The Nescafe coffee giant is aimed at generation Z as consumption habits change

Orb, Switzerland – for almost a century, an indescribable factory in a unsuspecting city under the Swiss mountains has been the host of some of the most consumed coffee trends made by the Nescafe caffeine giant.

From the 1938 launch of its Flaxed Soluble Coffee to Lyophilized Granules and subsequent coffee capsules, the Be protectedThe property brand is now pointing to its last iteration for the next generation of coffee drinkers.

“We have to develop solutions specifically to bring young people to the Nescafe brand,” Don Howat, a global category leader for Nescafe in Nestlé told CNBC.

For Nescafe, that means pointing to the cold coffee market. Today, a third (32%) of coffee consumed outside the home is frozen, according to the company’s compiled estimates. For many younger consumers, namely, generation Z, is often its first introduction to ubiquitous drink.

“Nescafe’s heart is really in the morning, drunk,” Howat continued. “We are trying to move to a space that is throughout the day, more in the afternoon, consumed cold, reoriented to that younger generation.”

“That provides a super exciting growth opportunity for Nescafe.”

Coffee is a great bet for Nestlé, with Nescafe and the sister brand Nespresso that represents two of the six key priorities of the company by 2025.

Represents a return to the nucleus For the world’s largest food and drink company, whose main lines include coffee, pet care and food under popular brands such as Nespresso, Purina and Kitkat.

Nestlé’s stock has delayed the main rivals as Uneilever and Danone In recent years, in the midst of weakest sales and revised orientation, even when the sector in general has been pressed by the prices of higher basic products and greater private label competition.

The CEO Laurent Freixe, who took the helm in September, promised to rename the business, saying that a series of acquisitions under his predecessor had “weakened the fabric” of the company.

“We want less, bigger and better innovations. We want to advance and impact,” Freixe told a media event earlier this month, citing coffee as one of the categories with the highest rate of “clear” victories.

The last gambit of the firm, Nescafe Espresso concentrated, marks a new approach to the development of products, one that plans to extend to other categories. The cold liquid concentrate, which can be used as a base for cold caffeine drinks, was developed in a research and development accelerator (R&D) and tested in the Kroger stores in the United States before its final sign.

It is one in a current of cold coffee products to flood the market lately, however, most have been in the pre -en -and ready to drink (RTD) space. Nestlé says that its objective is customization, with the concentrate designed to allow consumers to “hack” their coffee at home according to their preferences, for example, adding milk, water, lemonade or other drinks.

“Most young people have grown with cold coffee … their expectation is for cold coffee, many flavors, textures, additions,” Howat said.

Run in Australia at the end of 2024, the product has expanded from the USA, United Kingdom, Canada, Japan, China and Singapore with plans for more market markets. Meanwhile, a collaboration with the influencer Zach King is seen, to market the product in social networks users.

“He is achieving what we set out to achieve,” said Howat. “It simply leads the mark to a different space.”

The coffee giant now hopes that by attacking new consumers and consumption habits, it could pave the way for greater expansion in adjacent categories.

That includes the penetration of traditional tea markets such as India, China and Japan, building customization and premiumization, and addressing new consumption occasions.

“The interesting thing about younger consumers is that they are drinking much less alcohol,” said Howat.

Successive studies have indicated the lowest alcohol consumption habits between generation Z compared to previous generations, which caused an increase in non -alcoholic alternatives and health and well -being oriented. However, Julio’s investigation of an ISWR survey sought to discredit that narrative, citing the crisis of the cost of living as a source of the perceived abstinence trend.

However, Nescafe said he sees a new range to place coffee as a product of the whole day and a sophisticated alternative of alcohol.

“When they socialize at night with their friends, they would like to drink something that is an adult but may not have alcohol,” he continued.

“That provides an opportunity for Nescafe to enter that space, perhaps with decaffeinated products, with cold products, indulgent products,” he said.