2. E101: Distribution
Ryan Poissant - MaRS
email: rpoissant@marsdd.com
twitter: @ryanpoissant

3. Product
Price
Place
Promotion 3
The Four P s

4. The Four
P s
Product
Price
Distribution
Promotion
4

5. 5
3 Parts: Delivery, Sales, Service

6. It s OK and often optimal to mix &
match. 6
2 Flavours: Direct, Indirect

7. 7
How to Choose?

8. 8
Market type;
Existing, Re-segmented, New

9. 9
Market Stage

10. 10
Complexity

11. 11
Price

12. 12
Customer Preference

13. Default Choices 13
Channel
Type
Direct Indirect
Market
Type New Re-segmented Existing
Market
Stage Early Midstage Mature
Product
Complexity
Complex Simple
Price
Expensive Cheap

14. Other
Factors
• Size of market
• Diversity/complexity
of market
• Proximity of market
• Completeness of
offering
• Cost of channel
• Speed to market
14

15. 15
Not just a tactic...

16. 16
Amazon
Dell
...for some a Strategy Apple

17. 17

18. 18

19. 1970 - Invented
1976 - Patented
1986 – Launched
Sold as a complete solution,
machines & coffee for a per cup
price to restaurants and offices. 19
Background

20. 1970 - Invented
1976 - Patented
1986 - Launched
Sold as a complete solution,
machines & coffee for a per cup
price to restaurants and offices.
1988 - Acknowledged dud,
Nestle considers shutdown. 20
Background

21. 1989 - Jean Paul Gaillard named
Commercial Director.
Pivots 21
Background

22. 22
Separate machine & coffee.
Sell to consumers.

23. Made and serviced by 3rd
parties.
Sold through independent retail
stores.
Manufacturers handle delivery
and stocking.
Nespresso handles sales
training. 23
Machines

24. Sold online and over the phone
direct to members of the Nespresso
Club.
Delivered direct to consumers in 24
hours or less.
24
Coffee

25. As market matured Nespresso
added their own brand machines
made by an OEM.
Added it s own retail boutiques to
further control the sales message.
Created Nespresso Pro channel to
serve the office market.
25
Later

26. ~$3 billion
in annual
revenue
30%
CAGR
over 10
years
50
countries
20 billion
capsules
12 million
machines 26
Results

27. Questions?
Comments?
Suggestions? 27
Thanks!
Ryan Poissant rpoissant@marsdd.com @ryanpoissant