CASE STUDY

Harjas KaurKanika JainMahak AgarwalNaveen Kumar SumanPranay GoyalPriyanshu Jain

Coffee MarketACROSS THE WORLD IN INDIA

Total coffee production in 2013-14 is approx. 146 million bags.

Leading café chains: Starbucks, Dunkin’ Donuts, Costa coffee, etc.

Annual bean production approx. 5-5.2 million bags in the past three years.

Approx. 1.2 million bags coffee consumption in 2013-14.

Export of 3.75 million bags in 2013-14.

Leading café chains: CCD, Barista, Costa Coffee, etc.

Note: 16.67 bags = 1 ton.

Cafe Coffee Day CCD comes in the umbrella of Amalgamated Bean Coffee

Trading Company Limited. CCD has 1174 outlets in India . CCD has largest (i.e. 60%) market share in India. CCD has Asia's second largest network of coffee estates (10500

Acers). Average Footfalls of over 500 daily. Outlets set up are based on the three formats -- cafe, lounge

and square.

4 C’s Customer:

People in the 15-30 age group. Average spending at coffee retail shops is approximately INR 200.

Context: Easy sourcing of coffee beans. Heavy coffee drinks in South India.

Competition:Market Share of 54%.Closest Competitor is Barista.Distribution is major advantage over competitors.

Company: Largest chain of outlets in India. Largest exporter of coffee in India.

Porter’s Five Forces Model

IndustryRivalry-HIGH because of large number of competitors.Barista, Costa CoffeeStarbucks, BRU Cafe

Threat of new entrants-(High)Brand association, product differentiation, controlled access of distribution channels, significant capital requirements

Bargaining Power of suppliers-(LOW)•Availability of raw material from limited geographical locations•Fierce competition for better quality

Bargaining power of consumers- (MEDIUM)Number and varieties present in the market

Threat of substituted products- (HIGH)•Soft drinks•Juices•Smoothies•Tea

STPSegmentation• Socio-economic- middle class and upper class• Geographic- choose store location where they can find educated and coffee lovers. Eg: colleges, offices.• Demographic

TargetingStudent and young urban professionals in the Age group of 16-30 years.

Positioning•Positioned themselves as highly reputed coffee brand•Offers a wide variety of eatables, from Sandwich, Pasta to Muffin and Cakes

SWOT Analysis : CCDSTRENGTHS WEAKNESSES

Excellent and Established Brand. Loyal and huge customer base. Large number of outlets. Lower price in comparison with

other café chains. Different types of stores based on

price.

Self Service system at many stores. Pre-paid System. Less variety of products than other

competitor café.

Opportunities Threats• Introduce cheaper versions of coffee

to target more customers.• Tap the smaller towns and cities.• Coffee consumption in India is

growing at approx. 6% per year.• Tie ups with other companies for

promotion

• Highly competitive market.• Entry of foreign players like Costa

coffee, Star Bucks, etc. • Dynamic mindset of youths.• Dependent on Government

Commodity rates.

Wide Product varieties

Exciting Drinks

Bites and Desserts

STRATEGY BRAND ASSOCIATIONS: The

dominant part of the brand strategy of CCD was dependent on how well it was able to devise its brand associations. CCD targeted fashionable and vibrant youngsters and tried to create unique brand associations, which would provide long term advantages.

It worked on each of the 4P’s as a part of its strategy.

CAFÉ COFFEE DAY VS BARISTACAFÉ COFFEE DAY BARISTA

PRODUCT- Diverse product mix with eatables adopted to meet the Indian taste buds like samosa, biryani etc.

PRICE- Price has been set comparatively lower than other brands.

PLACE- With over 1350 outlets in India, CCD provides a luxurious place where people love to hangout. Distribution is the major advantage CCD has over other competitors. Its outlets were generally located near high streets of towns, institutes etc to target its consumers.

PROMOTION- Not much promotion was done in the first decade of sales. Promotion is done through tv, ticket sales and associations with youth oriented brands like Scooty etc. CCD had a huge web presence and a fan subscription of over 1.3 million.

PRODUCT- Diverse variety of premium coffees with authentic taste and color and beverages including mock tails. Eatables includes croissants and pastas among others and deserts.

PRICE- Prices are mostly inexpensive and competitively at par with ccd.

PLACE- With over 300 outlets in 30 cities in India, Barista portrays a sophisticated and warm environment that creates excitement among visitors.

PROMOTION- In the form of Press, TV and radio medias. Also, Sponsorships are provided. Collaborations have been done with Leo Matte toys and Star World. A ‘Barista Coffee Card’ is used for sales promotion.

SWOT Analysis : Barista LavazzaSTRENGTHS WEAKNESSES

Excellent brand name. Strong brand recall and popularity

amongst urban youth. Has over 200 stores across India. Wide range of beverages.

Self Service system at many stores. Pre-paid System Products are costlier than it’s main

rival CCD.

Opportunities Threats• Introduce cheaper versions of coffee to

target more customers.• Expand in Metros and other cities.• Target more customers by opening

outlets on highways, petrol bunks, etc.

• Highly competitive market.• Competition with already established

brand CCD, and some of fast growing café chains like Costa coffee, Star Bucks, etc.

• Dynamic mindset of youths.• Dependent on Government Commodity

rates.

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