A comparative study of customer experience in café coffee day vs barista


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A comparative study of customer experience in café coffee day vs barista

  1. 1. INTERNATIONAL JOURNAL OF ADVANCED RESEARCHInternational Journal of Advanced Research in Management (IJARM), ISSN 0976 – 6324(Print), ISSN 0976 – 6332 (Online), Volume 3, Issue 2, July-December (2012) IN MANAGEMENT (IJARM)ISSN 0976 - 6324 (Print)ISSN 0976 - 6332 (Online)Volume 3, Issue 2, July-December (2012), pp. 40-49 IJARM© IAEME: www.iaeme.com/ijarm.asp ©IAEMEJournal Impact Factor (2012): 2.8021 (Calculated by GISI)www.jifactor.com A COMPARATIVE STUDY OF CUSTOMER EXPERIENCE IN CAFÉ COFFEE DAY VS BARISTA Vijay.R.Kulkarni M.Com, MBA Assistant Professor Sinhagad Institute of Management and Computer Applications Pune, Maharashtra, India Email: Vijaykulkarni_r@rediffmail.comABSTRACTThe study is about customer perceptions about customer experience practices of Barista vs. CafeCoffee Day. The study was conducted in the city of Pune (India) during 01.06.2012 to15.07.2012.For the purpose of this study Exploratory Research Design is used. Conveniencesampling method is adopted for the study. Survey method is used for collecting the data. Thedata is collected through interviews with respondents from different professions, age,occupations & also intercepts at Barista and CCD. The sample for the study is 146 respondents.Nominal scale is used for all the variables except age, income, family size, no of childrenwherein ratio scale is used. SPSS 17 versions is used. Various statistical tools like Cronbach’sAlpha for Scale Reliability, Kaiser-Meyer-Olkin Measure of Sampling Adequacy and z test areused for data analysis. The findings of the study reveal that of the twenty five variablesconsidered in the study customer’s perception is found to be unfavorable in case of four variablesviz. 1) Exterior (facade) of the restaurant 2) Enough space in the isles to move comfortably in therestaurant 3) Scent & Perfume in the Restaurant 4) Delivery time taken for serving the products& 5) Taste and quality of Products. 40
  2. 2. International Journal of Advanced Research in Management (IJARM), ISSN 0976 – 6324(Print), ISSN 0976 – 6332 (Online), Volume 3, Issue 2, July-December (2012)Key Words: Comparative Analysis, Customer Perceptions, Coffee Cafes, Taste & Quality offood1. INTRODUCTIONDrinking coffee and tea is an inseparable part of Indian culture with south dominated by coffeedrinking. Offering tea or coffee to guests in any house hold is the minimum courtesy shown byIndians to the guests. Discussion over a cup of tea or coffee with friends during college days hasbeen a common feature amongst all Indians.In the pre-independence era Coffee houses belonging to Indian Coffee Board were the meetingplaces for the intellectuals, freedom fighters, politicians’ and social activists etc. to discuss issuesover a cup of coffee in the informal atmosphere of the coffee house. The tradition still continuedalbeit the existing restaurants available around.Due to liberalization; the television penetration, internet and phenomenal growth in mobile usagehas resulted in information explosion around the Indian consumer that has turned the passiveconsumer to a knowledgeable and vibrant consumer has given the Indian urbanites a bettercomprehension of lifestyles around the globe, particularly the western culture, resulting in IndianUrban young emulating the western life style. The lateral movement of the populace from ruralto urban areas in search of jobs and education, movement of people from one state to another haschanged the face of Indian society to cosmopolitan one. Today’s consumer no longer consumesproducts and services in the traditional sense but looks at the value derived through experienceone undergoes in the process. Among other things one of the fall outs of Globalization is thebirth of Modern retail format across products and services including fast food restaurantsencompassing coffee cafes like Barista and Café Coffee Day. Over a period of time coffeedrinking has travelled from the traditional coffee houses to coffee cafes.The changing lifestyle of young, unworldly mobile middle-class revolutionalized the café culturewith the young group of college girls and boys executives holding meeting with their customerson lap tops. Entrepreneurs across the professions with the constraint of not having official spaceuse the cafes as a meeting place. Hobby groups, Journalists, writers, Women’s club’s opt coffeecafes to spend time leisurely get-together. For the people visiting coffee cafes besides coffee andeatables may be incidental but what matters to them is the space and privacy, pleasing ambience 41
  3. 3. International Journal of Advanced Research in Management (IJARM), ISSN 0976 – 6324(Print), ISSN 0976 – 6332 (Online), Volume 3, Issue 2, July-December (2012)and atmospherics, relaxed atmosphere where they can unwind move on to a different level andenjoy the blissful experience.Barista and Café Coffee Day are the only two major players in the Indian coffee café industry inIndia and the customers look at them as interchangeable brands. Therefore these two coffee caféchains have been selected to study the customer’s perception of customer experience practicesfollowed by these chains.Following is the brief comparative profile of Barista and Café Coffee Day Table 1 Barista Café Coffee DayYear of 1999 1996establishmentNo. of stores- 317 1319 outletsRestaurantsProducts Vivacious Spicy Coffee, Vintage Butter Rum Cappuccino, Coffee Latte, Espresso, Coffee Coffee, Haute Hazelnut Coffee, Bespoke Mocha, Irish Coffee, Ice Coffee, Darjeeling Coffee Chai, Polish Irish Coffee, Dazzling Tea, Veggie Samosa, Masala sandwich, tikka Cinnamon Honey Coffee, Cold/Hot sandwich, Chocó Doughnut, Chocó Brownie, coffee/Tea, Banana Smoothie, Breakfasts, Spicy Chicken Salzone, All American sandwiches, Chicken, Calzone, Pasta, Cakes Muffin, Mirch Masala Chatka, Cookies etc to & Deserts to mention a few mention a fewPrice Differential Pricing Strategy Differential Pricing Strategy Strategically located outlets, at High Street/ Strategically located outlets, at High Street/Place Family Entertainment Centers, in and around Family Entertainment Centers, in and around Malls, Cinemas Malls, Cinemas, gas stations, near Colleges etcPromotion Sponsorships, collaborations, sales Sponsorships, collaborations, sales promotion: Barista Coffee Card promotion: Cafe Coffee Day CardPeople Groomed, Trained, Courteous Groomed, Trained, Courteous. Pleasant, Pleasant, Polite and Positive Polite and PositiveProcess Self service basis Self service basisAtmospherics Business Sign, Aesthetically designed Business Sign, Aesthetically designed restaurants & menus, posters, pamphlets & restaurants & menus, , posters, pamphlets & Magazines, Hygiene, AC, Music, TV, Magazines, Hygiene, AC, Music, TV, Illumination IlluminationTraining & 14 days rigorous training procedure for each 12 days rigorous training procedure for eachDevelopment employee: Induction & Refresher employee: Induction & RefresherOther Merchandize Coffee Maker, Coffee Mugs, Magic Cups, Coffee Makers, Coffee Mugs, Coffee Business Card Holders, Dolls, Gift Powders, Cookies, Men/Women T Shirts, Vouchers, Barista House Premium Plunger, Quick bites, Bags, Combo offers etc. 42
  4. 4. International Journal of Advanced Research in Management (IJARM), ISSN 0976 – 6324(Print), ISSN 0976 – 6332 (Online), Volume 3, Issue 2, July-December (2012)2. LITERATURE SURVEY‘The customer experience is a blend of a company’s physical performance and emotions evoked,institutively measured against customer expectations.’ “A customer experience can go into suchdetails as what colour your shoes see, what your briefcase looks like, your first opening line oryour haircut, even what a customer thinks of your stature and image. That immediate contactbuilds a perception about the person and therefore the company and that’s part of the customerexperience (Peter Scott, Customer Service Director, T-Mobile).” It’s the total experience ofgoing into a shop. It would be every aspect of what the customer sees, feels very kind ofdimension. Functional elements as well as emotional elements (Beverly Hudson ManagingDirector, W.H. Smith UK Retail).1” Experiences are the fourth economic offering, as distinctfrom services as services are from goods, but one that has until now gone largely unrecognized.Experiences have always been around, but consumers, businesses, and economists lumped theminto service sector along with such uneventful activities as dry cleaning, auto repair, wholesaledistribution, and telephone access. When a person buys a service, he purchases a set ofintangible activities carried out on his behalf. But when he buys a experience, he pays to spendmore time enjoying series of memorable events that a company stages-as in a theatrical play-toengage him in an inherently personal way.” Experiences have necessarily emerged to create newvalue. Such experience offerings’ occur whenever a company intentionally uses services as thestage and goods as props to engage an individual. Whereas commodities are fungible, goodstangible, and services intangible, experiences are memorable. Buyers of experiences-we’llfollow Disney’s lead and call them guests-value being engaged by what the company revealsover a duration of time. Just as people have cut back on goods to spend more money on services,now they also scrutinize the time and money they spend on services to make them morememorable-and more highly valued-experiences.”2 Today’s customer is not just influenced byprice and quality. There are many other factors that drive him towards the store. The retailershave to pay attention to these factors i.e. formulating the right marketing strategies in order to tapmore customer base and become successful in this competitive environment.3 Companies of allkinds claim to recognize that their customers are important. But what kind of experience are theyproviding for customers with their products, their services, their communications, and theirinteractions? How are customers really being treated? The answer is often “badly,” despite all 43
  5. 5. International Journal of Advanced Research in Management (IJARM), ISSN 0976 – 6324(Print), ISSN 0976 – 6332 (Online), Volume 3, Issue 2, July-December (2012)the protestations to the contrary. Think of waiting in lines in supermarkets or on the phone.Think of products that are perfect for someone else’s lifestyle or work environment, but neveryours. Think of unusable web sites, uninspiring ad campaigns, or unresponsive customer service.But not all companies provide poor experiences for their customers. Some companies deliver agreat experience, and that gives them a great competitive advantage. These companies have areal understanding of the customer perspective and use that to provide service, products, andcommunications that are relevant to the customer’s lifestyle and deliver a consistent experience.4“Experience” is a term that has spread throughout the business world with increasinglyfrequency over the course of the past decade—somewhat to the detriment of the concept. Phraseslike “experience marketing,” “experience branding,” “experience design,” “experienceeconomy,” and “360 degree branding” (a form of experience design) have proliferated, reflectinga recognition that customers relate to products and services in ways that go beyond theirperception of the functional value of those offerings. Some of companies are well recognized forthe success of their total customer experience—Disney and Apple, for example—and in factacknowledge the power and value of this approach. Others are less obvious, such as John Deere,General Motors, and Procter & Gamble, yet they all identify experience as a significant factoraffecting their financial performance. For all the interest in the concept of the customerexperience, however, there’s been little concrete discussion of how it’s achieved. Even some ofthe companies that have succeeded at it seem to have gotten there by accident or, in rareinstances, been led to their successes by the leadership of a marketing genius, such as SteveJobs.”5 A store’s environment can be defined as external to the person being studied which canbe measured independently of the person (Russel and Mehrabian 1976). That environment isnever natural, but includes cues, messages, and suggestions to consumers (Bitner1992; Markin,Lillis and Narayan 1976)6. In sum, based on Lewins field theory we derived the followingpredictions which are consistent with Maisters propositions: (1) Pre-process and post processdelays will be perceived as more inconvenient, frustrating and inappropriate than in-processdelays; moreover, the quality of the service will be rated lower and the consumer will be lesslikely to return to the restaurant for another visit. (2) Under conditions of high uncertainty aboutthe length of the delay, the delay will be perceived as more negative than under conditions of lowuncertainty. (3) Individuals will perceive a delay as more negative if they are in a high need state(very hungry) than in a low need state.7 44
  6. 6. International Journal of Advanced Research in Management (IJARM), ISSN 0976 – 6324(Print), ISSN 0976 – 6332 (Online), Volume 3, Issue 2, July-December (2012)3. RESEARCH OBJECTIVESTo compare customer perceptions on various customer experience elements betweenBarista and Café Coffee Day.4. RESEARCH METHODOLOGYFor the purpose of the study Exploratory Research Design is used. Conveniencesampling method is adopted for the study. Survey method is used for collecting the data.The data is collected through interviews with respondents from different professions, age,occupations & also intercepts at Barista and CCD. A well structured questionnaire isdesigned for the study and due care is taken to avoid any kind of ambiguity. The samplefor the study is 146 respondents. Nominal scale is used for all the variables except age,income, family size, no of children wherein ratio scale is used. The study was conductedin Pune city. The study was conducted during the period 01.06.2012 to 15.07.2012. Table No.2. KMO and Bartletts TestKaiser-Meyer-Olkin Measure of Sampling Adequacy. .831Bartletts Test of Approx. Chi-Square 1680.929Sphericity Df 325 Sig. .000 Table No.3. Reliability StatisticsCronbachs Alpha N of Items.916 245. DATA ANALYSIS TOOLSFor the purpose of this study the following statistical tools were used • SPSS- Scale Reliability Cronbach’s Alpha, • SPSS-Kaiser-Meyer-Olkin Measure of Sampling Adequacy, • Z Test • Tables 45
  7. 7. International Journal of Advanced Research in Management (IJARM), ISSN 0976 – 6324(Print), ISSN 0976 – 6332 (Online), Volume 3, Issue 2, July-December (2012)6. RESEARCH HYPOTHESISHo: There are no significant differences in customer perceptions for all the parametersH1: There are significant differences in customer perceptions for all the parameters7. Data AnalysisTable No. 4Customer Experience Factors Café Coffee Day Barista Ho: . Mea z Accepted N Mean SD N n SD /RejectedThe exterior (facade) of the restaurant is 73 3.70 1.210 73 4.23 .890 -2.21 RejectedappealingThe Illumination in the Restaurant is pleasing 73 4.26 1.270 73 4.11 1.048 .56 Acceptedto the eyesThe Beauty and Aesthetics of the Restaurant is 73 4.25 1.188 73 4.08 1.115 .63 Acceptedeye catchingThere was enough space in the isles to move 73 3.86 1.627 73 4.58 1.235 -2.12 Rejectedcomfortably in the restaurantScent & Perfume in the Restaurant 73 3.52 1.547 73 4.21 1.118 -2.23 RejectedQuality of Air Conditioning in the Restaurant 73 3.97 1.518 73 4.26 1.118 -.94 Acceptedmade my stay in the restaurant comfortableSeating arrangement in the restaurant 73 4.53 1.555 73 4.32 1.129 .68 AcceptedMusic in the Restaurant was soothing 73 4.00 1.546 73 3.86 1.407 .41 AcceptedPrice of the Products 73 3.81 1.587 73 4.12 1.333 -.89 AcceptedOrder taking Process 73 3.75 1.623 73 4.18 1.284 -1.26 AcceptedDelivery time taken for serving the products 73 3.85 1.689 73 4.47 .914 -2.0 RejectedAvailability of the Restaurants Parking 73 3.64 1.874 73 3.66 1.685 -.09 AcceptedCleanliness and Hygiene of the Wash Rooms 73 4.38 1.459 73 4.05 1.499 .94 AcceptedIn-Restaurant displays were impressive 73 3.97 1.527 73 4.19 1.023 -.73 AcceptedWhen I entered the sales associates greeted me 73 3.71 1.889 73 3.82 1.531 -.27 AcceptedTaste and quality of Products 73 3.75 1.460 73 4.48 1.119 -2.43 RejectedPresence of well groomed & Trained Staff 73 4.03 1.554 73 3.92 1.402 .32 Acceptedadded charm to the Restaurant environmentThe quality of fellow diners added to the 73 4.11 1.370 73 4.30 1.244 -.61 Acceptedoverall satisfying restaurant environmentI derived value for money and time spent in the 73 4.12 1.615 73 4.45 1.014 -.74 AcceptedrestaurantI will definitely talk good about the Restaurant 73 4.14 1.557 73 4.52 1.260 -1.15 Acceptedto my friendsI am happy and delighted to have wonderful 73 4.30 1.713 73 4.71 1.275 -1.28 Acceptedexperience in the Restaurant 46
  8. 8. International Journal of Advanced Research in Management (IJARM), ISSN 0976 – 6324(Print), ISSN 0976 – 6332 (Online), Volume 3, Issue 2, July-December (2012)8. DISCUSSION1. Appeal of the store from outsideA good-looking façade is important as it helps stimulate desire to visit the store. Store facadeattracts attention and provides consumers an out-of-the-world shopping experience, convenienceand satisfaction.store. Store entrance makes a statement to your buyers. It sets the tone forretailer’s products and services and also creates visual appeal to attract clients to enter in thestores. Each store needs to constantly invest in re-inventing itself, whether in terms of display,façade, interiors or products. The elements of store façade include height of the building,color scheme, business sign, parking areas, the neighborhood, window displays,illumination of the frontage, approach & the entry door of the store, to mention a few.The CCD and Barista outlets are located on High Streets with high traffic density andflanked by large and attractive stores selling high end branded products with eye catchingfacades. The Coffee Cafes have to compete with the other stores to gain the attention ofthe shoppers. Therefore it is all the more essential on the part of coffee cafes to keep thefaçade more and more different, attractive, eye catching and appealing to the customers.2. There was enough space in the isles to move comfortably in the restaurantIsle is the place between two racks. If the space between two racks is too narrow in theisles then it is not possible to move freely between the isles. The customers often shopwith their social groups and need personal space. Personal space is an issue whentrespassed causes customers to feel uncomfortable and frustrated. Personal space in aretail stores viewed from the perspective of retail environment suggests that when ashopper is bumped or jostled while looking at merchandise, may become uncomfortable,get annoyed, lose interest, and leave the area.Therefore provision of enough spaces for the customers to maneuver makes thecustomers comfortable and results in customers spending more time in the store therebyincreasing the possibility of spending more &translating into enhanced profitability for 47
  9. 9. International Journal of Advanced Research in Management (IJARM), ISSN 0976 – 6324(Print), ISSN 0976 – 6332 (Online), Volume 3, Issue 2, July-December (2012)the stores. Since Aisles are part of the store design the same may be incorporated in thestore design stage itself anticipating future footfalls in the store.3. Scent & Perfume in the RestaurantOur sense of small works continuously and therefore it evokes immediate and emotionalresponse and as such it can be effectively used as strategic element in the store atmospherics.Ambient scents are the general odors that do not emanate from a product but are present as partof the retail environment. We as human beings like pleasant fragrances/odors and their presencein our vicinity make us happy and have a positive impact on our behavior and result in amotivated state of mind, more purchases and strengthening of bond with the store.The intention of the customers who visit coffee cafes is to unwind, relax and spend memorabletime in the café. Therefore odors which are pleasing to sense of smell can transport the customeraltogether to a different level, motivate, spend more time in the café thereby increasing theprobability of spending more & generate referrals. The coffee cafes therefore need to takecognizance of the impact of odors ‘on consumer buying behavior and factor it in as an importantelement in the store atmospherics.4. Delivery time taken for serving the productsThough Customers visit coffee cafes for spending time in a relaxed & leisurely manner still it isrelative to the time at their disposal. Therefore any delay in service delivery process will have anegative impact on the customer. Customers will be satisfied if their perceived delivery-times areshorter than their expectations. It is a common experience that uncertain waits and unexplained waitsseem longer. In a restaurant setting delays are likely to take place due to inefficiencies in the servicedelivery process or circumstantial reasons like peak hours, unpredictable flow of customers,crowding etc.Therefore it calls on the part of the restaurant managers to remove the flaws in the delivery process inthe first place and understand the circumstantial factors that influence the customer’s reactions todelay in service delivery and taking corrective actions can lead to customer satisfaction5. Taste and quality of ProductsWe consume food to keep ourselves energized and healthy. When we look at the Indian culture,in addition to keep us going, enjoyment-taste and quality- is one of the most important aspect ofconsuming food. Given the diversity of cultures coupled with diversity in food habits from theregion to region, state to state and within the state it is evident that customers look at the qualityand taste of a given product from different perspectives. The increasing urbanization and lateralmovement of the people is making the cities and town more and more cosmopolitan.Given the scenario it therefore calls on the part of the restaurants to have deeper understanding ofthe changing tastes of the diverse customers. It is observed that other than the base product,coffee, the coffee cafes are outsourcing other products. It is therefore calls on the part of thecoffee cafes to keep a keen eye on the taste and quality of the products leading to customersatisfaction. 48
  10. 10. International Journal of Advanced Research in Management (IJARM), ISSN 0976 – 6324(Print), ISSN 0976 – 6332 (Online), Volume 3, Issue 2, July-December (2012)9. REFERENCES1. Colin Shaw & John Evans. Building Great Customer Experiences PP6. New York. 2002.2. B.Joseph Pine II & James H. Gilmore. The Experience Economy. Boston. Harvard BusinessSchool Press.3. Ruchi Malik. To Build A Model For The Determination Of Factors That Result In TheSuccess Of The Organized Retail Sector In India And Analyzing Its Relative Importance (WithReference To Fast Food Chains And Grocery And Vegetable Outlets. Indian Journal ofMarketing. Volume 42, Number 2, 2012.http://www.indianjournalofmarketing.com/archives/2012/feb2012.html.4. Bernd Schmitt. Competitive Advantage through The Customer Experience. The ex groupCustomer Experience Consultants.http://www.exgroup.com/thought_leadership/articles/competitive_advantage_cem.pdf.5. Steve Diller, Nathan Shedroff & Darrel Rhea. Making Meaning: How Successful Businesses’Deliver Meaningful Customer Experiences. Excerpts. http://www.makingmeaning.org/6. Referred from Shaked Gilboa and Anat Rafaeli: Store Environment, Emotions and ApproachBehavior: Applying Environmental Aesthetics to Retailinghttp://iew3technion.ac.il/Home/Users/anatr/COMPLE-FINAL-20-11-02.pdf7. Laurette Dube-Rioux, BerndH.Schmitt, France Leclerc, Consumers Reactions to Waiting:When Delays Affect the Perception of Service Quality. Advances in Consumer ResearchVolume 16, 1989 Pages 59-63. http://www.acrwebsite.org/search/view-conference-proceedings.aspx?Id=68818. Greg W.Marshall, Mark W. Johnston. Marketing Management. New York. 2010. McGraw-Hill Irwin9. Michael Levy, Barton A Weitz and Ajay Pandit. Retailing Management, Sixth Edition.Chapter 18, New Delhi. Tata McGraw-Hill Publishing Company Limited.10. C.R.Kothari, Research Methodology, Methods & Techniques by, Second revised edition,2010, New Age International (P) Ltd, New Delhi, India.11. Schiff man & Kanuk, Consumer Behaviour, 9th Edition, Pearson.12. Anantnarayan & Jayashree Nimagadda. A Hand Book of Research Process - 2009 edition,Macmillan Publishers India Limited, New Delhi, India.13. S.C.Gupta, Fundamentals of Statistics, sixth revised and enlarged edition, 2010, HimalayaPublishing House, Mumbai, India 49