CCD final 2

8/8/2019 CCD final 2

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Caf Coffee Day

Group 4


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Introduction

Coffee isthe second largesttraded commodity inthe world

Indian coffee is rated among the best-quality mild

coffeesinthe international market India accounts for about 4.5 percent of world

coffee production and the industry providesemploymentto 6 lakh people.

Karnataka accounts for 70 percent of country'stotal coffee production followed by Kerala (22percent) and Tamil Nadu (7 percent)


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Introduction

Out ofthe total production only 20% is consumed

inthe domestics markets restis exported

Branded coffee accounts for 53 per

cent, unbranded 40 per cent, with cafes

constituting 7 per cent.

India is one ofthe fastest growing coffee markets

inthe world and is making its presence feltintheworld market as well asinthe domestic retail

arena


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Caf shops growthinIndia

9226

1400

4500

1996-2000 2000-2005 2005-2010 2010-2015

Growth


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Introductionto CCD

A division ofIndias largest coffee

conglomerate,the Amalgamated Bean Coffee

Trading Company Limited (ABCTCL)

Popularly known as Coffee Day or CCD,its a

Rs. 750 crore,ISO 9002 certified company

Asiassecond-largestnetwork of coffee estates

(10,500 acres) and 11,000 small growers, CCD

has a rich and abundantsource of coffee


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Introductionto CCD

Launched its 1st outletin Bengalurus BrigadeRoad in 1996

Till 2002, outlets were confined to southIndia

Today ithas more than 970+ outlets acrossthecountry

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


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Vision and Mission

CCDsVision: To be the only destination for

dialogue over a cup of coffee

CCDs Mission: To be the best Cafe chain by

offering a world class coffee experienceat affordable prices


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Divisionsin Coffee Day


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Core Benefit of CCD

Affordable coffee

A place to spend time with friends

A place for those who are Young at Heart


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Basic Product

Features: Wide range of coffee,tea and other quick bites and coolers

Good music/presence of juke boxes

Comfortableseatingarrangement Affordableprices

Benefits Peergroupacceptability

Placeto hang out

Easy onthepocket

Designand Style Brightcolors

Couchesand canechairs

Very vibrantand trendy


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Expected Product

World class coffee

Variety interms of coffee and side orders

Comfortable seating

Augmented Product

Cansit for long hours Easy onthe pocket

Ambience


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Potential Product

Latentneed for coffee shops

Different formats like garden

cafes, lounges, book cafes,sports cafes etc Extend Brand into a premium segment

New additionsto the menu

Slush Mocktails

Herbal tea


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STPD

Segmentation

Coffee lovers who wantto 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 atheart


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STPD

Positioning Young hang out place

Where youngsters can meet and make friends

Chill-out-zone

Differentiation Affordable coffee and snacks

969 outlets acrossthe country Blanketstrategy

All company owed stores

Catersto the local taste


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Accessibility

Presence in multiple cities

Different catchments like:

highstreets, malls, multiplexes, offices, educationalpremises, and railway stations

As many as 4 storesin a single street

Cluster approach

No problem of cannibalization asthere is latent

need inthe market


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Affordability

Lower prices as compared to other popular

caf chains like Barista, Mocha, Costa Coffee

Acceptability

Anytime, Anywhere Caf

Largely visited for leisure Part ofthe life ofthe society


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Brand concept and Strategy

Brand CCD able to make connection withthe Indian

consumers predominantly among the youth

Brand Fitis youth or young atheart

Innovative formatstoo woo the customer

Tangible benefits and Intangible benefits-Group

membership


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Brand meaning

Music Cafes, Highway Cafes, Book cafes, lounge

Cafes, Garden Cafes, Cyber Cafes,Sports Caf,Singles

Caf, Fashion Caf

Values:Socially conscious brand-Silent brew masters Culture:Promote the feeling oftogetherness

User: Three categories of customers

Deep brand with focus onthe whole experience

Spirit branding : Getting the good feeling by using our

product


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Logo of CCD

Red square stands forleadership, passion

White swirl implies purity ofpurpose ,invigorating propertiesof caf

Greenstroke depicting 125 years

of cafe growing heritage

The font used for cafe is calledslurry and looks asthoughthelettershave congealed out of aliquid. The word isstill forming

itself and evolving

Fresh New avatar : a dialogue

box-withthe words Caf

Coffee Day writtenin a

distinctspecially created font

The new trendy dialogue logo

symbolizesthe essence of

what a caf coffee day caf is

all really about a perfect

place to relax and dialogue

A lot does over coffee


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Consumer Analysis


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Sample Demographics


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Why People visit CCD?

Liesure

36%

Celebration10%Meeting

18%

Coffee

23%

Variety

10%

Entertainm

ent

3%

Researchshowsthat, while

customers come for coffee (23%), a

substantial amount of customers

just come to hang out with

friends for leisure and fun.(36%).

CCD is also the venue for business

meetings (18%), celebrating special

occasions (10%), or just plain time

pass(13%).


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USP of CCD

Ambienc

e28%

Pricing12%

Product

Variety

14%

Service

8%

Proximity

of

Outlets

---------

PanIndiapresence

38%

Its mainUSPisits all India presence.

Its dcor,interiors, atmosphere, visual

branding plays a very significant role inattracting customers

Around 12% of respondents feel

CCD, providesthe right value for money

and is less expensive than other coffee

shops.


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Important Factors for the Consumers

Food

10%

Ambience

29%

Price

5%Accessibility18%

Service

18%

Hygine

20%


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Group Types and Sizes

Friends

54%

Family

8%

Colleagu

es

28%

Clients

4%

Alone

6% Maximum footfalls are in groups of

size 3-5 people.

Followed by people coming in groups

of 2, a major part of which are couples.

Around 54% ofthe sample visits CCD

in groups of 3-5.

27% are the couples.

13% come in groups of more then 5.

And 6% ofthe people are singles.


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Brand Recall

Logo (Red&Purple

colour

combination)

31%

Brand Message

(Lot canhappen

over coffee)

13%

Couches

33%

Coffee Bean

Machine

19%

Service

4%


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Customer Satisfaction

Tangible wayssuch as

Price

8%

Intangible wayssuchas ambience and

comfort

31%

Emotional

attachment

16%

Experential- Sensory

Pleasure

(Sight,sound,smell, f

eel etc)

28%

Symbolic/Aspirationa

l - Concept ofself

and society

17%


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Brand Competitive Advantage

Taste of

coffee/food

19%

People/Service

10%

Value for money

28%

Ambience/Experie

nce

43%


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Brand Comparison

0

5

10

15

20

25

CCD BARISTAFOOD: Customers found

foods, drinks, desserts & coffee served

at boththe placesto be ofsimilar

quality.

AMBIENCE:More than 50% of

respondents believe that CCD hasbetter atmosphericsthan Barista.

PRICE : CCD is considered less

expensive & more reasonable than

Barista & having a higher value for

money.

ACCESSIBILITY: Almost allrespondents feltthat CCD was more

accessible interms of proximity.

SERVICE : Again, we see that CCD

emerges as a better brand interms of

customer service


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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 cafs

Dark Forest Co is a Furniture manufacturing company supplying furniture(2500 pieces/month)to CCD outlets

Timber for thisissourced from own plantations

Benefits E

conomies of combined operations Economies ofinternal 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


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Co-branding

CCD hasnever opted for mass media advertising and believed thechainsstoresspeaks for the brand

Successful co-branding activities with reputed companiessuch asLevis, Apple iPod, Airtel. These brands also have similar targetaudience as CCDs

CCD appeared in co-branded commercial for Yamahas motorbikeand HDFC

Wasthe single point vendor for Air Deccansupplying food andbeverages with discounts on purchase of merchandise

Promotesits brand through barter deals( in-film promotion deals)

and appeared in many films Co-branding withEnrique Iglesias,Elton John concerts and WWE

shows

Deal withWorldSpace radio to provide music atthe stores


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ExpansionStrategies

Domestic

Close to 1000 outlets

Plansto double itto 2000outlets by 2014

Variousstore/caf formatslike Garden Caf,SportsCaf,Singles Caf etc

Web-based ordering andelectronic processing systems

International

Currently six outletsinViennaand Pakistan

Plansto increase itto 50

outlets acrossEurope andMiddle East and Asia-Pacificby 2012

Inorganic expansion.Acquisition ofEmporio for Rs15 crore in June 2010


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Brand Marketing Tradeoff

Retaining customers vs. Brand Expansion vs. Points of parity vs.

Short-run vs. Sales-generating vs. Quality maximization vs.

Acquiring customers Brand Fortification Points of difference

Long-run objectives Brand-building activities Cost minimization

Strategic Tradeoffs

Financial Tradeoffs


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Why itis Difficultto build a brand?

Competing on aggressivepricing laid down by

competitors like Barista

With more small playerscoming up,it could resultin a

fragmented market

Brand building globally evenmore difficult

Continuous rebrandingexercise is expensive: CCD hadto invest 150 Cr in Rebranding

itself

Building Brands


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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 GreensCCD Barista

Still carries a youth oriented brand,

lacksstrength and power

Customers can easily identify and

relate to barista

Less physical evidence associatedwiththe brand

More association with physicalevidence

With rising incomesthere may be a

brand shift from CCD to barista

Barista already catersthe premium

segment customers

Brand is more a combination of

Indian & Western offerings

More stress onWestern offerings


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Challenges Contd.

Variety Seeking Customers

Customers may switch easily whenthey are

offered more variety

Brand Building from a Nationalto an

International brand, a difficult exercise

Promotional Expenditure

Aspirations of being global would involveexpensive advertisement campaignsin other

countries


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SevenDeadly SinsofBrandManagement

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 brand7) Failure to understand complexity of brand

equity measurement & management.


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Accolades

CCD ranks No 2 inthe Brand Equitys Most Trusted Brands2008 survey inthe food services category

Rival Barista is at No 5 onthe same list

CCD was awarded the Exclusive Brand Retailer ofthe Year

by ICICI Bank inits Retail Excellence Awards 2005 for theorganized retail sector

Coca-cola goldenspoon award 2010 for excellence in foodretailing

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 asthe Entrepreneur ofthe Yearby Economic Timesin 2003


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Brand Managerstake on Brand CCD

CCD today has become the largest youth aggregator, and from a

marketing stand point,the successhas come by focusing on

the 3As: Accessibility, Affordability and Acceptability.- Bidisha

Nagaraj,theMarketing presidentofCafe CoffeeDay

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 atheart. We

are about juke boxes, good and affordable coffee and food. The

brand fitis with youth or the young atheart. So we often look out

for brandsthat are aspirational innature. Sudipta Sen

Gupta,Marketinghead, Caf CoffeeDay.


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Conclusion

Coffee industry is one ofthe fastest growing industry in

India

Consistency in food and beverages acrossthe length

and breadth ofthe network Strong Acceptance amongstIndian consumer

Strong brand image and hasstrengthto maintain brand

loyalty

Top of mind recall for coffee shop goersinIndia


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Conclusion

Managers perceive it as a high value for propositionin

terms of product and services but more people like to

visit CCD for informal meetings

Strong emotional connect withthe 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 byyoung generationto hang around whichinturnis

attracting the market captivated by CCD


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Airport CCD


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Documents

CCD final 2