ACKNOWLEDGEMENT

It gives me a great pleasure to present a project study on COFFEE

RETAILING INDUSTRY W.R.T CAFÉ COFFEE DAY. This project is my
effort to present in a nutshell, information about the COFFEE RETAILING
INDUSTRY and the different aspects of the company “CAFÉ COFFEE
DAY”.
I present this project study to my college for bms course, which is
affiliated to UNIVERSITY OF MUMBAI as part of fifth semester. this project
has been prepared under the due guidance of Ms. PARVATHI
VENKATESH. i also acknowledge this project to my college, our principal
PROF. VENKATRAMANI, our Bms coordinator MRS. VARSHA GANATRA
AND my whole college staff.
i am also thankful to café coffee day managers Mr. NILABH
BANARJEE AND Ms PRAGYA. also to manager of QWIKY’S Mr. K.
MAHADEVAN for their immense support and cooperation in making this
project.
Lastly, I would always be thankful to all my friends, colleagues and family
members whose constructive criticism and unconditional help went long a
way in the due course of this project.

ABHIJIT JOSHI
TYBMS
 INDEX

CHAPTER-1
⇒ COFFEE RETAILING INDUSTRY IN INDIA.

CHAPTER-2
⇒ BACKGROUND OF CAFÉ COFFEE DAY

CHAPTER-3:
⇒ PROFILE OF CAFÉ COFFEE DAY

CHAPTER-4:
⇒ MARKETING MIX OF CAFÉ COFFEE DAY

CHAPTER-5
⇒ MAJOR COMPETITORS OF CAFÉ COFFEE DAY.

CHAPTER-6
⇒ COSTOMER RESEARCH (ON THE MERCHANDISING PRODUCTS
OF CAFÉ COFFEE DAY).

CHAPTER-7
⇒ CONCLUSION.

2
 Executive Summery

Café Coffee Day was launched in Bangalore in 1996. It was just an attempt
to bring the coffee bar culture in India. And in mater of just 7 years Café
coffee day has become one of the best hang outs for the youth in the
country. There has been a great change in the overall behavior of the
consumer; coffee that was considered to be just a refreshing drink has now
become one of the most popular drinks in India. Café coffee day brought a
very rich variety of coffee, which the Indian customer was not at all aware
of.
Café coffee day also changed the overall impression of coffee
bar by introducing food items and “Merchandising Products” in the café. And
hence also started getting great popularity in the north of the country. It
basically enabled the customer to not only get coffee in the café but also to
enjoy great variety of veg and non-veg food. And also provided it’s
merchandise in the form of t-shirts, mugs, caps and coffee powder etc.
But the real Unique Selling proposition of Café coffee day is it’s
nominal price. To attract price sensitive customer’s of India café coffee day
has reduced its prices considerably. This is all because they have their own
plantations and so the cost on raw materials is reduced. the low price of
café coffee day has made Café coffee day to have a strong position against
the competitors. Café coffee day has also done many innovations in the
market by introducing musical jukebox called Q-jam and by opening first
time in India a complete wireless café. Café coffee day tried to make “coffee
bar” a very popular concept by opening outlets on a very large scale across
the country and their by promoting through word of mouth. hence it has
successfully captured the middle class of India. The success of café coffee

3
day prompted other companies to follow the same path. So now there are
many competitors like Barista, Qwiky’s etc. These coffee bars are giving a
very tough competition to the Café coffee day by targeting not only middle
class of India but also targeting the sec-A and sec-b class. But this is the
only begging of the whole game, in the near future there are many other
coffee bars to step in, including the world famous starbuck’s and Java green
by reliance.etc.

I have put my by best efforts to bring out the various aspects of café
coffee day right from it’s product mix to market mix. Also under the guidance
of café coffee day I conducted a customer research to find out the response
of the customers regarding it’s merchandising products.
Another intension of doing this project was to give an idea about the future
of coffee retailing industry and what café coffee day should do to stand
against the up coming giants.

4
 CHAPTER 1

“COFFEE RETAILING INDUSTRY IN INDIA”

 Introduction.

 Coffee retailing in India.

 Expert’s opinion about the coffee retailing industry.

5
 INTRODUCTION

Today India is going through a major economical and Cultural

Revolution. All those things that were considered luxury items at some point
of time now have become part of our day-to-day life. Along with the
developing economy of India there has been a change in the behavior of the
Indian customer also. Today the Indian customer is found well educated and
has started accepting western life style. Hence India has become a very
dynamic and diverse market for the world. And the companies have realised
that some innovations in the market can make them explore and exploit this
hidden gold mine. There has been many innovations in the Indian markets
in the recent years. Coffee retailing is one of the examples-

Coffee Culture has now being implemented from the past seven
years in India after it has gained importance in the Western countries like in
USA. This coffee culture was introduced by companies like Café coffee day,
Barista and Qwiky’s coffee pub etc. This coffee parlors are constantly
flooded by the old and young people, college students, office working
crowd, family group, etc. They may be regular or first time customers
entering the coffee outlets but have a lot of varieties to taste in coffee, which
are not seen in hotels or restaurants.

Tea and coffee are served by almost all small caterings, hotel,
restaurants, etc but providing the coffee taste with mouth watering flavors in
a cool and trendy environment with best of the services are managed only
by few companies at a affordable prices. This is the area where the
competition is at the highest level and people who like to spend on the
higher side like to visit such outlets, which serve coffee at affordable prices
with best quality hygienic food with a good ambience.

6
This coffee bars have increased the over all consumption of coffee and
have made coffee a very popular drink in the country.

EXPERT’S VIEW ABOUT THE INDIAN COFFEE RETAILING INDUSTRY?

Now lets try to find out, what does experts like Mr. Harish Bijoor thinks about
the whole coffee-retailing industry?
First some information about Mr. Harish Bijoor -Mr. Harish Bijoor,
Vice-President, (Marketing Operations), Tata Coffee Limited, has been with
Tata group for more than eight years. He started his career with Unilever
group in India dealing with tea, coffee and spices operations and spent eight
years in the group. He has held various positions in these companies
ranging from sales manager to business manager to the presently held
position, VP (Marketing & Operations). He is a market-research enthusiast
and is an ardent writer. He has been contributing his articles to various
newspapers and magazines in the world. In the year 2001 he published a
book called "Marketing Trends: Smart Insights into the world of Indian
business"
In an interview to India Infoline, Mr. Harish gave his views about the
present and future scenario of coffee market in the country.
In the interview he told about coffee consumption through cafes in the
last few years in India– according to him "If we peek at the consumption of
coffee at cafes like Café coffee day, Barista, Quicky’s, we will see that it is a
small percentage. I have done a calculation on the coffee consumption
through the Café route. If India produces 3,00,000 tones of coffee per year,
to occupy even 25% of this output of this country through the Café route, we
need 50,140 Cafes! At this point of time we have about 250 Cafes in the
country. The maximum number we will reach at the end of this calendar
year will be 400. At the end of the next: 600. And at the end of the next: 950!
We will not ever have more than 6000 Cafes in this country! Therefore, the
Café does nothing very much to consumption. It does great things to
attitude towards coffee! It can spark off domestic consumption. The real

7
market for coffee lies in the polypack forms. Packaged coffee marketed as
an FMCG."

In the present scenario, a large chunk of coffee retailing happens

through the small coffee outlets that sell coffee powder targeted at
household consumption. Next comes the consumption that takes place
outside the house and is largely limited to the filter coffee served at
Darshanis and the Udupi type of hotels. According to Bijoor, "The single
biggest market for Indian coffee remains the domestic market. The market
numbers stand at around 48,000 tons per annum as of today. This
represents a per capita consumption number that is just about 46 gms. This
is pathetic. Compare this number to other robust coffee consuming
countries and the acute weakness of the Indian coffee consumer market is
apparent. The per capita consumption of coffee in North India stands at 2.4
gms. This means that an average Indian in the north of this country
consumes less than 1 cup of coffee in a full year!"

He also talked about what will be the future of the overall coffee
consumption through cafes in India- According to Bijoor “A huge opportunity
lies ahead of the players and upgrading the consumers to drink coffee at
these chains will spell success to these chains. But this is not an easy task
and requires a continuous effort to build strong brands that these
consumers can relate with. There is also a scope for further segmenting to
take place.

The bottom end is wide open currently occupied by the Darshinis

and Udupi restaurant chains. The middle segment is occupied by the Café
Coffee Day chains with their natty set of coffees. The premium segment is
the domain of the Barista chain. The super-premium segment is sparsely
occupied by niche offerings like Yantra in Mumbai. This is the entry level
strategy of the Café players. There will emerge a need to further sub-
segment. Existing players, who currently own the Cafes will fast see the

8
need to franchise out the Café chain. More offerings will hit the market and
the sub-segmentation will bring in community Cafes. A Café for women
only! A Café for the Rock enthusiast! A Sports Café! One can go on and on.

Companies like Café Coffee Day that operates at different levels

with a presence in coffee retailing through coffee points where it serves
coffee in polypacks, to trendy Cafes are in a better position to capture the
attention of the consumers at the lower end. Café Coffee Day's most unique
aspect is its exclusive relationship with the plantation division of the
company. It also enjoys a cost advantage currently because of its direct
access to the coffee beans from the company's 5,000 acre-plantations. This
places the company in a position to offer world-class products at affordable
Indian prices. Its coffee products priced between Rs. 20 to Rs. 45 are 10%
to 20% cheaper than similar products of other coffee-chains in the country.
So café coffee day has great potential”

9
 CHAPTER 2

“BACKGROUND OF CAFÉ COFFEE DAY”

 Background of the Parent company.

 Background Of Café coffee day

10
THE BACKGROUND OF THE PARENT COMPANY: Amalgamated Bean
Coffee Trading Company Limited (ABCTC LTD.)

It was in the golden soil of Chikmaglur that a traditional family owned

a few acres of coffee estates, which yielded rich coffee beans. Soon
Amalgamated Bean Coffee Trading Company Limited, popularly known as
Coffee Day was formed. With a rich coffee growing tradition since 1875
behind it coupled with the opportunity that arose with the deregulation of the
coffee board in the early nineties. Coffee Day began exporting coffee to the
connoisseurs across USA, Europe & Japan. In the calendar year 2000,
Coffee Day exported more than 27000 tonnes of coffee valued at US$ 60 m
to these countries and, for the second time in its short career of 7 years
retained the position as the largest coffee exporter of India.
Coffee Day has a wide and professional network in the major coffee
growing areas of the country comprising over 50 agents and 50 collecting
depots. Coffee Day's two curing works at Chikmaglur and Hasan cure over
70,000 tonnes of coffee per annum, the largest in the country.
Coffee Day has a well-equipped roasting unit catering to the specific
requirement of the consumers. The process is carried out under the control
of experienced personnel to meet highest quality standards. The most
modern technology available is used to maintain consistency and roast the
coffee beans to the demanding specifications of the discerning coffee
consumers.
Key Features
• 125 years of coffee growing history.
• A fully equipped ISO certified roasting plant with a 70000 tonnes per
annum capacity at Hasan.
• 5000 acres of self owned Coffee Plantations.
• A ready and enviable base of more than 10000 suppliers.

11
 • Among the top exporters of coffee in India (Coffee Day Exports).
Coffee Day Comprises of the following Sub Brands-
• Café Coffee Day
• Coffee Day – Vending
• Coffee Day – Xpress

BACKGROUND OF CAFÉ COFFEE DAY

The idea of bringing an international coffee experience prompted

ABCTC ltd. To launch a Cyber cafe in the year 1996 at Bangalore. Though
the focus was more on Internet browsing at that time, the concept of an
exclusive café for drinking coffee gained popularity.
Café Coffee the international cafe experience. The Cafe offers
more than 10 types of hot coffee, 5 types of cold coffee and one tea for tea
lovers. International syrups like Hazelnut, Irish cream and English tonic are
also available. The range of syrups on the menu changes every month. The
three international coffees on the menu (Columbian Juan Valdez, Kenyan
Safari and Ethiopian Qawah) are imported and blended according to Indian
taste.
Café Coffee Day currently owns and operates 113 cafes in all major
cities in India. It is a part of India's largest coffee conglomerate named
Coffee Day, Rs. 200 crore ISO 9002 certified company. Coffee Day's most
unique aspect is that it grows the coffee it serves in its cafes.

Key Features
• Pioneers of the Café Concept in India with the its first Café at
Brigade Road, Bangalore in 1996. This Café was opened as a Cyber
Café (first of its kind) but later, with the burst of cyber cafes it
reverted to its core competency…. Coffee

12
• Essentially a youth oriented brand with majority of its customers
falling in the 15-29 year age bracket
• Each café, depending upon its size attracts between 400 and 800
customers daily
• At present it operates 113 cafes across 15 cities
• Plans to operate 200 cafes by March 2004
• It is a place where customers come to rejuvenate themselves and be
themselves rather than a place to be “seen at” vis a vis other cafes.

CHAPTER 3
“PROFILE OF THE COMPANY”

 Profile of café coffee day

& Organization structure.

o Mission Statement.

o Consumer Profile.

o Expansion Plan.

o Logo- why it was changed?

o Significance of colours in the logo.

13
 o Significance of text, fonts and swirl in the logo.

o Décor.

PROFILE OF THE COMPANY

Mission Statement:
To be the best Café chain in the country by offering a world class
coffee experience at affordable prices.

Customer Profile:
Research shows that 37% of the customers are between 20 and
24years. 27% of the customers are between the age group of 25-29 years.
60% of the customers who visit the café are male and 40% are female. 52%
of customers who visit the cafes are students. 18% of the customers visit
the cafes daily while another 44% visit weekly. Each café, depending upon
its size attracts between 1000 and 2500 customers daily, mainly between
4pm and 7 pm. Customers describe Café Coffee Day as the place they
frequent most after “home and workplace/college”. It is a place where they
meet friends and colleagues, in groups of 3 or more. The prices here are
perceived to be reasonable and it is a place where customers come to
rejuvenate themselves and be themselves rather than a place to be “seen
at” vis a vis other cafes.

Expansion Plan:
The first Café Coffee Day was opened in Brigade Road in 1996,
Bangalore's busiest shopping area. At that time, the café culture had still not
arrived in India. In that sense, Café Coffee Day is the pioneer of the concept

14
in India. Over the years Café Coffee Day currently owns and operates
113Cafés in all major cities in India.

Cafe Coffee Day entered the Mumbai market in the month of June
2002,through a tie-up with Mars Restaurant as well as the stand alone
cafes.

This is in line with Café Coffee Day's pan-India expansion plans.

There will be more than 200 Cafes by March 2004.

Logo:

The New Cafe Coffee Day logo

Reasons for change:
. The parent company, Amalgamated Bean Coffee Trading Co Ltd.,
was already one of India’s leading exporters of green coffee owning
thousands of acres of coffee plantations and its own processing units and
curing works. It had also ventured into retailing of roast and ground coffee
through Coffee Points in South India, which began replacing local brands as
the undisputed no. 1 in its segment. The brand under which R&G coffee
was being retailed was (and is still) called Coffee Day. The target audience

15
for this brand were found to be quality conscious, mostly traditional South
Indian families with classical tastes. The logo reflected this fact.
When Café Coffee Day was launched in 1996, the target audience
was expected to have a similar profile and the logo adopted for the cafes
was a close variant of Coffee Day. There was a profile match, for some
time. The years rolled by and the café culture percolated almost completely
to the Indian youth by year 2000. No longer was the café a bastion of the
intellectual, it had become an urban youngster’s favorite “hangout”. An in-
house research shows that Café Coffee Day’s customers are mostly young
college students and young professionals
And so it was time for Café Coffee Day to rejuvenate itself - through
its look and logo. The change of logo is the beginning of a process at café
Coffee Day. The spin off’s of this contemporization process will be seen in
the brand communication and the interior design as well.

The significance of the Colors:

• RED stands for leadership and vitality. It also stands for passion (…
for coffee).
• The GREEN stroke harks back to our coffee growing heritage and
the coffee plantations that we own.

The significance of the Text, Fonts and Swirl :

Café is noticeably larger than the rest of the text inside the logo box.
This denotes that Café Coffee Day pioneered the café concept in India way
back in 1996. Café Coffee Day would like to own the word “café” in the
minds of its customers. When one thinks of a café its got to be Café Coffee
Day. The font used for “Café” is called SLURRY. The font looks as though
the letters have congealed out of a liquid. It gives the impression that the
word is still forming itself and evolving into something new and something

16
better constantly. This is the characteristic of Café Coffee Day’s customers
and this is the characteristic that the brand too wants to adopt.

The upward SWIRL inside the logo box stands for the invigorating
and uplifting nature of coffee and the ambience at café Coffee Day.

“COFFEE DAY” has been written in the same stylized font as the earlier
logo for continuity’s sake as also to preserve some of the linkages with
Coffee Day, its sister brand.

Décor:
Café Coffee Day, had gone in for an image change and revamping of
interiors in the last quarter of 2001.
Café interiors at the company's 113 outlets are being given a whole,
new look. The flagship outlet at Brigade Road, Bangalore has been
renovated and now sports a trendy new look.
In a change from the largely wood and granite based interiors, there
is more of steel and lots more colour The young colours of today, lime
green, yellow, orange, and purple will predominate. The crockery will also
sport these colours.
The larger cafes will also have lounge areas and a few bean
bags.Café Coffee Day will also have music events in order to pep up the
ambience and focus on its key clientele: the youth.

ORGANIZATION STRUCTURE

17
 CHAIRMAN

DIRECTOR

OPERATIONAL
HEAD

REGIONAL
HEADS

AREA
MANAGERS

BRANCH
MANAGERS

SHIFT
CHAPTER 4
MANAGERS

“MARKETING MIX OF CAFÉ COFFEE DAY”

STAFF

 Product.
• Different types of coffee.
• Food in café coffee day.
• Merchandising products.

 Place.
 Café coffee day in India.
 Café coffee day in mumbai.

18
  Price.
• Comparison

 Promotion.
 Major tie-ups.
 Innovations in the market.

PRODUCT
The impression that we get when ever we hear the name Café
Coffee day is that it would serve only coffee. But it’s not the case with Café
coffee day. Though Coffee remains it’s specialty, Café coffee day also
provides variety of other products.
Talking about their specialty i.e. Coffee, Café coffee day provides
rich variety of both national as well as international coffee.

The different types of coffee offered in Café coffee day are:

HOT COFFEE

• Espresso- it is a Strong black coffee having no frills.

• Espresso Americano- it’s a lighter expresso for mellow moods
• Macchiato- it’s Expresso topped with milk foam.
• Cappuccino- it’s one of the hottest selling item prepared in true Italian
style
• Cafe Latte – it’s Espresso with milk. It is a light coffee.
• Chococinno-A sinful combination of chocolate ice & hot coffee.
• Cafe Mocha -Hot coffee with a swirl of chocolate.
• Irish Coffee -Whipped cream tops the flavour of your choice.
Plunge deeper and discover light espresso.

INTRNATIONAL COFFEE

19
 Every country has its distinct style of making coffee and so to make
people aware of the different varieties and different style of coffee. Café
coffee day also provides some of the best coffee from the different
countries around the world.

• Colombian Juan Valdez- Rich well balanced coffee with a fruity

flavour.
• Ethiopian Qahwah -Delightfully flavored and aromatic with dark
chocolate overtones.
• Kenyan Safari- With the bright, striking flavour of blueberry.

COFFEE ADD-ONS

The customers can also enjoy the coffee with the extra add ons of
flavour: it basically includes

• Flavored Syrups- it consists of imported flavours, which are added

with hot coffee.
• Red Eye – this is an additional shot of espresso for having a strong
coffee
• Whipped Cream- customers can Snowcap the coffee with some
lightened cream
• Scoop of Ice Cream
• Chocolate sauce.

COLD COFFEE

In India it is generally believed that coffee is something which is only a

hot beverage, but Café coffee day has changed this perception of the
people by introducing great variety of the cold coffee, so those people
who want to chill out in the hot climate of India can have this chilling
refresher. It includes –

20
 ICE BLENDED COFFEE

• Almond Frappe-It is an almond flavor rich, creamy cold coffee with

whipped cream and garnished with additional almonds.
• Cold Sparkle - it is a Chilled coconut - Flavoured coffee.
• Crunchy Qahwah-its crunchy, creamy cold coffee with a shot of
whipped cream and garnished with corn flakes.
• Tropical Iceberg -it’s a Chocolate flavoured coffee with crushed ice.
• Arabian Heights -it a coffee that gives a Distinct flavour of cardamom,
stimulating from the first sip.
• Devils Own-A smooth blend of cream and coffee, drenched with
chocolate sauce and topped up with a shot of whipped cream
• Iced Eskimo -A chiller to the core. This is as good as coffee can get.
• Kaapi Nirvana-This is one of the best coffee offered by café coffee
day, Kaapi Nirvana is an Indian coffee that won the silver medal in
the world Barista Championship, 2002.

COFFEE ON THE ROCKS

• Mochachillo-A swirl of chocolate, espresso and rich creamy milk

served on the rocks.
• Cappachillo-Espresso with rich creamy milk, served with floating ice
cubes.

• Vegan shake -this is one of the special products offered by Café

coffee day. This shake does not contain any animal fat and has a
chilled coffee flavour.

CREAM BLENDED COFFEE

• Cafe Frappe - its Ice cream and coffee blended to smooth, creamy
perfection.

21
 TEA

For those people, who want to try something different, can have tea in the
cafe. Café coffee day basically provides three different varieties of
specialized tea in their cafes. These are:

• Assam Tea - It’s a Premium tea from the misty hills of Assam.
• Masala Chai - For that ethic feel.
• Lemon 'n Ice Tea- It’s the perfect way to Chill out.

COFFEE POWDER

• Dark Forest - India's first special, high altitude, single-origin coffee.

• Arabicaah- Cafe blend
• Perfect- Ultra Rich
• Charge- Bright

FOOD IN CAFÉ COFFEE DAY:

As the competition in the coffee retailing sector has increased. Café
coffee Day tries its best to have an upper hand in it. They continuously work
to improve their services and the products. As a result Café Coffee Day not
only provides wide variety of coffee but also a very wide range of food.
The consumer survey done by café coffee day shows that food sales
are now almost equal to the coffee sales in many cities like Mumbai, Delhi
and across northern India. Officials at coffee bars say, the sales of food
have doubled and customers are asking for a mix of fusion food and a
snacky Indian meal along with good coffee.

Cafe Coffee Day is now planning to serve wraps, lasagne, subs,

quiches and Italian sandwiches like 'ciabatta' along with Indian favorites like
briyanis, dhoklas, kati rolls and kebabs across its 113 outlets across the
country. As per the article in the economic times dated April 25th 2003
Sudipta mukherjee the marketing head of Café Coffee Day said "Since we
expanded outside South India two years ago, we have realised the impact

22
of food on our profitability. Almost 95% of our customers demand food and
we have to take this demand seriously. In our food menu, the break-up
originally was 33% food and 77% desserts like pastries and sundaes. The
share of food will now go up to 50% and the rest will be desserts," this
clearly shows that the demand for food is rising day by day in the coffee
bars. Ms Banerjee also said that coffee sales continue to dominate
revenues from traditional coffee markets in South India. But it's a different
story north of the Vindhyas, coffee blends do not enthuse customer without
food on the menu. she gave example of the customers of Dalal street
(Mumbai) who demand dhoklas along with coffee, she also talked about
Delhi where customers ask for munches like matthis.

Hence To meet the consumer preferences they have their weekly,

monthly and standard menus. For menu innovations, Cafe Coffee Day has
tied-up with Neelam Batra, the Indian celebrity chef in California known for
her fusion food.

MERCHANDISING ITEMS:

Besides selling such food items, Café coffee day also sells
merchandising items like T-shirts, caps, mugs, coffee powder, bags etc.
these items are in the range of Rs50 to Rs100. Cafe Coffee day is very
keen to find out the responses of the people regarding it’s merchandising
product and hence is carrying out a market survey on these merchandising
items. The survey is basically to find what does customer feel about the
products like T-shirts, caps and mugs. It is also required to find whether the
customers are really aware of the different products available in Café coffee
day or not.

23
 PLACE

Place is one of the important factors in the overall strategy of Café

coffee day. Place here not only means location of their outlets but also it
means location of the manufacturing or processing plant.

Café coffee day owns 7,000 acre of coffee plantations in Chikmaglur

in the Western Ghats of Karnataka and has a capacity of producing 5000
tonnes of coffee per year. The coffee thus produced is processed in its own
plants in its curing works in Hasan and Chikmaglur.

24
 Café coffee day has an advantage here, since it has it’s own plant
located in Chikmaglur, timely and consistent flow of raw materials is
possible in least cost. The other competitors of Café coffee day namely
barista and Quicky’s don’t have their own fields and as a result they have to
depend on their suppliers for the timely delivery of the materials.

Now let us see the location of café coffee day outlets in different parts of the
country.

In the south, café coffee day is located in the cities like Chennai, Mysore,
Bangalore Mangalore, Chikmaglur, Belgaum, and Goa.

Name of the city Number of outlets

Chennai 5
Mysore 1
Bangalore 25
Mangalore 3

25
 Chikmaglur 1
Belgaum 1
TOTAL 36

In the west it is located in cities like- Mumbai, Pune, Vadodara, Ahemdabad,

Goa.

Name of the city Number of outlets

Mumbai 30
Pune 5
Vadodara 2
Ahemdabad 1
Goa 1
TOTAL 39

In the north it is located in cities like- New Delhi, Agra, Lucknow, Jaypur,
Haryana, Masoorie, Dehradun, Chandigarh, Jalandar, Amritsar, Ludhiyana.

Name of the city Number of outlets

New Delhi 14
Agra 1
Lucknow 1
Jaipur 1
Haryana 1
Masoorie 1
Dehradun 1
Chandigarh 4
Jalandar 1
Amritsar 1
Ludhiyana 1
TOTAL 27

26
In the east it is located in cities like- Kolkata, Bhuvaneshwar.
And the rest of the cafes are located in Hydrabad and Nagpur.

Name of the city Number of outlets

Kolkata 4
Bhuvaneshwar 1
Hydrabad 8
Nagpur 1
TOTAL 14

CAFÉ COFFEE DAY IN MUMBAI

Mumbai is the main target for the café coffee day and hence mumbai has
the largest number of Café coffee day outlets. There are 30 outlets in
mumbai

1. Bandra:
There are about 3 outlets in Bandra out of which one is situated at
BPCL in Linking Road, whereas the other is at Bandra (West)
situated in Bandstand in Byramji Jijibhoy Road. The third outlet is at
Just Around The Corner, which is next to the St.Theresa’s school.

2. Andheri:
There are around 4 outlets in Andheri, which is situated at Fame
Adlabs on Link Road, the second one is located near Lokhandwala
complex. Third one is at “Birdy’s” Seven Bunglows in J.P.Road in
Versova, and the fourth one is at Mount Shopping Arcade in
J.P.Road in Versova.

27
3. Juhu:
There are 2 outlets in Juhu those are at Juhu Tara Road and Kings
International, Juhu.

4. Santacruz:
There are about 2 outlets in Santacruz which are at Tagore Kung
Saraswati Road and at Mohammad Siddique , Santacruz (West)

5. Other outlets:
The other outlets of café coffee day are situated at Dalal Street
(Fort), Chembur, Dadar, Ghatkopar, Worli Sea Face, Colaba, Khar
(west), New Queens Road, Juhu Vile Parle (west), Napean Sea
Road, Sion (west) and Matunga. Their future plan is to open more
outlets in and around Mumbai.

Café coffee day and Bharat Petroleum Corporation Limited alliance

BHARAT Petroleum Corporation and Cafe Coffee Day announced an

alliance to open Cafe Coffee Day outlets in select In &Out BPCL
petrol pumps.

The outlets will be stand-alone cafes or kiosks or coffee counters at

the BPCL retail outlets.

Cafe Coffee Day has already set up nine cafes at BPCL outlets —
three each in Mumbai, Delhi and Bangalore, said Mr. S. Ramesh,
General Manager (Brand Management), BPCL.

"BPCL has an impressive network of retail outlets across the country.

And each of these sites is a potential Cafe Coffee Day outlet," said
Mr Naresh Malhotra, Director, Cafe Coffee Day.

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 PRICE
Price is a very critical factor to carry out any business. Even a single
rise in the price of the product can reduce demand of the product
considerably.

Café coffee day is known for providing specialized coffee at a very

subsidized rate. And hence this factor helps in attracting customers from
rival coffee chains. But how is this possible to provide a specialized coffee
at very less cost? the reason for this is that Café coffee day has its own
coffee plantations So as a result, Café coffee day sells what it grows. As
compared to the competitors which either import coffee or has some internal
suppliers.

Let us now compare the prices of the three coffee chains i.e. Café
coffee day, barista and the Quicky’s

PRODUCT CAFÉCOFFEE QWIKY’S BARISTA

DAY (Rs) (Rs.)
(Rs.)
CAPPUCCINO Rs.22 Rs.30 Rs.30
CAFÉ MOCHA Rs.35 Rs.45 Rs.40
CAFÉ LATTE Rs.22 Rs.40 Rs.35
ESPRESSO Rs.15 Rs 20 Rs.20
AMERICANO Rs.15 Rs.30 Rs.20
HOT CHOCOLATE Rs.30 Rs.40 Rs.35

By comparing the prices of the products available in Café Coffee

Day, Qwiky’s and Barista, we can see that the prices of Barista and Qwiky’s
are on the higher side as compared to Café Coffee Day. Thus we can see
that Barista’s and Qwiky’s target customers are professionals, working
couples and families in the SEC-A and SEC-B categories that detest the
loud ambience of coffee pubs and who are willing to pay these high prices.

29
 Whereas Café Coffee Day’s typical customers are between the age
of 15-29 years, which shows that these are mostly college going students or
are from upper middle class or middle class families, who can afford these
prices and looking at these target customers the company has designed its
outlet to look young and trendy with vibrant colors such as lime green,
yellow, purple and orange predominating the outlets.

This places the company in a position to offer world-class products at

affordable Indian prices. Its coffee products priced between Rs. 10 to Rs. 35
are 10% to 20% cheaper than similar products of other coffee-chains in the
country.

This difference in prices is because all these café’s are selling three
different concepts. Barista has tried to inculcate the Italian coffee culture in
India. It’s a place where one can go with work and keep sitting throughout
the day. Qwiky’s has tried to bring the American coffee pub culture in India.
Cafe Coffee Day, on the other hand is a regular fast food joint where one
goes to eat, drink and generally have a good time with friends and family.
Besides target customers are more towards the higher end of the market
than Café Coffee Day’s.

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 PROMOTION

Promotion plays a very vital role in the success of any business. A

good promotion can increase sales and bring profit to the firm; similarly a
bad promotion can decrease sales and bring losses to any firm. Promotion
means not only advertising your products for the potential customers but
also satisfying the needs and wants of your existing customers.

Today’s coffee parlors are not just in the business of selling coffee, or
a quick bite to go with it, but are in the lifestyle business. The well-lit trendy
coffee chains serve a wide variety of coffee flavors in an ambience where
visitors can unwind themselves by indulging in various activities like playing
chess, scrabble or listen to the music and watch cricket on TV.

This is exactly what Café Coffee Day is doing, by serving coffee with
soulful music to their existing customers so that they can rejuvenate
themselves and be themselves rather than a place to be “seen at” vis a vis
other cafes. They provide the customers with the music they like with the
help of Q-Jam.

Apart from satisfying their customers with their favorite coffee’s and
music, Café Coffee Day in their effort to connect to its main customers,
youth, has had it tie up with various movie productions, launch a fun tabloid
for customers, sponsor deprived children, and more. Ms Sudipta Mukherjee,
Head (Marketing), Café Coffee Day, said the company had tied up with a
number of movies for in-film promotions. While the cafes have been used as
locations for a number of films in Tamil, Telugu and Kannada, they have
featured in Bas Yun Hi, a Hindi film featuring Nandita Das and Channel V
VJ Purab Kohli, and in Main Hoon Naa, choreographer Farah Khan's
maiden directorial venture starring Shah Rukh Khan and Sushmita Sen,

31
scheduled for release in January next year. In fact, for Main Hoon Naa, a
set of Café Coffee Day was constructed in Darjeeling and the cast and crew
were even served coffee from it!

Café Coffee Day had also tied-up with Dum, the Hindi film starring
the new kid on the block, Vivek Oberoi, and Diya Mirza. As part of the cross-
promotion, the two stars had visited selected Coffee Day outlets across the
country. Also, the `Dumdaar' contest, which was conducted where one gets
to enter on ordering a specially formulated `Dumdaar' coffee, which is a
strong blend of Hawaiian Kona and Monsoon Malabar variety, earns the
winner of the grand prize a coffee date with Diya Mirza. According to the
marketing head, for most films, including Dum, there has been no exchange
of cash involved considering the mutual benefit.

In-house research showed that after movies, it was sport and music
that were other passions with youth, and these were areas, which Coffee
Day would associate itself with

In addition, Café Coffee Day also relies on customer feed back

through regular feed back forms at all its outlets to be in the know of
customer preferences and tastes.

The company spends around 2 percent of its revenue on cross

promotions with other lifestyle brands and regular events like art exhibitions
and live music.

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MAJOR TIE-UP’S OF CAFÉ COFFEE DAY

 B4U Music, the music and lifestyle television channel for youth has
entered into a major retail tie-up with the Cafe Coffee Day.

In keeping with the tie up, 60 Cafe Coffee Day outlets spread across Delhi,
Mumbai, Chandigarh, Hyderabad, Chennai, Mangalore, Chikmagalore and
Pune, will beam only B4U Music. In turn, the channel that offers fashion,
music, trends, travel and lifestyle programmes, will offer free commercial
airtime to promote the coffee chain. The tie-up up between Cafe Coffee Day
and B4U also extends to on-ground promotions by the two.The coffee
outlets will see many events, contests and parties at its premises organised
by the TV channel. According to Cafe Coffee Day's marketing head Sudipta
Mukherji, "So far we've done sporadic, promotion-led advertising. With the
help of B4U, we're getting into building our brand."B4U Music has promised
between 10 and 12 commercial spots on the channel during prime time.
According to B4U officials, the tie-up is aimed at offering its viewers the
blend of finest coffee with good music.

 Ready To Go? Magazines: Café Coffee Day has tied-up with Ready
To Go? Magazines. These magazines would be available for reading
across cafe coffee day outlets in Bangalore, Mumbai, Chennai, Delhi,
Pune and Hyderabad. Yet another feature is A Ready to Go? Online
contest on the Cafe Coffee Day website, where the first 500 cafe
citizens participating in the contest would get a year’s worth of free
subscription to the magazine.

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  National Geographic Channel(NGC): cafe coffee day has aligned
nationally with National Geographic covering 92 cafes across 16
cities for NGC’s Mission Everest Contest, where five people have
been chosen for the ultimate mission. National Geographic will
telecast the entire expedition on Sundays at 7 pm. The reality show
will run for nine weeks from April 20 to June 15, 2003.
All one have to do is visit www.nationalgeographic.co.in, play the
game, win mileage points and you stand a chance of winning a whole
lot of goodies from National Geographic Channel. Apart from this, in
Bangalore, the National Geographic contest forms can be filled up by
the café customers who can drop their filled-out forms into a lucky dip
box at the café and lucky winners get to win National Geographic
merchandise — T-shirts, caps and jackets. Café Coffee Day
advertisements will now be featured regularly on air by the NGC till
May 30, 2003.
 Levi’s Jeans: Café Coffee Day and Levi’s are conducting a nation-
wide promo on the Dangerously Low range of their latest
denim line. The promotion will be running at all the Cafes for
two months from the 20th of April to the 20th of June. The
promotion includes a puzzle contest and a Special 6 Inches
below Coffee available only at the Café Coffee Day outlets.
Apart from thousands of Levi’s gift vouchers, the mega prize is an all-
expense paid trip to New Zealand which includes high-speed jet boat
rides, bungee jumping, rafting, helicopter rides and loads more.

Café Coffee Day is also involved in the promotion of the reality show
“Are You Hot Or Not”, which is showed on AXN channel. Café Coffee Day is
promoting this reality show in India. They have also promoted the recently
realeased Hindi feature movie Meri Nayee Podasan.

According to Sudipta mukherjee “ coffee shops have a high loyalty

factor: 60-70% of customers come in at least once a week. To preventing
fatigue from sitting in, we did some promos of our own- around the soccer

34
world cup, Valentine’s Day and Christmas. Companies like wrangler,
archies and weekender turned up on their own initiative to give away prizes
during those events. That set us thinking” ever since, there’s been a deluge
of advertisers, even Hindi movies and TV serials. Café coffee day has even
been designing special drinks for the products like the Levi 6” below jeans.

Cafe Coffee Day has promoted it self by doing number of Innovations

in the overall coffee retailing industry. The innovations are as follows-

INNOVATIONS

ABCTC ltd. did innovation by introducing India’s first Internet café in

1996 - Café coffee day. Since then Café Coffee day has done many
innovations in the total coffee-retailing sector and hence projected it’s image
as a ‘Café with a difference’.

Theses are some of the Innovations done by Café Coffee day over the
years….

Introduction Of touch Screen Digital Jukebox In the Café:

Bangalore, June 22, 2002- Café Coffee Day introduced the touch
screen digital Jukebox for the listening pleasure of its customers in all its
café's across the country. The Jukebox called "Q Jam" allows customers to
choose the songs they want to hear. .Q jam has been manufactured by Real
Image Media Technologies, a Mumbai based concern.

The touch screen digital Jukebox is operated by a remote server and

each can store about 1500 tracks. The digital database is divided into
categories like - music by genre, artist, album, mood, favorites, new
releases and top numbers in English and Hindi can be chosen. The dial up

35
facility enables the Jukebox to automatically download new songs from the
server the following day. Therefore new songs are played each day.

Even without any customer interaction, the Jukebox plays songs

continuously, but what has been a big hit with the customers is that it plays
requests and also offers a facility to dedicate a song. The user-friendly
touch-screen interface guides the user step-by-step through song selection
and dedication. If the user does not select any song, the Jukebox will pick
up songs at random from its database and play them.

Ms. Sudipta Mukherjee, Head - Marketing, Café Coffee Day says, "The
concept of this state-of the art Jukebox makes for a trendy, new-age feel
and fits perfectly with our scheme of things. Music is an important part of
the ambience in the café and the choice of music must rest with the
customer ".

Café Coffee Day launches its music café at New Friends Colony at New
Delhi

February 18, 2002 - Café Coffee Day launched its music café at New
Friends Colony in New Delhi. The café will feature live musical
entertainment. The aim of the music café is to bring the joy of live music in a
whole new way. This is the fourth Café Coffee Day outlet in New Delhi. The
other café's are at Ansal Plaza, Airport, Noida and Vikaspuri.

The café is centrally located at the Community Center at New

Friends Colony. Encompassing an area of 1,100 sq ft, the café is donned in
vibrant colours ranging from purple to lime green and yellow. Modern and
aesthetically designed furniture enhances the overall appearance of the
café. The Café will serve the choicest of coffee at affordable rates in an
ambience filled with good live music. Non-coffee beverages, pastries, ice
cream and desserts will also be served. The café will also have attractive
merchandise such as T-shirts, coffee mugs, caps, and badges.

36
 Mr. Naresh Malhotra, Director, Café Coffee Day said, "We envision
our café at New Friends Colony to be a place where great coffee and good
live music come together. Our café will provide an avenue for promoting
local talent. Weekends will feature live musical performances by best
musicians locally presenting top quality music. The idea is to offer a cosmic
mix of music to customers. There will always be something happening at the
café, which is the hotbed of new and youthful talent.

Introduction of a larger and stronger coffee called "Take Away Large" for the
coffee lovers at Café Coffee Day.

Bangalore, July 31, 2002 - Café Coffee Day introduced a large take
away hot coffee called the "Take Away Large". This coffee is strong
compared to the regular take away coffee and is topped with a thick layer of
froth. The freshly brewed coffee is served in a spill proof disposable cup and
is available at all café's across the country. Café Coffee Day is the only café
chain in India, which promotes the "Take Away" coffee concept
aggressively.

Ms. Sudipta Mukherjee, Head Marketing - Café Coffee Day said,

"The 'Take Away" concept at our café is extremely popular with those
customers who like to grab a good cup of fresh roast and ground coffee
while they are on the move. The reason to introduce the "Take Away Large"
is to offer this segment of customers a real coffee experience".

Customers will not only enjoy their favorite hot coffee in a large cup,
but also take with them a part of the café experience, which is what Café

37
Coffee Day is all about and is best summed in the tagline "A lot can happen
over coffee".

Cafe Coffee Day outlet launches a Café with wireless Internet access

Café Coffee Day announced the launch of the first customer loyalty
program in all its cafes across the country on July1 2002 in Banglore. "Café
Citizens Program" is a loyalty program launched through Net Carrots
Loyalty Services to reward regular customers How about surfing the internet
or carrying on with official work while sitting anywhere in a cafe, sipping a
hot cup of coffee? Sounds exciting, but is it possible? Yes. You can enjoy
the facility at the Lavelle Road outlet of Cafe Coffee Day in Bangalore,
which has achieved the unique distinction of becoming the country’s first
wireless public cyber cafe.Visitors at the outlet can now connect to the net,
surf or exchange mails from any corner of the cafe, be it indoor or outdoor.
The ‘Wi-Fi’ facility, which was launched on Feb 5th, 2003 uses Bangalore-
based Ittiam’s 802.11b Wireless LAN Access point prototype on one end
and handhelds/palmtops/laptops with the commercial off-the-shell WLAN
cards on the other.

38
 After the launch of this café Ms Sudipta Mukherjee head of marketing
department told a newspaper called Deccan Herald “Currently, the outlet is
providing visitors laptops and tablet PCs to surf the net free of cost. We are
yet to come up with pricing strategy for the facility. We are presently offering
visitors the devices so that they experience the new way of internet
surfing,”. However she added that the pricing structure would be finalised
within the next 10 days of the launch. Until then the service would be free of
cost.

Stating that it was a significant event in many respects, Mr Srini

Rajam, Chief Executive Officer of Ittiam said that it provided Ittiam an
opportunity to field test and demonstrate its complex technology. “We are
delighted to showcase our wireless LAN solution in a real life application,”
he added.

Hence café coffee day has given a new meaning to the whole Café
cocept by not only providing the best coffee and food but also the best
available technology to its customers.

Café Citizen Program

Café Coffee Day is the first café chain in India to introduce a customer
loyalty program.

Speaking on the launch of the "Café Citizens Program", Naresh Malhotra,

Director, Café Coffee Day said that they have found, that their Cafes have
become a favorite hang-out place for youngsters. So they wanted to
acknowledge and reward their loyalty to Café Coffee Day by giving them
(customers) a unique loyalty programme which provides instant benefits as
well as long-term surprises."

39
 Starting from July 1, 2002, any customer who bills a minimum of Rs.
100 on a single bill is automatically eligible for membership to the "Café
Citizens Program". However, if a customer has billed less than Rs 100,
he/she can pay Rs. 25, irrespective of the bill amount and avail membership
to the "Café Citizens Program".

The Café Citizens Card entitles members to a 10% discount on all

food and beverage bills for one year from the month of membership.
Through the "Café Citizens Program", members will also receive surprise
gifts when they reach total-billing amounts (across Café Coffee Days
outlets) of Rs. 2,500 (1st milestone), Rs. 5,000 (2nd milestone) and Rs
10,000 (3rd milestone) respectively. Members can track their total billing
spend at any Café Coffee Day outlet across the country. The Program also
entitles members to get special offers and invitations from Café Coffee Day.

Freedom From Illiteracy

Bangalore, August 13, 2002 - Café Coffee Day in a unique gesture

extended its financial support to CRY with the aim of educating 55 children
for one year. This move was with respect to India’s 55th Independence Day
celebrations.

Ms. Sudipta Mukherjee, Head - Marketing, Café Coffee Day, handed

a cheque of the initial amount to the underprivileged Children from a CRY
supported project.

40
Café Coffee Day collected the balanced amount by placing collection boxes
on behalf of CRY at all its café's across the country on August 15th they
carried out such collection till August 31,2002. Hence Café coffee day gave
its customers an opportunity to contribute towards CRY's child development
initiatives.

Ms. Sudipta Mukherjee said, "Café Coffee Day is happy to support

CRY by contributing to the education of 55 less privileged children. An
education will help these children thrive in a rapidly changing environment.
This gesture is a commitment towards building a happy society. This, we
felt, was the most appropriate way to celebrate the 55th year of our
country's Independence".

Appreciating the initiative taken by Café coffee day towards the

development of under privileged children. Mr. Cyriac Joseph, Senior
Manager, Resource Generation, CRY (South), said, "We appreciate Café
Coffee Day's initiative in making this donation and also for offering their
customers a unique opportunity to participate in CRY's efforts to change the
lives of underprivileged Indian children. We consider this donation as an
investment made by the company in the future of our country".

Dark Forest

The company recently launched a premium coffee known as “The

Dark Forest” in not only in India but also in other countries like Japan,US
and UK. Being tipped as the connoisseur’s coffee, ABCTCL wishes to put its

41
marketing and distribution network behind Dark Forest as also within the
reach of as many connoisseurs as possible in terms of affordability.

Piped as the country’s first single origin estate branded special

coffee, Dark Forest is priced at Rs 80 for 200 gms and Rs 175 for 500 gms.
The coffee is planned to be marketed both in India and abroad. The
company claims that the coffee pickers belong to the Lambini tribe while
curing and washing of the beans is undertaken at the 184 year old
Kathlekhan estate, which was taken over by ABCTCL in year 2000.
Thereafter, the beans are sent to the company’s own processing facilities
for roasting, grinding and filling.

Dark Forest will be available in the form of beans as well as pure

coffee powder. The company claims it has no additives, chikory or
otherwise. For the domestic buyer, Dark Forest will be retailed through the
current 32 cafes of the Cafe Cofee Day chain and the 250 Coffee Day retail
points spread all over the country. It will also be retailed through select
stores in major cities. A mail order option will be put in place soon as also a
web-based purchase mechanism.

CHAPTER 4

“MAJOR COMPETITORS OF CAFÉ COFFEE DAY”

42
  Existing Competitors.
o Qwiky’s Coffee Pub.
o Barista

 The New Competitors Are On the Way…

o Coffee Club ltd.
o Starbucks.
o Coffee Pai Café.
o Java Green.

EXISTING COMPETITORS

It is generally seen in today’s world that whenever a company does

innovation in a certain field, other companies also follow the same path and
come with more innovative ideas and concepts. Same is the case here- As
soon as café coffee day started getting popularity; other companies came
up with their own coffee pubs.
So now there are two major competitors for Café coffee day. These
are namely Qwiky’s coffee pub and Barista. Both these cafes have a strong
economic support and are giving very tough competition to Café coffee day.
Barista has made it’s presence in the minds of Sec-a people and has
become the fastest growing coffee chain in India.

43
 On the other hand Qwiky’s is a very slow moving competitor, which has
very limited outlets but has great potential to grow in the coming future.

Now let us have some insight of both theses competitors-

QWIKY’S COFFEE PUB

Qwiky’s: Inspired by the specialty coffee bar scene in the US, Shashi
Chimala the owner of the two software companies in the U.S set up Qwiky's
Corporation with a vision to set up coffee pubs around the globe.
Mr. Shashi Chimala the chief executive officer of 'Qwiky's was in the
second batch of the software engineers exported to us in the year 1979.
Shashi Chimala co-founded CBSI - now known as Convansys - a Nasdaq
listed company, in 1984, but left the firm to start Indigo Technologies in
1992 all by himself. The indigo technologies basically gave him a chance to
have innovations in the market. His company started offering products,
which were used by various Stock exchanges.

Chimala got an attractive deal from SSI Technologies in 1998: he

sold Indigo Technologies in return for stocks in SSI. The share price of the
SSI was around Rs 500 when he Indigo Technologies, but soon thereafter
jumped to Rs 2,500 and at onetime even touched Rs 7,000.

But then he decided to return to India and start a new business.

Chimala did not want to come up with a software firm because he knew that
the software bubble can burst at any time. After analyzing all the
opportunities, Chimala brewed a new idea. He decided to start a coffee pub
and sell coffee. And hence Qwiky’s came in to existence. The first Qwiky's
Coffee Pub was established in Chennai on October 1999. Qwiky's
expanded its operations through different formats: Qwiky's Coffee Pubs
which are stand-alone coffee bars, Qwiky's Coffee Islands which are store-
in-store units within large stores such as Lifestyle and RPG's Music World,
movie theatres and multiplexes and Qwiky's Coffee Xpress, which are

44
essentially coffee kiosks. By 2002, Qwiky's had 15 Pubs and Islands, and
15 Xpress kiosks, in Chennai, Hydrabad, Bangalore, Delhi and Pondicherry.
It has served more than a million cups of coffee in just two years.

Quicky’s in mumbai- the quicky’s has not at all taken mumbai as a

serious or potential market. That’s why it has only three islands in over all
mumbai. The islands are with collaboration of lifestyle. The three islands are
located in Mulund (armol), Phoenix, and in malad. The quicky’s have a plan
of opening the first standard outlet in mumbai in cross roads. The quicky’s
also have plans of opening it’s outlets in other countries like Singapore and
Srilanka.

A VISIT TO QWIKY’S COFFEE PUB

Qwiky’s is a latest coffee pub to strike mumbai in last one year. Qwiky’s
opened its first island in Armol mumbai .A visit was made to the Quicky’s
island located in Mulund (armol). Where Mr.K.Mahadevan the manager of
Quicky’s for the whole mumbai region was interviewed and the following
information was collected.

• Raw materials:

Qwiky’s get coffee from the plantations located in Chikmaglur. They

don’t own their own plantations like café coffee day does. But they claim
of having a strong links with plantation owners. For milk, Qwiky's are

45
dependent on the local suppliers. And for food Qwiky's have tied up with
Mr. Diren Kanvar a well-known chef.

• Number of Outlets in mumbai:

Qwiky's don’t have standard outlets but they have got islands in mumbai,
these islands are located in the lifestyle. One is here in Mulund and other
one is in phoenix (lower Parel). Qwiky’s has plan of opening another
island in malad, which would be again inside Lifestyle showroom.
Regarding standard outlets in mumbai they have plans of opening a
“Standard outlet” in Cross Roads

• Space for each outlet or Island:

According to Mr. Mahadewan, the outlets or islands should have not

more than 1000sq.ft of area because if the area is more that, then it
becomes a restaurant and not a café. The island in Mulund has a total
area of 970 sq.ft with a sitting capacity of 24/36 customers. He believes
that having area less than 1000sq.ft is very much economical

• Organization structure:

Qwiky’s have got 5 staff members in each outlet or island, consisting of

2 trainee baristas. Then there is a shift manager and an Outlet manager.
According to Mr. K.Mahadewan these many people are more than
enough to handle a single outlet.

• Recruitment of employees:

46
Qwiky’s recruit people as trainee baristas. And according to their
performance they promote them. In fact, Mr. Mahadevan joined Qwiky’s
as a trainee barista

• Recruitment on Qualification or on the personal skills:

While recruiting people, Qwiky’s give more preference to their personal

skills and the way they handle the customers. But Qwiky’s also consider
the qualification part. They recruit mostly management students and
hotel management students on the basis of their personal skills.

• Rewarding schemes:

Qwiky’s conduct everyday briefings. They give specific targets to their

employees’ everyday. Whenever any employee performs well, they get
appreciation letter, or some kind of a gift voucher etc. Qwiky’s don’t
believe in giving monetary incentives because that creates negative
competition.

• Customers :

Qwiky’s have all the type of customers right from families, college-going
crowd to business people. And also those customers who visit the
“lifestyle”. Dividing customers on income group Qwiky’s have both Sec-A
crowd as well as higher middle class crowd.

• Customer loyalty plan:

Basically Qwiky’s don’t consider customers as customers but they

consider customers as guests. They claim that to have developed an
emotional relationship with the customers. They know customers, by
their names, address they also know customer’s personal details like
birthdays etc. and accordingly they send birthday cards. They also know

47
what kind of coffee their customers like and they prepare coffee
according to their preference.

Qwiky’s also have a suggestion scheme where customers can

give suggestions regarding the over all working of the café. If they have
complaints we make sure that we correct our mistakes. Qwiky’s also
give free dinner and gifts to the customers who give the best suggestion.
In short Qwiky’s believe in” personalized café” kind of a system.

• Stand against competitors:

The only thing that makes Qwiky’s stand against their competitors is the
original coffee that they provide. According to Mr. Mahadewan the
competitors add some extra ingredients in coffee, which changes the
taste of the coffee but Qwiky’s is the exception. Qwiky’s do believe that
currently in mumbai they are not very popular. But since they have
entered just last year they expect to get popularity very soon.

• Promotion of Café:

As far as mumbai is concerned Qwiky’s don’t spend any amount on

advertisement. Because they have not entered mumbai in the “big way”
as other competitors have. Qwiky’s get their promotion through Lifestyle.
Whenever people see advertisement of lifestyle indirectly Qwiky’s also
get promoted.

• Future plans:

Qwiky’s have a plan of opening a standard outlet in mumbai. Also they

are opening two outlets in Srilanka and one outlet in Singapore next
year. Qwiky’s don’t believe in expanding at a very fast rate because it is

48
 not economical. And also they believe that, a café should get success
and popularity because of its quality. And not because of it’s Quantity.

BARISTA

One of the biggest and the strongest competitor of café coffee day is
Barista. Promoted by the New Delhi-based Java Coffee Company, Barista is
the fastest growing coffee retailing chain in the country. The brand takes its
name from the Italian term for a coffee brew master. Since beginning
Barista has tried to position itself as a fine café and not as a coffee pub that
Quicky’s and Café Coffee Day are. Its target customers are also different
from that of Quicky’s and Café Coffee day constituting professionals,
working couples and families in the SEC-A and SEC-B categories that
detest the loud ambience of coffee pubs.

From the beginning Barista's expansion plans have been quite

aggressive and the company's strategy takes an advantage by establishing

49
early presence across the country. There is a distinct first mover advantage
in this business and Barista planned to tap that. The first Barista outlet was
started in March 2000 in New Delhi, where tea is much more of a universal
drink than coffee. Currently, the company operates around 105 outlets
across the country.

Barista is exploring the opportunities of serving wide markets

including the ones overseas. In India, apart from the retail chains, the
company has initiated moves to tap the home brewing market by introducing
home brewing products and equipments. This apart, Barista has plans to
make a foray into branded merchandise such as caps, T-shirts, coffee mugs
and other coffee paraphernalia. The home brewing products include Barista
House Blend that is made out of Arabic coffee beans and priced at Rs. 120
for 200 grams. While the home brewing equipment includes the French
Press and Expresso Machines sourced from Swiss company, Bodum.
These moves are expected to take Barista's reach beyond the retail and
institutional segments that in turn would boost the demand for coffee
retailing market and develop the category as a whole.

THE NEW COMPETITORS ARE ON THE WAY…

In the near future Indian markets are going to be flooded by number

of national and international coffee bars. And hence these existing coffee
bars are going to face huge competition in coming future. The new
competitors are as follows-
COFFEE CLUB LTD.
Singapore-based Coffee Club Ltd., is all set to enter the Indian
markets. The company plans to open outlets in Chennai and Bangalore and
then move to Mumbai and Delhi. The company seems to have understood
different formats that are being run in India and is establishing outlets of two
types: Coffee Club and Coffee Club Xpress. The Coffee Club outlets are

50
targeted at professionals and other sophisticated up market customers who
prefer sophisticated service and are willing to pay a premium. Coffee Club
Xpress caters to the young and trendier customer segment on a self-service
basis and would have more of a mass appeal.

Each Coffee Club outlet will have a unit offering food, cakes and
pastries. In the Coffee Club it would be 55% beverages and 45% food and
in Xpress it would be 65% beverages and 35% food. The company is aiming
to differentiate itself from the competition by offering two different concepts
and very different theme as a lifestyle café. Company sources claim that all
Coffee Club/Xpress outlets would serve about 45 to 50 varieties of coffee
and each gourmet coffee that would be siphon-brewed to maintain the
delicate flavor and aroma.

But action would speed up once players like Starbucks, which is the
world leader in the coffee retailing market and is counted as one of the
strongest brands in the world enter India. The deep pockets combined with
their brand name and expertise in specialty coffee retailing is being looked
at as a formidable challenge for the current players.

STARBUCKS

After spreading the coffee culture around the world through its green-
and-white embalmed cafes, the $2.6bn Starbucks plans to sell its lattes in
India by early next year. A four-member team from Starbucks International
was here in June and has short-listed a few cities for the initial launch. The
company will initially set up shop in the three metros - Mumbai, Delhi and
Chennai.

Two to three pilot coffee shops will be opened in each of these cities,
and Starbucks is planning 2,000-2,500 sq ft area for each of them. After the

51
pilot stage, the company aims to open up to 25 outlets in each city, though
these would be much smaller, at 1,200-1,500 sq ft.

Sources say that Chennai will see the first Indian Starbucks. When
contacted, Pedro Man, president of Starbucks Asia Pacific, said “We are
excited about opportunities for Starbucks in India, but currently have no
announcements to make regarding the market."

Starbucks is one of the fastest growing brands in the world, after

entrepreneur Howard Schultz bought the chain 15 years ago. Since it went
public 10 years ago, Starbucks Coffee - with its 5,689 outlets in 28 countries
- has grown in sales at an average of 20% annually to $2.6bn in '01, and
profits have climbed at 30% annually to $181.2m last year.

Its green-and-white mermaid logo is omnipresent in markets such as

the US and Canada, making the company a favorite on the Wall Street. The
company's stock has soared 2,200% over the past decade, outstripping
such big daddies as Wal-Mart, PepsiCo, General Electric, Coca Cola and
Microsoft.

The Starbucks target audience is the hip, urban, on-the-go caffeine

addict, and the chain that originated in Seattle has got mega-plans for India.
In Round II, Starbucks plans to do research on other locations like
Bangalore, Hyderabad and Calcutta - the feasibility studies are slated to
happen later this year.

COFFEE PAI CAFE

THE café culture is on a roll with yet another café brand announcing
plans for a pan-India rollout over the next four years.

Pai's Foods Pvt Ltd, which has introduced the "more restaurant than
café" concept with the launch of Coffee Pai Café here in Kolkata on Aug

52
8th, announced plans to seek a nationwide presence with the setting up of
250 outlets in 36 cities across the country within the next four years.

To begin with, 15 cities, including Delhi, Mumbai, Pune, Chennai,

Hyderabad, Bangalore, Kolkata, Chandigarh and Jaipur, among others,
have been identified where Coffee Pai Café franchisee outlets would be set
up in the months ahead. In fact, the idea was to open 12 franchisees in
select cities within the next 12 months, this information was given by Mr
Naveen Pai, Director of Pai's Foods Pvt Ltd, at the time of the launch of the
café.

Along with a flavoured coffee range, outlets of the brand would serve
freshly prepared vegetarian and non-vegetarian dishes, which would be
priced at around Rs 120 at the higher-end. According to Mr. Pai "The idea
is to blend the Baristas and bawarchis”, he also added that Coffee Pai Café
offerings would range from pastas to paranthas.

Besides setting up the infrastructure, franchisees of Coffee Pai Café

would have to pay a one-time franchisee fee of Rs 2 lakh. Besides, 20 per
cent of the revenue that is generated would have to be given to Pai's Foods
as commission. "As a company, our earnings from franchisee fees and
commission during the current fiscal is expected to be around Rs 1.5 crore",
Mr. Pai said.

JAVA GREEN

The Reliance group is set to make a foray into coffee retailing

business by launching a coffee brand called Java Green, which will be sold
in its over 700 web stores across the country. Reliance Infocomm, which will

53
market the brand through the coffee bars inside its web stores, has also
finalised plans to set up independent Java Green coffee outlets shortly.
Reliance Infocomm, which in fact launched its nationwide chain of web
stores on January 26, is exploring the option of setting up standalone Java
Green outlets in Mumbai and Chennai shortly.

Sources close to Reliance Infocomm said the first coffee retail outlet
is expected to come up at Spencer Plaza, the shopping mall in Chennai.
Qwiky's, the Chennai-based coffee retailing company, will manage the
entire operation of the coffee bars housing Reliance Infocomm's web stores.
Sashi Chimala, who had set up Qwiky's five years ago, after working in the
US software industry for many years, is billed as the brain behind Reliance
Infocomm's coffee retail outlets.

"Java is actually the blend of three things. The name represents computer
script, Indonesian coffee and the beautiful peacocks of Bali," said a source
who was involved in the coffee retailing strategy for Reliance Infocomm.
Other beverage brands like Java Roll and Java Wraps will be sold through
the web store coffee outlets.

CHAPTER-6
“COSTOMER RESEARCH”

 Customer research on the latest offering of café coffee day –“

The merchandising products”

• The need

54
 • Objective of the research.

• Method of data collection.

• Analysis And Interpretation Of The data.

Scope Of The Study.

• Response of the customers.

• Problems Identified.

• Measures to be taken.

The Need

Café coffee day is one of the leading coffee chains in India. With
more than 120 outlets in the country, Cafe Coffee Day not only provides its
customers different varieties of coffee but also provides rich variety of food.
But recently Cafe Coffee Day entered in to a totally new dimension of
products-“MERCHANDISING PRODUCTS”. The merchandising products
consist of Caps, T-shirts, Bags and Coffee powders like the famous “Dark
Forest”.
But are the customers really aware of these products???
This is a very vital question, which requires an answer.
In order to answer such questions and to know the consumer behavior
towards Café Coffee Day’s merchandising products, a challenging project
was undertaken to make a study of the existing customers and give

55
 feedback and suggestions to the management on how to popularize Café
Coffee Day’s merchandising products and take it to the peaks.

Objectives of research
1. To know how far he (customer) is aware of Café Coffee Day’s
new merchandising products.
2. To know which Merchandising product(s) of Cafe Coffee Day he
likes.
3. To know any other merchandising product he would like to have.
4. To know what he feels about the prices of these products.
5. To know if he is interested in buying the gift vouchers of Cafe
Coffee Day..
6. To know what new merchandising products the customers wants.
7. To give proper feedback and suggestions to the management on
the basis of analysis to improvise on the situation.

Method Of Data Collection

i. Primary Data: The Company Profile is written on the basis of a

personal interview conducted on one to one basis with the
outlet manager Mrs.Pragnya of the Santacruz outlet (Head
Office). An appointment was taken for about an hour and
questions were shooted & the data was noted.

After studying the problem area a questionnaire was drafted to know the
behavior & feedback of the existing customers. The questionnaire was
prepared abiding by the guidelines to prepare it. The questionnaire
prepared was very objective with multiple alternatives along with yes & no
i.e., multichotomous and dichotomous questions. Most of the questions

56
were close ended but care was taken to introduce some open-ended
questions to enable the respondents to express their own views. Our guide
first corrected the questionnaire and then the final copy was given to the
head office of Café Coffee Day at Santacruz along with a request letter
signed by our principal to carry out this project. After getting the permission
from the head office this questionnaire was then taken to their outlets and
randomly 60 customers at 5 outlets were surveyed. While the customers
were answering the questions we personally sat with them asking counter
questions to know the reason behind marking a particular answer as the
questionnaire was very objective and could gather very less information. An
interview with the customer was possible at most of the time and people too
were very co-operative, and frank in giving answers.

ii. Secondary Data: This is the data collected on the various

other outlets owned by Café Coffee Day all over India. This
data was collected from the net from the website
www.cafecoffeeday.com.

Analysis And Interpretation Of The data

After all the questionnaires were filled, they were compiled and tabulated
based upon the responses given by the customers. After sorting out all the
questionnaires the tables were carefully analyzed and the data was
interpreted in the form of pie diagrams for visual presentation. After carefully
studying the problem, the responses and analyzing the situation,
suggestions were provided.

Scope Of The Study

57
 The study was made to know the customers of Café Coffee Day better.
The customers surveyed were the existing customers of Café Coffee Day.
This will help to know the likes and dislikes of the customers and with the
help of this information, changes can be made accordingly so as to satisfy
more number of customers. This study will also help to know what is the
feedback of the customers towards the merchandising products of Café
Coffee Day. One thing, which also became clear, was that the awareness of
these products was not up to the mark. This study will help the management
know the loopholes and fill in the gaps. It is also seen that if the
management itself takes a survey the opinion received is not very
dependable and frank but myself being an external authority, I could get
more reliable and correct information. The management itself accepted this
fact. Thus, this research will definitely be of extreme importance to Café
Coffee Day.

Response Of Customers Towards Café Coffee Day’s Merchandising

Products

58
 Q1. Age group?

2% 2%

13% Below 25
26 - 35
36 - 45
83% Above 45

From the survey that was conducted, it was found out that the major
customers for café coffee day are below 25 years of age. It can be seen
from the pie diagram that they constitute about 83% of the total customers.
This shows that majority of the customers are young college going students.
Then about 13% of the people are between the age of 26-35, these are
mainly working people who come to Cafe Coffee Day for business
proposals or just to relax after having a tired day at the office. Then about
2% of the customers are between the age group of 36-45 consisting of
mostly working class group. The remaining 2% are above the age group of
45. they basically come to Cafe Coffee Day with their friends or relatives.

Q2. Household Income per month?

59
 Below 15,000
24% 22%
Above 15,000 &
Below 30,000
Above 30,000 &
Below 45,000
20%
34% Above 45,000

Analysis:

From the pie – diagram above it can be seen that about 34% of the
customers have their household income above 15,000 & below 30,000,
whereas 22% of customers have their household income below 15,000. The
customers having above 30,000 & below 45,000 as their household income
comprises of about 20% of the total customers whereas 24% have their
household income above 45,000.

From the above observation we can see that major number of

customers have their monthly household income above 15,000 and below
30,000, which shows that the customers are mainly from upper middle class
families. The other customers who have monthly household income below
15,000 comprises of about 22%, which shows that they are mainly from the
middle class families. The above 45,000 group are mainly higher-class
people and they comprises of about 24% of the total customers visiting Café
Coffee Day.

60
Q3. At which time of the day do you prefer to visit the café?

9 a.m to 12 p.m
1% 13%
12 p.m to 3 p.m

15%
47% 3 p.m to 6 p.m

6 p.m to 9 p.m
24%
any time
preferable

Analysis:
From the pie – diagram above we can see that about 47% of the customers
prefer to visit the café at about 6 p.m to 9 p.m, whereas 24% prefer to visit
between 3 p.m to 6 p.m. The customers who like to visit the café during 12
p.m to 3 p.m and 9 a.m to 12 p.m are about 15% and 13% respectively
whereas those who preferred any time are just a mere 1%.

From the observation we can analyze that the major number of the
customers prefer to visit during the evening time, since according to them
that’s the time when they are free and when the colleges and offices are
closed. The customers who prefer to visit during noon are those who come
to the café’s during the break for hangout. There are very less customers
during the daytime as we can see from the observation that the number of
customers visiting the café are only in the range of 10% to 15%. Thus we
can analyze that the café’s are mostly crowded during the evening time i.e.

61
between 6 p.m to 9 p.m, whereas very less customers prefer to visit the
café’s during the daytime i.e. 9 a.m to 12 p.m & between 12 p.m to 3 p.m.

Q4. What made you aware of this place?

Outlet itself
6% 2%
6% Word of mouth

47% Newspaper
inserts
39% Radio

Multiple choices

Analysis:
the pie – diagram shows that about 47% of the customers knew about the
outlet itself while passing by, whereas 39% knew it by word of mouth. The
customers who came to know about Café Coffee Day through radio are just
about 6%. Those who became aware of the café through newspaper inserts
are also 6% of the total customers surveyed. The customers who ticked
more than one choice are about 2% of the total research conducted.

The above observation suggests that the promotional strategies of

Café Coffee Day are not up to the mark, since majority of the customers
came to know about the outlet while passing by, whereas others came to
know by those customers who have already visited the café i.e., through
word of mouth. Their strategy to use newspaper inserts and radio as a
medium to promote the café has not been able to provide them with their
desired results, since the customers who became aware of Café Coffee Day
through this medium is just about 6% of the total customers surveyed. So in

62
order to attract more number of customers the management should opt
other mediums like T.V, ads in newspapers etc.

Q5. How often do you visit Café Coffee Day?

22% 23% Once in a fortnight

Once in a month

Atleast once in a
week
23%
Twice in a week
32%

Analysis:
From the pie – diagram above it is observed that about 32% of the
customers visit the café once in a month, whereas 22% of the customers
visit the café twice in a week. The customers who visit fortnightly are about
23% and those who visit atleast once in a week are about 23% of the total
customers surveyed.

From the above observation, it is observed that the majority of the

customers who visit Café Coffee Day are occasional customers i.e., those
customers who visit the café only once in a month. Their regular customers
comprises of those who visit the café’s everyday, atleast once in a week or
twice in a week and the total percentage of these customers are about 45%
as compared to the occasional customers who are about 55% of the total

63
customers surveyed. These occasional customers are those who visit the
café’s once in a month or fortnightly.

Q6. What is the purpose of your visit?

9%
3% Hangout

8%
Kitty parties

Business
proposals
Any other
80%

Analysis:
From the pie – diagram above we can see that the about 80% of the
customers visit Café Coffee Day for hangout, whereas 8% of the customers
have visited the café for kitty parties. The customers who visit the café for
business proposals are a mere 3% as compared to those who visit the
café’s for any other purposes and these comprises of about 9% of the total
customer surveyed.

From the above observation we can analyze that the majority of the
customers visit the café’s for hangout i.e., they come to the café for enjoying
and spending some time with their friends or relatives. As according to
them, it is a place where they come to rejuvenate themselves and be

64
themselves rather than a place to be “seen at” vis a vis other cafes. The
other customers who visit the café for business proposals, kitty parties or for
any other purposes constitutes to a mere 20% of the total customers
surveyed. Thus we can say that the majority of the customers think of Café
Coffee Day as a place to hangout or to be with your friends or colleagues.
These cafes allow customers to spend as much time as they prefer and this
is what attracts the customers to these café’s.

Q7.What attracts you to this place?

31% Coffee
40% Price
Ambience
Music
5% Multiple choices

12%
12%

Analysis:

From the above pie diagram we can see that most of the customers have
preferred more than one choice i.e. they like most of the features of Cafe
Coffee Day. As we can see from the diagram it self that it comprises of 40%
of the total customers surveyed. The customers who only liked coffee in

65
Cafe Coffee Day are about 31%. Where as the customers who preferred
ambience and the music are both 12%. On the other hand there were only
5% of the customers who think that price is the major factor that has
attracted them to this café.

Q8. Are you aware of the merchandising products of cafe coffee day?

40%
Yes
No
60%

Analysis:

According to our findings, 60% of the customers that we interviewed were

aware of the merchandising products of café coffee day. On the other hand
about 40% of the customers were not aware of the products. Most of the
customers who were not aware of the café coffee day’s merchandising
products, visit café coffee day once in a month or once in a fortnight i.e
these are the occasional customers.

66
 Though majority of the customers of cafe coffee day are aware of the
merchandising products, cafe coffee day should take the other 40%
(customers who are not aware) very seriously and should try to display the
products in a much attractive manner. Though nearly all the outlets we
visited had a proper display of the products, the outlet situated in Chembur
had no display and so the products were not visible at all, this should be
taken in to consideration and proper steps should be taken to improve it.

Q9. Which merchandising product of cafe coffee day do you like?

13%

32% Mugs
T-shirts
25% Caps
Coffee Powder
Multiple choices

11% 19%

Analysis:

It was also tried to find out which merchandising products customers

liked the most. From the research it was found out that about 32% of the
customers like mugs. They especially liked the overall appearance and the
shape of the mugs. Then about 25% of the people liked the coffee powder,

67
specially the dark forest. About 19% of the people liked the t-shirts but only
thing that they complained was regarding the variety and sizes of the t-shirts
available. They also had a little childish appearance, which was not
preferred by the college going customers. about 13% of the people liked
more than one products but mostly they liked mugs and coffee powders.
Then only 11% of the people liked caps the amount of acceptance is low
because people think the prices of caps are high and the quality also is not
up to mark.

Q10. What do you feel about the prices of the products?

5%
26%

High
Reasonable
Low

69%

Analysis:

68
From the above pie diagram we can analyse that about 69% of the people
think that prices of the merchandising products are reasonable. While 26%
of the people think that the prices are high. And only 5% of the people have
opinion that the prices of the merchandising products are low. Customers
also said that they really feel that the prices of mugs are quite reasonable
enough. But many people thought the other items like caps and t-shirts were
not worth buying, since they said that by paying little more they could get
the branded ones.

Q11. Any other merchandising products, you would like to prefer?

16% 20% G ift vo u ch e rs

10% C h o co la te B o x
Bags
K e yrin g s
18%
36% Mu ltip le ch o ice s

Analysis:

69
The above pie diagram indicates what other merchandising products the
customers would like to have in future. We found out that 36% of the
customers would like to have Chocolate box as this can be presented as a
gift for any occasion. 20% of the people preferred gift vouchers. Where as
18% of the people wanted bags which can be used in their daily life. 16% of
the customers had multiple choices. But most of the people liked the
chocolate box. Only 10 % of the customers wanted Cafe Coffee Day key
rings.

Q12. How do you grade Café Coffee Day’s merchandising products?

19% 22%

Good
Excellent
Average
18%
Need to improve

41%

Analysis:

70
 Now let us see what is the opinion of the customers towards
these merchandising products of Café Coffee Day. About 41% of the
customers think that the products are just average. Then about 22% of
the customers grade it as good. 19% of the people said that the products
still need more improvement. The remaining 18 % think that the products
are excellent especially the mugs and the coffee powder.

Q13. Would you be interested in buying cafe coffee day’s gift vouchers?

34%
Yes
No
66%

Analysis:

71
If cafe coffee day launches gift voucher in the market , the customers
opinion to it is as follows : 66% of the customer will go for the gift voucher as
it completely new concept and latest arrival in cafe coffee day , whereas
34% of customer are not interested in these voucher scheme. Because
most of these customers are occasional customers and hence do not find it
interesting.

Q14. If yes, then in what denomination you will prefer it?

3%
13%
28% 50
100

21% 200
500
Multiple choices
35%

Analysis:

72
From the above pie chart we can analyze that most of the customers (35%)
would like to have gift vouchers in the range of Rs.100. where as about 28%
of the customers preferred to have gift vouchers in the range of Rs. 50.
21% of the customers preferred the range of Rs. 200 and 13% of the
customers would like to have gift voucher in the range of Rs.500. 3% of the
people would prefer any denomination given to them especially in the range
of Rs.100.

Problem’s Identified:

 The quality of the merchandising products is not good.

 There is no variety in the merchandising products for the
customers to choose from.
 The t-shirts and caps look as if they are meant for small kids.
 The promotional strategies for these merchandising products
are very poor.
 There is less awareness about these merchandising products.
 These products are not properly displayed because of which it
is hardly visible to the customers.

73
Measures to be taken:

1) The quality of the merchandising products should be

improved first.
2) The products should be promoted by distributing
pamphlets containing details about the products in
near by localities, colleges, households, offices,
shopping malls and inside the café etc.
3) The products should be displayed in such a manner
that it should be clearly visible to the customers as
soon as they enter the café’.
4) There should be more varieties available for the t-
shirts, caps, bags etc.
5) There should be more sizes available for the t-shirts &
the caps section.
6) The merchandising products could be given as a gift
to the regular customers who passes a certain bill
limit, so that he can atleast experience the products.
7) The merchandising products should have a very
attractive look. Then there should be a certain section
to attract children’s.
8) The prices of these products should be reduced to a
certain limit.
9) Some branded companies can also be approached to
provide t-shirts and other products.

These are some of the suggestions, which Café Coffee Day should follow in
order to increase their sales of merchandising products as well as the other
products.

CONCLUSION

74
 Hence it can be said that café coffee day has really changed the over all
dimension of coffee retailing industry by making coffee chain a very popular
and a trendy concept. It has successfully captured the middleclass and the
upper middle class customers of the country.
But as there are many achievements, there are many loop holes also.
Though Cafe Coffee Day has targeted higher middle class people by
providing specialized coffee in a very subsidized rate. It has somehow not
achieved the expected success in the overall Indian market. Barista on the
other hand targets SEC-A and SEC-B class people and is a leading coffee
chain in India. According to café coffee day manager Nilabh Banerjee Cafe
Coffee Day and barista are not competitors since they have different target
customers. but the fact is that Barista has able to capture upper segment of
the middle class and there by reducing customers of café coffee day.

Cafe Coffee Day should change its image in the market. Cafe
Coffee Day gives more importance to price rather than services and
ambience. Though low price is it’s Unique selling preposition. It can be seen
that it’s presentation and the ambience has been compromised on the
grounds of low price That’s why it has an image of a ‘café for economical
class’. Cafe Coffee Day should try to provide the best services and
ambience like barista does along with less prices. Thus creating an image of
a “Café for all”. for this it should not only target middle class but also sec-A
and sec-B crowd.
Cafe Coffee Day should focus on promotion rather than on expansion
In northen part of India, coffee culture is still a very new concept. People are
not really aware of the different types of coffee that the coffee chains
provide. In this case expansion in large scale will only create presence of a
café on the ground and not in the minds and hearts of the people.

Cafe Coffee Day should get strong hold of the local people. Other
cafés in mumbai like Independence café or Café Mocha they are very
popular locally and have a very large number of regular local customers.

75
Cafe Coffee Day should also try to get popularity in the local area. This can
be done by giving free coupons or gift vouchers to the local customers or by
arranging contests or competitions locally.
Café coffee day entered in to a totally new dimension of the products
that is the merchandising products . it was mainly done to increase the sales
and also to increase the popularity. But sadly the research shows that this
products except Coffee powder and Mugs were not at all liked by the
costumers. Most of the customers were not at all aware of this concept.
And those who were aware did not like the concept. Because according to
them the products offered were not at all stylish or appealing, and also had
quite high price. So café coffee day should try it’s best to improve the
existing merchandising products.

Also Cafe Coffee Day should not underestimate the number of coffee
chains, which are going to enter in the country in coming future. Though
Cafe Coffee Day have their own plantation and hence cost of raw materials
is less. But it does not mean it will have a strong hold in the future. Because
the upcoming coffee chains are already very much famous in the world and
have a very good brand image in the industry. E.g.- Starbuks, it does not
produce it’s own coffee but still it accounts for 1% of the total coffee
consumption in the world.

Also some of the Indian companies like reliance with Java Green and
Coffee Pai café. These companies also have a great potential to capture the
market.
So it can be concluded that café coffee day has been a strong player
in the overall coffee retailing game. But looking at the present and the future
scenario, it can be seen that this “Exciting game has just begin “

76
 BIBLIOGRAPHY.

WEB SITES
• www.cafecoffeeday.com
• www.mouthshut.com
• www.indiacoffee.com
• www.indiainfoline.com
• www.google.com
• www.yahoo.com

MAGAZINES
• Business world
• Business India.

• India today.

NEWS PAPERS
• Economic times.
• Indian express.

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