Melitta Canada has adopted an aggressive below-the-line marketing strategy after the appointment last November of Allan Beesley as general manager, vice-president of sales and marketing.
Beesley was brought in to oversee a corporate restructuring after Melitta shed its manufacturing operations to the u.s. earlier in 1992.
Toronto-based Melitta markets a variety of premium-priced coffees, but it is also well known for its Melitta-brand coffee filters and coffee makers.
Beesley says he does not rule out media advertising in the future, but adds for the time being he has directed the firm’s marketing funds into sampling programs, couponing and in-store demonstrations.
He says the move reflects an effort by Melitta to reach its customers more efficiently.
Before joining Melitta, Beesley ran his own Toronto marketing consultancy.
Before that, he held executive positions with a number of packaged goods companies, among them Bristol Myers, Colgate-Palmolive and Warner Lambert.
As well, he has served as vice-president of marketing at both Revlon and Avon.
Twenty per cent of Canadian coffee drinkers consume 80% of the coffee sold in this country.
Beesley says to reach that 20% effectively, a more targetted approach is working for Melitta.
He says his below-the-line programs, together with limited radio support, can move more than 100 cases of product at one store during a weekend.
At the time Beesley started with Melitta, he says like most other companies, it was grappling with the tough economic conditions but was also undergoing fundamental changes.
New focus
Beesley says the Canadian organization and its costs needed to be restructured to reflect the new focus, and that new approach has produced results.
This year’s first-quarter A. C. Neilsen results showed double-digit growth in consumer purchases through supermarket channels of distribution and, he says, in recent weeks, performance has been even stronger.
His challenge at Melitta was to develop the niche market for its premium quality, premium-priced coffee.
It recently introduced a Legends series of place-of-origin coffees which includes Kona Style, German Premium, Vienna Mocha, Blue Mountain and Expresso coffees, and a dessert line of Irish Cream, Hazelnut, Chocolate Mint and Raspberry flavors.
Consumers spend about $240 million annually on roast coffee. Half of that market is split between heavyweights Nabob Coffee and Maxwell House.
Beesley says the speciality coffee segment is an underdeveloped category for supermarkets, so that is where he went to work.
In planning the sampling program, he divided retailers, mainly in the grocery sector, into three classifications: target accounts, which are a prime focus; developmental accounts, which receive secondary emphasis, and core accounts, which are those retailers that Melitta has previously invested in.
Beesley says the amount of product sold during sampling shows the program works, but adds that company research also indicates once a consumer tries Melitta products they will repurchase.
Research
He says recently completed research involving in-home taste panels revealed high purchase intent levels after product trial.
Melitta is unique in the coffee business because, unlike the competition, it provides all three parts of the coffee equation: coffee makers, filter papers and coffee.
Beelsley says all three areas are important, but adds the Melitta coffee maker is viewed as the fundamental building block.
‘After someone buys a Melitta coffee maker, they are more inclined to buy Melitta filter papers to compliment it, and even more inclined to buy Melitta coffee.’
To make that fundamental building block even more accessible, Melitta has entered into a joint venture with a Mexican company to produce its high-end ibs, Interval Brewing System, coffee maker for the North American marketing.
The same quality of technology available in the German-made product that retails in Canada at around $90 will be available later this year at $29.95.
Melitta’s worldwide headquarters is in Germany and the North American base is in Cherry Hill, N.J.
