Café Coffee Day –Final Project Report on: “Promotional Strategies For Cafes in Malls (Mall Activations)”SIP project report submitted in partial fulfillment of the requirements for the PGDM Programme By: Amit Kumar Singh (Roll no. : 11009) Project Supervisors: MR.ARUN P (Marketing Manager, Café Coffee Day) International School Of Business & Media, Pune (2010-12). Acknowledgements The completion of the project would not have been possible without the kind help and support of some people who helped me complete my assignment and helped in ensuring that any form of hindrance faced was countered with, effectively. My deepest respects to my Company Project Guide, Mr. Arun P(Marketing Manager, Café Coffee Day) whose expertise and knowledge helped me enhance my own knowledge in all major aspects of business. I would also like to thank Mr.K.Ramakrisnan (Marketing Head, Cafe Coffee Day) without whose co-operation and support nothing would have been possible. Lastly I would like to thank all the customers of Café Coffee Day who provided the necessary feedback and suggestions required to complete my surveys. 2 For my project on “Promotional Strategies For Cafes In Malls (Mall Activations)”. Kolkata Regional Office. The timeline for the project was Two month. The Projects were done keeping in mind that Café Coffee Day is a youth oriented enterprise and that attracting and satisfying also attracting more young and vibrant people in one of its primary objectives. I was asked to work on one projects namely “Promotional Strategies For Cafes In Malls (Mall Activations)”. 3 .Executive Summary I was involved with one project during my two month internship with Café Coffee Day. the research and Data Collection was done mainly through survey conducted on facebook as I was asked not to do a questionnaire inside the malls by my project guide. with increasing popularity of such Café chains. more and more players are entering the market with better products and services. Today‟s youth love their music and like socializing with friends and loved ones. one can bring the customer closer to the Café and increase brand loyalty. and light music playing in the background. the Café Chains in the country provide just what the youth wants. It sort of has a soothing effect which enables them to converse freely and share their experiences. are in popular demand in India mainly because of the ambience these Cafes provide to their consumers and also because of an increase in the number of coffee drinkers in the country. A culture of coffee drinking which originated from the south has been spreading throughout the country mainly after the inception of such Cafes. However. lavish seating. hence making it difficult for the existing players to retain or create new customers. By Doing the “Promotional Activities” wherein the customer gets discounts and other benefits. Such is the sort of ambience the youth normally prefer. If one walks into any Café.Introduction Today Café Chains like Café Coffee Day. Barista. 4 . Costa Coffee. Taking this into account. one can notice the trendy design. etc. other eating outlets in malls and Café Coffee Day were chosen because of their identical pattern of functioning and growth. while providing suggestions and recommendations for improvement. The aim of this Thesis is to successfully compare two prominent service sector companies on a common platform. QSR(quick snack restaurants).Objectives of the Study The objective of the project on “Promotional Strategies For Cafes In Malls” is “To study Café Coffee Day. 5 . and attempt to improve brand loyalty amongst their customers. This is why it is important to study how these brands differentiate themselves from each other. analyze their working and performance. They are the only major player or competitor for café coffee day in malls and their customers consider both as interchangeable brands. and highlight what they are doing well. identify areas of excellence and areas needing improvement. and provide suggestions for such improvement”. Concepts/Models used Project: “Promotional Strategies For Cafes In Malls (Mall Activations)”: Organizations need to retain existing customers while targeting non-customers. with the room. Customer satisfaction is an ambiguous and abstract concept and the actual manifestation of the state of satisfaction will vary from person to person and product/service to product/service. Measuring customer satisfaction provides an indication of how successful the organization is at providing products and/or services to the marketplace. for example. with the amenities in the room. A hotel. with the restaurants. and often is. Utilitarian benefits of a product are associated with the more instrumental and functional attributes of the product . but it is almost always reported at an aggregate level. Additionally. The state of satisfaction depends on a number of both psychological and physical variables which correlate with satisfaction behaviors such as return and recommend rate. measured along various dimensions. Work done by Parasuraman. evidence suggests that consumers purchase goods and services for a combination of two types of benefits: hedonic and utilitarian. The level of satisfaction can also vary depending on other options the customer may have and other products against which the customer can compare the organization's products. It can be. Hedonic benefits are associated with the sensory and experiential attributes of the product. Zeithaml and Berry between 1985 and 1988 provides the basis for the measurement of customer satisfaction with a service by using the gap between the customer's expectation of performance and their perceived experience of performance. Work done by 6 . Customer satisfaction is measured at the individual level. might ask customers to rate their experience with its front desk and check-in service. in a holistic sense. and so on. the hotel might ask about overall satisfaction “with your stay” As research on consumption experiences grows. This provides the measurer with a satisfaction "gap" which is objective and quantitative in nature. Regardless of the scale used. It is essential for firms to effectively manage customer satisfaction. The usual measures of customer satisfaction involve a survey with a set of statements using a Likert Technique or scale. Customer satisfaction data can also be collected on a 10-point scale. The customer is asked to evaluate each statement and in term of their perception and expectation of performance of the organization being measured. the objective is to measure customers‟ perceived satisfaction with their experience of a firm‟s offerings.Cronin and Taylor propose the "confirmation/disconfirmation" theory of combining the "gap" described by Parasuraman. Their satisfaction is generally measured on a five-point scale. we need accurate measurement of satisfaction 7 . To be able do this. Zeithaml and Berry as two different measures (perception and expectation of performance) into a single measurement of performance according to expectation. They began to boil the beans creating a drink they called „qahwa‟ which translates to ‘that which prevents sleep’. The drink became widely popular. The American retail café Starbucks in born. First known discovery of coffee berries.Industry details THE COFFEE CAFÉ INDUSTRY The beginning: It all began around 1000 A. The industry consists of a mix of individual cafés. when Arab traders began to cultivate coffee beans in large plantations. Legend of goat herder Kaldi of Ethiopia. Experiments with the berries himself and begins to feel happier. • Coffee is presently the second most traded commodity in the world. It is second only to oil. The Coffee Café Industry The Coffee Café industry is currently one of the biggest and fastest growing sectors in business.The first coffee trees are cultivated on the Arabian Peninsula. Interesting facts about Coffee & Cafés: • Coffee was first known in Europe as Arabian Wine. who notices goats are friskier after eating red barriers of a local shrub. hotel cafés and retail café chains.D. and the need for coffee beans grew. • Nescafe was invented by Nestle because it had to assist the Brazilian government to solve its coffee surplus problem. Coffee is now the world‟s most popular beverage. which leads to a boom in retail and hotel cafés. 8 . The work 9 . The bulk of these cafés are mainly in Europe. These retail chains have work with an organized structure of man.coffee. Any customer can walk into any major hotel in the world. and they provide customers with a homely. where every little town or village has local cafés. Retail Café Chains: The last. These cafés are not really major players in the coffee café industry. These cafés set themselves apart from retail chain cafés and hotel cafés because they provide customers with a homely. These coffeehouses are extremely important. material and money. where people gather together for a conversation over coffee. sitting at her local café. There are millions of such cafés around the world. The most recent example is the author J. It is a relatively unorganized sector. hotels all over the world started opening 24-hour coffee shops where visitors to the hotel could walk in for a cup of coffee and some food at any time.K. which cannot be emulated. casual experience. and enter the coffeehouse. Off late.Individual Cafés: The main bulk of revenue is earned by small. revolutionaries and thinkers of our time. individual cafés. Hotel Cafés: Ever since the popularization of coffee. but rather provide supplementary services to the hotel industry. because they provide international visitors to the hotel with a universal drink. Rowling. run mostly by families and friends. and know what to expect. and the most organized sector in the coffee café industry. is the retail café chain. these chains have become extremely popular and are growing at an ever-increasing pace. who has written most of the Harry Potter series of books. These cafés have been the birthplace and sanctuary for various creative minds. or just to be alone with their thoughts. classic appeal. Several hotels all over the country started opening coffee.tumbler‟ continues to this day. These places also served food and other drinks to their customers.on developing a recognized brand consistent to all their outlets. The mess was established in the 1940s and continues the tradition of coffee but supplements it with Tiffin also. During the early years the drink was confined only to traditional rich Brahmin families who served filter coffee in a „davra. It is also believed that many scripts and ideas for films evolved here. Coffee however was not the only item on the menu. wherever they go. The drink also became famous and as a result even five star hotels began cashing in on it.end customers. In order to spread the drink. though the tradition of serving filter coffee in the „davra. coffee houses emerged at various places in the country.shops that catered to high. One of the oldest coffee houses in South India is the Raayars mess. They provide customers with a standardized level of service and quality at each of their outlets. Chennai. which serves first class filter coffee even today. Customers can do to any Starbucks across the world and know exactly what to expect. The main focus of my project is increase the number of walk-ins per day in cafes in malls and eventually increase the sales in Café Coffee Day Growth of Café Industry in India Hot beverages have always been a part of the tradition of India. which also served as the opposite places for lawyers and the educated class to hold discussions ranging from politics to cinema. Coffee is no more confined to the rich Brahmin class now. The vast popularity of these retail chains is shown in the rapid international growth of brands like Starbucks. especially South India. to all sections of society.tumbler‟. Coffee took the first seat in South India when the traditional Brahmin classes brought down the beverage from the ruling British around the 1930s. which customers can easily relate to. The vintage location of the mess attracts huge crowds even today early in the mornings. 10 . This showed the popularization of coffee cafés. Barista. and internationally. A number of coffee café owners tried to westernize the taste in contrast to the filter coffee. The last decade witnesses the growth of numerous coffee pubs in the country. and Café Coffee Day have opened up around the country. 11 . Now. The concept of a café today is not merely about selling coffee. large retail chains like Qwikys.crore industry in the country. Retail cafés now form a multi. but about developing a national brand.The drink has now become more of a concept than merely a drink itself. and have huge potential for growth locally. 000 tonnes of coffee per annum. for the second time in its short career of 7 years retained the position as the largest coffee exporter of India. popularly known as Coffee Day was formed. The process is carried out under the control of experienced personnel to meet highest quality standards. In the calendar year 2000. the largest in the country. which yielded rich coffee beans. Coffee Day began exporting coffee to the connoisseurs across USA. 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 exported more than 27000 tones of coffee valued at US$ 60 m to these countries and. Coffee Day has a wide and professional network in the major coffee growing areas of the country comprising over 48 agents and 50 collecting depots. Europe & Japan. Coffee Day's two curing works at Chikmagalur and Hassan cure over 70. Soon Amalgamated Bean Coffee Trading Company Limited. Coffee Day has a well-equipped roasting unit catering to the specific requirement of the consumers. 12 . The most modern technology available is used to maintain consistency and roast the coffee beans to the demanding specifications of the discerning coffee consumers.CAFÉ COFFEE DAY Corporate Profile It was in the golden soil of Chikmagalur that a traditional family owned a few acres of coffee estates. • USP of the Brand: Affordable Price 13 . ISO 9002 certified company.Xpress Coffee Day – Exports Coffee Day . Coffee Day's most unique aspect is that it grows the coffee it serves. Key Features • Pioneers of the Café Concept in India with the its first Café at Brigade Road. depending upon its size attracts between 400 and 800 customers daily. This Café was opened as a Cyber Café (first of its kind) but later.Fresh & Ground Café Coffee Day Coffee Day – Vending Coffee Day . • Essentially a youth oriented brand with majority of its customers falling in the 1529 year age bracket • Each café. It is a part of India's largest coffee conglomerate named Coffee Day. Bangalore in 1996. with the burst of cyber cafes it reverted to its core competency Coffee.Perfect Café Coffee Day currently owns and operates over 1090 cafes in all major cities in India.Coffee Day Comprises of the following Sub Brands Coffee Day . • It is a place where customers come to rejuvenate themselves and be themselves. Milk by Amul and samosa‟s by Patsiers Gallery. The average serving size for Café Coffee Day‟s main product categories is 14 . 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 food in-charge will look at the way food is being stored. Product Sources: Coffee Day's most unique aspect is that it grows the coffee it serves in its cafes. Café Coffee Day also sells merchandise through its stores. Marketing person will go about checking displays. The operational incharge will go around checking business.Quality Coffee – Winner of Platinum. but also of value for money. what is the time take to extract the coffee and so on. how the merchandise are displayed Serving Size:The serving size of a product is a measure. Quality standards: Café Coffee Day has a check on quality all the time and in several aspects. record keeping service and check the feedback forms. The eatables at Café Coffee Day are catered by different vendors: example: ice creams are catered by Cream Bell. Gold. Silver and Bronze medals at the India Barista Championship 2002. 5 per cent of the revenue comes from sale of merchandise. not only of quantity. The coffee beans are supplied to all the cafés from Chikmagalur. coffee is being made. Coffee Day has a well-equipped roasting unit catering to the specific requirement of the consumers. Product Serving Size Hot Coffee 210 ml Cold Coffee 350 ml Smoothies 350 ml Granitas 350 ml Merchandising: At Café Coffee Day merchandise started more as a sentimental thing than as a revenue stream. But soon it has become a serious business. People wanted to wear something that reminded them of the cafe so they designed T-shirts and sold thousands of those. Café Coffee Day sells various young and trendy merchandise through its stores: Caps T-Shirts Bags Mugs Coffee Filters Coffee Powders Coffee Mints Pens 15 . They wanted to reward coffee lovers and they started selling mugs. 5 per cent of their revenue comes from the merchandising. where the customer goes to the counter to place his order. 16 . both male and female.Process: The order process at Café Coffee Day is based on self-service. 27% of the customers are between the age group of 25-29 years. 52% of customers who visit the cafes are students. It is urban youngster‟s favorite “hangout”. It is a place where they meet friends and colleagues. 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. who are waited on by friendly and informed staff. Brand Image Café Coffee Day is a regular meeting place for 15 to 29 years old. 60% of the customers who visit the café are male and 40% are female. beverages and food in an invigorating ambience. Positioning: Consumer Profile: Research shows that 37% of the customers are between 20 and 24years. 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. depending upon its size attracts between 500 and 800 customers daily. 18% of the customers visit the cafes daily while another 44% visit weekly. in groups of 3 or more. Whereas they have a flexible delivery process. Customers describe Café Coffee Day as the place they frequent most after “home and workplace/college”. Each café. hot or cold. mainly between 4pm and 7 pm. and are offered the best made coffee. Their merchandising includes funky stuff like t-shirts. it has tried to derive a policy whereby it can satisfy all its customers.Its customers are mostly young college students and young professionals. The From the time it first started its operations. Thus they have been trying to capture the Indian taste along with classic coffee. caps etc. The best selling item in summer is frappe. tikka sandwich etc. biryani. It is for those who are young or young at heart. In winter it is cappuccino. Most of the eatables have been adopted to meet the Indian taste buds like samosa. Motivation and personal skill are laid emphasize upon. The young people favor it. People: People at Café Coffee Day believe that “People are hired for what they know but fired for how they behave”. masala sandwich. The changes have been more due to the government taxes than any thing else. 17 . products have a decided Indian taste to it . Products: Café Coffee Day product mix constitutes a wide range of products that appeal primarily to Indian coffee and snack lovers. which is coffee and ice cream blended together.be it food or coffee. Prices: Considering that Café Coffee Day knows its major customer lies in the bracket of 15. there has been only minor changes in the pricing policy of Café Coffee Day.29. 18 . It symbolizes what Café Coffee Day is all about. lime green.having a chat and relaxing and enjoying in the company of friends over a cup of coffee. there is more of steel and lots more color now. The young colors of today. Images: Café Coffee Days logo is a Dialogue box in red and white. new look. yellow.Physical Evidence: a) Logo. In a change from the largely wood and granite based interiors. Décor & Architecture: Café Coffee Day had gone in for image change and revamping of interiors in the last quarter of 2001. orange. Café interiors have been given a whole. Colors. and purple predominate. Locations: Café Coffee Day looks to cater to their target market with strategically located outlets. Cinemas. Offices. They also have their magazine called as „Café Beat‟. there are Barista outlets located in and around Malls. The menus. All the six lead characters are shown often visiting a coffee shop and a lot of youth like watching the programmed. The linkage was that it is a youth based Programmed and it had a coffee house. posters. Considering their generic appeal. Colleges. pamphlets are all designed to attract young and young at heart.Literature: The literature provided by Café Coffee Day is indicative of its youthful image. 19 . But they are involved in all the areas of serious consumer passion. This endorses their brand image of a café that appeals to coffee lovers of all ages. Through television: Café Coffee Day held a contest around a very popular programmed on Zee English called Friends. That is why they had a contest running where customers could win Friends' merchandise. which is published monthly at their Bangalore head office and distributed throughout the branches. etc. Promotion: Café Coffee Day does not believe in mass media promotions. Their outlets are generally located in High Street/ Family Entertainment Centers. The areas of excellence and improvement have been identified based on factual information. They have also done promotion for History Channel. so the information is relative to this city. I was given approximately 10000 coupons to be distributed with help of a promoter outside or within the malls and the idea was put forward by me to simply increase the walk-ins in the café to eventually increase the sales. India. books and Internet and newspapers. where they have run promotion for Hollywood Heroes. Customers visiting QSR‟s and Café Coffee Day outlets. They had asked a few question and a lucky winner won a trip to Hollywood. Social Media: CCD also communicates with its customers and potential customers using Facebook and Twitter. Besides the primary data collected with the help of the survey on facebook. The reason being that a lot of their young consumers are interested in careers. in light of which recommendations and suggestions have been provided for the overall improvement of the organizations in the future. a comparative analysis has been done so as to find out the areas of excellence and areas of improvement of both organizations. The data was collected based on information provided by: 1. This Thesis was conducted in 2011 in Kolkata. Modeling is a career that a lot of youngsters are interested in and this was an excellent platform. Methodology used For the project on “Promotional Strategy For Cafes In Malls”. I have also collected the relevant secondary data from various sources like magazines. Based on the relevant primary and secondary data. 2. The management of the organization. 20 .They have tied up with Channel [V]'s Get Gorgeous contest. It was conducted only on peak hours(11 am to 2 pm and 5pm to 8 pm). This survey was conducted in the month of April and May. The target age group was 16-45. This had to be done without the knowledge of the Café team.• • • • • The survey was conducted in the Cafes in Malls in Kolkata only. 21 . Interpretations and conclusions/summary Customer Connect in any form of business is very essential. The Café Coffee Day brand is. we even see that where Café Coffee Day has an edge over its competitor Barista when it comes to Ambience. and always has been. Service and Pricing. it does need to work on its Core Product. both for their prices and for their value for money. 22 . extremely youth. Ina country where over 40% of the population is under the age of 20. This strategy has worked extremely well so far. there is huge potential for Café Coffee Day to become one of the country‟s largest youth brands. and Café Coffee Day got a high rating. in the market survey. where Barista wins. By Measuring Customer Expectations one can not only improve oneself but also come up with new innovative and fresh ideas so as to increase customer satisfaction hence increasing Café footfall even more. Café Coffee Day is projected as an “affordable” brand.oriented. The untapped market share and potential for growth is enormous. From the survey conducted to measure “Customer Expectations” it is evident that more and more people are starting to experience the atmosphere provided by the Cafes. Moreover. long-term customer perception of the brand isn‟t very positive. and not printed advertisements and posters everywhere. Customers are not 23 . Install coolers for outside seating.Recommendations As far as customer Satisfaction is concerned Café Coffee Day is doing quite well. its current training policies. wherever unnecessary advertising is taking place. Although it might be an important source of revenue. it has to counter stiff competition from competitors and new entrants. But there are still certain areas where their brand needs to be much stronger. My second recommendation is that Café Coffee Day looks at its current recruitment. Café Coffee Day needs to do a lot of work if they hope to catch up with Barista. For Café Coffee Day: • • • • • • • More range in food products Eggless pastries. Magazines . Make seating less congested. My first recommendation for Café Coffee Day is to clean up the décor at every outlet. newspapers and puzzles on table. Deduction in prices of some items. selection and most importantly. However. momos wanted in menu. With regard to the physical evidence associated with the brand. Café Coffee Day has done extremely well so far to project itself as unaffordable youthoriented brand. TV shows only DD1 in some cafes. Café Coffee Day would do better to provide promotional space for its partners with the use of clever collaborations. 24 . and Café Coffee Day is lagging far behind Barista is this aspect. For Barista: • • • • • • • • Lower prices for all products. Lower wait time Quicker service.happy with the behavior and service of the staff. Bring more variety in food Want More Indian food in menu. Open more outlets. Want better music. Keep environment a few feet outside cafes also clean. e. Kolkata.Limitations of the Study For the project on “Promotional Strategies For Cafes In Malls”. The study was conducted only for Cafes in Malls in Kolkata i. 25 . I was not allowed to interact with the Café team and also the customers inside the cafe at any point of time during the survey i. my interactions were limited to just my friends online and also people going into the mall and not the customers sitting in the café and also coming out of the malls and to the people in the Regional office .e. for the Cafes in the city only. They felt as if the café‟s had been hijacked just for advertising. This has to be taken care of. Although a high rating has been received by both Café Coffee Day and Barista in most of the parameters. If the existing players play it right. both have to work on “pricing”. it will without doubt become on of the best Café chains in the world. The Café Coffee Day brand. Café Coffee Day already has a separate department for digital marketing which has been working on digital menus and other related aspects. Moreover cleanliness of the Cafes is also important. If it does work on these aspects. The Seating in the Cafes is good. 26 . but not as good as the prices they charge.oriented brand. This could prove as a deterrent during future national and international expansion. A lot of respondents did not like the fact that Café Coffee Day outlets and literature served as prime space for allot of advertising and promotions. they would without doubt manage to create a healthy market for themselves creating a sort of barrier for new entrants.Scope for future improvements The Café Business is a booming one with an ever increasing customer base. lacks the power and strength expected to maintain brand loyalty. Moreover they need to keep updating their Cafes as time passes. The brand doesn‟t project a clear image to customers about what Café Coffee Day is all about. although clearly a youth. Appendices 27 . com www.Bibliography www.in www.” Marketing Management 28 .com Philip Kotler.barista.google.cafecoffeeday.co.