Marking his one year anniversary as Nespresso North America’s CEO, Alfonso Gonzalez Loeschen told FoodNavigator-USA that taking the helm of the brand’s North American business at the start of the pandemic came with unique challenges, but it also offered significant opportunities to grow the business and its potential to be a force for good.
“It has been a hectic year,” Loeschen said, explaining that some of the biggest challenges included getting to know employees while social distancing, and maintaining production while navigating safety, supply chain and operational challenges.
Despite these challenges, Nespresso sales reached a six-year high in fiscal 2020 with organic growth accelerating 7%, according to Nestle, which attributed the jump in part to increased at home demand for high quality coffee as well as innovations, such as Reviving Origins, limited-edition products and the launch of the brand’s first organic coffee.
Loeschen added during the pandemic consumers also “internalized much better than what you had in the past, the social and environmental [importance] of business models,” and placed a premium on companies that shared their values.
To maintain that growth in 2021, Loeschen said, Nespresso is doubling down on innovation and will better communicate through a new digital campaign the positive social and environmental benefits of each cup of its coffee.
“Innovation is still at the heart of what we do”
As a frontrunner in the creation of single-serve coffee, Nespresso has always held innovation at the core of its business proposition, and a series of new machines, products and services rolling out show that “innovation is still at the heart of what we do,” Loeschen said.
He explained that Nespresso’s latest and upcoming innovations address modern consumer challenges – helping the brand maintain relevance even as coffee shops reopen and some Americans return to their on-the-go lifestyles from before the pandemic.
“When looking at how do we maintain this [growth], one is to build and innovate on some of the must-haves from our consumer perspective,” Loeschen said. “So, you have people who will continue to be worried a little bit about their health … so we’ve created our just-launched Momento range, which is a full coffee and milk solution for offices and out-of-home venues” that doesn’t require consumers to touch anything beyond their capsule and cup.
The machine features an app that allows users to select their cup size and choose a recipe without touching a shared screen or it can be set to automatically brew a cup of coffee when a particular pod is inserted. It also has a lock screen feature that requires disinfecting before each use.
Recognizing that not all consumers will return to their places of work full time, Nespresso also is innovating ways for businesses to provide employees coffee perks at home.
For consumers who continue to work and live at home but who want a getaway, Nespresso has launched a line of new tropical iced coffee flavors, including a limited edition tropical coconut over Ice. It also relaunched as part of the permanent collection available year-round two popular summer blends: Barista Creations Ice Leggero and Ice Forte.
Nespresso also will continue to expand its Reviving Origins range, which features specialty beans that the company helped farmers grow in troubled regions.
“What we do is we go into troubled coffee regions where coffee was thriving at a certain point in time, and now it’s not, either for political reasons, economic reasons, war” or a natural disaster such as when hurricanes wiped out the coffee plantations in Puerto Rico, Loeschen said.
“We go in there with our different NGO partners, we rebuild the coffee industry, we work with farmers and help them rebuild their economic viability. And it’s a win-win situation because we are able to bring a product that consumers can continue to enjoy – either a rare coffee or bring back coffees that potentially were from certain areas but disappeared,” he said.
“Made with Care”
Nespresso’s Reviving Origins line is only one example of how the company supports farmers and the environment – something the brand wants to better communicate with consumers this year through ha new digital campaign, Loeschen said.
He explained that earlier this year Nespresso launched its “Made with Care” campaign, which continues the brand’s longstanding partnership with spokesman and Nespresso Sustainability Advisory Board member George Clooney. It also includes other influencers, like digital entrepreneur Chiara Ferragni, agronomists that work with the brand, internal employees and other celebrities and activists all who share the brand’s values and social and environmental efforts.
Among those efforts is Nespresso’s AAA Sustainability Quality program, through which Loeschen said the company provides technical assistance to farmers to improve their yield by adopting biodiversity practices that protect the environment, conserve water and hedge against climate change or natural disasters.
Loeschen said Nespresso also is piloting a program in Columbia to create retirement programs for farmers with the hope that it will not only help older farmers but also entice younger people to enter farming rather than go to cities for jobs with better benefits.
Finally, Loeschen said, the company will share through digital and social media its ongoing efforts to become carbon neutral by 2022.
By sharing these efforts with consumers through the digital campaign and by continuing to innovate, Loeschen said that Nespresso hopes to show consumers how every cup of Nespresso “is a positive cup.”
He explained: “If you really know what’s behind every cup of coffee, then you can really see the positive impact that you can have on people’s lives – whether that is something small like, ‘I love my machine,’ or something bigger like an impact on our coffee farmers’ lives and community.”
That not only will drive sales, Loeschen said, but it also is “what drives my excitement … and makes me very passionate about working with a brand or company like this one.”