Café Coffee Day

Group 4
 Introduction
• Coffee is the second largest traded commodity in the world 
• Indian coffee is rated among the best-quality mild coffees in
the international market
• India accounts for about 4.5 percent of world coffee
production and the industry provides employment to 6 lakh
people.
• Karnataka accounts for 70 percent of country's total coffee
production followed by Kerala (22 percent) and Tamil Nadu
(7 percent)
 
 Introduction
• Out of the total production only 20% is consumed
in the domestics markets rest is exported
• Branded coffee accounts for 53 per cent,
unbranded 40 per cent, with cafes constituting 7
per cent.
• India is one of the fastest growing coffee markets
in the world and is making its presence felt in the
world market as well as in the domestic retail
arena
 Café shops growth in India
Growth
4500

1400

226
9
1996-2000 2000-2005 2005-2010 2010-2015
 Introduction to CCD
• A division of India’s largest coffee
conglomerate, the Amalgamated Bean Coffee
Trading Company Limited (ABCTCL)
• Popularly known as Coffee Day or CCD, it’s a
Rs. 750 crore, ISO 9002 certified company
• Asia’s second-largest network of coffee estates
(10,500 acres) and 11,000 small growers, CCD
has a rich and abundant source of coffee
 Introduction to CCD
• Launched its 1st outlet in Bengaluru’s Brigade Road in
1996
• Till 2002, outlets were confined to south India
• Today it has more than 970+ outlets across the country
• “Out-of-home premium coffee consumption”
• Includes affordable coffee, add-ons, quick bites,
deserts, services and experiences
• Largest coffee retailer in Asia
• Touch 1 million customer/day
 Vision and Mission

• CCD’s Vision: To be the only destination for

dialogue over a cup of coffee

• CCD’s Mission: To be the best Cafe chain by

offering a world class coffee experience
at affordable prices
Divisions in Coffee Day
 Core Benefit of CCD

• Affordable coffee
• A place to spend time with friends
• A place for those who are “Young at Heart”
 Basic Product
• Features:
– Wide range of coffee, tea and other quick bites and coolers
– Good music/presence of juke boxes
– Comfortable seating arrangement
– Affordable prices
• Benefits
– Peer group acceptability
– Place to hang out
– Easy on the pocket
• Design and Style
– Bright colors
– Couches and cane chairs
– Very vibrant and trendy
 Expected Product
• World class coffee
• Variety in terms of coffee and side orders
• Comfortable seating

Augmented Product
• Can sit for long hours
• Easy on the pocket
• Ambience
 Potential Product
• Latent need for coffee shops
• Different formats like garden cafes, lounges,
book cafes, sports cafes etc
• Extend Brand into a premium segment
• New additions to the menu
– Slush
– Mocktails
– Herbal tea
 STPD
• Segmentation
– Coffee lovers who want to have a world class
coffee experience at affordable prices and have a
good time
• Target Customers
– Male/female between 15-30 years of age
– Middle or upper middle class
– Young at heart
 STPD
• Positioning
– Young hang out place
– Where youngsters can meet and make friends
– Chill-out-zone

• Differentiation
– Affordable coffee and snacks
– 969 outlets across the country
– Blanket strategy
– All company owed stores
– Caters to the local taste
 Accessibility
• Presence in multiple cities
• Different catchments like:
– high streets, malls, multiplexes, offices, educational
premises, and railway stations
• As many as 4 stores in a single street
• Cluster approach
• No problem of cannibalization as there is latent
need in the market
 Affordability
• Lower prices as compared to other popular
café chains like Barista, Mocha, Costa Coffee

Acceptability
• Anytime, Anywhere Café
• Largely visited for leisure
• Part of the life of the society
 Brand concept and Strategy
• Brand CCD able to make connection with the Indian
consumers predominantly among the youth
• Brand Fit is youth or young at heart
• Innovative formats too woo the customer
• Tangible benefits and Intangible benefits-Group
membership
 Brand meaning
• Music Cafes, Highway Cafes, Book cafes, lounge Cafes,
Garden Cafes, Cyber Cafes, Sports Café, Singles Café,
Fashion Café
• Values: Socially conscious brand-Silent brew masters
• Culture: Promote the feeling of togetherness
• User: Three categories of customers
• Deep brand with focus on the whole experience
• Spirit branding : Getting the good feeling by using our
product
 Logo of CCD

• Red square stands for leadership, • Fresh New avatar : a dialogue

passion box-with the words Café
• White swirl implies purity of purpose Coffee Day written in a
,invigorating properties of café distinct specially created font
• Green stroke depicting 125 years of • The new trendy dialogue logo
cafe growing heritage symbolizes the essence of
• The font used for cafe is called slurry what a café coffee day café is
and looks as though the letters have all really about –a perfect
congealed out of a liquid. The word place to relax and dialogue
is still forming itself and evolving • A lot does over coffee
Consumer Analysis
Sample Demographics
 Why People visit CCD?

Entertainment •Research shows that, while

Variety 3%
10% customers come for coffee (23%), a
Liesure
36% substantial amount of customers
Coffee just come to “hang out” with friends
23%
for leisure and fun.(36%).

Celebration
Meeting 10% • CCD is also the venue for business
18%
meetings (18%), celebrating special
occasions (10%), or just plain “time
pass”(13%).
 USP of CCD
 Its main USP is its all India presence.

Its décor, interiors, atmosphere, visual

Ambience branding plays a very significant role in
28%
Proximity of Outlets attracting customers
---------Pan India
presence
38%

Around 12% of respondents feel CCD,

provides the right value for money and
Pricing
12% is less expensive than other coffee
shops.
Service
8%

Product Variety
14%
Important Factors for the Consumers
Hygine
20% Food
10%

Ambience
29%

Service
18%

Accessibility
18%
Price
5%
 Group Types and Sizes

•Maximum footfalls are in groups of

Alone size 3-5 people.
Clients 6%
5% •Followed by people coming in groups
Colleagues
28% Friends of 2, a major part of which are couples.
54%
•Around 54% of the sample visits CCD
in groups of 3-5.
•27% are the couples.
Family
8% •13% come in groups of more then 5.
•And 6% of the people are singles.
 Time and Money Spent
• Avg Time spent : ½ & hour to 2 hours
• The Doughnut shows the avg money spent by
customers at CCD. Less than Rs.
More than 200 100
22% 13%

Rs.100 to 200
65%
 Brand Recall
Service
4%
Coffee Bean Machine
19% Logo (Red&Purple colour
combination)
31%

Couches
33%
Brand Message (Lot can
happen over coffee)
13%
 Customer Satisfaction
Tangible ways such as Price
Symbolic/Aspirational - 8%
Concept of self and society
17%

Intangible ways such as

ambience and comfort
Experential- Sensory Pleasure 32%
(Sight, sound, smell, feel etc)
28%

Emotional attachment
16%
Brand Competitive Advantage
Taste of coffee/food 
19%

Ambience/Experience
43% People/ Service
9%

Value for money 

28%
 Brand Comparison
CCD BARISTA
25 •FOOD: Customers found foods,
drinks, desserts & coffee served at
both the places to be of similar
quality.
20
•AMBIENCE: More than 50% of
respondents believe that CCD has
better atmospherics than Barista.
15 •PRICE : CCD is considered less
expensive & more reasonable than
Barista & having a higher value for
10 money.
•ACCESSIBILITY: Almost all
respondents felt that CCD was more
accessible in terms of proximity.
5
•SERVICE : Again, we see that CCD
emerges as a better brand in terms of
customer service
0
Food Ambience Price Accessibility Service
 Vertical Integration
• The group
– owns plantations
– retails coffee through exclusive outlets
– Exports coffee around the world
• Employees : 10,500+, engaged in growing, processing and retailing coffee
• Company owned cafés
• Dark Forest Co – is a Furniture manufacturing company supplying furniture (2500
pieces/month) to CCD outlets
• Timber for this is sourced from own plantations

Benefits
• Economies of combined operations
• Economies of internal control and operations
• Assure supply or demand
• Better quality control and coordination
• Protect proprietary technology
• Gain (or offset) market power
• Avoid cost of dealing with market
 Co-branding
• CCD has never opted for mass media advertising and believed the
chain’s stores speaks for the brand
• Successful co-branding activities with reputed companies such as Levi’s,
Apple iPod, Airtel. These brands also have similar target audience as
CCD’s
• CCD appeared in co-branded commercial for Yamaha’s motorbike and
HDFC
• Was the single point vendor for Air Deccan supplying food and
beverages with discounts on purchase of merchandise
• Promotes its brand through barter deals( in-film promotion deals) and
appeared in many films
• Co-branding with Enrique Iglesias, Elton John concerts and WWE shows
• Deal with WorldSpace radio to provide music at the stores
 Expansion Strategies
• Domestic • International
– Close to 1000 outlets – Currently six outlets in Vienna
– Plans to double it to 2000 and Pakistan
outlets by 2014 – Plans to increase it to 50
– Various store/café formats outlets across Europe and
like Garden Café, Sports Café, Middle East and Asia-Pacific
Singles Café etc by 2012
– Web-based ordering and – Inorganic expansion.
electronic processing systems Acquisition of Emporio for Rs
15 crore in June 2010
 Brand Marketing Tradeoff
Strategic Tradeoffs

Retaining customers vs. Brand Expansion vs.

Acquiring customers Brand Fortification Points of difference

Financial Tradeoffs

Points of parity vs. Short-run vs.

Long-run objectives Brand-building activities Cost minimization

 Brand Marketing Tradeoff
Tactical Tradeoffs

Push vs. Continuity vs.

Pull Change Contemporary Change

Organizational Tradeoffs

Classic vs. Independent vs.

Universal Image Local Standardization

 Why it is Difficult to build a brand?
Competing on aggressive

competitors like Barista

pricing laid down by

With more small

players coming up, it
could result in a
fragmented market

Building Brands

exercise is expensive: CCD

Continuous rebranding
had to invest 150 Cr in
Rebranding itself
more difficult
globally even
Brand building
Challenges for Brand Builders
• Increased Competition
– Major international players are expected to enter
the market like star bucks, Gloria Jeans and
domestic player like Reliance- Java Greens
CCD Barista
Still carries a youth oriented brand, Customers can easily identify and
lacks strength and power relate to barista
Less physical evidence associated More association with physical
with the brand evidence
With rising incomes there may be a Barista already caters the premium
brand shift from CCD to barista segment customers
Brand is more a combination of More stress on Western offerings
Indian & Western offerings
 Challenges Contd.

• Variety Seeking Customers

– Customers may switch easily when they are
offered more variety
• Brand Building from a “National” to an
“International” brand, a difficult exercise
• Promotional Expenditure
– Aspirations of being “global” would involve
expensive advertisement campaigns in other
countries
 Seven Deadly Sins of Brand Management

1) Failure to fully understand meaning of brand

2) Failure to live up to brand promise
3) Failure to adequately support the brand
4) Failure to be patient with the brand
5) Failure to adequately control the brand
6) Failure to properly balance consistency &
change with the brand
7) Failure to understand complexity of brand
equity measurement & management.
 Accolades
• CCD ranks No 2 in the Brand Equity’s Most Trusted Brands 2008
survey – in the food services category
• Rival Barista is at No 5 on the same list
• CCD was awarded the ‘Exclusive Brand Retailer of the Year’ by ICICI
Bank in its Retail Excellence Awards 2005 for the organized retail
sector
• Coca-cola golden spoon award 2010 for excellence in food retailing
• “Best Coffee Bar” award from Times Food Guide 2007 – New Delhi
& Mumbai
• Awaaz Consumer Awards 2006 – Best Coffee Shop Brand
• V G Siddhartha was voted as the “Entrepreneur of the Year” by
Economic Times in 2003
 Brand Managers take on Brand CCD
• CCD today has become the largest youth aggregator, and from a
marketing stand point, the success has come by focusing on
the 3As: Accessibility, Affordability and Acceptability.”- Bidisha
Nagaraj, the Marketing president of Cafe Coffee Day

• “Although demographically, a typical consumer would be male or

female between 15-29 years of age, belonging to middle or upper
middle class, we call our consumers young or young at heart. We
are about juke boxes, good and affordable coffee and food. The
brand fit is with youth or the young at heart. So we often look out
for brands that are aspirational in nature.” – Sudipta Sen Gupta,
Marketing head, Café Coffee Day.
 Conclusion
• Coffee industry is one of the fastest growing industry in
India
• Consistency in food and beverages across the length
and breadth of the network
• Strong Acceptance amongst Indian consumer
• Strong brand image and has strength to maintain brand
loyalty
• Top of mind recall for coffee shop goers in India
 Conclusion
• Managers perceive it as a high value for proposition in
terms of product and services but more people like to
visit CCD for informal meetings
• Strong emotional connect with the target audience

• Competition with other coffee cafes like Barista, Mochas.

• Other hukka  parlours like Sheshas , Peshawar , Koylas, U
Turn are also gaining lot of attention and preferred by
young generation to hang around which in turn is
attracting the market captivated by CCD
Airport CCD