As the head of German food giant Kruger, the $3 billion family business behind Aldi’s Expressi coffee capsule machines, he needs to stay awake if he’s going to topple Nespresso. “Oh my god,” he said on a recent visit to Sydney. “I’ve been asked this before.
When I say six to 10 cups a day, people say, ‘Geez.’ In the past it was, ‘Let’s go have a cigarette and a chat.’ Coffee is like having a chat, it’s becoming part of the daily culture — so I have lots of chats every day.”
The 36-year-old, who took over running of the family company three years ago, is this week celebrating five years since the launch of the Expressi coffee machine and capsule business in partnership with Aldi Australia.
Since 2011, the company’s capsule business has grown to $190 million in sales annually. While that’s still a tiny chunk of its $2.9 billion turnover, Mr Kruger said capsules were experiencing “tremendous” growth.
The launch, which was supported by a massive advertising campaign at the time, marked one of the first times an Aldi product was marketed as a stand-alone brand. Expressi is now the number one coffee machine sold in Australian supermarkets.
The German discount chain earlier this month revealed record sales of $5.8 billion in calendar 2014 — its most recent filings with the Australian Taxation Office — an increase of nearly $1 billion on the previous year, with pre-tax earnings of $238.5 million.
The retailer currently has about 10 per cent share of Australia’s $90 billion grocery market, and analysts predict that figure will reach 15 per cent within the next few years as it expands into South Australia and WA.
When the Swiss-designed Expressi machines rolled out to Aldi supermarkets in Germany three years ago, it marked the first time a product had been introduced to Aldi’s home market from Australia.
“My father had 42 years of history with Aldi,” Mr Kruger said.
“Aldi was one of the first retail partners he started off with, so it has always been a very strong relationship. Actually the first products we sold into Australia were through Aldi.
“When we looked at the growing market of coffee capsules, we had a good chat to the guys from Aldi Australia. Despite the fact that everybody was looking at doing Nespresso ‘me-toos’, I was saying no, we want a point of differentiation.
“Today it’s written on the side of the carton, ‘Award-winning partnership’, but it has always been a collaborative approach. Normally when you do private label business it’s very transactional. But this was really much more like a marriage.
We said, ‘We want to go for the market, let’s go for it together.’ So it was an honour for us — it was like being a knight.”
Mr Kruger said when the Australian launch first took place, it was night time in Germany. “We were having a conference call with our guys here on the ground. They were telling me, ‘Marc, you cannot imagine, the people are queuing in front of the shops.’”
