Coffee wars : CCD taking on the global brands

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Coffee Wars in India Café Coffee Day Takes on the Global Brands Ribhu Darshan (2014226) Richa Sahijani (2014228) Rishab Khemka (2014231) Rishabh Aggarwal (2014232) Rohit Sonakia (2014235) Sampriti Datta (2014250)

Transcript of Coffee wars : CCD taking on the global brands

Page 1: Coffee wars : CCD taking on the global brands

Coffee Wars in IndiaCafé Coffee Day Takes on the Global Brands

Ribhu Darshan (2014226)Richa Sahijani (2014228)Rishab Khemka (2014231)Rishabh Aggarwal (2014232)Rohit Sonakia (2014235)Sampriti Datta (2014250)

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The Coffee Shop Market in India

• Hot beverages – a part of Indian tradition• Coffee took the first seat in south India• To spread the drink – coffee shops emerged• Indian ( RTD ) Domestic coffee market – INR 1100

crore• Growth – 2250 crores by 2017

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Competitor Analysis• Nearest competitor Barista has 169 outlets• The ASPD at CCD outlets stands in the range of R15,000-20,000 as

compared with Starbucks INR 60,000-65,000 for FY14• Costa Coffee reported a loss of INR 60.5 crore in 2014 fiscal, compared to

INR 49.4 crore in the previous fiscal.• Exit of Gloria Jean’s from India – 2014• CCD market leader in retail footprint- 1568 stores• Competition from QSRs- Mc Donald’s ( McCafe’s)

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The Café, Lounge and Square

Cafe• Chairs very close – customers complain of intrusion of

privacy• Affordable hangout for the young crowd

Square• For absolute Coffee Connoisseurs• Coffee Snobbery

Lounge• Outstanding ambience – commendable service• Meal for two @ INR 750

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Segmentation, Targeting and PositioningParameters Starbucks CCD Dunkin Donuts

Segmentation People looking for coffee with experience

Youngsters looking to hangout with

friends

People looking to have western style

breakfast and coffeeTargeting Upper middle class Youngsters – college

students and working

professionals

Middle and Upper Middle class,

families

Positioning Great Coffee. Great Service.

A place between office and home

A place offering good quality and

fresh donuts along with coffee

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8Ps of Services

• Product - Coffee with great taste - Personalized coffee with great taste

• Price - A meal for two @ CCD 350 - A meal for two @ Starbucks 750

• Place - SB in metros and cosmos - CCD in tier I and tier II cities

• Promotion - CCD Print ads on newspapers, magazines, tie up with multiplexes, movie associations and other brands - Social Media ( Starbucks )

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Continued

• Physical Environment - Classic Interiors at Starbucks – Traditional - Trendy and bold interiors at CCD

• People - more pleasant, polite, positive at Starbucks than CCD

• Process - Self Service @ Starbucks - Partly self service @ CCD

• Production Quality - Great coffee great taste.

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Facilitating Elements of the Service Flower

• Information - An attractive list of offerings - Assistance offered by staff• Payment - Credit and Debit card ( Better at SB) - Cash and Coupons - Starbucks Rewards• Billing - At the cash desk - Also at the table• Order Taking - Suggestions from the staff - Greeting customers - Always say yes ( Starbucks )

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Enhancing Elements of the Service Flower

• Consultation -Assistance with the food catalogue - Suggestions • Hospitality - Wifi - Music - Clean lavatory - Good food and beverages - Better ambience ( Starbucks )• Safe-keeping - Credit Card Security - Food standards• Expectations -Happy Hours - Privilege Cards

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LOVEMARKS

• Mystery - logo• Sensuality - physical environment

• Intimacy - Passion - Commitment

by Kevin Roberts

Page 12: Coffee wars : CCD taking on the global brands

LOVEMARKS

• Mystery - logo• Sensuality - physical environment

• Intimacy - Passion - Commitment

by Kevin Roberts

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The Love/Respect Axis

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Supply Chain at CCD & Starbucks

Café Coffee Day

• Assembling food at outlets• 1497 outlets across 142 cities• Vertically Integrated • Short purchase cycle• Zero Channel Distribution

Starbucks• C.A.F.E Practices-ensuring quality• 75 outlets• Long purchase cycle.• Tata Coffee – Tata Starbucks

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Service Blueprint of Starbucks

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Service Blueprint of CCD

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The recent challenges CCD• Less attention to customer

service• Quality Employee retention

problem• Rural Employees• Managing 1497 outlets• Expansion plan -500 more

outlets in 2015• High real estate prices

Starbucks• Inability to maintain consistent

service levels with increased no. of outlets

• High real estate cost• Only 50 Starbucks cafes in India• Not an affordable price point for

the younger lot

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To-do list Starbucks• Expansion ( Leverage on ties with Tata ) - Starbucks café in Vivanta by Taj - Starbucks in Westside, TanishQ.• Pick their employees with increased precision to standardize

service across the globe.• Cost advantage- Improve the efficiency of supply chain

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Relevant assumptions• Average revenue from one store of Starbucks – 2.2 Crore per

fiscal• Average revenue from one store of Café coffee Day – 5.4

Crore per Fiscal• No of employees per store at CCD – 10• No of employees per store of Starbucks – 10-15

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Strategies for CCD• Groom the frontline personnel to talk in English – English classes for

employees- soft skills – new hires/groomed for tier I cities.• Redo the seating arrangement – Preserve the privacy for a lot to

happen over coffee.• Ask your customer if he is okay with the ambience – the temperature,

the music – find him a sweet spot.• Ease the payment – make sure the machines work fine.• Ask for memorable dates – birthdays, anniversaries – make it special –

send mystery bags, personalized messages.

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Continued

• CCD should strengthen ties with Ginger• Enhance customer experience in CCD - personalize your offerings - say hi to your customers ( use names )• Strengthen employee training programme- manage every

MOT• Adopt “ Never say No”• Plan a state of the art service recovery strategy• Re launch the brand with excellent service levels- focus on

customer service

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Continued• Increase awareness of the CCD Lounge and Square – Corporate

Magazines • Put the best employees to serve at the Lounge and the Square.

Personalize offerings .• Ask customers for suggestions – crowd source• Offer Parking facilities for two wheelers as well as four• Make the bills look attractive , make them worth preserving – enhance

the social quotient.

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Merci