Internationalization of Bosnian black

coffee brand: bringing the traditional

coffee experience to the world
Selma Kadic-Maglajli
c and Maja Arslanagic-Kalajdzic

Introduction Selma Kadic-Maglajlic and

Maja Arslanagic-Kalajdzic
It was a cold evening in early March 2019 when Rusmir Hrvic , CEO and owner of AS Group, are both based at the
and Adis Hasakovic , CMO of AS Group, were sitting in a restaurant overlooking the small School of Economics and
town of Veghel in The Netherlands. They were having dinner after a meeting with the Business, University of
management representatives of one of the leading retail chains in The Netherlands, Jumbo. Sarajevo, Sarajevo, Bosnia
Jumbo was part of the privately-owned Van Eerd Group, which was established in 1921. and Herzegovina.
According to Statista (2018a, 2018b), it was the fourth largest retail chain in The
Netherlands with more than 580 stores (just after Kruidvat [more than 930 stores]; Albert
Heijn [about 850 stores] and Gall & Gall [about 600 stores]). The managers of Jumbo
seemed keen on the idea of accepting their traditional black coffee brand and listing it as a
stock unit for further merchandising, but they wanted to see their marketing plan with firm
details as soon as possible.
During the dinner, Mr Hrvic  and Mr Hasakovic  remembered the winter of 2010. It was during
that winter, when the economic crisis was at its strongest, that a family company, AS, from
the small town of Jelah in Bosnia and Herzegovina (B&H) acquired the Vispak company,
which was at that time facing a hopeless situation. Vispak was one of the biggest coffee
processing and packaging firms in B&H. It had also evolved as a producer of numerous
food products. Since its establishment in 1972, it had become recognizable for its roasted
and milled coffee Zlatna džezva (pronunciation: zla:t˛a ‘dз« @zva). The idea for acquiring
Vispak came from Mr Hrvic  personally. Most of the people around him doubted his idea,
and the only person who supported him at that time was his friend Mr Hasakovic . They both
believed in their vision of the largest food processing company in B&H and knew that they
had the potential, knowledge and expertise to make it real. Mr Hrvic  was born in 1973 and
graduated from the School of Economics and Business, University of Sarajevo. This brave,
competent and knowledgeable young business leader had never been employed in a large
multinational corporation nor lived abroad. His business knowledge, almost intuitive, came
from his first business experiences, when he was a 10-year-old boy helping his uncle to run
a local grocery store in Jelah. That is how everything started.
In 2018, almost a decade after the successful acquisition of Vispak, Zlatna džezva, which is Disclaimer. This case is written
solely for educational purposes
Vispak’s flagship brand of traditional black coffee, was sold in multiple countries around the and is not intended to represent
world; however, mostly in ethnic shops. Nevertheless, Mr Hasakovic  had an idea to further successful or unsuccessful
managerial decision-making.
exploit the brand’s potential, because he strongly believed that “this brand is first when it The authors may have dis-
guised names; financial and
comes to customer loyalty in B&H, but it is able to make a great impact internationally, too.” other recognizable information
Meeting with representatives of Jumbo in Veghel was the start of the process of negotiation to protect confidentiality.

DOI 10.1108/EEMCS-05-2017-0104 VOL. 9 NO. 1 2019, pp. 1-24, © Emerald Publishing Limited, ISSN 2045-0621 j EMERALD EMERGING MARKETS CASE STUDIES j PAGE 1
 for entry into a modern trade channel in The Netherlands for Vispak’s brands, with the main
focus on Zlatna džezva.
Mr Hrvic and Mr Hasakovic  have made many things together. They have been through
stressful times and also successful situations. The two friends found a way to make risky
decisions, to survive economic downturns and to deal with the complex political
environment of B&H. But, when it came to the decision about the composition of the offer to
Jumbo, they were unable to find agreement about several important issues. What was to be
the future of Zlatna džezva in The Netherlands’ market? What should be the marketing
strategy for Zlatna džezva as a response to the market environment in The Netherlands?
What would be their market positioning, and should they keep the name of the brand
(having in mind that pronunciation for non-Balkans is quite difficult), or should they
internationalize it and make it more comprehensible for people who are not from Balkan
countries? While Mr Hrvic was leaning toward an international switch in branding strategy,

Mr Hasakovic had a strong opinion that Zlatna džezva should keep its identity that
communicates the Bosnian heritage, culture and tradition.

Global coffee market

Coffee is a commodity widely consumed throughout the world in different forms, ranging
from the Turkish coffee that is recognized as part of the intangible cultural heritage of
Turkey (UNESCO, 2013) to canned coffee drinks common in Japan, or low-fat, iced-mocha
frappes in North America. Coffee also represents the highest consumed beverage in
developed countries, such as the USA and EU countries (Global Coffee Market, 2018),
while it is produced almost exclusively in the developing world. Furthermore, coffee
consumption is expected to witness a 5.5 per cent compound annual growth rate (CAGR)
per year until 2023 (Global Coffee Market, 2018). The largest coffee drinking nation in
Europe and North America in 2017 was Finland, where the average Finnish citizen
consumed 12 kg of coffee per year (for an overview of per capita consumption of coffee in
2018, see Exhibit 1). Furthermore, according to a study by Acorns (2017), the average US
consumer spends about US$1,100 per year on coffee.
Different classifications can be used to segment the coffee market. Based on product type,
the simplest method is to segment the market into roasted, instant, ready-to-drink and
specialty coffee. The largest coffee segment consists of roasted and ground coffee,
accounting for 76 per cent of all coffee consumed in the world. Products that fall into the
roasted category include whole beans and ground coffee that require processing to create
a beverage (Zlatna džezva belongs to this segment). The bulk of roasted coffee is
produced by large corporations. Potential growth opportunities exist, however, for more
local roasters who blend different beans together (e.g. Arabica and Robusta) to create
unique flavors. The trade in green coffee beans requiring roasting at the consumer level is
also increasing in Europe. Although it accounted for only a very small fraction of the market,
it is following a trend toward home-roasting/on-site roasting, especially in relation to the
increase in the consumption of specialty coffee, which was a parallel trend.
Instant coffee (coffee crystals and coffee powder) is a beverage derived from brewed
coffee beans that enable people to quickly prepare hot coffee by adding hot water to the
powder or crystals and stirring. Instant coffee is commercially prepared by either freeze-
drying or spray drying, after which it can be rehydrated. Ready-to-drink coffee consists of
packaged coffee that requires no preparation other than reheating. This type of coffee is
primarily found in vending machines, although canned coffee is becoming more popular
worldwide. Furthermore, single-serving options of ready-to-drink coffee are becoming
increasingly available in Europe, and in 2016, coffee capsules accounted for more than 15
per cent of the EU coffee market (P&A Coffee Newsletter, 2016). Specialty coffee includes
cappuccinos, lattes and espressos along with organic coffees, all of which command

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premium prices. In 2018, more than 40 per cent of all coffee within the specialty coffee
segment was premium-priced, according to Global Coffee Market (2018).
Based on the source type, the global coffee market has been segmented into Arabica,
Robusta and Liberica coffees types. The Arabica holds the highest market share at 70 per
cent, while Robusta and Liberica hold about 27 per cent and 3 per cent, respectively.
Furthermore, based on flavor, the market is categorized into flavored and non-flavored
coffee. Flavored coffee is further segmented into vanilla, caramel, Irish cream, hazelnut and
others. The caffeinated and decaffeinated types of coffee are two segments that divide the
coffee category based on the processing method (Global Coffee Market, 2018).
Mr Hrvic knew that as the coffee market has been constantly growing, it has also been
transformed from a principally bulk market to a market increasingly concerned with quality
and sustainability. This is why it was important for him to learn as much as possible about
the market in The Netherlands to be able to properly target new consumers. Also, as a trend
of a new millennium, coffee has been promoted as an artisanal product, rather than a
commodity, as the number of consumers willing to pay higher prices for coffees of high
quality has increased.
In the coffee segments, it is interesting to note that men drink as much coffee as women.
Therefore, there are no gender differences in their habits. Women are, however, more
concerned about the price of coffee than men. Finally, factors such as the availability of a
wide range of coffee types, flavors and brewing styles, rising urbanization and disposable
incomes and an increasing number of food outlets, retail stores and cafes are driving the
global coffee market’s growth. However, the price fluctuation of coffee beans and climate
change, leading to supply shortage, are restraining the market. Mr Hrvic  prepared himself
for these factors by ensuring a stable supplier and adding insurance in case the prices rise.

Vispak – a small player from a developing country with big global plans
Vispak was established in 1972 in Visoko (small city in B&H). In the same year as the
company was founded, the production of Zlatna džezva, the company’s most famous
brand, started. Two years later, production of Vispak’s espresso coffee began, and the
company started using the latest models of IMA machines that were the best at that time for
tea packaging, as well. They moved their production to a new facility in 1980 and installed
new production lines for packaging of coffee, snacks and other similar products, such as
spices and food additives. During the entire period of aggression on B&H (1992-1995),
Vispak did not stop production. After the aggression ended, the company faced
reconstruction. In 1998, Vispak began exporting different products to Sweden (primarily
satisfying the needs of B&H diaspora). This marked the beginning of Vispak’s export
activities.
After 1995, Vispak went through different ownership structures, including the so-called
“employees’ ownership” (the type of privatization where public ownership was allocated to
employees through various employee stock ownership plans). The turning point for the
business activities of Vispak came in 2010, when Mr Hrvic decided to acquire the company.
What was notable about this acquisition was the fact that it was one of the few in B&H which
was performed entirely on the capital market[1]. In particular, during the nine-month period
from April to December 2010, Vispak’s shares were traded via the Sarajevo Stock
Exchange. One by one, shares were repurchased from a total of 621 shareholders and nine
capital funds, which ultimately left the AS Group owning 83.93 per cent of shares. The final
result made the AS Group a major shareholder of Vispak and that concluded the purchase.
After the acquisition, the new owners faced a number of significant challenges:
䊏 There were BAM 3m of debts in contributions and taxes[2].
䊏 The employees lacked trust in the new management.

VOL. 9 NO. 1 2019 j EMERALD EMERGING MARKETS CASE STUDIES j PAGE 3

 䊏 The local environment had no faith in the new owners.
䊏 There was bad publicity.
䊏 The market share of Zlatna džezva in the local market was low, which was measured
per mille[3].

The acquisition of Vispak marked the beginning of the formation of the AS Group and a
vision that aimed to create a rounded, locally-owned food industry system in B&H. It was no
surprise that in 2017, the AS Group had more than 3,300 employees, which made them one
of the largest employers in B&H. Mr Hrvic  stated that he had one rule which was to be used
during the revitalization of the company: “that [the] company needed to be managed fairly
and diligently”. It was important for him to spend all of the available funds on revitalization
and to have realistic views on all of the business possibilities.
The strength of Vispak’s brands was immediately recognized by the new management, and
the products were instantly returned to store shelves throughout the country. Positive
financial results were followed by Vispak’s improved market positioning. One year after the
acquisition, 76 per cent more products were placed compared to the previous year. Less
than three years after the acquisition, Vispak had almost doubled its revenue. In three
years, a complete return on investment was achieved, with revenues exceeding e9m in
2010 and over e26.5m in 2018 (for the overview of revenues, see Exhibit 2).
Since the acquisition, one of the most important goals for Vispak had been to increase their
exports to 35 per cent of total revenues. One of the main preconditions for the increase in
exports was obtaining quality certificates. Therefore, by the end of 2016, Vispak had
acquired numerous quality certificates, such as HACCP, ISO and halal certificates. These
certifications helped them to reduce and eliminate problems with the export of products
related to demanding Western markets and also with respect to the demands of the
Australian and UAE markets.

Coffee brand Zlatna džezva in the local market

As an experienced marketer, Mr Hasakovic  considered that one of his great successes was
being able to position Zlatna džezva as a brand that built its image on tradition, heritage
and quality (Exhibit 3). This made consumers perceive Zlatna džezva as the “real Bosnian
coffee.” To underline this message, Mr Hasakovic  decided to organize an event in the city
of Mostar (B&H), where the Zlatna džezva coffee was prepared in the largest coffeepot in
the world. This event made it to the Guinness Book of World Records. Vispak was officially
given a Guinness certificate, confirming their entry to the World Book of Records, and this
brought a great deal of attention to Zlatna džezva in the local market. Because of its
success, this PR activity has been continued, so the largest coffeepot in the world has
traveled across 20 countries and evoked a great deal of interest from the media in all the
countries where the events of preparing the Zlatna džezva coffee in the largest coffeepot
have taken place. During its journey, many interesting situations occurred. For example,
when the Guinness coffeepot was dispatched from China by boat, it got “lost. Then, when it
was sent to Brazil by plane, the journey to the final destination lasted for 30 full days. One of
the main reasons was a problem at the customs office, where officers did not believe the
documentation that stated that the Guinness coffeepot was 12 meters tall.
Similarly, one of the most successful campaigns in B&H was Vispak’s Zlatna džezva
support of the B&H football team on the road to qualification for the FIFA World Cup in
Brazil. This was an advertising campaign that had implications for Bosnian society in a very
special way. B&H is a multi-ethnic country of Bosniaks, Croats and Serbs. The country was
torn apart by the most destructive European war (1992-1995) since the Second World War,
in which neighbors and friends killed each other. The Dayton Peace Agreement of 1995
helped bring the war to an end. However, it divided the country on ethnic lines, between the

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overwhelmingly Serb-populated Republika Srpska (Republic of Serbs) and the Federation
of B&H, populated mostly by Bosniaks and Croats. Although the war had ended almost
three decades previously, inter-ethnic relations were still problematic. There were separate
political and even educational systems in the two entities; the people did not communicate
with each other unless they were forced to for some reason, and Bosnian Croats and Serbs
identified themselves more with Croatia and Serbia, respectively, rather than with B&H. In
this situation, the qualification of the national team of B&H for the World Cup 2014 was an
important step in national and inter-ethnic reconciliation, contributing to national identity
building. It was the first and (so far) the only time that the B&H football national team was
placed at this level of competition.
This was a period when everyone across B&H was thrilled to follow the national football
team. All of the football matches in which the team played became almost a national holiday
across the country. At that time, an advertising campaign was launched for Zlatna džezva,
whose endorser and face of campaign was a famous B&H actor, Enis Bešlagic . This also
contributed to the building of a national identity in a special way. The aim was to even
further connect Zlatna džezva with the success of the B&H team. It was accompanied with a
positive atmosphere, and the Bosnian coffee-making tradition highlighted the pleasure of
socializing it creates. The campaign included a series of adverts accompanied with the
slogan “We’ll drink it in Brazil, so help us God,” OOH advertisements and limited-edition
coffee packaging.
This innovative campaign was followed by excellent results on the local market. Namely,
according to the research agency Ipsos (2016), which conducted a study of 1,000
consumers in B&H, Zlatna džezva was the first brand in terms of loyalty (11 per cent),
followed by Grand coffee (9.5 per cent), coffee Brazil (7 per cent), Franck coffee (5.9 per
cent) and Dino coffee (4.8 per cent).
It became clear to Mr Hasakovic  that whilst he could not make Zlatna džezva as successful
elsewhere as in B&H, the brand was very strong. Hence, he began to envision its success
in western Europe. On the other hand, he knew that investing in communication and
promotional activities abroad, with the limited resources that the company had, would mean
sacrificing some activities on the local and regional market where there was still strong
competition.

The role of culture

It would be very difficult to understand the brand position of Vispak’s flagship brand, Zlatna
džezva, without understanding the role that coffee plays within B&H. Once this is
understood, the real challenge becomes how to position this strongly culturally rooted
brand in foreign markets and how to make it appealing to international consumers who are
not so familiar with a type of coffee that needs to be prepared in a special way.
Zlatna džezva, and other Vispak products were strongly grounded in the idea of Bosnian
culture and tradition, a culinary experience which primarily maintains relations between all
of the people who live in B&H. Keeping that in mind, the success of Vispak’s products on
international markets would reflect the success of Bosnian culture. This was the proposition
that Mr Hasakovic  pondered in his mind when he was tasked with developing an
international marketing plan for Zlatna džezva. He knew that he needed to play the culture
card in the right way.
Food had been for centuries the basic element of Bosnian tradition and one of the most
important elements of B&H cultural heritage. Gastronomy in B&H has developed under
many influences from East and West. Many dishes were created under the influence of
central-European, Mediterranean, Oriental, Turkish, Greek, Austrian, Hungarian and Eastern
cuisine, and over time, a specific culture of food serving has developed. Influences and
techniques of meal preparation from different cultures were incorporated into local traditions

VOL. 9 NO. 1 2019 j EMERALD EMERGING MARKETS CASE STUDIES j PAGE 5

 over time, which has resulted in an interesting blend. For example, “Slow food” was one of
the recent trends in gastronomy all over the world, while in B&H, food has been prepared in
that way for centuries. The B&H cuisine is usually described as a miraculous combination of
worlds, both continental and Mediterranean, modern and traditional. As it includes fewer
spices, it suits a healthy lifestyle and has also been known as the French cuisine of the
Balkans.
When it comes to beverages, people in B&H have developed a unique coffee drinking
culture. Bosnian coffee is very different from instant coffee, American coffee or espresso
coffee in terms of both flavor and preparation. Bosnian coffee can usually be described as
being most similar to Turkish coffee, which is consumed in regions influenced by Ottoman
cuisine, although it has some important differences. To make Bosnian coffee, it is first
necessary to take the pot and some just-boiled water. Bosnian coffee is prepared in a
specific pot called a džezva (Turkish coffeepot) that is first heated. Then, a fildžan
(traditional coffee cup) is filled with a little boiled water and put aside. The rest of the water
is mixed with coffee, which has been previously placed in the Turkish coffeepot. This is then
heated again until the mixture boils (for the full instructions and the process, see Exhibit 4).
The traditional way of coffee drinking was by sipping it through a sugar cube. Namely, a
piece of sugar cube was immersed in the coffee, the drinker takes a bite and then drinks
the Bosnian coffee. Drinking Bosnian coffee was always a part of tradition, so an invitation
for a cup of coffee was actually an invitation for a conversation, socializing and spending
some quality time together.
When talking about tradition, it is interesting to note that traditional coffee (86 per cent) has
the top position in the hot drinks category among consumers in B&H from 15-64 age group,
followed by other types of coffee (51 per cent) and tea (76 per cent) as per IPSOS (2015)
Consumer research. This tradition was encompassed in the Zlatna džezva brand. The real
challenge for Mr Hasakovic  was to promote the brand of traditional coffee and present
these traditional values in the foreign markets.

International marketing activities of Zlatna džezva

In 2018, Zlatna džezva used an undifferentiated strategy for international brand positioning,
meaning that it was presented on every market under one name – Zlatna džezva – and with
the same visual identity and packaging. The only thing that differed was the declaration on
the reverse of the packaging. Furthermore, the coffee composition and the preparation
advice were also adjusted for some markets (as was the case with other famous brands),
but this was not communicated.
Zlatna džezva was present on international markets, mostly in the segment of ethnic shops
(markets specific for immigrants), and also in some modern retail stores, such as American
Wal-Mart, German retailers Real and Hofer, Austrian Billa, Swiss Otto’s, Dutch Spar and
Interspar and E.Leclerc in France. It could also be found online on Amazon.com. Mr Hrvic 
was proud that Zlatna džezva was sold everywhere in the South-Eastern Europe region, in
the countries of Central Europe, Austria, Switzerland, Germany, Scandinavia, the USA and
the Middle East.
Croatia and Slovenia were important markets for Zlatna džezva. In these two countries,
consumers were familiar with the category of Bosnian coffee and its preparation (due to
cultural similarities and shared history), and they were used to the brand Zlatna džezva.
Hence, it was no surprise that most of the marketing activities for the foreign markets in the
period from 2013 to 2016 were conducted in Slovenia. This has brought positive results, as
revenues increased by more than 450 per cent in the period 2013 to 2016. Marketing
activities were first created to fit the needs of intermediaries (such as store salesmen) and
only afterwards were they expanded to fit the requirements of the major retail chains. This
led to the establishment and improvement of relationships with final consumers. At the

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beginning of the activities, the campaign targeted immigrants from B&H, but eventually,
marketing activities in 2016 expanded to the domestic Slovenian and Croatian population.
The resources invested were low, compared to the competition within the category, but they
were used efficiently through PR events (e.g. public drinking coffee from the Guinness
coffeepot, Exhibit 5). Such PR stunts resulted in many articles being written in important
weekly newspapers and magazines in Slovenia, which also educated people about Bosnian
coffee and its preparation. In 2017, Zlatna džezva was one of the top three coffee brands
sold in Mercator Slovenia, which is one of the biggest modern trade chains in the country.
Such success meant that further opportunities for Zlatna džezva had to be explored and
used. Mr Hrvic did not want to stop expansion of the brands, and he felt that it was time to
focus even more on internationalizing and raising brand awareness, especially outside of
the ethnic shops and diaspora. He knew that this was a risky decision to make and one that
required further investment and a significant amount of funds, but he felt it was the right
time.

Dutch market and consumers

Hot drinks represent the largest sector of the Dutch Young Adult Drinks market, with 54.0
per cent of the market in volume terms. The hot drinks sector is very highly fragmented, with
many manufacturers and importers holding small market shares. According to Datamonitor
(2002), hot drinks consumption in The Netherlands is very high. Coffee consumption in The
Netherlands is among top five worldwide (Exhibit 1), higher than consumption in Sweden,
Switzerland or Belgium, and the average per capita consumption was about 8.5 kg in 2018.
The strong café culture among younger consumers is one of the main drivers for this. Young
adults, of 25-34 years of age, is the largest sector of the Dutch Young Adult Drinks market,
representing 15.3 per cent of the market in value terms. The age group of 18-24 years is the
smallest sector of the Dutch Young Adult Drinks market, representing 8.1 per cent of the
market in value terms.
According to Statista (2018a, 2018b), revenue in the coffee segment for The Netherlands
amounted to US$1.825m in 2018. The market is expected to grow annually by 2.1 per cent
(CAGR, 2018-2021). The market’s largest segment is the segment “Roast Coffee” with a
market volume of US$1.586m in 2018. Dutch consumers focus on consistency of taste and
quality. About 85 per cent of the Dutch population consume traditional mainstream coffee
(i.e. roasted, instant or ready-to-drink). The remaining 15 per cent are interested in specialty
coffee. The most popular coffees consumed by the Dutch belong to the cheap bulk
segment. At the same time, demand for premium coffee is increasing rapidly in The
Netherlands as a result of more educated consumers who are also willing to pay higher
prices for higher quality. As such, the specialty segment is developing with a wider variety
of products, such as single origin coffees. The rise in out-of-home consumption, and the
proliferation of coffee bars, is also observable in The Netherlands (Centre for the Promotion
of Imports from developing countries, 2018). This was important for Vispak to compare their
own position to the position of potential competitors in the market. In general, previously, the
company had been positioned in the cheaper coffee segment of the foreign markets.
In line with the MarketLine (2016) report, The Netherlands is well known for its excellent and
well-developed infrastructure (airports, roadways and ports), as well as a well-developed
and diversified economy. The country is one of the main points of entry for goods imported
into Europe. The economy of The Netherlands is dependent mainly on trade, financial
services and industry. The Dutch economy has been a free market system for the past two
decades, and the government has effectively reduced its role in the economy to regulation
and taxation. The Netherlands is a highly industrialized country with activities focused
primarily on food processing, chemicals, oil refining and electrical machinery. Agriculture in
The Netherlands is also highly modernized and efficient, and the sector is highly profitable.
Despite its current decline, industry is a major component of the economy. In the industrial

VOL. 9 NO. 1 2019 j EMERALD EMERGING MARKETS CASE STUDIES j PAGE 7

 sector, energy companies have achieved high profits, benefitting from the increase in
global energy prices. The main economic details of The Netherlands are presented in
Exhibit 6.
The Netherlands has a well-developed licensing system, which is considered to be one of
the easiest and most hassle-free in the entire EU. The country regulates competition among
corporate entities. Apart from that, ease of tax compliance in The Netherlands enhances its
competitiveness. However, the country’s reputation as a tax haven and increasing
restrictions on access to credit remain areas of concern. The Netherlands Competition
Authority enforces fair competition in all sectors of the Dutch economy and takes action
against companies that participate in price-fixing cartels or abuse a dominant position. It
strictly assesses the authenticity of mergers and acquisitions in The Netherlands. This is
indicative of a more competition-friendly market and fewer monopolies in its markets. The
government’s measures to ease product market regulation have strengthened competition.
Low regulation increases the purchasing power of households and decreases costs for
businesses through lower production expenses.
According to the OECD Entrepreneurship at a Glance 2016 report, The Netherlands is one
of the most entrepreneurial nations in the world. The survival rates of new start-up firms and
the size of new employer enterprises is consistently higher when compared to other
countries. The percentage of all people employed in the country is greater when compared
to the UK and the US for micro firms (one to nine employees). This reflects the industrial
structure in the country, its economic size and the market openness and also helps to
generate employment growth.
The country has high scores in human development due to good levels of health care,
education and income. It has a high doctoral graduate rate in science and technology, but
low SME collaboration on innovation remains a concern. The Netherlands has an extensive
system of social support through insurance and governmental assistance. The government
makes it mandatory to have equal pay for equal work, and prohibits discrimination on the
grounds of marriage, pregnancy, or motherhood. Life expectancy (2016) is 81.3 years (total
population), while it is 79.2 years for men and 83.6 years for women. Ethnic composition in
The Netherlands is Dutch (78.6 per cent), EU (5.8 per cent), Indonesian (2.2 per cent),
Turkish (2.4 per cent), Surinamese (2.1 per cent), Moroccan (2.2 per cent), Caribbean (0.8
per cent) and other (5.9 per cent).

Further steps
As Mr Hrvic  and Mr Hasakovic  concluded their dinner in Veghel, they were aware that
Zlatna džezva was Vispak’s most prominent brand, whose excellent results in the local B&H
market and in international markets in ethnic segments were insufficient to exploit its full
capacities. Therefore, they were determined to enter new markets through modern retail
and by targeting customers who were beyond the Bosnian diaspora and attempting to
spread further across the EU. Nonetheless, competition in international markets was
constantly growing, and investment in Vispak’s aggressive promotion and positioning in
international markets had been limited or almost negligible compared to other global
competitors within this category (i.e. Nespresso).
An additional problem was the fact that for most of the consumers in the world, Bosnian
coffee was an unfamiliar term, especially taking into account its unique preparation and
consumption modes. A chance for cooperation with a Dutch retailer and the space which
would be given to the brand led them to rethink their strategy. New ideas definitely had to
be related to increasing opportunities to enter the Dutch modern retail trade and also to
make new strategic decisions about approaching new international markets.
The two businessmen decided they would continue their discussion as soon as the holiday
season ended. They scheduled a meeting at the beginning of January 2019. The ultimate

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goal was to finalize and send the outline of their proposal to the retailer Jumbo by the end of
January. Mr Hrvic  knew that he had about e75,000.00 as budget for the first year of entry,
and this amount would need to be allotted to the entry costs and to the promotional
activities. Mr Hasakovic was still not convinced that he would have sufficient funds for a
proper promotional campaign. As they went to their hotel rooms, they wondered how Zlatna
džezva could enter and position itself in European markets in the field of modern retail. They
Keywords:
were aware that if this went as planned, the recipe for the success of Zlatna džezva could Marketing,
be translated to other Vispak products (e.g. chocolates and sweets “Tiru-Liru plus,” International branding,
“Stampi” and “ChocoMilk”). Consumer behaviour

Notes
1. Since 1996, B&H has faced the transition from a planned communist economy to capitalism, and in
terms of privatization and acquisitions this transition was not very smooth in the case of many firms.
2. BAM is the abbreviation for the Bosnian Convertible Marka, which is the currency of Bosnia and
Herzegovina.
3. Per mille indicates parts per hundred and its written sign is %.

References
Acorns (2017), “Money matters report”, Acorns Grow.
Centre for the Promotion of Imports from developing countries (2018), “Exporting coffee to The
Netherlands”, Ministry of foreign Affairs of the Netherlands, available at: www.cbi.eu/market-information/
coffee/netherlands/
Datamonitor (2002), “Netherlands - young adult drinks: industry profile reference code: 176-760”.
IPSOS (2015), IPSOS Consumer Research in Bosnia And Herzegovina, IPSOS, Sarajevo.

Global Coffee Market (2018), “Global coffee market – growth, trends and forecasts (2018-2023)”,
available at: www.mordorintelligence.com/industry-reports/coffee-market (accessed 13 March 2018).
MarketLine (2016), “Netherlands, in-depth PESTLE insights”, ML00002-029.

P&A Coffee Newsletter (2016), “Coffee consumption grows despite crisis and higher prices”, available at:
www.peamarketing.com.br/imgs/pa_coffidential__103__february2016.pdf (accessed 12 February 2017).
Statista (2018a), “Top 10 retail chains in The Netherlands in 2018, by number of stores”, available at:
www.statista.com/statistics/669946/top-10-retail-chains-in-the-netherlands-by-number-of-stores/
Statista (2018b), “Coffee in Netherlands”, available at: www.statista.com/outlook/30010000/144/coffee/
netherlands#

Further reading
AS Group (2017), “About”, available at: www.asgroup.ba (accessed 15 March 2017).

International Coffee Organization (2017), “Coffee trade statistics”, available at: www.ico.org/
monthly_coffee_trade_stats.asp (accessed 25 May 2017).
E-Importz (2016), “Coffee statistics 2016”, available at: www.e-importz.com/coffee-statistics.php
(accessed 28 January 2017).
UNESCO (2003), “Intangible heritage section”, UNESCO Culture Sector - Intangible Heritage - 2003
Convention, available at: www.unesco.org (accessed 29 April 2017).

VOL. 9 NO. 1 2019 j EMERALD EMERGING MARKETS CASE STUDIES j PAGE 9

 Exhibit 1. Top 20 coffee consuming nations (in kg per capita)

Figure E1

Finland
Norway
Iceland
Denmark
Netherlands
Sweden
Switzerland
Belgium
Luxembourg
Canada
Bosnia and Herzegovina
Austria
Italy
Brazil
Slovenia
Germany
Greece
France
Croaa
Cyprus

0 2 4 6 8 10 12 14

Source: available at: www.worldatlas.com/articles/top-10-coffee-consuming-nations.html

Exhibit 2. Vispak’s revenue growth

Table EI
Year Revenue (million EUR) Revenues from exports (%)

2010 9.0 22
2011 12.0 25
2012 14.0 27
2013 16.0 30
2014 18.0 30
2015 22.5 31
2016 23.0 31
2017 25.0 33
2018 26.5 34
2019 28.0 36
2020 30.5 37
Note: Data for years 2019-2020 are based on predictions

PAGE 10 j EMERALD EMERGING MARKETS CASE STUDIES j VOL. 9 NO. 1 2019

Exhibit 3. “Zlatna džezva” packaging design embedded in B&H culture

Figure E2

VOL. 9 NO. 1 2019 j EMERALD EMERGING MARKETS CASE STUDIES j PAGE 11

 Exhibit 4. The process of preparing Bosnian coffee

Figure E3

PAGE 12 j EMERALD EMERGING MARKETS CASE STUDIES j VOL. 9 NO. 1 2019

Exhibit 5. Guinness Turkish coffeepot in Ljubljana (Slovenia) main square

Plate E1

Exhibit 6. The Netherlands key fundamentals

Table EII
2014 2015 2016f 2017f 2018f 2019f 2020f

GDP, constant 2005 prices (billion USD) 845.42 861.48 876.99 894.53 911.67 928.52 946.01
GDP growth rate (%) 1 1.9 1.8 2 1.92 1.85 1.88
GDP, constant 2005 prices, per capita($) 43,484 44,177 44,924 45,566 46,179 46,854 47,589
Inflation (%) 1 0.6 0.7 1.4 1.6 1.7 1.8
Exports, total as a percentage of GDP 105.94 105.52 104.08 102.39 100.34 98.34 96.36
Imports, total as a percentage of GDP 91.76 88.3 87.13 85.77 84.09 82.46 80.83
Mid-year population (million) 16.83 16.9 16.97 17.05 17.12 17.19 17.25
Unemployment rate (%) 7.4 6.9 6.5 6.3 5.83 5.67 5.34
Mobile penetration (per 100 people) 116.65 118.14 119.62 121.1 122.57 124.03 125.49
Source: MarketLine (2016) Netherlands, In-depth PESTLE insights. ML00002-029

Corresponding author
-Maglajlic
Selma Kadic  can be contacted at: selma.kadic@efsa.unsa.ba

VOL. 9 NO. 1 2019 j EMERALD EMERGING MARKETS CASE STUDIES j PAGE 13