Marketing Research &

Product LaunchOf

Coffee“Master Blend”

Consumption Trend In India

• Coffee consumption has shown an annual average growth of 2.14% between 1951-2008.

• The domestic market has grown from about 18,400 tonnes to about 70,000 tonnes during 2008.

• In India coffee consumption is dominated in southern India including states Tamil Nadu, Karnataka, Andhra Pradesh.

• Coffee consumption in India is an urban phenomenon with an urban and rural divide of 71% and 29%

Coffee Consumption by type and per capita consumption (All India)

Year Coffee Consumption(MT) Per Capita Consumption(Kg)

Arabica Robusta Total

1951 14857 3526 18383 0.051

1961 17293 16580 33873 0.077

1971 20387 17517 37904 0.069

1981 28586 22210 50796 0.074

1991 37500 17500 55000 0.065

2001* 34000 30000 64000 0.062

2002* 34000 34000 68000 0.066

2008* 33800 36500 70300 0.068

Consumption - Volume and growth rate by states

Period Tamil Nadu Karnataka Kerala Andhra

PradeshSouth India

Non-South All India

Mean (MT) 1974-80 19344 13614 3106 3458 39522 3277 42799

1981-90 26308 14982 5470 5630 52389 3145 55534

1991-00 24753 15282 3415 4670 48119 3527 51646

1974-03 24040 15025 4602 5283 48951 3506 52456

Growth Rate (%) 1974-80 3.40 8.84 27.41 0.14 6.41 -3.17 5.54

1981-90 -0.25 1.41 1.58 9.24 1.37 -1.94 1.16

1991-00 1.18 0 5.83 1.74 1.11 4.28 1.30

1974-08 0.88 0.90 2.73 2.40 1.25 1.25 1.25

Consumption and Attitude of Indian Coffee Consumers• Coffee consumption dips from 11% at home to 6% outside.

• Penetration (Beverage consumed in the past 12 months) of coffee at 59% is low compared to that of tea.

• Penetration of filter coffee is highest in South India,But In the Rural areas (South India) instant coffee has a higher level of penetration than filter coffee.

• Coffee is consumed as a first cup only by 23% of coffee drinkers even in the traditional market of the South.

• Yesterday's consumption is the highest among the 15-24 and 35-44 age group.

Attitudes To Coffee• Coffee at home is significantly different to coffee outside.

• Coffee from vending machines rated significantly more satisfactory in the North as compared to the East or the West.

• Barriers to coffee are its bitter taste, inconsistent taste outside & high price.

• Less knowledge about coffee.

• Attitudes differ significantly across regions in India.

Potential Opportunities For

Growth• Filter Coffee in the North.

• Cold Coffee in North.

• Occasional Consumers.

• Rural Areas in South.

Recommendation & Outlook

• Development in non-traditional markets .

• The Retail Space: outlets and distribution .

• Product forms .

• Consumer education.

• Focus on the youth .

• Consider competition from tea & cold drinks.

INTRODUCTION TO “Master Blend”

- Taste That Makes It Happen

MISSION

“Enriching the coffee with aromas, taste & the entire experience of enjoying coffee & guarantying consistent & high quality special coffee products”

VISION

“Through our professional skills & clarity of purpose & values, we aim to become the Number One Coffee Company in India”.

Product Profile

MASCOT

NEW PRODUCT IDEA &

MARKET OPPORTUNITY

COFFEE BASICS• Most Popular Drink.

• Most Consumed Drink After Water.

• Caffein’s Sensory Pleasure & Richness Of The Aroma.

• Gives A Drinker An Uplift.

• Coffee Is Produced From A Small Red Fruit’s Seeds.

• A Complex Process Of Converting A Seed Into The Liquid Beverage.

COFFEE PRODUCTION IN INDIA

• 6th Largest – Producing 4% Of The Total World Production.

• 1,70,000 Coffee Farms & 9,00,000 Acres Of Land Having The Coffee Trees.

• 90% Of The Production Comes From The Smaller Growers.

• Karnataka.

• Kerala.

• Tamilnadu.

COFFEE BOARD OF INDIA

• The Coffee Board Of India Consists

• A Chairman.

• 33 Other Members. (Growers,consumers,traders)

• All Members Are Appointed By The Central Govt. Representing Different Interests In The Board

• Uptill 1992-93 – Marketing Looked After By The Board

• After The Liberalization

• 1992-93 – Introduction Of Isq- (Internal Sale Quota) Allowing The Growers To Sell 30% Their Production Directly To The Consumers.

• 1993-94 – Fsq- (Free Sales Quota) Now Allowing 50% To Be Sold Directly To The Consumers.

• 1994-95 – Further Liberalisation For The Smaller

Producers Allowing 100% & 70% To The Bigger

Growers.

IDEA GENERATION• The Coffee Culture In India.

• People From All Cultures, age, & demographies Drink Coffee.

• Major Inputs In The Metros By Barista, C.C.D In Revolutioning The Dimension Of Coffee Drinking.

• As They Say That “The Chai Is Out And The “Kafi” Is In”

• Nestle – Nescafe & Hind. Uni. Lever – Bru ,are The Major Players In The Market Today.

Marketing Mix of

“Master Blend”

Product

Place/Distribution

Price

Promotion

ACTIVITES 1st MONTH 2ND AND 3RD MONTH 4TH MONTH

Fixed cost for Television & Press advertisement

16.5 lakhs 16.5 lakhs 16.5 lakhs

Full page color advertisement in magazines & Filmfare

2 lakhs 2 lakhs 2 lakhs

A3 size color advertisement in TOI, Hindustan Times &

Navbharat Times

3.5 lakhs 2 lakhs 1.5 lakhs

Hoardings & Billboards 8 lakhs 8 lakhs 8 lakhs

Ads on Sony, Star Plus & Zee TV from Monday to Saturday. Between 7.30 pm to 11.30pm

Two 30 sec ads & four 15 second ads – Daily

Five 10 sec ads during 2 pm to 6 pm - Daily

Two 30 sec ads & four 15 second ads – Daily Five 10 sec ads during 2 pm to 6 pm - Daily

Five 10 second ads – Daily Three 15 sec ads during 2 pm to 6 pm – Daily

SWOT OF

“Master Blend”

Strength

• Unique Blend.

• Competitive Pricing.

• Easy To Prepare & Easy To Use

Weakness

• Majority Of People In India Are Tea-drinkers.

• Who Drink Coffee Are Loyal To The Brands They Drink.

• Investment Into Promoting The Coffee.

Opportunities

• Convert The Tea-drinkers To Coffee Drinkers.

• The Quality Of Both The Beans Are There Hence Its More To Attract And Change The Brand Preferece.

Threats

• Coffee Products Face A Stiff Competition From Tea.

• Low Profit Margin Due To Ressession.

• Threat From New Entrents.

SWOT OF

STARBUCKS

STRENGTHS

• Established Logo, Developed Brand

• Company Operated Retail Store

• High Visibility

• Valued And Motivated Employees

• Good Relation With Suppliers

• Industry Market Leader

• Strong Financial Foundation

• Customer Base Loyalty

WEAKNESSES

• Lack Of Internal Focus

• Ever Increasing Number Of Competitors

• Product Pricing Expensive

OPPORTUNITIES

• Expansion Into Retail Operations

• Technological Advances

• Brand Extension

THREATS

• Competition From Restaurents, other Coffee Shops Etc.

• U.S Market Saturation

• Cultural And Political Issues In Foreign Countries.

• Consumer Trends Towards More Healthy Ways.

Segmentation &

Future Prospects

Conclus

ion

Thank you