Commercial Fund

39253(1)14Profit

124107805418MC

1248765458COGS

2481941459926Sales

47%45%42%37%12.6%Market Share

525430345266206Market

20072006200520042003Mio. Bht


Projected Market size & Nescafe Gold sales & Profit in next 3 years

0

100

200

300

400

500

600

2004 2005 2006 2007

-5

0

5

10

15

20

25

30

35

40

45

Market

Sales

Profit

Mio Bht.

Right investment make profitjump up high!

20%

47%

12%

42% 45%

11%15%

18%

12% 13%12%

11%12%

9%12%

13%13%

19%19%

45%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

2002 2003 2004 2005 2006 2007Nescafe Gold Moccona Royal Gold Tasters Choice green


N. Gold market share continuously fly high and higher...

Firm market Leader Position

How to ensure the result?

� Quarterly performance review

266

206200

0

50

100

150

200

250

300

2002 2003 2004

20%

47%

12%

42% 45%

11%15%

18%

12% 13%12%

11%12%

9%12%

13%13%

19%19%

45%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

2002 2003 2004 2005 2006 2007Nescafe Gold Moccona Royal Gold Tasters Choice green


858277554Commercial Fund

39253(1)14Profit

124107805418MC

1248765458COGS

2481941459926Sales

47%45%42%37%12.6%Market Share

525430345266206Market

20072006200520042003Mio.Bht

+ Sales, Market Share, Financial Outlook : Investment / Profit+ Set KPI in quarterly basis

� Research in Q3 2005 to check attitude & usage

Nescafe Gold is ready ...

Market

• Coffee premium segment is growing by > + 20% every year.• Out of home consumption is booming.• Consumer is opened to premium coffee.

266

206200

0

50

100

150

200

250

300

2002 2003 2004

Competition

• No one drives the market seriously today, but Nescafe Gold.• Nescafe Gold gain many competitive advantages.• Competition is not aggressive today.

Consumer

• Age 30 – 60 Years with modern lifestyle• They are looking for great taste of coffee.• They are opened to many kinds of media.


Tools to hit

• Attractive Product to serve consumers needs.• Right pricing to make people buy.• Full distribution to ensure sales.• Communication & Promotion to drive success.

Quality coffee

TVC

In-store activity

Sampli

ng

OOH

$ Market Growth $$ Market Growth $

Cinema

Print

P/R


Future Outlook

• Market is expected to grow by > +20% for next 3-5 years.• Nescafe Gold will grow > +30% in next couple years.• The 1st comer always enjoy the big piece of cake.

We invest for the future ...

Nescafe Gold

Ready to strike the market

WELCOME TO WELCOME TO

THE WORLD OF COFFEETHE WORLD OF COFFEE

THANK YOUTHANK YOU

Nescafe Gold

Business

world of coffee

coffee consumption

coffee great taste

coffee ua study

market share

uhtbottle soya milk7rtd

nescafe brand

high product image