Marketing channels of Nescafe

Welcome back Nescafe lovers,

This time I will explain the distrubution channels of Nescafe, I will do this by asking question and answering this.

Question 1

Draw an overview of the distribution channels for your product. Describe the channels in terms of complexity and distance.

Nescafe is making use of the Dual Distribution, it is not possible for the consumer to purchase coffee directly from Nestle. Although, Nescafe have different sites in different languages those site is made only for the country in which language it is written. For example, I searched on the nescafe.co.uk site and there is page where you can find and there is a button available called buy now, after you clicked this button you need to choose the retailer and need a supermarket account. On the Dutch site from Nescafe there is also a button available called buy now but it will his own site you can find the product with a button ‘buy now’ but you will be redirected to the supermarket site that is available in the area where you live.

So, Nescafe is using two different distribution channels. Below I will make an overview how it looks like

Distribution Channel 1	Distribution Channel 2
1.    Nestle/ Nescafé	1.    Nestle/ Nescafé
2.    Supermarket	2.    Wholesale
3.    Consumer	3.    Retailer
4.	4.    Consumer

I found out in the previous review question that not everyone can be a distributor who can purchase the goods directly from Nestle. Nestle settled op some points if the distributor accord to this points he can leave a suggest and the DMU of Nestle will look of the distributors is a suitable for Nestle.

To be a distributor and make part of the distribution channel will be complex, it is not possible to purchase directly from Nestle / Nescafe or to be a distributor of Nestle / Necafe. You need to accord to the strict rules that is settled up by the management of Nestle, if the distributor like to purchase directly from Nestle / Nescafe the company need to leave a request to Nestle and the DMU of Nestle will judge if you could be a possible distributor for Nestle. This make it difficult for distributors to take part in the business channels of Nestle.

As I figured out nestle making use of 3 to 4 channels, it is possible for Nestle to send a quick delivery to the channels if it is necessary.

Question 2

Describe which distribution functions are fulfilled through the different channel members.

Distribution Channel 1,
Nestle has different brands among themselves one of those brands are Nescafe. Supermarkets can purchase directly from Nestle after this process the coffee from Nescafe will be available in the shelving for the consumer.

Distribution Channel 2,
Nestle will choose their own distributors / wholesalers, it is possible for distributors wholesaler the send a request to Nestle and they will judge if you can be a distributor for Nestle. After they receive approval from Nestle they can purchase directly from Nestle and can sell it retailer. The retailer can sell it to the consumers.

Question 3

How can your product’s image be influenced by the retail concept in which it is sold? Clarify your answer!

Nescafe is supporting local farmers who are making the coffee beans and support to have a better environment. One of the points Nestle settled is that potential distributors need to prove that they also produce environment friendly and they made some actions to stimulate the environment.
This will make sure Nescafe can tell the consumer that they produce and working together with distributors to a better environment.
Nestle made strong rules to become a distributor they made it because it will harm the image of Nestle and they only want to work with distributors who are also working to develop themselves

Question 4

Which distribution strategy has been chosen for your product?

Nescafe makes part of the selective distribution;
In the Netherlands is it possible to buy the coffee in all the Dutch supermarket nearby (so Aldi, Lidl are not making part of it). But not in every supermarket only the Dutch and there are also supermarkets in the Netherlands who are original Germany supermarkets. The consumer will go to supermarkets like AH and Jumbo to buy this specific product from Nescafe.

Thanx for your time! Next week I will upload another questions with answers that will make clear how Nescafe act in the market