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Coffee wars in India : CCd taking on the global brands
- 1. 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)
- 2. 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
- 3. 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)
- 5. 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
- 6. Segmentation, Targeting and Positioning Parameters 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 coffee Targeting 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
- 7. 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 )
- 8. 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.
- 9. 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 )
- 10. 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
- 11. LOVEMARKS • Mystery - logo • Sensuality - physical environment • Intimacy - Passion - Commitment by Kevin Roberts
- 12. LOVEMARKS • Mystery - logo • Sensuality - physical environment • Intimacy - Passion - Commitment by Kevin Roberts
- 14. 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
- 15. Service Blueprint of Starbucks
- 16. Service Blueprint of CCD
- 17. 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
- 18. 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
- 19. 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
- 20. 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.
- 21. 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
- 22. 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.
- 23. Merci