The Illy Case Study Prof. A.Sinatra a.a. 2011/2012

 THE KEY ACTORS and what’s their contribution to the Illy success  PRODUCT STRATEGY: define the work behind the Illy’s production  ILLY’S STRATEGY: describe the strategy the company followed Main aspects you have to identify:

 1933: FRANCESCO ILLY  He invented the expresso machine and the pressurization technique  Focus on the perfect cup of coffee and the complete production process  Trieste - High skilled workers - Multilingual city - Large city  1956: ERNESTO ILLY  Chemical degree  “Cocktail of science and business”  Research & Development  Branding  Strong ethical values  1977: RICCARDO ILLY and, from 1993, ANDREA ILLY  Internationalization  Process innovation  Top consistent quality  Cafe’s culture  Diversification THE KEY ACTORS - International minded people - Large companies - Vibrant life with coffee shops

UNIQUE, PERFECT BLEND PRODUCT STRATEGY illy Caffè Single brand Consistent taste year after year Sales increased 15 times Top consistent Quality ARABICA Quality of coffee, from 9 regions, from Brazil, to Africa to the Central America Scientific /Technological innovation that lead to the definition of a portfolio of patents  Internal R&D laboratories  University Network  Multi disciplinary Focus  Testing each bag  Fast shipping to the central warehouse in Trieste  Special containers for shipping  Selection of each bean (50 in a cup)  Air treatment after the toasting process

 WORLD NICHE LEADER very large competitors  CONTINUOUS INNOVATIONS & PATENTS large proprietary portfolio  FIT WITH THE LOCAL CULTURE EU Vs USA  EXTENDED HoReCa NETWORK Customer experience  DRIVEN BY CUSTOMERS’ NEEDS  LONG RANGE PLANS Avoid shortcuts ILLY’S STRATEGY