INTRODUCTION

“India’s favorite coffee shop, where the young at heart unwind.”

Café Coffee Day is a chain of coffee shops in India having its head quarters in Chikmagalur,

Karnataka. A division of Amalgamated Bean Coffee Trading Company Ltd. (ABCTCL), it is

commonly known as Coffee Day or CCD.

It opened its first cafe in 1996 on Brigade Road in Bangalore, and today has the largest cafe

retail chain in India - with 1481 cafes in 110 cities. Headquartered in Bangalore, a majority of its

cafes are also located in Bangalore.

The cafe chain has had much success riding, and to some extent creating, the cafe culture wave

that swept across metropolitan India following strong economic growth resulting in an increase

in youth spending power.

It has even tied up with World Space and Microsense to enable its cafes with satellite radio and

Wi-Fi, respectively. Its first Wi-Fi cafe was opened on Lavelle Road, Bangalore.

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GROWTH OF CAFÉ INDUSTRY IN INDIA

Hot beverages have always been a part of the tradition of India, especially South India. Coffee

took the first seat in South India when the traditional Brahmin classes brought down the

beverage from the ruling British around the 1930s. During the early years the drink was confined

only to traditional rich Brahmin families who served filter coffee in ‘davra- tumbler’. Coffee is

no more confined to the rich Brahmin class now, though the tradition of serving filter coffee in

the ‘davra- tumbler’ continues to this day.

In order to spread the drink, coffee houses emerged at various places in the country, which also

served as the opposite places for lawyers and the educated class to hold discussions ranging from

politics to cinema. It is also believed that many scripts and ideas for films evolved here. One of

the oldest coffee houses in South India is the Raayars mess, Chennai, which serves first class

filter coffee even today. The mess was established in the 1940s and continues the tradition of

coffee but supplements it with Tiffin also. The vintage location of the mess attracts huge crowds

even today early in the mornings, Coffee however was not the only item on the menu. These

places also served food and other drinks to their customers. The drink also became famous and

as a result even five star hotels began cashing in on it. Several hotels all over the country started

opening coffee- shops that catered to high- end customers. This showed the popularization of

coffee cafes, to all sections of society.

The drink has now become more of a concept than merely a drink itself. The last decade

witnesses the growth of numerous coffee pubs in the country. A number of coffee cafe owners

tried to westernize the taste in contrast to the filter coffee.

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Now, large retail chains like Qwikys, Barista, and Cafe Coffee Day have opened up around the

country. The concept of a cafe today is not merely about selling coffee, but about developing a

national brand. Retail cafes now form a multi- crore industry in the country, and have huge

potential for growth locally, and internationally. These cafes form the main focus of this project.

COMPANY HISTORY

Amalgamated Bean Coffee Trading Company Limited (ABCTCL) is an entrepreneurial venture

of Chairman, Mr. V. G. Siddhartha. His passion for coffee coupled with the opportunity provided

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by the deregulation of The Coffee- Board in 1993 created the perfect timing for the launch of this

company. Their visionary Chairman could foresee the demand for Indian coffee abroad and

ABCTCL began exporting coffee to coffee connoisseurs across USA, Europe & Japan.

The "Coffee Day" as brand was born in the year 1994. In the year 2000, Coffee Day exported

more than 27, 000 tonnes of coffee valued at US$ 60 m and for the second time in a short span of

7 years retained its position as the largest coffee exporter of India. In this short journey of 19

years, the company has grown into six divisions and has overtaken one milestone after another

without looking back. Mr. V. G. Siddhartha has a vision to further expand ABCTCL in the

domestic and overseas market.

Key Features:

125 years of coffee growing history

A fully equipped ISO certified roasting plant with a 70000 tonnes per annum capacity at

Hassan

5000 acres of self owned Coffee Plantations

A ready and enviable base of more than 10000 suppliers

Among the top exporters of coffee in India (Coffee Day Exports

COMPANY BACKGROUND

Coffee Day sources coffee from 5000 acres of coffee estates, the 2nd largest in Asia, that is

owned by a sister concern and from 11,000 small growers. It is one of India’s leading coffee

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exporters with clients across USA, Europe & Japan. With its roots in the golden soil of

Chikhmaglur, the home of some of the best Indian Coffees and with the vision of a true

entrepreneur nurturing it, Coffee Day has its business spanning the entire value chain of coffee

consumption in India.

Its different divisions include: Coffee Day Fresh n Ground (which owns 350 Coffee bean and

powder retail outlets), Coffee Day Xpress (which owns 251 Coffee Day Kiosk), Coffee Day

Take away (which owns 7000 Vending Machines), Coffee Day Exports and Coffee Day Perfect

(FMCG Packaged Coffee) division.

Café Coffee Day (CCD) pioneered the café concept in India in 1996 by opening its first café at

Brigade Road in Bangalore. Till about the late 1990’s coffee drinking in India was restricted to

the intellectual, the South Indian traditionalist and the five star coffee shop visitor. As the pure

(as opposed to instant coffee) coffee café culture in neighboring international markets grew, the

need for a relaxed and fun “hangout” for the emerging urban youth in the country was clearly

seen.

Recognizing the potential that lay ahead on the horizon, Café Coffee Day embarked on a

dynamic journey to become a large organized retail café chain with a distinct brand identity of its

own. From a handful of cafés in six cites in the first 5 years, CCD has become India’s largest and

premier retail chain of cafes with 1481 cafes in 110 cities around the country. Cafe Coffee Day

introduced the café culture in India with its first cafe at Brigade Road in Bangalore in 1996.

There has been no looking back for their company from then till now; in fact they have grown

from strength to strength.

Cafe Coffee day is the regular meeting place for 18 to 35 year olds, both male and female, who

are waited on by friendly and informed staff, and are offered the best made, hot or cold , in an

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invigorating ambience. They provide invigorating ambience and excellent customer service

clubbed with excellent coffee to their customers. Each cafe depending upon its size attracts

between 400 to 800 customers daily.

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

Chikmagalur and Hassan 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.

The following are ABCTCL 6 divisions:

Exports - India's largest coffee exporters. Currently export over 30000 tonnes of green coffee

per annum, i.e. 15% of India's coffee exports. They have also ventured into specialty coffee

exports.

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Coffee Day Fresh and Ground- Major player in the roast & ground filter coffee segment. It

provides a unique assortment of blends at affordable prices. The coffee is freshly ground in front

of the customer and sold to him.

Cafe Coffee Day - It is a place where customers come and rejuvenate themselves. It is a meeting

place for the young and the young at heart. In the café Hot and Cold coffee as well as

merchandise are sold to the customers.

Coffee Day Vending – To serve the man on the move who though hurry does not have to

compromise on quality of coffee he drinks. Coffee Day has its vending machine placed in vendor

outlets in major cities.

Coffee Day Express – Bridges the need gap between the leisurely cuppa and the bite at the café

and a quick drink at the vending point. In this segment you would notice kiosks strategically

positioned where a customer can not only drink coffee but also grab a quick bite on the move.

Coffee Day 'Perfect'- For mass-in-home consumption section where filter coffee is consumed

every day. The filter coffee is sold in packaged form to the customers.

CAFÉ FORMATS

Café Coffee Day has been experimenting with café formats for quite some time. Backed by the

motivation of providing customers with exciting choices as well as constantly redefining ‘the

café experience’, CCD has ventured into the following formats:

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Music Cafés provide customers with the choice of playing their favourite music tracks on the

Digital Audio Jukeboxes installed at the café! There are around 85 cafes with such jukeboxes. 32

cafes also provide customers with the visual treat of watching their favorite music videos by

means of Video Jukeboxes.

Book Cafés offer the perfect solution to people who think that the coffee experience is

incomplete without browsing through the bestsellers or reading a classic. CCD’s book corners

accentuate the age-old combination of ‘coffee and books’. This exciting concept has been

successfully tested at 15 cafes in 12 cities across India and the numbers are set to grow

exponentially. CCD has tied up with English Book Depot, one of India’s leading book

distributors for placement and rotation of reading materials appealing to Café Coffee Day’s

discerning customers.

Highway cafés presents the traveler en route not only with good coffee and scrumptious snacks

amidst great ambience but also with clean restrooms to get rid of that weariness from the road!

Lounge cafés at Hauz Khas, Delhi and Southern Avenue, Kolkata (Southern Avenue) and

Hyderabad (Jubilee Hills) combines the style and luxury of a lounge with the lively ambience

and comfort of a café. With exquisite interiors, exotic menu and thematic music, CCD Lounge

offers a whole new experience to the connoisseur while assisting the latter through its team of

hostesses who are poise and style incarnate and are looked upon as fashion icons.

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Garden cafés combine the joy of rejuvenating amidst verdant landscapes and pots of coffee.

Cyber cafés combine the urge to surf, & not to mention get connected through the internet while

enjoying perfectly brewed cups of coffees, both domestic as well as International blends! These

are of course just milestones.

CCD is about to launch Sports Café, Fashion Café & Singles Café…

Café Coffee Day comprises of the following Sub Brands

Coffee Day - Fresh & Ground

Cafe Coffee Day

Coffee Day – Vending

Coffee Day – Xpress

Coffee Day – Exports

Coffee Day – Perfect

“Actually, this seems to be the basic need of the human heart in

nearly every great crisis - a good hot cup of coffee.”

Cafe Coffee Day is a part of India's largest coffee company named Coffee Day, ISO 9002

certified company. Coffee Day's most unique aspect is that it grows the coffee it serves in its

cafes. Cafe Coffee Day's vending machines have a special niche in the market compared to

competitors because Cafe Coffee Day machines offer filter coffee unlike the instant coffee

offered by competitors' brands. Growing from a coffee exporter to a coffee parlour, cafe coffee

day has certainly come a long way in

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this segment.

CAFÉ COFFEE DAY VISION, MISSION AND VALUES- PRISM

VISION: “To be the only office for dialogue over a cup of coffee”

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MISSION: “To be the best Cafe chain by offering a world class coffee experience at affordable

prices.”

PRIDE - I take pride in my work and in my organization.

RESPECT - I respect my customers, my subordinates, my peers and my superiors.

INTEGRITY - I will show the highest level of integrity towards my work and my company

under all circumstances.

SELF - DISCIPLINE - I will imbibe and practice self-discipline in all my daily activities.

MOTIVATION - I will always be motivated to give the best for my organization, my team and

my customers.

MARKETING MIX OF CAFÉ COFFEE DAY

PRODUCT:

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Café Coffee Day product mix constitutes a wide range of products that appeal primarily to Indian

coffee and snack lovers. Products have a decided Indian taste to it - be it food or coffee . Most of

the eatables have been adopted to meet the Indian taste buds like samosa, biryani, masala

sandwich, tikka sandwich etc. Thus they have been trying to capture the Indian taste along with

classic coffee. The best selling item in summer is frappe, which is coffee and ice cream blended

together. The young people favor it. In winter it is cappuccino. Their merchandising includes

funky stuff like t-shirts, caps etc.

Product Mix:

Coffee & Tea Refreshing alternatives Eatables

Hot Coffees Granitas Melting Moments

EspressoEspresso AmericanoMacchiatoCappuccinoCafé LatteChococinnoCafé MochaIrish Coffee

Blood OrangeCool BluePineapple CrushEmerald IceRuby Surprise

Banana n’ Walnut CakeBanana Chocolate MousseBanana Caramel pieChocolate DoughnutCookiesMarble CakePineapple GetauxChocolate Cake

International Coffees Smoothies Ice-Creams

Colombian Juan ValdezEthiopian QahwahKenyan Safari

Mango ColadaStrawberry Colada

VanillaChocolateSeasons Best

Cold Coffees Cremosas Quick Bites

Sweet MintCold SparkleBrandied BananaTropical IcebergIced Eskimo

LitchiGinger SpicePina Colada

Samosa’sPuffPizzaCroissantFrench Fries

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Kathi RollWrapsBiryaniSandwichesKulchaBurgerPastaMasala Sandwich

Coffee Add-Ons Cool Refreshers

HoneyFlavoured SyrupsRed EyeWhipped CreamScoop pf Ice creamChocolate Sauce

Fruit JuicesMineral Water

Teas

Assam TeaMasala ChaiLemon ‘n Ice TeaKashmiri QahwahApple n Cranberry ice tea

Product Sources:

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Coffee Day's most unique aspect is that it grows the coffee it serves in its cafes. 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. The coffee beans are supplied

to all the cafés from Chikmagalur.

The eatables at Café Coffee Day are catered by different vendors: Example: Ice creams are

catered by Cream Bell & Amul, Milk by Amul and Samosa’s by Patsiers Gallery.

Café Coffee Day also sells merchandise through its stores. 5 per cent of the revenue comes from

sale of merchandise.

Quality standards:

Café Coffee Day has a check on quality all the time and in several aspects. The operational in-

charge will go around checking business, record keeping, and service and check the feedback

forms. The food in-charge will look at the way food is being stored, coffee is being made, what

is the time taken to extract the coffee and so on. Marketing person will go about checking

displays, how the merchandise are displayed

Serving Size:

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The serving size of a product is a measure, not only of quantity, but also of value for money. The

average serving size for Café Coffee Day’s main product categories is detailed in table:

Product Serving Size:

Product Quantity

Hot Coffee 210 ml

Cold Coffee 350 ml

Smoothies 350 ml

Granitas 350 ml

Role of Technology

Technology plays a major role in Café Coffee Day because all the work like billing, stock

maintenance, inventory control, etc is done with the help of computers.

For making the coffee and tea they require machines, which give an edge to the service provider

over local players like the small tea stall or coffee stall.

Merchandising:

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At Café Coffee Day merchandise started more as a sentimental thing than as a revenue stream.

They wanted to reward coffee lovers and they started selling mugs. People wanted to wear

something that reminded them of the cafe so they designed T-shirts and sold thousands of those.

But soon it has become a serious business. 5 per cent of their revenue comes from the

merchandising.

Café Coffee Day sells various young and trendy merchandises through its stores such as:

Caps

T-Shirts

Bags

Mugs

Coffee Filters

Coffee Powders

Coffee Mints

Pens

PRICES

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Considering that Café Coffee Day knows its major customer lies in the bracket of 15- 29, it has

tried to derive a policy whereby it can satisfy all its customers. The price for a cup of coffee

ranges from Rs.17 to Rs.54. From the time it first started its operations, there has been only

minor changes in the pricing policy of Café Coffee Day. The changes have been more due to the

government taxes than anything else. The main USP of Café Coffee Day has been its pricing

structure which is far more affordable than its competitors.

CCD has been able to keep their prices lower than their competitors because with the sudden

spurt of growth in number of outlets, came the benefits of economies of scale. Currently, their

prices are the lowest they have ever been, and they can competitively match their prices against

Barista’s prices. CCD could maintain its profit- maximization policy until it could earn large cost

savings because of the benefits of high volume. The main factors that affect their pricing are

their cost of goods sold. The costs are not as high as compared to competitors because unlike

others it does not import a majority of its products. Considering that CCD is trying to target a

market whose age range is between 15 and 55 years, a pricing policy appealing to this segment is

difficult. Extremely low prices act as a deterrent to some customers who might regard it as an

indicator or quality, while very high prices cannot be afforded by most of the youth. But since

CCD’s current consumer profile is quite young, their prices are mostly inexpensive, and at par

with their competitors.

LOCATION/ PLACE

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This is a prime factor in determining the success of a retail chain. However, Cafe Coffee Day has

adopted a top down approach, wherein they first identify the cities and then decide on precise

locations within its limits .While selecting a city CCD has devoted substantial management time

and effort in zeroing in on the cities where they are now situated. The selection of the cities was

based on the following criteria.

Sizeable population of executives, students and families in SEC A & CCD category.

High disposable income with people looking for new vistas in leisure and lifestyle

oriented concepts.

High level or organized retail activity.

Rapid socio- economic development.

Level of commercial importance (Industrial cities, state capitals etc.)

Number of educational establishments and opportunities available for employment.

The first CCD outlet was set up on July 11, 1996, at Brigade Road, Bangalore,

Karnataka. Following this, CCD opened over 1000 cafés throughout the nation by 2011. As of

July 2013, there are 1481 outlets across 28 states of India. Cafe Coffee Day has also started its

outlets in international cities like Karachi, Vienna, Dubai and Prague.

Café Coffee day, in June 2010, acquired Café Emporio, a café chain from the Czech Republic.

Cafe Emporio has 11 cafés in Czech Republic. While 7 of them are in Prague, 1 is in Brno and

Olomouc and 2 are at Freeport-Hate. Café Emporio runs on 2 formats similar to CCD’s regular

cafés and Lounge & Square set ups.

Café Coffee Day looks to cater to their target market with strategically located outlets. Their

outlets are generally located in High Street/ Family Entertainment Centers. Considering their

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generic appeal, there are CCD outlets located in and around Malls, Cinemas, Colleges, Offices,

etc. This endorses their brand image of a café that appeals to coffee lovers of all ages.

Distribution of outlets:

Every Café Coffee Day outlet is a part of India’s largest coffee conglomerate named Coffee Day.

Since all the cafes are owned by the company, it becomes easier for them conduct feedback

surveys like dipsticks etc. Coffee day’s most unique aspect is that it grows the coffee it serves in

its cafes. 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. Café Coffee Day currently operates 1481

outlets all over the country. They have a market presence in over 120 cities. Delhi, NCR alone

has more than 24 outlets, and the number of outlets in the area is increasing at a phenomenal

pace. Each café, depending upon its size attracts between 400 and 800 customers daily. In

addition to that they are also going abroad. They will open 50 outlets overseas in 10 cities.

Distribution of stock:

The distribution of coffee beans start from their roasting plant at Chikmagalur. The coffee beans

are sent to the main offices of north and south India on monthly basis. The outlets contact the

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Head Distributors on weekly basis. As far as other eatables are concerned, the inventory is

checked on daily basis and orders are placed according to the requirement. Café Coffee Day uses

its own store vehicle (small van) for transportation needs.

PROMOTION

Café Coffee Day does not believe in mass media promotions. But they are involved in all the

areas of serious consumer passion.

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Through television:

Café Coffee Day held a contest around a very popular programme on Zee English called Friends.

All the six lead characters are shown often visiting a coffee shop and a lot of youth like watching

the programme. That is why they had a contest running where customers could win Friends'

merchandise. The linkage was that it is a youth based programme and it had a coffee house.

They have tied up with Channel [V]'s Get Gorgeous contest. The reason being that a lot of their

young consumers are interested in careers. Modeling is a career that a lot of youngsters are

interested in and this was an excellent platform.

They have also done promotion for History Channel, where they have run promotion for

Hollywood Heroes. They had asked a few question and a lucky winner won a trip to Hollywood.

Ticket sales:

Café Coffee Day is involved in ticket sales in quite a few events, Enrique being one of them.

They were involved in WWE, Elton John, and Bryan Adams ticket sales. These acts are very

much appreciated by their consumers. It helps both the organizers as well as Café Coffee Day.

Organizers need to tell people where the tickets are available and single Café Coffee Day logo

says it all. From Café Coffee Day’s point of view, they always ask for a certain amount of tickets

around which they have a contest. Couples can win ticket for free. This in turn raises the

awareness level as cafe staff approaches the consumers to inform them about the contest. There

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is not a better publicity mechanism then the person who is serving you telling you about the

same.

Tie-ups:

Besides that Café Coffee Day also tie up lot of the youth brands. Their promise to the customer

is that a lot can happen over a coffee. So every time they try to ensure something good happens

to their customer. So they have a contest going on with Levis, another one with Scooty, Liril,

latest one with Airtel Friends.

Another placement area they have is with HDFC. HDFC wanted to promote their debit card and

they choose Café Coffee Day. So 21 cafes have debit card machines.

Association with movies:

Café Coffee Day also decided to stick with the next big thing i.e. Bollywood. Earlier a few

movies, whose target audience matched that of the consumers at Cafe Coffee Day, started

shooting a few scenes in the cafe. So they had a Hindi movie Bas Yun Hi and a couple of Telugu

and Tamil films with prominent Cafe Coffee Day brand placement . Later they took a conscious

decision of being seen in certain movies like Khakee and Main Hoon Na. As part of this effort,

the brand was placed smartly in two Bollywood ventures, the Amitabh Bachchan, Aishwarya

Rai, Vivek Oberoi starrer Kyun Ho Gaya Na, Sajid Nadiadwala's Salman Khan, Priyanka Chopra

starrer Mujhse Shaadi Karoge, as well as movies like Salman Khan starrer Lucky and Socha Na

Tha. The latest has been the movie “ Barfi” starring Ranbir Kapoor and Priyanka Chopra.

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A lot of serials are shot in Cafe Coffee Day. Like one of the very famous serial, Kahaani Ghar

Ghar Kii was shot.

Sales Promotion:

Café Coffee Day uses special ‘Café Citizen Card’ for rewarding Café Coffee Day’s customers. It

is a loyalty program to gain new customers and retain the existing ones. The Café Citizens Card

entitles members to a 10% discount on all food and beverage bills. The members also receive

surprise gifts, along with special offers and invitations from Café Coffee Day from time- to-

time. CCD’s sales promotion techniques include:

Giving away Gifts during occasions e.g. valentine day

Offering Coupons

Café Citizen card which allows regular members to avail discounts upto 20% and

become a member after a purchase amount of upto 2000 Rs.

Sugar free campaign which was mainly done to spread awareness of staying healthy

and fit by using the sugar free sachets

Discounts during festive times to members

PHYSICAL EVIDENCE

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Logo, Colors, Images:

Café Coffee Day has used bright red and green colors in its logo. RED stands for leadership and

vitality. It also stands for passion (for coffee). The GREEN stroke harks back to their coffee

growing heritage and the coffee plantations that they own. 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 it’s 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

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.

Décor & Architecture:

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Café Coffee Day had gone in for image change and revamping of interiors in the last quarter of

2001. Café interiors have been given a whole, new look. In a change from the largely wood and

granite based interiors, there is more of steel and lots more colour now. The young colours of

today, lime green, yellow, orange, and purple predominate.

Literature:

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The literature provided by Café Coffee Day is indicative of its youthful image. The menus,

posters, pamphlets are all designed to attract young and young at heart. They also have their

magazine called as ‘Café Beat’, which is published monthly at their Bangalore head office and

distributed throughout the branches.

PROCESS

The order process at Café Coffee Day is based on self-service, where the customer goes to the

counter to place his order. Whereas they have a flexible delivery process, where they wait for

some time for the customer to pick up the order but if the customer takes too long then the order

is delivered on his table. In some cases, the employee may approach the customer to take his

order and provide him with the same and also do the billing requirements.

PEOPLE

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People at Café Coffee Day believe that “People are hired for what they know but fired for how

they behave”. The people at Café Coffee Day are characteristically trained to be Pleasant, Polite

and Positive. They ensure you have a quiet, uninterrupted visit and provide an escape from the

daily pressures of life. Their uniforms are in sober shades of black and magenta, and contribute

to the overall laid-back feeling of the café.

Motivation and personal skill are laid emphasize upon. Their employees are like friends to the

customer but at the same time they know about the international standards of hygiene and

cleanliness and personal grooming.

POSITIONING OF CCD

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Customer Profile (Target Audience):

The café is a meeting place for 15-29 year olds, both male and female who are served the best

coffee by friendly and informed staff, in an uplifting and invigorating ambience.

60% of the customers who visit the café are male and 40% are female. 52% of customers who

visit the cafes are students.

Teenager’s form 25% of CCD’s customers while 37% of the customers are between the age

group of 20 to 24 years and another 24% belong to the age group of 25 to 29 years of age.

Customers within the age group of 30 to 34, 35 to 44 and > 45 form 4%, 5% and 5%

respectively.

18% of the customers visit the cafes daily while another 44% visit weekly. 22% of the customers

visit occasionally whereas 16% of the customers visit monthly.

Each café, depending upon its size, attracts 400- 800 customers daily, mainly between 4pm and

7pm.

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;

a place where they rejuvenate and are free to be themselves rather than a place to be “seen at” viz

a viz other cafes.

Brand Image:

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Café Coffee Day is a regular meeting place for 15 to 29 years old, both male and female, who are

waited on by friendly and informed staff, and are, offered the best made coffee, hot or cold,

beverages and food in an invigorating ambience. It is urban youngster’s favorite “hangout”. Its

customers are mostly young college students and young professionals. It is for those who are

young or young at heart.

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;

a place where they rejuvenate and are free to be themselves.

Café Coffee Day has created its brand image such as to revolve around the phrase:

“India’s favorite coffee shop, where the young at heart unwind.”

CAMPAIGNS & TIE-UPS UNDERTAKEN BY CAFÉ COFFEE DAY

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THE LEVI’S CAMPAIGN

The 6” Below the Naval Jeans campaign, the Sykes Reversible’s (Ulta Pulta) campaign, the

Levi’s 501 campaign, the TLTT (The Levi’s Torture Test), the ‘Hello Gorgeous’ campaign etc

all are some of the successful in café activations designed and executed for Levi’s. Every season

CCD becomes an important media for Levi’s to launch its new range of apparels. Along with

providing tremendous on ground visibility in terms of wall visuals, tent cards, danglers, posters

etc., a contest (wherein customers could win Levi’s clothes) is designed to inject customer

interactivity and to add excitement to the entire campaign. The cohesiveness of the entire

campaign is accentuated by creating a new drink and christening it as the Levi’s drink for the

promo period!

THE SUGAR FREE CAMPAIGN

In order to promote Sugar Free, CCD launched a “ Low calorie menu” in association with the

former for the calorie conscious. The new menu consisted of a wide range of Low calorie Hot

coffees, International coffees, Tea, Tropical Iceberg & a range of veg. and non-veg. food as well

as deserts like Lemon Soufflé to name a few. This menu was communicated to the customer by

means of Sugar Free branded menu boards, menu cards etc. Also, a few bottles of Sugar Free

were displayed at the counter to serve as a pointer to the on-going activity.

THE TVS SCOOTY VALENTINE CAMPAIGN

The Valentine month in 2004 witnessed an innovative campaign for TVS Scooty. CCD promoted

TVS Scooty by means of a creative promotion which besides adding visibility and customer

interactivity also conveyed the brand attitude to the end customer and helped them relate to the

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same. Through the ‘TVS Scooty Valentine Singles Campaign’, customers were asked to enter

the contest of why they would rather be single and make TVS Scooty their Valentine that year.

To add to the festivities of the Valentine month, CCD created 2 special combos called the TVS

Valentine Combos– Hot & Cold (2 ice blended Cold coffees/2 Café Mochas with a Chocolate

Fantasy). The contest was of course made attractive by the no. of freebies like Sony Discmans &

MP3 players etc. which customers stood to win. Not to mention the Mega prize of a 4 stroke

TVS Scooty for 2 lucky winners.

THE CHANNEL V- GET GORGEOUS HUNT

CCD was the exclusive on ground partner for the national hunt for the most gorgeous female

models by Channel V, wherein candidates could drop their entry forms with portfolio at any

CCD outlet. The event was heavily promoted by CCD through in café branding and on air by

Channel V. CCD also launched a new range of ‘Get Gorgeous drinks’ as part of the promotion.

Innovative collaterals like branded stirrers etc. were used to add that extra element of surprise.

So much so was the success of the campaign that Channel V has chosen CCD to be the on

ground partner for ‘Get Gorgeous- Parts to be launched in future too.

THE HIMALAYA HONEY CAMPAIGN

The Himalaya Drug Company had recently entered into a tie up with Café Coffee Day to

promote their honey. This honey was made available through over 100 Café Coffee Day outlets

across 7 cities, in a 3-month promotion where Coffee Day customers experienced the taste of

pure of honey in innovative ways. Honey Cappuccino, Honey milk shake, rich chocolate cake

and ice cream topped with honey and nuts! Four unique dishes were conceptualized by Café

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Coffee Day, each enriched with the goodness of pure Himalaya Honey. These were an instant hit

with the customers. In addition to honey-based items, bottles of Himalaya Forest Honey were

also available in all Coffee Day outlets.

MOVIE TIE-UPS

CCD has become an important national on ground partner for Production Houses to promote

movies better among the masses by means of colorful collaterals like – posters, tent cards,

danglers et al. Interactivity is ensured by conducting exciting contests around the movie wherein

customers with the correct answers stand to win movie cassettes, CDs, movie tickets as prizes

and also through a Lucky draw get a chance to win a ‘Coffee date with their favourite movie

stars’. Hence, the ‘touch & feel’ experience to the movie.

The ‘Mujhse Shaadi Karogi’ Promotion:

The contest, starting July 10, 2004 ran across 168 cafes in 42 cities for a month, where any

customer billing a ‘Shagun’ amount of Rs 301 was guaranteed to win at least one prize ranging

from audiocassettes to movie tickets and a chance to enter a lucky draw, which would win them

a coffee date with Priyanka Chopra. To heighten the excitement, CCD even created an ambience

of ‘Shaadi Season’ with cafe staff wearing heart shaped badges with ‘Mujhse Shaadi Karogi

Contest @ CCD’ pinned on their shirts. Creatively designed posters and tent cards in the

wedding card format were used as tools to encourage customers to be a part of this contest. CCD

has also tied up for promotions of movies like Barfi, Khakee, Bas yun hi, Main Hoon Na, etc.

CAFE COFFEE DAY IN ‘WI-FI' TIE-UP WITH MICROSENSE

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Cafe Coffee Day, the country's leading chain of cafes, has tied up with Microsense, provider of

wireless computing solutions, to Wi-Fi enable its coffee outlets across the country.

BANGALORE, DHNS: Partnering with Microsense, Cafe Coffee Day has already Wi-Fi

enabled 50 of its outlets across Bangalore, Mumbai, New Delhi and Chennai. The number would

increase to 100 by March, Cafe Coffee Day Chief Executive Officer Naresh Malhotra told

newsmen here on Monday. In a phased manner, all the Cafe Coffee Day outlets, spread over 50

cities, will be Wi-Fi enabled, he added. Pointing out that the cafes had been attracting huge

number of business customers; he said the partnership would enable laptop and PDA owners to

hook to the internet while sipping coffee at its outlets. Microsense Director N V Krishna said the

Wi-Fi service would feature plug and play functionality VPN support and always on

connectivity. It would be provided through post-paid and pre-paid access accounts supported by

a central authentication and billing platform developed and operated by microsense, he added.

CAFÉ BEAT MAGAZINE

Café Beat reaches more than a million smart, receptive and upwardly mobile youth of India

every month. It is one of the most widely read YOUTH magazines in the country and is a part of

one of the largest Indian retail youth brands – Café Coffee Day.

Café Beat Fact file:

12 pages, all color, monthly tabloid. Available at all cafes across the country. Available FREE of

cost to customers for in-café reading. Many customers also carry it away for their referrals. 38%

of the customers at CCD read Cafe Beat (survey conducted in Aug.'04 in the 4 metros.). CCD

gets around 3 million walk-ins in all its cafes per month. Essentially a youth magazine covering

topics like movies, music, travel, lifestyle, e-dating, books, career etc. which interest the youth

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displayed on magazine stands/counter at the cafes. The new issue is kept on the tables during the

first week for greater visibility.

Readership profile: Students and young professionals, mostly. SEC A and B.

TRAVELGURU & CAFÉ COFFEE DAY PROMISE HOLIDAYS SHOPPING

Cyber café’ gets a whole new meaning as Travel guru, India’s leading travel portal, today

announced a tie-up with Café Coffee Day to offer enticing gifts over coffee and cake. A

steaming cup could bring with it a holiday in hot Goa … a chilled frothy glass a cool getaway in

serene Leh. Travel shopping has become little more than a coffee session thanks to two of the

country’s most innovative and youthful brands!

Starting December all the way to February 2007, select Café Coffee Day outlets in Mumbai,

Delhi, Bangalore, Ahmedabad, Baroda, Chennai and Hyderabad are offering a Travel guru gift

voucher with every purchase of Rs.200/- or more. Every such voucher would take as much as Rs.

1000 off on hotel bills and vacation packages and Rs.200/- off on air-flight costs. Both offers are

valid for three months. To add to the excitement around the festive season, Travel guru is the

sole sponsor for Café Coffee Day’s month-long ‘Café Coffee Day Santa’ contest. Running

through the month of December, covering over 350 Café Coffee Day outlets, customers buying

two CCD gift certificates may send an SMS message with the bill number to 9880COFFEE.

Travelguru will hand out loads of travel gift vouchers to the winners of a lucky draw. One lucky

couple will get to enjoy an experience of a lifetime, by winning the Grand Prize – a 1-night

cruise experience for two people, courtesy Travel guru.

“Travel guru’s partnership with Café Coffee Day, the leading vendor in the lifestyle retail space,

is an exciting opportunity to market travel,” said Devyani Nagpal, Chief Marketing Officer-

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Travel guru. “This strategic partnership will allow Travel guru to offer customers phenomenal

deals on weekend getaways, vacation packages, cruises and hotel stays across 72000 hotels and

resorts across the Globe … bargains won over a cup of coffee!”

Café Coffee Day Director Naresh Malhotra echoed the enthusiasm: “We are very excited about

this strategic partnership with Travel guru, India’s largest hotel consolidator. This partnership

will help us offer our customers the best in travel deals across hotels, vacations, cruises and

airfares and meet their holiday needs. This makes their visit to Café Coffee Day more

experiential and rewarding. Looking to the future, we anticipate offering many innovative travel

shopping options, in conjunction with our travel partner Travel guru”. The partnership aims at

ultimately providing a unique travel shopping experience to Indian travel customers and making

travel very accessible to them. For now though, the crowd that “chills” out at Café Coffee Day

can go shopping for great value deals on India’s widest range of hotel and vacation options,

through Travelguru by just buying their favorite cup of latte!

AIR DECCAN TAKES CAFE COFFEE DAY TO THE SKIES

With Starbucks expected to enter the Indian market sooner rather than later, it seems logical that

India's leading fine coffee-cafe chain Cafe Coffee Day should take to the skies, courtesy the

country's pioneering low-budget airline which now links up more urban centers — 46 at last

count — than the competition. Both Air Deccan's parent company Deccan Aviation and Cafe

Coffee Day took off in the same year from India's Garden City.

Cafe Coffee Day, a division of the Rs 300-crore Amalgamated Bean Coffee Trading

conglomerate, will now be the single-point vend or supplying snacks and beverages on board all

of Deccan Air's 186 daily flights. Cafe Coffee Day (CCD) estimates that when the roll-out is in

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full flow, the four million passengers on board Deccan Air flights could add up to Rs 20 crore a

year to its annual turnover, at an average of Rs 50 per passenger. For Deccan Air, the tie-up

could enable the airlines to provide its passengers with reasonably priced snacks and beverages

of a standard quality. Which is what its passengers are said to have indicated a preference for in a

recent survey. The CCD service will begin with the Bangalore-Chennai flights, and will be

extended to other sectors progressively. Since CCD has a pan-India footprint, the strategy can be

implemented seamlessly even in smaller hinterland towns, where the competition —in both

aviation and the fine coffee cafe segment— does not have a presence. The MoU to this effect

was signed today by Air Deccan managing director Captain GR Gopinath and Cafe Coffee Day

director Naresh Malhotra. Speaking on the occasion, Capt Gopinath quipped that another factor

he and Amalgamated Bean Coffee Trading chairman VG Siddhartha and he owned neighboring

coffee estates.

CAFÉ COFFEE DAYS OUTLETS DOT ON PILGRIMS MAP

“Nothing catches the eyes as much as a swank CCD outlet as one enters temple towns”

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In 1996 with the chain's first café at Brigade Road, Bangalore, the company realized that the

urban Indian youth was looking at a place to relax and unwind and CCD filled this need gap. The

largest retail chain of cafes has today become one that every customer relates to as his/her

neighborhood 'hangout'. There is an element of familiarity that prompts one to visit the outlet

while one is on transit, thus CCD has outlets at airports, gas stations, highways, tourist

destinations and what's more even popular temple towns such as in Katra there are two cafes (en

route Vaishno Devi), Amritsar there is one café (the Golden Temple), Bhubaneshwar there are

three cafes (en route Jagannath Temple at Puri), Mathura highway has one café (birthplace of

Lord Krishna), Madurai has one café (the Meenakshi Temple).

Also within metros there are certain cafes right opposite holy places, which show a marked

increase in sales on certain specific days. For instance, the cafe opposite the Siddhivinayak

Temple in Mumbai records a marked increase in sales on Tuesdays every week or during the

eleven days of Ganesh Chaturthi. In Bangalore, opposite the café at Malleshwaram there is a Sai

Baba Temple that draws a good number of pilgrims on Thursday/Friday particularly in the first

week of the month; Sabarimala, a place that is frequented by pilgrims from November-January

culminating in the rare view of a sacred 'Jyothi'; at Manipal which is close to the Udupi Lord

Krishna temple, is frequented by pilgrims who visit here during the Janmashtami and last but not

the least the churches which are nearby the Panjim/Miramar cafe in Goa include Old Panjim

Church, Dona Paula church , St Inez, Caranzlem, Teligao that are very significant religious

places for travelers from Europe, etc. CCD has immediate plans to open outlets in Tirupati,

Varanasi and Allahabad.

COMPETITOR ANALYSIS

Major players in the industry:

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Following are the major players in coffee shop industry:

Barista Lavazza

One of India's largest franchised chains of coffee bars, the Barista Lavazza coffee

company operates around 250 outlets across India – 15 crème lounges and the rest

espresso coffee bars.

It plans to open 300 new stores over the next three years and has begun aggressively

marketing its products outside Indian borders into neighboring countries. Considered the

Starbucks of the East, Barista offers many of the same menu items like espresso, lattes,

cappuccino and various pastries, in addition to basic coffee. Despite being Indian, Barista

sticks closely to its Italian roots by serving Italian coffees exclusively.

Costa Coffee

British coffee retail chain Costa Coffee launched its outlet in New Delhi, becoming the

first international coffee chain to start operations in India in September 2005.

The chain is currently operational with more than 40 outlets and expanding aggressively

to tap this potential market.

Café Mocha

It was started by a Mumbai based entrepreneur Riyaz Amlani, who has a long experience

in the hotels and restaurants business. This store is strikingly different from others, they

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love being over-the-top and thus it’s a place that either you love it too much or find it

’Over the top’. Studying the marketing Mix adopted by café mocha. Owned by

Impresario Entertainment & Hospitality Pvt. Ltd, Mocha opened its doors at Church

gate (Mumbai) in December 2001.

It has 15 operational outlets across the country and its own central kitchen.

Future plans for Singapore, Dubai and New York and Chicago.

Other indirect Competitors include McDonalds, Pizza Hut, KFC, etc. that also offer hot/cold

coffees and similar kind of eatables.

Retail players like Reliance Retail and Shoppers Stop are also retailing coffee with their multi

products offering outlets like Reliance Timeout and Desi Café respectively.

32%

4%

48%

8%

8%

Competitors Analysis

Barista

Minerva Coffee Shop

Café Coffee Day

Gloria Jeans

Beyond Coffee

Café Mocha

Costa Coffee

SERVICE BLUEPRINT

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SERVICE ENCOUNTERS / MOMENTS OF TRUTH

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When the customer first enters the restaurant he can find AD posters on the front

glass of the Cafe Coffee Day.

After entering into Cafe Coffee Day, customer is guided by an employee, where he is

provided with a menu card for the order. Here customer can feel the ambience and the

décor of the restaurant. After giving an order to the employee, employee passes the

order to the front section of the kitchen. The employees in the front section would

pass the order to back-end kitchen where the order is prepaid. Parallel, employee

would update the billing machine. The prepared order is then served to the customer.

After availing the services and the products of Cafe Coffee Day, customer would ask

for Bill. Employee would then give the updated bill to the customer.

Customer will pay the bill either through cash or through credit/debit card. After

payment is done the database of Cafe Coffee Day gets updated.

After payment of the bill the customer leaves the restaurant.

SWOT ANALYSIS

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Strengths

Products of extremely good quality and taste.

It’s a youth oriented brand , hence huge potential since 40 % population is below 20

It produces/grows the coffee it serves hence reducing the cost.

USP of brand is it’s considered a highly affordable brand.

India's largest retail chain of cafes.

ISO 9002 certified company

Wide product line

Weakness

Weak brand image and lacks strength to maintain brand loyalty.

Poor ambience and decor. Café Coffee Day outlet served prime space for advertising and

promotions.

Many of the Café Coffee Day stores are incurring losses due to wrong site selection.

Focuses on Youth oriented brand image and targeting.

Opportunities

Coffee cafe industry is one of the fastest growing industries in Asia.

More people like to visit Café Coffee Day for informal meetings.

Café Coffee Day has gone international, and is planning to attract many new international

markets, hence gaining international recognition

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Threats

Competition with other coffee cafes like Barista, Mochas.

International Brands like Gloria Jeans, Coffee Bean & Tea Leaf and Illy Café.

Change in consumer taste and preferences

Other hukka parlors are also gaining lot of attention and preferred by young generation to hang

around which in turn is attracting the market captivated by Café Coffee Day.

PORTER’S FIVE FORCES MODEL

Threat of new entrants

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Threat of new entrants is high. As more and more international brands are looking towards India

as the new target Market. E.g.:-

Gloria Jeans

Star Bucks

Illy Café

Coffee Bean

Bargaining power of customers

Bargaining power of customers is high as more and more Cafes are coming. So Café Coffee Day

needs to keep the prices as per customers. The price should satisfy the customer and attract them.

Below mentioned are three factors to be considered:-

Price comparison

Variety of products

Service provided

 Bargaining power of Suppliers

Bargaining power of suppliers is very low as Café Coffee Day manufactures its own coffee bean.

More over the food items they buy from local suppliers are easily available and they can easily

change the suppliers as and when they want. Below are few factors mentioned regarding the

bargaining power of suppliers:-

Food items obtained from local suppliers

Follows backward integration

Coffee beans from its base in Bangalore

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Threat of substitutes

Threat from substitutes is very high. As there are Hukka Parlors, Other fruit juice joints are

becoming the new junction for youth. E.g.:-

Ice tea offered by Costa coffee

Coffee offered by other competitors

Cold drinks served in stadium

Competition within industry

Competition within the industry is very high. As there are number of old players like Barista,

Café Mocha, and Minerva are well established players in the market. Barista is also targeting the

same market segment i.e.; youth.

CONCLUSION AND RECOMMENDATIONS

The best known cup of coffee in town comes from here. You can't miss Cafe Coffee Day; if there

isn't one in your neighborhood, there's one near your college/office, You might as well give in,

they're taking over. The college crowd is big, because the rates are more or less affordable, office

goers hang out here at lunch breaks to take in the laid-back air of the place, first-dates meet here

because it's neutral ground, and couples because they're not likely to bump into their parents.

You're left alone to play your favorites on the jukebox and nurse your mug of coffee for however

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long you want. All at a price, of course - Rs. 5 per favorite song and around Rs. 25 for the drink.

The range of coffees here, both cold and hot, is impressive. The latte (with cinnamon, if you like

it that way), Irish coffee, Cappuccino and its chocolate-y version, the Mochaccino are the most

requested hot coffees. While the Frappe, with chocolate ice-cream blended in, the Tropical

Iceberg, which is the classic cold coffee, and the award winning Kaapi Nirvana are the chilled

favorites. Order cookies to go with it and, suddenly, none of your problems in life will seem like

such a big deal. CCD also does a decent job of the teas, of which it has only three, but the Masala

Chai is good. The eats here are also very popular, in fact, many people skip coffee altogether and

just come here for the grub. For the most part, though, the food here is nothing spectacular. Their

ever-changing menus haven't really improved matters, either. CCD also sells its own range of t-

shirts, coffee mugs and bags. Their line of pre-packed coffee powders is steeply priced, but there

is no dearth of takers, and the filter-coffee has some dedicated drinkers it’s hard to miss: It sports

a youthful look. Plush, pleasing interiors, plus colors such as lime green, yellow, purple and

orange predominate make Café Coffee Day a soft-low decibel spot for the trendy youth.

Café Coffee Day, a division of Amalgamated Bean Coffee Trading Company Ltd (ABCTCL),

has become a hot brand with the youth. Truly, if excitement has an address, it would be Café

Coffee Day. It’s just the place to be.

They have great plans of expanding their business internationally as well as domestically and

increase the number of their outlets considerably. It is one of India’s most successful brands that

have captured a huge place in the minds of the young as well as at heart.

CCD’s major competitors are Barista and McDonalds but CCD manages to stand strong due to

its marketing strategies and pricing structure. CCD initiative to make its presence felt all around

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places such as tourists spots, pilgrim places, temple towns, colleges/offices, campuses, etc. has

been the major reason of its success.

RECOMMENDATIONS

1. To improve the interiors and décor and also the quality of service.

2. To have more and more tie-ups and campaigns. So also conduct contests occasionally.

3. Introduce more products at competitive and affordable prices for college students.

4. Try to attract children by offering products for them and also provide gifts and toys by

having tie-ups with companies like Disney and Barbie like its competitor McDonald does.

5. To introduce more diverse merchandise and create a proper brand image for its merchandise.

6. Only 50 % or less than 50 % people find Café Coffee Day quality of service, ambience,

pricing and location to be very good which proves that still Café Coffee Day need to do lot of

homework in order to satisfy its customers.

7. It should introduce a feedback form system in order to know about the customer’s

satisfaction level.

REFERENCES:

India Today

Beat Magazine

www.cafecoffeeday.com

Donnelly, James H. and William R. George (1981), Marketing of Services, Chicago: American

Marketing Association.

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Marketing Management, Rajan Saxena, 3rd edition, Tata McGraw Hill Publishing Company Ltd.

www.timesofindia.com

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