cafe coffee day
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Café Coffee Day is India's largest coffee chain with over 1400 cafés across 200 cities. It pioneered the café culture in India and sees growing demand from the young population. CCD targets youth aged 15-35 and sees 57% of customers in this segment. It aims to expand its network of cafés to smaller towns. Competitors include Starbucks, Barista and local coffee shops but CCD maintains the largest market share. The presentation provides analysis of CCD's business model and strategies through frameworks like SWOT, PESTEL, Porter's Five Forces and marketing mix. Suggestions are given to cultivate coffee aficionados and improve customer experience.
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cafe coffee day
- 1. Presented by : Group 2 B008 Indrajit B009 Vipul B015 Tanmay B021 Dhruv B051 Pratik B056 Gaurav Brand Analysis
- 2. What is Café Coffee Day? • India's largest coffee conglomerate, Amalgamated Bean Coffee Trading Company Ltd • Pioneer of the café culture and the first to launch the ‘coffee bar’ concept in India • Network strength: Over 1400 cafés in 200 cities/towns across India and growing • Average Footfalls: 200 per café per day
- 3. Market Analysis • Coffee – a sunrise industry • Growing young population and promotion of coffee culture • Coffee Segmentation: Robusta and Arabica Beans Different growth culture Pure and blended coffee Cheaper products like chicory, vanilla, mocha Filter coffee and instant coffee 43% share of filter coffee
- 4. Café Coffee Day Network of 1450 cafes across India 185 cafes 64 cafes 172 cafes 191 cafes
- 5. Market Analysis 60% 30% 10% Growth Target Tier I Tier II Tier III • Network strength of over 1450 cafes in 200 cities and towns with average footfalls of 200 per café per day • Distribution Strategy: • Single unit at Chikmagalur with capacity of 70,000 tonnes per annum • Packaging industry: • Serving hot coffee 210ml and cold coffee 350ml • CCD merchandises • Regional Distribution: • Targeting expansion in smaller towns • New café formats in metros – • Lounge • Square 300 150 50
- 6. Hangs out at cafes/malls Looking for a good lifestyle Looking for a multiplicity of experiences Seeks 'feel-good factor' and expression of identity through choice of brands consumed. But is also value conscious Likes to be seen at the right placeSocially Active Profiling the CCD’ian Strong voice in household purchases Consumption areas: Personal clothing & accessories, food, entertainment, consumer durables Make consumption related decisions in company of friends Tech Savvy Influencers: Peer group, workmates
- 7. • Average dwell time at café: 45 minutes • Meeting place for 15-35 year olds • The place they frequent most after “home and workplace/college” • A place where they meet friends and colleagues, in groups of 3 or more • A place where they rejuvenate and are free to be themselves rather than a place to be “seen at”
- 8. • Major chunk of CCD customers falls within the age group of 20 to 30 which accounts for 57% of the overall percentage. • The group comprises of mainly college going students and young working professionals Segment Target Positioning
- 9. Segment Target Positioning • There is a definite skew towards singles: 66% singles, 27% married & 7% others. 27% 66% 7% Married Single others
- 10. Business Professionals : 23% Special occasions : 20% Hangout for youth: 57% Segmentation Target Positioning Who hangs out at CCD?
- 11. Ansoff’s Matrix Entered with basic products Winning customers of competitors Was used as promotion and cost cutting techniques Come out with new and different products Eg. Pasta in food and new flavor in beverages Existing customers New Products New customers Old Products Eg. increased sales in Western India due to new products launched Launch Café Coffee Day in a new market Eg. In Africa where coffee has never been launched before PresentNew Present New Market Products
- 12. STRENGTHS • First-mover advantage • Excellent brand name and visibility • ISO 9002 certified company • Quality, service and taste • Youth oriented brand • Reduction in cost WEAKNESS • Lack of individual attention to loyal customers • Unavailability of fresh food • Market penetration of coffee bars is 5% OPPORTUNITY • Fastest growing industries in Asia • Merchandising • Tie ups with other companies for promotion • Tapping smaller market • Cheaper varieties of coffee THREAT • Competition with Barista, Mochas, Gloria Jeans, Costa Coffee & Starbucks • Presence of other ‘Hangout’ locations • Unorganized market • Dependent on government commodity rates SWOT
- 13. Product •Wide range •Frappe – Summer •Cappuccino - Winter •Merchandizing Price •Range from Rs45 to Rs100 •Over the years only minor changes in pricing policy Place •All locations •Strategically located outlets •Coffee machines in college canteens •Kiosks in offices Promotion •Channel [V]’s “Get Gorgeous” Contest •Tie up with youth brands •Khakee and Main Hun Na •Sales Promotion Process •Self service to table service •Complaints and feedback •Response time People •“People are hired for what they know but fired for how they behave” •Motivation and personal skills Physical Evidence •Logo in “Dialogue Box” •Architecture and décor •Coffee table books •Tag line : “A lot can happen over coffee” Marketing Mix
- 14. Porter’s Five Forces Model Threat of new entrants (LOW) Buyer’s Power (HIGH) Supplier’s Power (LOW) Threat of Substitutes (HIGH) Industry Rivalry (HIGH)
- 15. Porter’s Five Forces Model Threat of new entrants - Medium •Presence of several established brands/hangout places/fast food joints •High costs for starting a coffee shop chain •Government policies promoting FDI (Starbucks) Buyer’s Power - High •Low switching cost •Variety of products •Variety of services Supplier’s Power - Low •Absence of cartelization •Government regulations on prices of milk and coffee •Backward integration Threat of substitutes - High •Aerated drinks, milk beverages, juice centres and tea shops •Fast food joints like Pizza Hut, Mcdonalds etc •Hangout places like Hukka parlours and Bistro Industry Rivalry - High •Local Coffee chains like Barista, Mochas •Entry of international coffee chains such as Starbucks, Costa Coffee, Gloria Jeans
- 16. Economic Social Technological Environmental • Less bureaucratic hurdles • Easy sourcing of coffee beans • Cost control because of Govt regulations • Heavy coffee drinkers in South India • Cheaper sourcing maintain quality • Targets youth and middle class • Affordable for a meeting place • Marketing strategy based around technology • Provide entertainment over Bluetooth &Wi-Fi Political PESTEL Analysis • Limited production/Less pollution • Use biodegradable plastics Legal • Ethical and based on customer delight • Less consumer complaints and quick customer service
- 17. Competitor Analysis CCD 54%Barista 26% costa coffee 14% others 6% Market Share CCD 68% Starbucks 12% Gloria Jeans 3% Barista 17% Share of mind CCD 33% Chandu Chaiwala 67% Unorganised sector Sample size – 150+
- 18. STRENGTHS • Excellent brand name and brand visibility • Excellent human resource – ambience and décor • Strong brand recall and popularity • Has over 200 stores across India • Creating of Moment of Truths for couples WEAKNESSES • Perceived as expensive brand • Dependent on TATA suppliers for coffee beans • Competition from other coffee chains, restaurants and fast food joints • More known for coffee, less known for its food products OPPORTUNITIES • Introduce cheaper & unique versions of coffee • Tap smaller towns/cities • Increase promotion to change the perception of being an expensive brand THREATS • Threat from existing coffee chains and fast food outlets • Dependent on government commodity rates SWOT
- 19. Product•Wide range but not as CCD •Traditional product with traditional names Price•Skim pricing policy •Prices are lower, but still higher when compared to CCD Place•Strategically located outlets •Malls, cinemas, offi ce areas, high streets Promotion•Promotion through Press, TV and Radio medias Process •Self service •Complaints and feedback People •Pleasant, polite and positive •Uniforms in sober shades of brown and orange •Personal skills Physical Evidence •Colors in logo, interiors and posters •Uses shades of brown and orange to promote its laid back atmosphere Marketing Mix
- 20. STRENGTHS • Global brand name coupled with the trustworthiness of TATA • Experience of expanding into emerging markets • Perception of Higher quality products • Youth oriented brand • Excellent brand and service • Reduction in cost WEAKNESS • Starbucks is recognized for its high prices • Considered a place for elite class to hangout • Lack of presence in non-metro cities • Relatively small product breadth OPPORTUNITY • Interest in Western Brands in Indian minds • Targeting rapidly growing Indian urban youth • Well defined plan to expand in the next 5 years THREAT • Global Policy Conflicts • Presence of other ‘Hangout’ locations • Largely unorganized market • Established competitions SWOT
- 21. Advertising • As a reaction to the launch of Starbucks in India, CCD debuted with TV Ad – Sit down-ism • Gives customer a purpose for hanging out • Word of mouth • Subtle advertising in movies and TV serials • Print and social media • Sponsoring college events and giving out discount coupons • Tie up with different corporates • Presence of outlets in all areas
- 22. Suggestions • Cultivating a cult following for coffee afficionados • Custom made orders • More variety in food • Healthier options in food • Train staff to strike a personal cord of regular customers • Availability of all items on menu all the time • Screening of key sports events – IPL, EPL etc
Editor's Notes
- Chaiwala.in