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issue: April 2004 APPLIANCE Magazine

European Report
Small Appliances: Coffee Maker Premiere, Bread Maker Comeback


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By Paul Roggema, European Correspondent, APPLIANCE Magazine

The household division of Philips Electronics (Amsterdam, The Netherlands) recently introduced the Senseo coffee maker in the U.S. market. This single-serving, low-pressure coffee maker has been a monster success in Europe (5 million units sold), exceeding all sales expectations in Dutch, Belgium, and German markets.

The system is a mixed design. It has a pump and a pressure chamber, like traditional espresso makers, but the pressure is much lower (just above 1 atmosphere). It uses servings (or pods), and the brewing process is fixed for time, temperature, and pressure. Lower pressure means cheaper components, so the appliance can be sold at a U.S. $70 price point. Operation is automated and, therefore, coffee quality is constant, always fresh, and easy-to-use. At low pressure, no real crema can be expected, but there is an attractive frothy coffee layer. The taste of the coffee is always the same, and no “old” coffee has to be thrown away. The coffee pods are manufactured in four flavors by Douwe Egberts, Holland’s well-known coffee company, part of Sara Lee Corporation.

The taste is somewhere between “normal” (“slow”) filter coffee and espresso. Especially for consumers in Northern European countries, who are used to slow coffee makers, it is perceived as a great improvement. Coffee is stronger, and brewing is almost instantaneous (less than 1 min). The fact that the coffee maker looks (and hums) like an espresso machine greatly helped market acceptance.

So are the success factors on the European markets also applicable to U.S. consumers? Did Starbucks educate them enough to upgrade to a new system with a different price level? “We feel that we can repeat the enormous European success in the U.S.,” says Nina Riley, senior director of Innovation for Philips North America. “At least about 30 percent of all consumers are coffee-involved (through regular visits of coffee houses as Starbucks), and they are willing to reproduce the real coffee experience at home. The Senseo concept offers the perfect cup of coffee, every time, thanks to the fixed brewing process. The frothy coffee layer locks in the aroma and gives a velvety structure. It looks and feels as good as it tastes.”

According to Ms. Riley, the basic marketing formula of the product is the same, with a few changes. The original name was Senseo Crema, but in the U.S., the word “crema” associates too much with coffee cream (in Europe they add “milk”). The coffee pods are imported and are the same brand (Douwe Egberts) as the first Dutch introduction. In The Netherlands, the familiarity of the brand helped, but in the U.S., an unknown European brand is chic and adds to the credibility of the concept. The taste, Ms. Riley notes, is identical to the European versions.

“We are very confident,” she tells APPLIANCE. “Philips sold 5 million Senseo units in just 3 years, so you could call it the new DVD.”

For Philips, the Senseo success could have a silver lining: the company’s American business in consumer electronics needs improvement. (They are Europe’s market leader in televisions, and they invented the CD.) Bringing its brand to consumers’ kitchens in large volumes will improve its brand awareness significantly.

 

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