The Positive Cup by Nespresso.

Nespresso. What else? Who doesn’t know this advert?

Goerge Clooney, with his incredible charming sex appeal made all of us desire a delicious cup of Nespresso coffee. Isn’t true?

Positioned in the luxury segment of the coffee industry, Nespresso won the game in terms of brand awareness and market share. Now, well acclaimed among different consumer targets, it is ready to break another record.

Sustainability. This is the goal

Nespresso commits that every cup of Nespresso coffee, both for at-home and for professional customers, will be carbon neutral by 2022.

Any cup of Nespresso Coffee has the potential not only of delivering a moment of pleasure, but also to restore, replenish and revive environmental and human resources.

What does it mean to be Carbon Neutral?

Carbon neutral means having a balance between emitting carbon and absorbing carbon from the atmosphere in carbon sinks.

Removing carbon oxide from the atmosphere and then storing it is known as carbon sequestration. In order to achieve net zero emissions, all worldwide greenhouse gas emissions will have to be counterbalanced by carbon sequestration.

This is the ambitious but feasible goal:

Nespresso has been carbon neutral across its business operations since 2017 and now commits to achieving full carbon neutrality across its supply chain and product life cycle.

What is the Nespresso Plan to become Carbon Neutral by 2022?

Three factors:

1. Carbon emission reduction
   
2. Planting of trees in and around coffee farms where Nespresso sources its coffee (insetting)
   
3. Investments in high quality offsetting projects (compensation)

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1. Carbon Emission Reduction

When talking about a sustainable product it is crucial to keep in mind the concept of Value Chain.

A value chain is a set of activities that a firm operating in a specific industry performs in order to deliver a valuable product for the market.

Considering then the goal of Nespresso it is crucial to decarbonize the value chain.

How?

1. Driving towards 100% renewable energy in all Nespresso boutiques and increasing the use of biogas within the manufacturing process
   
2. Expand circularity of Nespresso products and packaging. Increasing the use of recycled plastic within Nespresso machines, as well as use of recycled and low carbon virgin aluminum within coffee capsules.

2. Planting trees in coffee farms and the surrounding landscapes

Trees are the best way to capture carbon from the atmosphere while investing in nature and building a regenerative agricultural system.

It also provides the shade needed to improve the quality and quantity of the coffee harvest.
The roots also help protect against soil erosion and landslides and promote soil regeneration.

Thanks to the partnership with Pur Project, Nespresso will triple the capacity of planting trees in coffee producing countries such as Colombia, Guatemala, Ethiopia and Costa Rica.

3. Investments in High Quality Offsetting Projects (compensation)

Nespresso is ready also to invest in projects to support forest conservation and restoration (planting of new trees) as well as implement clean energy solutions within farming communities.

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How big is the coffee market?

According to Businesswire, the global coffee market is anticipated to reach US$ 134.25 billion in 2024, growing at a CAGR of 5.32% for the period spanning 2020-2024.

The two most important factors that are expected to drive the market are:

1. Green coffee consumption in emerging economies
2. Growing demand for specialty coffee

But not only:

1. Increasing out-of-home coffee consuming population
2. Rapid urbanization
3. Rising e-commerce retail sales
4. Increasing instant coffee preference

This is though a clear indication of the market need. Sustainability becomes crucial even in the beverage industry.

What is the fastest growing market?

Surprisingly, the fastest-growing regional market is Asia-Pacific. The main reasons are: A rise in the demand for coffee by the working population, the growing presence of a large number of coffee chains and an increase in the e-commerce retail sector.

What is the overall feeling today in coffee industry?

The increase of environmental conscience in the recent years has awakened the need for coffee retailers to reduce their carbon footprint. This means implementing resources in developing technology that will help them achieve that goal.

Growth in Coffee Consumption by young people

The best reflection of this trend can be seen in Asian countries.

In China, for example, a market that has shown huge potential in the last 5 years, the main coffee consumers are among the ages between 20 and 30. Social media, especially Instagram, their preferred platform, has impacted this generation.

Among the most popular Instagram hashtags are #CoffeeLovers and #Coffee, and it would not surprise you if you saw at least one coffee cup pic a day, when you scroll through your timeline.

Also, coffee houses that congregate young people are becoming more and more popular, thus backing up this trend’s continuous growth for the upcoming year.

So even in the coffee industry the z generation is the one that makes the difference and companies have to take this in consideration when strategizing their plans for growth.

Nespresso. What else?