FINAL RESEARCH PROJECT
“CUSTOMER PERCEPTION AND ATTITUDE
TOWARDS RETAIL COFFEE CHAINS – A STUDY IN
DELHI, W.R.T BARISTA, CCD, NESCAFE”
SUBMITTED IN PARTIAL FULFILLMENT OF PGDBM (2006-08)
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FINAL RESEARCH PROJECT
“CUSTOMER PERCEPTION AND ATTITUDE
TOWARDS RETAIL COFFEE CHAINS – A STUDY IN
DELHI, W.R.T BARISTA, CCD, NESCAFE”
SUBMITTED IN PARTIAL FULFILLMENT OF PGDBM (2006-08)
Submitted to:
XXXXXXXX
Submitted by
XXXXXXXX
ACKNOWLEDGEMENT
I would not have completed this project without the help, guidance and support of certain people who acted as guides and friends along the way. I would like to express my deepest and sincere thanks to my faculty guide NAME, for her invaluable guidance and help. The project could not be complete without her support and guidance. I am also thankful to NAME for his help in completing the project. They acted as a continuous source of inspiration and motivated me throughout the duration of the project helping me a lot in completing this project.
INTRODUCTION
Today Coffee has become a lifestyle. Also, it has caught the fancy of today's generation - youth. These were not the typical coffee drinking target customers. But now they are a big part of the target base for coffeehouses. And it is fashionable to be seen at the Coffee Pubs. It is in a way, a lifestyle statement.
That is bad news for tea - still the favorite brew for a majority of Indians, which has been losing out to coffee in recent years. India is one of the world's largest exporters of tea and also one of its biggest consumers. But it is coffee drinking which is increasingly becoming a statement of young and upwardly mobile Indians.
And coffee bars, an unheard of concept till a couple of years ago, are suddenly big business. Corner bars like these are offering more than just coffee and snacks to their customers. For many of their regular patrons, a visit to these bars is also a part of the western lifestyle they so much want to identify with.
The Coffee retailing sector in India is booming today, with several companies active in the market. Some are local entities, some have come from abroad and have tied up with local companies, and some seem to prepare themselves for an entry sooner or later. The market growth is expected to be 20 to 30% annually in the next couple of years.
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.
Coffeehouse
A coffeehouse shares some of the characteristics of a bar, and some of the characteristics of a restaurant, but it is different from a cafeteria. As the name suggests, coffeehouses focus on providing coffee and tea as well as light snacks. This differs from a café , which is an informal restaurant, offering a range of hot meals, and possibly being licensed to serve alcohol. Many coffee houses in the Muslim world, and in Muslim districts in the West, offer shisha , powdered tobacco smoked through a hookah. In establishments where it is tolerated - which may be found notably in the Netherlands, especially in Amsterdam - cannabis may be smoked as well.
From a cultural standpoint, coffeehouses largely serve as centers of social interaction: the coffeehouse provides social members with a place to congregate, talk, write, read, entertain one another, or pass the time, whether individually or in small groups.
History
Since the 15th century, the coffeehouse has served as a social gathering place in Middle Eastern countries where men assemble to drink coffee (usually Arabic coffee) or tea, listen to music, read books, play chess and backgammon, and perhaps hear a recitation from the works of Antar or from Shahnameh. In 1457 the first coffeehouse, Kiva Han , was opened in Istanbul, just four years after its conquest by the Ottomans. Coffeehouses in Mecca soon became a concern as places for political gatherings to the imams who banned them, and the drink, for Muslims between 1512 and 1524. In 1530 the first coffee house was opened in Damascus, and not long after there were many coffee houses in Cairo.
In the 17th century, coffee appeared for the first time in Europe outside the Ottoman Empire, and coffeehouses were established and quickly became popular. The first coffeehouses in Western Europe appeared in Venice, due to the traffics between La
France they were banned. Émilie du Châtelet purportedly wore drag to gain entrance to a coffehouse in Paris. In a well-known engraving of a Parisian coffeehouse of c. 1700, the gentlemen hang their hats on pegs and sit at long communal tables strewn with papers and writing implements. Coffeepots are ranged at an open fire, with a hanging cauldron of boiling water. The only woman present presides, separated in a canopied booth, from which she serves coffee in tall cups.
The traditional tale of the origins of Viennese coffeehouses begins with the mysterious sacks of green beans left behind when the Turks were defeated in the Battle of Vienna in 1683. All the sacks of coffee were granted to the victorious Polish king Jan III Sobieski, who in turn gave them to one of his officers, Franciszek Jerzy Kulczycki. Kulczycki began the first coffeehouse in Vienna with the hoard. However, it is now widely accepted that the first coffeehouse was actually opened by an Armenian merchant named Johannes Diodato.
In London, coffeehouses preceded the club of the mid-18th century, which skimmed away some of the more aristocratic clientele. Jonathan's Coffee-House in 1698 saw the listing of stock and commodity prices that evolved into the London Stock Exchange. Auctions in salesrooms attached to coffeehouses provided the start for the great auction houses of Sotheby's and Christie's. In Victorian England, the temperance movement set up coffeehouses for the working classes, as a place of relaxation free of alcohol, an alternative to the public house (pub).
Coffee shops in the United States arose from the espresso- and pastry-centered Italian coffeehouses of the Italian-American immigrant communities in the major U.S. cities, notably New York City's Little Italy and Greenwich Village, Boston's North End, and San Francisco's North Beach. Both Greenwich Village and North Beach were major haunts of the Beats, who became highly identified with these coffeehouses. As the youth culture of the 1960s evolved, non-Italians consciously copied these coffeehouses. Before the rise of the Seattle-based Starbucks chain,
Seattle and other parts of the Pacific Northwest had a thriving countercultural coffeehouse scene; Starbucks standardized and mainstreamed this model.
In the United States, from the late 1950s onward, coffeehouses also served as a venue for entertainment, most commonly folk performers. This was likely due to the ease at accommodating a lone performer accompanying themself only with a guitar, even with limited floorspace; the political nature of much of 1960s folk music made the music a natural tie-in with coffeehouses with their above-referenced association with political action. A number of well known performers like Joan Baez and Bob Dylan began their careers performing in coffeehouses. Blues singer Lightnin' Hopkins bemoaned his woman's inattentiveness to her domestic situation due to her overindulgence in coffeehouse socializing, in his 1969 Coffeehouse Blues.
From the 1960s through the mid-1980s, many churches and individuals in the United States used the coffeehouse concept for outreach. They were often storefronts and had names like The Gathering Place (Riverside, CA), The Lost Coin (New York City), and Jesus For You (Buffalo, NY). Christian music (guitar-based) was performed, coffee and food was provided, and Bible studies were convened as people of varying backgrounds gathered in a casual "unchurchy" setting. These coffeehouses usually had a rather short life, about three to five years or so on average. An out-of-print book, published by the ministry of David Wilkerson, titled, A Coffeehouse Manual , served as a guide for Christian coffeehouses, including a list of name suggestions for coffeehouses.
Format
Coffeehouses in the United States often sell pastries or other food items
Cafes may have an outdoor section (terrace, pavement or sidewalk cafe) with seats, tables and parasols. This is especially the case with European cafes. Cafes offer a more open public space compared to many of the traditional pubs they have replaced, which were more male dominated with a focus on drinking alcohol.
feature simple offerings: a variety of foods based on egg, toast, and kaya (jam), plus coffee, tea, and Milo, a malted chocolate drink which is extremely popular in Southeast Asia and Australasia, particularly Singapore and Malaysia.
In parts of the Netherlands where the sale of cannabis is decriminalized, many cannabis shops call themselves coffeeshops.
In modern Egypt, Turkey and Syria, coffeehouses attract many men and boys to watch TV or play chess and smoke shisha.
a. Barista Coffee
Barista Coffee is a chain of espresso bars in India. Headquartered in Delhi, Barista currently has espresso bars across India, Sri Lanka and the Middle East. It was founded in 1997, p Led by the dynamic duo of Ravi Deol & the marketing ace Sandeep Vyas; Barista was the fastest brand to make it to the list of super brand's and is ranked among the top 50 phenomenons that changed India. Starbucks corporations decided to enter into an agreement that allowed Barista Coffee to use the brand for cafes as long as it allowed Starbucks to use the brand "Barista" for brewing equipment. Italy's Lavazza has now acquired Barista.
Barista Coffee in India can be easily called the pioneers of ‘coffee culture’ in India. Established in February 2000 to recreate the ambience and experience of the typical Italian neighborhood Espresso Bars. Barista Coffee aims to provide a comfortable and friendly place for people to relax and unwind over a cup of coffee.
Ownership : Barista Coffee Company is owned by Lavazza, Italy’s largest coffee company. Lavazza is one of the most important roasters in the world, a leader in Italy with a 46.5% share of the retail market (in value, source: Nielsen). It operates in over 80 countries, in the Home and Away-from-Home sectors (Foodservice, Vending and Retailing). In 2006 sales totalled USD 1.2 billion.
Outlets : Barista at present has over 170 Espresso Bars and 7 Barista Crèmes in over 29 locations: Delhi, Gurgaon, Bangalore, Hyderabad, Kolkata, Mumbai, Chennai, Pune, Ghaziabad, Noida, Chandigarh, Mohali, Dehradun, Shimla, Mussorie, Jaipur, Kanpur, Lucknow, Bhopal, Indore, Bhubaneshwar, Ahmedabad, Baroda, Cochin, Coimbatore, Manipal, Guwahati etc. making it one of the largest retailers of specialty coffees in Asia. Barista further has laid international footprints in Sri Lanka ( outlets), Oman and UAE (6 outlets).
Ambience : Barista Coffee is not just about drinking coffee but also about the entire experience. At Barista the ‘Joy of Coffee’ is reflected in the warm ambience, the exotic flavours and the friendly service provided by the brew-masters. To add to the informal ambience, Barista Espresso Bars offer games like Scrabble, Pictionary and Battleship for the guests. Barista Espresso Bars were the first place where the customers were called by their first names to create an atmosphere of informality and friendliness. Barista in its outlets have Wi-Fi enabled corners for executives-on- the-go. Open seven days a week, most Barista Espresso Bars begin brewing from 10 a.m. and are open till late night.
Coffee : Barista Coffee places strong emphasis on the quality of coffee beans and the process of preparing, rich aromatic coffee. The coffee is created with carefully hand picked mature cherries of the Arabica coffee plant, ensuring a uniform and high quality harvest. This 100% Arabica coffee is sourced from Tata Coffee’s plantations in Karnataka, India. House blend beans are sourced and roasted in India by Tata Coffee. The international coffees such as Costa Rican, Kenyan and Jamaican Blue Mountain are sourced from the respective countries and custom roasted in Italy.
Food : In an attempt to further enhance the experience at the Barista Espresso bars, it has on offer a delicious snacks and dessert menu. On offer are authentic Italian food items such as biscottis, paninis, wraps, twisters, puffs, sandwiches and other munchies to go along with its wide coffee range. To cater to the sweet tooth, Barista also offers mountains of ice creams, oodles of chocolate, chunks of crumbly apple pies, walnut brownies etc.
within the establishments giving the consumers the opportunity to enjoy a cup of delicious coffee while browsing through a book, enjoying music or appreciating art.
Barista is a comfortable place to spend time with friends, family, strangers, the girl next door, her neighbour's aunt, well, just about anyone. And even if you drop by alone, they have some of the finest beverages to keep you company.
To begin with, there's the Barista House Blend - their signature blend of coffee and select international coffees from some of the most noted coffee growing regions of the world. Followed by an extensive list of steaming hot espressos, cappuccinos and lattes made from the finest Arabica beans.
To cool things down, they have fruit smoothies and chilled granitas in tropical flavours. And finally, a refreshing range of cold and frozen coffees that will make anyone who tries them return for more.
Barista traces its roots back to the old coffee houses in Italy - the hotbeds of poetry, love, music, writing, revolution and of course, fine coffee. Drawing inspiration from them, they have single-handedly taken on the challenge to open people's eyes to the simple pleasures of coffee and revolutionize the coffee drinking experience in every city that we invade.
To live up to this promise, they have employed skilled Italian roastmasters at their roastery in Venice. Sourced only the finest quality Arabicas. And have had our espresso bars designed to reflect a warm, friendly and inviting atmosphere. Add to this, a menu you can ponder over for hours and you have everything you need to escape the pressures of daily life.
At last count, the aroma of fine Barista coffee permeated in over 100 espresso bars across India, Sri Lanka and the Middle East.
b. Café Coffee Day
Café Coffee Day is a division of India's largest coffee conglomerate, Amalgamated Bean Coffee Trading Company Ltd. (ABCTCL), popularly known as Coffee Day, a Rs. 300 crore ISO 9002 certified company. 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 exporters with clients across USA, Europe & Japan.
With its roots in the golden soil of Chickmaglur, 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 354 Coffee bean and powder retail outlets), Coffee Day Xpress (which owns 341 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 498 cafes in 85 cities around the country.
“Enthused by the success of offering a world-class coffee experience, CCD has opened a Café in Vienna, Austria and is planning to open other Cafes in the Middle East, Eastern Europe, Eurasia, Egypt and South East Asia in the coming months.”
Cyber cafés at Brigade Rd, Bangalore, Airport, Bangalore and Airport, Delhi 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!
Mission statement “To be the best café chain in the world by offering a world class coffee experience at affordable prices”.
Brand association CCD has emerged as an interactive alternative media for brands to communicate with the ‘young at heart’.
Other media, such as electronic, print and outdoor, offer brand communication through visual and audio modes to a large section of the populace, both relevant and irrelevant. Café Coffee Day offers a much more interactive, targeted communication, sometimes adding even a taste dimension to a brand idea!
Various in-café collaterals used to impart visibility to a brand inside a café or to add the element of interactivity to a campaign are Posters, Tent Cards, Danglers, Leaflets, Brochures, Coasters, Drop boxes, Contest Forms, Stirrers, Standees etc.
Over the years, CCD has successfully promoted a number of brands/products/events through various innovative tactics and promo ideas. Cashing in on its mass captive audience, we at CCD have entered into tie-ups and promotions which are well knit with our brand promise and which can be creatively used to woo the Indian Youth.
Customer profile
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.
Research shows that teen-agers form 25% of our customers while 38% of the customers are between 20 and 24years and another 23% belong to the age group of 25-29 years. Students and young professional comprise around 72% of our customers.
18% of the customers visit the cafes daily while another 44% visit weekly. Each café, depending upon its size attracts between 500 and 800 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; a place where they rejuvenate and are free to be themselves rather than a place to be “seen at” vis a vis other cafes.
Awards
Cafe Coffee Day: the best Indian Food Services Brand Business World November 8th, 2004
Food services top 5
- McDonald’s
- pizza hut
- café coffee day
- barista coffee
- domino’s
FMCG major Nestle India, having catapulted its business with the launch of its probiotic range of frozen dairy products, is now all set to grow its coffee business.
While coffee chains such as Café Coffee Day and Barista target the upper middle class youth segment, Nestle India through its ‘Cafés’ is going all out to woo the masses.
Mr. Martial Rolland, CEO, Nestle India, said, “The idea is to create a sustainable model that is scalable through these cafes.
They use these outlets as our laboratories to try out new products and gauge the reaction of consumers to the newer variants of coffee.
Not deterred by the competition the coffee chains could present, they are pleased that there are more players in the competition as it will expose more consumers to coffee.
“The difference between the coffee chains and us is affordability. No one knows coffee the way we do.”
Nestle; however, plans to continue its cafes pan-India under the franchisee model. They are focusing more on product delivery vis-À-vis the ambience. They refuse to divulge the size of the company’s café business.
However, according to company officials it was far larger than some of the others who claim to have the maximum number of outlets in the country.
Nestle has cafés across schools, colleges and offices.
Perfect blend
Affordability, in fact, is a major criterion for Nestle India as far as products are concerned. The company’s motto to target the lowest denominator is clear through the pricing of its brands in the category as well as the blends used in the products.
India is predominantly a tea drinking country. Therefore, the harsh and strong flavour of coffee is not preferred by most people. So, the blends they use in their brands are also very specific to consumer tastes.
New product
Based on consumer insight, the company has just launched its new product ‘Nescafe Mild’, targeted specifically at the mass market of tea drinkers.
Their long heritage in the country helps them understand people better. Also with the understanding of coffee that they have acquired globally, they want to leverage their expertise here as well.
Cold coffee category
The company is also examining several possible segment forays under coffee, however, moving away from hot to the cold category.
Though the market for products such as cold coffee is still very small in India, experiences from their Café outlets have made them realise the growing demand for it. They are examining possibilities of launching such products in India.
In fact, the coffee market in India in itself is rather small with great opportunity for growth. And, as a company, they focus more to grow their coffee business here.
RESEARCH OBJECTIVE – “Customer Perception and Attitude towards retail coffee chains – a study in Delhi, w.r.t Barista, CCD, Nescafe”
SUB OBJECTIVES:
- Preference in choice of Coffee chain
- Factor affecting the customer choice of coffee chains