Home Coffee Competition Heats Up

Nestlé is couponing online for its Nespresso home espresso machine as Kraft Foods brings its Tassimo machines to the U.S.

Nespresso is offering $50 off the purchase of a home machine, whose prices range from $180 to $500. The system has seen increased competition in recent years from newcomers Tassimo (Kraft Foods and Braun) and Home Café (Procter & Gamble and Black & Decker).

Kraft launched Tassimo in U.S. department stores in September with a $170 price tag. The system appeared on The Apprentice: Martha Stewart in November as teams competed to design retail displays for Tassimo. Kraft supported the appearance with a gift-with-purchase offer, giving two mugs to consumers who bought a machine.

Nespresso machines launched in Europe in 1986 via Nespresso SA, a division of Nestlé Group, then rolled into the U.S. in 1991. Nestlé broke its first TV ads in 2000, in Europe; the brand serves consumers via 33 boutiques (mostly in Europe, with one in New York) and via its Nespresso Club. Buyers are automatically enrolled in the club, which offers quick ordering (for coffee pods), maintenance advice and occasional promotions. Nespresso Club touts 1.6 million members.

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