Case Study - Henri Nestle - Nestle Coffee

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 productsIn 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 café 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,