BrandTrack: Coffee sector in an instant
This month BrandTrack looks at the instant coffee. It is a sector with few brands – although specialist lines play a key role – and in which long-running campaigns and established brand values pitch against own-label’s lower prices
Brands bought Nestlé dominates the instant coffee market; nearly two-thirds of purchasers had bought a Nescafé brand in March 1995. The combined own-labels represent the second force, but they account for less than half the Nestlé penetration. Kenco and Maxwell House are the only other significant brands, but are bought by less than ten per cent of respondents.
There are relatively few instant coffee brands, even with the own-label presence. However, the top brands offer several varieties within brands which play a key part in households’ repertoire purchase.
In general, the market does not show any strong demographic bias, although the incidence of own-label purchase declines noticeably with age. Gold Blend purchasers tend to be older and more upmarket than the norm, and the brand has a very strong franchise in London and the South-east.
Reasons for purchase
Habit is the strongest factor in the market, 79 per cent of buyers attributing purchase
to it. This figure rises to 88 per cent for both the main Nescafé brands, in significant contrast to both own-label and the other brands except Kenco. Buyers over 40 are more likely to be brand loyal.
Relative cheapness is the next most potent influence to be acknowledged, and presents a diametrically opposed brand profile. Own-label purchasers are more than twice as
likely to give cheapness as a motive, and this is also a significant factor for
Maxwell House buyers. In-store impulse purchase also seems to be linked with perceived economy, as it is more influential for own-label than for most of the brands.
The importance of novelty and experimentation as a purchase impetus in the
coffee market relates less to brand switching, and more to the purchase of speciality variants within brands, which have proliferated in recent years. The incidence of experimentation is greater among younger and upmarket buyers.
Sixteen per cent of buyers claim to have been persuaded to buy a particular brand by television advertising.
However, this figure rises to 28 per cent of Gold Blend, and 45 per cent of Kenco buyers, arguing for the effectiveness of highly visible and memorable advertising.
Advertising recall
The respondents claimed to have seen advertising for 12 brands during March
1995. Unspecified Nescafé advertising is recalled by 57 per cent of buyers, with
29 per cent remembering Gold Blend. Kenco and Maxwell House effectively
tie for third place, and are the only other brands which score more than ten per cent recall. The high levels of recall reflect the long-term effect of consistent advertising by the top brands, as there was relatively little actual spend during March.
The recall of Kenco Instant may have been reinforced by advertising for Kenco Filter, which spent 226,000 in March, using the same “coffee-house” strategy.
AB/Cl/C2 purchasers, who form the main target, are more likely to remember advertising for at least one brand; there is no difference in recall levels between older and younger respondents.
This is in strong contrast to most other markets covered by BrandTrack, where the younger, and also the more downmarket consumers were more likely to recall advertising. Media expenditure
Expenditure on instant coffee is effectively split between Nestlé and Kraft Jacobs Suchard. Nestlé accounts for 63 per cent of total annual expenditure, supporting Nescafé, Gold Blend, Alta Rica and Cap Colombie and other specialities and variants. Kraft is responsible for 35 per cent of market spend, promoting its Maxwell House, Birds and Kenco Instant brands.
Of the 23m spent in the past 12 months, 91 per cent went to television. Nestlé was the only significant user of the other media, running posters for Nescafé and Gold Blend, and press advertising for the smaller and more specialist brands.
Researchers asked a sample of 325 women aged 20 to 50 who bought instant coffee in March 1995
Analysis: The Human Factor
Fieldwork: ESA Market Research 01727 847572
Ad spend: Register-MEAL 0171 833 1212
For customised reports on instant coffee, contact Elaine Hunt, BrandTrack tel/fax 01451 844754
