THE INDIAN INSTITUTE OF PLANNING AND MANAGEMENT Barista v/s Cafe Coffee Day {Comparative study} Submitted To: Submitted By: Ankeeta Pawa Daksh Gupta Digibh Guliani Poorva V. P. Saxena Salik E. Khan Index Synopsis The aim of this study is to successfully compare two prominent service sector companies on a common platform, analyze their working and performance, and highlight what they are doing well, while finding out which one has been able to attain the maximum market share. Barista and Cafe Coffee Day are chosen because of their identical pattern of functioning and growth.
They are the only two major players in the national coffee cafe industry, in India and their customers consider both as interchangeable brands. This is why it is important to study how these brands differentiate themselves from each other, and attempt to improve brand loyalty amongst their customers. This study is divided into five sections: Section One: The Coffee Cafe Industry. Section Two: Case study on Barista. Section Three: Case study on Cafe Coffee Day. Section Four: Customer Survey. Section Five: Conclusion. The Coffee Cafe Industry The Coffee Cafe industry is currently one of the biggest and fastest growing sectors in business.
The industry consists of a mix of individual cafes, hotel cafes and retail cafe chains. Individual Cafes: The main bulk of revenue is earned by small, individual cafes, run mostly by families and friends. It is a relatively unorganized sector. There are millions of such cafes around the world, and they provide customers with a homely, casual experience. The bulk of these cafes are mainly in Europe, where every little town or village has local cafes, where people gather together for a conversation over coffee, or just to be alone with their thoughts.
These cafes have been the birthplace and sanctuary for various creative minds, revolutionaries and thinkers of our time. The most recent example is the author J. K. Rowling, who has written most of the Harry Potter series of books sitting at her local cafe. These cafes set themselves apart from retail chain cafes and hotel cafes because they provide customers with a homely, classic appeal, which cannot be emulated. Hotel Cafes: Ever since the popularization of coffee, 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.
These coffeehouses are extremely important, because they provide international visitors to the hotel with a universal drink- coffee. Any customer can walk into any major hotel in the world, and enter the coffeehouse, and know what to expect. These cafes are not really major players in the coffee cafe industry, but rather provide supplementary services to the hotel industry. Retail Cafe Chains: The last, and the most organized sector in the coffee cafe industry, is the retail cafe chain. Off late, these chains have become extremely popular and are growing at an ever -increasing pace.
These retail chains have work with an organized structure of man, material and money. The work on developing a recognized brand consistent to all their outlets, which customers can easily relate to, wherever they go. They provide customers with a standardized level of service and quality at each of their outlets. The vast popularity of these retail chains is shown in the rapid international growth of brands like Starbucks. Customers can do to any Starbucks across the world and know exactly what to expect. The main focus of my project is on two nationally recognized retail cafe chains: Barista & Cafe Coffee Day.
Growth of Cafe 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 a ‘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. 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. Barista Coffee House I. CORPORATE PROFILE
Barista coffee was established in 1999 with the aim of identifying growth opportunities in the coffee business. Increasing disposable incomes and global trends in coffee indicate immense growth potential in one particular segment. More significantly, they believe they have been quick to spot a latent need waiting to be trapped: Coffee lovers seek a complete experience. One that combines intelligent positioning with the right product mix and carefully designed cafes. In other words, customers seek an “experiential lifestyle brand”. As of today, Barista exists in over 22 cities, and operates over 140 outlets nationally.
In the last 2 years, Barista has opened over 100 outlets in the country and with a new outlet opening nationally every 14 dates, Barista is currently experiencing phenomenal growth. With outlets opening in Sri Lanka and Dubai, Barista is looking at potential growth opportunities in Asia, making it highly competitive international brand. II. MARKETING MIX Product mix: Coffees & Teas Refreshing| RefreshingAlternatives| Eatables| Coffee with Milk| Smoothies| Sandwiches| CappuccinoCaffe MochaCaffe Latte| GuavaMangoGrape| Paneer TikkaCheese & TomatoChicken TikkaSmoked Chicken| Black Coffee| Granitas| Rolls|
Espresso ItalianoEsperanoTMAmericano| Blue CuracaoLime IceMixed Fruit TangoGuava Crush| Kadhai Paneer RollChicken Masala Roll| Dessert Coffees| Milk Based| Pastas| Latte BiancoCaffe Borgia| Strawberry FreezeMocha FreezeIcepresso| Tangy Tomato PastaCreamy Chicken Pasta| | Cold Coffees| Iced Tea| Other Food| Barrista FrappeBarrista BlastIced Caffe Mocha| LemonPeach| BBQ Chicken Croissant| Coffee Add-ons| Other Drinks| Desserts|
Various FlavoursChocolate FudgeWhipped CreamEspresso ShotIce Cream Scoop| Ginger FizzKinley Water| Walnut BrownieMocha ExcessChocolate ExcessDark TemptationChocolate MousseChocolate Chip MuffinAlmond Raisin MuffinApple Cake| Teas| | | AssamEnglish BreakfastDarjeelingEarl Grey| | | Product sources:Barista sources its coffee beans from around the world, but a major supplier is TATA Coffee, part of the TATA Group that owns a large stake- holding in Barista. These coffee beans are then sent to Venice, Italy where they are roasted into a blend exclusively for Barista.
The food and desserts at Barista is exclusively catered to by the Taj, who ensures a high standard of quality with all its products. Barista also sells merchandise through its store, all of which is imported. The merchandise accounts for nearly 1/6th of Barista’s overall sales. Quality sources:Barista has a check on the quality of its products every 14 days. Barista also incorporates TQM at its headquarters in Delhi. Since Delhi is the base for all its distribution, quality control measures are adopted there to avoid any poor quality products being distributed.
Merchandising:Barista sells various kinds of merchandise through its stores. Various merchandises like :Tiramisu Flavours, Coffee Mugs, Blue Curacao, Barista French Press, Barista Coffee Beans. Pricing:Barista has a ‘Skim Pricing Policy’. They began with a higher price, and skimmed the cream for the market. With the sudden spurt of growth in number of outlets, came the benefits of economies of scale. Because of this, they have been able to gradually lower their prices, and appeal to different segments of their target market.
Currently, their prices are the lowest they have ever been, and they can competitively match their prices against Cafe Coffee Day’s prices. The prices are constantly changing though, and the last 1-year has seen 3 changes (mostly reductions) in prices. This gradual price reduction meant that Barista 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 quite high because imports a majority of its products and product- sources.
Positioning:Consumer Profile:According to research, over 65% of Barista’s customers are in the 15- 30 age- group. The majority of these are students and young urban professionals. Brand Image:Barista positions itself as a brand for anyone who loves coffee. Their products, services and outlets are more like the traditional European cafes, where people would meet for the love of coffee, and for an intellectual appealing time. They position their outlets as a place “where the world meets”, and they look to appeal to anyone in the 14- 60 age group that loves good coffee and looks for a nice quiet time. Physical Evidence: a) Logo, Colours, Images: Barista, since the beginning has looked to use colors in its cafe interiors, logos and images; to project a “warm, earth glow, synonymous with coffee”. Barista uses shades of Orange & Brown to good effect to promote its “laid- back” atmosphere. b) Decor and Architecture: Barista’s internal decor and architecture expresses the simplicity you would normally associate with traditional cafes. The furniture is made of light shades of wood, and there are comfortable sofas in bigger cafes.
The walls are shades of orange, with various photographs of the love for coffee spread around each outlet. Promotions: Barista currently carries out mass promotion campaigns. This is mainly in the form of promotions in the Press, TV and Radio Medias. At present, they do not rely heavily on advertising, but rely more on sponsorships and strategic alliances with other corporations. Barista also takes part in various sales promotion activities to help increase sales at their outlets. a) Sponsorships: Barista sponsors various events and festivals, which provides them valuable promotion directed at strategic markets.
The sponsorships are mainly in kind, although major events are sponsored in cash also. b) Collaborations: Barista has entered into special collaborations and alliances with various partners for co- marketing brands. For example, Barista entered into a deal with Leo Mattel toys to provide the popular board game Scrabble at every Barista outlet across the country. Barista has also entered into partnerships with various movies, for promotions through Barista, and recently, they tied up with Star World for its “Absolutely Everybody” campaign. Distribution: Distribution of outlets:
Every Barista outlet is owned by the company, and not franchised out to anyone. Barista can thus control and make quick changes to its entire retail chain. Barista currently operates in over 120 outlets all over the country, and at their current rate, they are opening a new outlet approximately every 10 days. They have a market presence in over 20 cities. Mumbai alone has over 30 outlets, and the number of outlets in the city is increasing at a phenomenal pace. Barista has a thumb rule for selecting cities and locations for the distribution of outlets.
Location: This is a prime factor in determining the success of a retail chain. However, Barista Coffee has adopted a top down approach, wherein they first identify the cities and then decide on precise locations within its limits. III. HUMAN RESOURCES: Barista’s boom in growth has sparked of a greater need for more and more human resources. This poses a challenge for Barista to ensure that their employees all across the country are well trained and provide consistent service at every outlet. Position|
Counter Staff: Junior Executive (0-2 years experience) Executive (1-3 years experience) Senior Executive (3-5 years experience)| Field Staff: Territory Manager Area Manager Regional Manager| Support Staff: Marketing Supply Human Resources Finance| Recruitment & Selection: Barista currently opens a new outlet somewhere in the country every 10-12 days. The spurt of growth can only be successful if they have the right people working for them.
The high expansion means that more staff is needed immediately at the Counter Staff and Field Staff Level. This is only possible is Barista uses the correct recruitment and selection policy Sources of Recruitment Barista’s main sources of recruitment are: 1) Walk- ins 2) Referrals 3) Placement Agencies Recruitment & Selection Process Barista hires people for their counter staff from external sources, and follow the following process for recruitment: 1) Collection and review of Curriculum Vitae 2) Personal interviews with H. R. Manager 3) Personal Interviews with Area Manager/ Regional Manager.
Recruitment is usually done on a monthly basis, depending on the number of outlets and expansion taking place in that month. Training & Development: To insure consistent employee performance, training and development policies are very important- even more so in service sector organizations. Barista Coffee has a set, 14 days rigorous training procedure for each employee. With training modules customized to fit the professional needs of each employee. In the case of their brew masters, the training programs are drawn up and conducted by trainers who have been trained by Italian brew masters.
Barista has a Training & Development policy, which basically consists of two parts, Induction Training and Refresher Training. Employee Code of Conduct: Barista employees are trained with regard to their code of conduct at the induction level. It is at this stage Barista tries to infuse, what it refers to as key qualities for its employees: pleasant manners, polite behaviour and positive attitude. The code of conduct of each employee is supervised everyday by territory managers. Performance Appraisal: Barista currently carries out performance appraisals every quarter of a year. Direct supervisors in most cases carry out these appraisals.
Currently Barista doesn’t have any other kind of appraisal programs like upward/ 360o appraisals. Barista does conduct Exit Interviews though, and uses it to improve employee retention. Cafe Coffee Day I. CORPORATE PROFILE It was in the golden soil of Chikmagalur that a traditional family owned a few acres of coffee estates, which yielded rich coffee beans. Soon Amalgamated Bean Coffee Trading Company Limited, popularly known as Coffee Day was formed. With a rich coffee growing tradition since 1875 behind it coupled with the opportunity that arose with the deregulation of the coffee oard in the early nineties, Coffee Day began exporting coffee to the connoisseurs across USA, Europe & Japan. In the calendar year 2000, Coffee Day exported more than 27000 tonnes of coffee valued at US$ 60 m to these countries and, for the second time in its short career of 7 years retained the position as the largest coffee exporter of India. Coffee Day has a wide and professional network in the major coffee growing areas of the country comprising over 48 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. 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 Cafe Coffee Day currently owns and operates 213 cafes in all major cities in India. It is a part of India’s largest coffee conglomerate named Coffee Day, Rs. 200 crores ISO 9002 certified company.
Coffee Day’s most unique aspect is that it grows the coffee it serves. Key Features • Pioneers of the Cafe Concept in India with the its first Cafe at Brigade Road, Bangalore in 1996. This Cafe was opened as a Cyber Cafe (first of its kind) but later, with the burst of cyber cafes it reverted to its core competency…. Coffee. * Essentially a youth oriented brand with majority of its customers falling in the 15-29 year age bracket * Each cafe, depending upon its size attracts between 400 and 800 customers daily. * It is a place where customers come to rejuvenate themselves and be themselves. USP of the Brand: – Affordable Price – Coffee – Winner of Platinum, Gold, Silver and Bronze medals at the India Barista Championship 2002. II. MARKETING MIX: Product Mix: Coffees ; Teas| Refreshing Alternatives| Eatables| Hot Coffee| Granitas| Melting Moments| EspressoEspresso AmericanoMacchiatoCappuchinoCafe LatteChococinnoCafe MochaIrish Coffee| Blood OrangeCool BluePineapple CrushEmerald IceRuby Surprise| Banana n’ Walnut CakeBanana Chocolate MousseBanana Caramel pieChocolate DoughnutCookiesMarble CakePineapple GetauxChocolate Cake| International Coffee| Smoothies| Ice Creams|
Colombian Juan ValdezEthiopian QahwahKenyan Safari| Mango ColadaStrawberry Colada| VanillaChocolateSeasons Best| Cold Coffee| Cremosas| Quick Bites| Sweet MintCold SparkleBrandied BananaTropical IcebergIced Eskimo| LitchiGinger SpicePina Colada| SamosaPuffPizzaCroissantFrench FriesKathi RollWrapsBiryaniSandwichesKulchaBurgerPastaMasala Sandwich| Coffee Add-ons| Cool Refreshers| | HoneyFlavoured SyrupsRed EyeWhipped CreamScoop pf Ice creamChocolate Sauce| Fruit JuicesMineral | | Teas| | | Assam TeaMasala ChaiLemon ‘n Ice TeaKashmiri QahwahApple n Cranberry ice tea| | |
Product Sources: 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 cafes from Chikmagalur.
The eatables at Cafe Coffee Day are catered by different vendors: example: ice creams are catered by Cream Bell, Milk by Amul and samosa’s by Patsiers Gallery. Cafe Coffee Day also sells merchandise through its stores. 5 per cent of the revenue comes from sale of merchandise. Quality sources: Cafe 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, 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 take to extract the coffee and so on.
Marketing person will go about checking displays, how the merchandise are displayed. Merchandising: At Cafe 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. Cafe Coffee Day sells various young and trendy merchandise through its stores: Caps, T-Shirts, Bags, Mugs, Coffee Filters, Coffee Powders, Coffee Mints, Pens.
Pricing: Considering that Cafe 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 Cafe Coffee Day. The changes have been more due to the government taxes than anything else. Positioning: Consumer Profile: Research shows that 37% of the customers are between 20 and 24years. 7% of the customers are between the age group of 25-29 years. 60% of the customers who visit the cafe are male and 40% are female. 52% of customers who visit the cafes are students. 18% of the customers visit the cafes daily while another 44% visit weekly. Each cafe, depending upon its size attracts between 500 and 800 customers daily, mainly between 4pm and 7 pm. Customers describe Cafe Coffee Day as the place they frequent most after “home and workplace/college”. It is a place where they meet friends and colleagues, in groups of 3 or more.
The prices here are perceived to be reasonable and it is a place where customers come to rejuvenate themselves and be themselves rather than a place to be “seen at” vis a vis other cafes. Brand Image: Cafe 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 favourite “hangout”. Its customers are mostly young college student stand young professionals.
It is for those who are young or young at heart. Physical Evidence: a) Logo, Colours, Images: Cafe 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. Cafe is noticeably larger than the rest of the text inside the logo box. This denotes that Cafe Coffee Day pioneered the cafe concept in India way back in 1996. Cafe Coffee Day would like to own the word “cafe” in the minds of its customers.
When one thinks of a cafe it’s got to be Cafe Coffee Day. The font used for “Cafe” 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 Cafe 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 Cafe Coffee Day. b) Decor & Architecture:
Cafe Coffee Day had gone in for image change and revamping of interiors in the last quarter of 2001. Cafe 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. Promotion: Cafe Coffee Day does not believe in mass media promotions. But they are involved in all the areas of serious consumer passion. Through television: Cafe 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. Modelling 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: Cafe 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. Tie-ups: Besides that Cafe 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. Association with movies: Cafe 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, forthcoming movies like Salman Khan starrer Lucky and Socha Na Tha, Priyanka Chopra starrer Fashion. Distribution: Every Cafe 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 Cafe Concept in India with the its first Cafe at Brigade Road, Bangalore in 1996. This Cafe was opened as a Cyber Cafe (first of its kind) but later, with the burst of cyber cafes it reverted to its core competency…. Coffee. Cafe Coffee Day currently operates 213 outlets all over the country. They have a market presence in over 49 cities. Delhi, NCR alone has 24 outlets, and the number of outlets in the area is increasing at a phenomenal pace.
Each cafe, depending upon its size attracts between 400 and 800 customers daily. III. HUMAN RESOURCES: With the boost in the number of their retail outlets, Cafe Coffee Day had to concentrate on the quality and quantity of their human resource in order to meet up with the set standards. They make sure that the employees all across the country are well trained and provide consistent services at every outlet. Recruitment ; Selection: It is the process of differentiating between applicants in order to identify those with a greater likelihood of success in a job.
The role of selection in an organization’s effectiveness is crucial for at least two reasons; first work performance depends on individuals and second because of the costs incurred in hiring individuals is enormous for an organization. The best way to improve performance is to hire the people who have the competence and the willingness to work. Arguing from the employee’s viewpoint poor or inappropriate choice can be demoralizing to the individual concerned and demotivating for the rest of the workforce. The cost of searching and training individual may range from Rs. 2,50,000. r more. Costs of wrong selection are even greater. Selection is a long process commencing from the preliminary interview of the applicant and ending with the contract of employment. The process differs among organizations and between two different jobs within the same organization. Selection procedure for senior managers is long-drawn and rigorous but on the other hand for shop floor workers it is simple and short. Training ; Development: To ensure consistent employee performance, training and development policies are very important- even more in service sector organizations.
Cafe Coffee Day has set 12 days rigorous training procedure at their office in Bangalore for all the assistant managers. Whereas all the team members undergo a 3 days training at respective head offices in North or South India. Employee working hours: The working hours are split into convenient shifts spread over 8:30 am to 10:30 pm. Night drops are provided for late evening shifts. Employee code of Conduct: After substantial efforts Cafe Coffee Day has been able to convey to their staff (the ones who serve food) that they are doing a job and are at par socially with many consumers.
Their attitude and communications is kept up to mark. Along with cleaning the table well, their employees communicate with the consumers on one to one basis. It is a cultural shift; it is a huge responsibility as, in India you do not look at the people serving at your table as your peer. Their employees are like friend to the customer but at the same time they know about the international standards of hygiene and cleanliness and personal grooming. Performance Appraisal: Performance management is an integral part of a comprehensive human resource management strategy.
Its objective is to maximize individuals’ performance and potential with a view to attaining organizational goals and enhancing overall effectiveness and performance appraisal at Cafe Coffee Day every 6 months. Customer Survey Survey Methodology: A survey was conducted, consisting of a sample of randomly selected people, in the age group of 18-25. This survey aims to find out how Barista and Cafe Coffee Day’s target market, rate their products and services. A copy of the customer survey is attached in the Annexure. Characteristics of visit: The respondents were first asked to describe the characteristics of a typical visit to a coffee shop.
This includes their choice of coffee shop, frequency of visits, time & money spent on a single visit, average group size and influential factors affecting their choice. Comparative Rating: The survey also asked the customers to rate the following parameters on a scale of 1-5 (1 being the worst, 5 being the best), for both Barista and Cafe Coffee Day: 1. Taste & Quality of products. 2. Prices of products. 3. Order/ Delivery time & Order/ Delivery process. 4. Performance of staff. 5. Ambience. ANALYSIS OF THE SURVEY: Preference of coffee shops:
Although this is not a true indicator of market share, it gives us some idea or the closeness in which both companies operate. They both received an equal preference in the survey, with 50% of the respondents choosing Barista and the remaining 50% choosing Cafe Coffee Day, indicating there is no clear winner in terms of actual visits to the outlets. Frequency of Visits: Considering the age- group for the sample, it’s quite evident that they have enough free time to visit cafes regularly. Out of those surveyed, 50% said they visited a coffee shop 2-3 times a week, and 30% visited a coffee shop 2-3 times a month.
This is great opportunity for Barista and Cafe Coffee Day to attract regulars with loyalty programs. Spending Habits: The values of Graph illustrate how much money the respondents usually spend at coffee shops. While the majority of respondents spent between Rs. 25 & Rs. 75 on a single visit to an outlet, a high percentage also spent between Rs. 75 & Rs. 125. An important point to note here however is that a majority of the people who were in the Rs. 75 & Rs. 125 bracket were Barista customers. Deciding Factor:
When asked about the most important factor that contributed to their choice of coffee cafe, an equal number (40%) of respondents selected the taste of coffee/ food and the ambience/ experience. Only 20% of them choose value for money as their most important factor. This would indicate a clear shift of consumer focus from price factors to service factors. Conclusion Areas of Excellence Both cafes have certain areas where they have been consistently performing well. These are essentially the strengths of the brand, and Barista & Cafe Coffee Day need to capitalize on these strengths to increase their market share and brand loyalty.
The main areas of excellence, based on the Case Studies & Market Survey, have been identified as follows: Barista: 1. Strong Brand Image: Barista has a strong and clear brand image. Their customers can easily identify and relate to the Barista brand. This helps increase and maintain brand loyalty. 2. Excellent Human Resource: According to the survey, Barista received an excellent rating for the service and behaviour of their staff. This is a huge advantage, especially in a service organization. Barista must strive to keep this advantage. 3. Ambience & Decor:
Another significant area of excellence is the kind of ambience and decor Barista cafes have. Respondents to the survey, including whose who chose Cafe Coffee Day as their choice of cafe, gave Barista a near perfect rating for their Ambience & Decor. 4. Strong base for expansion & growth: Barista have worked hard on heir brandimage and human resources, and have a strong base for future expansion and growth- whether nationally or internationally. Cafe Coffee Day: 1. Highly rated Taste & Quality of products: Cafe Coffee Day got a high rating in the market survey, for the Taste & Quality of their products.
If they work on this aspect, there is huge potential for them to attract customers, just based on the taste and quality of products. This is also helped by the fact that they grow their own coffee beans, and this provides an important base for future expansion and growth. Cafe Coffee Day even won the “Barista Coffee- Making Championship” for the Best Coffee. 2. Value for money proposition: Cafe Coffee Day is projected as an “affordable” brand. This strategy has worked extremely well so far, and Cafe Coffee Day got a high rating, both for their prices and for their value for money, in the market survey. 3.
Strong youth orientation: The Cafe Coffee Day brand is, and always has been, extremely youth- oriented. In a country where over 40% of the population is under the age of 20, there is huge potential for Cafe Coffee Day to become one of the country’s largest youth brands. The untapped market share and potential for growth is enormous. Thus, Cafe Coffee Day has done extremely well so far to project itself as an affordable youth- oriented brand & has been able to attain larger market share leaving behind Barista Coffee House…. Primary Questionnaire Name: Age: Profession: Sex: Q1) What Coffee Shop do you usually go to?
Barista Cafe Coffee Day Others Q2) How often do you visit a Coffee Shop? 2-3 times a week 2-3 times a month Not Often Q3) How much money do you usually spend at a Coffee Shop? 25-75 Rs. 75-125 Rs. Over 125 Rs. Q4) What is the single most important factor for you to choose a Coffee Shop? Taste of Coffee/Food Value for Money Ambience/Experience Bibliography * www. cafecoffeeday. com – Search engines – Case Study * www. barista. co. in- Search engines – Case Study * www. google. com- Search engines * Philip Kotler – principles of Marketing
