Marketing Management 2 Term Project

On

Coffee
Presented by: Group 7

Gaurav Bhattacherjee (B13026)

Krishnan Sethumadhavan (B13029) Neha Sanghvi (B13037) Ram Mohan Paramasivam (B13046) Sagar Kumar (B13051)

Agenda
Introduction Consumer & B2B market size Prominent coffee manufacturing companies & their brands Prominent Brands In Each Segments

Brand Positioning: Nestle Nescafe vs its Competition

SWOT Analysis Suggestions Logo of Different Brands Bibliography

Introduction
India is the 6th largest producer of coffee in the world. Around 3 % of the world

coffee production
Karnataka, Kerala and Tamilnadu contributes about 99% of total coffee produced in

India
In the annual output of 3,00,000 tons, domestic consumption is only one third (i.e.

around 100,000 tons)

Per capita consumption of coffee is around 85 grams in our country As per 2011 data, Indian coffee market is estimated at $230 million, or about 1,400

crore.
It is estimated to grow at about 13-14% a year over the next five years. It is forecasted that the coffee market in India will cross INR 5600 Crore by 2017.

 The B2B market size for coffee in India is 32% and rest of the 68% comes from B2C B2B market include supply in:B2B, 32%

Hotels
Restaurants Caf Chains Corporates IRCTC

Airlines Educational Institutions Defense canteens Multiplexes Hospitals

B2C, 68%

Messes

 Nestl and Unilever together have the market share of around 67% in which Nestle accounts for 36% and Unilever accounts for 31%. And rest of the 23% market share is held by TATA COFFEE, AMALGAMATED BEAN COFFEE TRADING CO LTD, NARASUS, LEO and other local players NESTLE HUL TATA COFFEE Nescafe Classic BRU Gold Green Coffee Nescafe Sunrise BRU Exotica Spray Dried Coffee Nescafe Sunrise Premium BRU Lite Agglomerated Nescafe MFC BRU Roast Ground Freeze Dried Nescafe Cappuccino BRU Select LEO Nescafe ChocoMocha BRU Ice Cappuccino LEO (Filter coffee) Nescafe Vanilla Latte BRU Cappuccino Range BRU Instant NARASUS Udhayam AMALGAMATED BEAN COFFEE TRADING CO LTD Fresh N Ground Coffee Day Perfect (Filtered coffee)

 Segmentation by Price High Priced Brands

Nestle Nescafe Gold Classis Sunrise Sunrise Premium Average Price Price of 100 gm 499.00 210.00 155.00 146.00 252.50 HUL BRU Exotica Gold Lite Instant Average Price Price of 100 gm

Mid Priced Brands

Narasus Price of 100 gm 45.00 Coffee Price of Day 100 gm Arabicah 106 Leo Price of Coffee 100 gm Leo House 74.00 Blend Leo madras blend Leo Top Blend Leo Pure Top Blend Average Price 65.00

529.00 Udhayam Filter 199.00 Coffee Narasus 130.00 Extra Strong 174.00 Coffee Narasus 258.00 Peabery

215.00

Charge

106

98.00

Perfect

106

92.00 74.00 76.25

Low Priced Brands

Price of 100 gm AVT Premium Coffee 33.00 Green Label Coffee Price of 100 gm 40.00

Average Price

119.33

Average Price

106

 Segmentation by Level of Caffeine

Light Coffee

Bru lite, Bru instant, Bru select, Bru cappaccino, Nescafe cappaccino, Nescafe vanilla latte, Nescafe sunrise premium Bru gold, Bru exotica, Nescafe alta rica, Nescafe cap colombie, Narasus udhayam filter coffee, Narasus Extra Strong Coffee,Narasus Peabery, Leo House Blend,Leo madras blend, Leo Top Blend, Leo Pure Top Blend Nescafe original decaff, Nescafe gold blend decaff

Strong coffee

Decaffeinated Coffee

 Segmentation by Product Type

1.

Instant Coffee Prominent Brands: Nestle Nescafe, HUL BRU and Tata Coffee Filtered coffee Prominent Brands: Amalgamated Bean Coffee Trading Co Ltd, Leo Coffee , AVT Premium Coffee and Green Label Coffee

2.

Segmentation by SKU
1.

Sachet
Nescafe, Bru 3 gms, 8 gms, 50 gms, 100 gms, 200 gms and 500 gms Narasus filter coffee, Leo filter coffee, AVT premium 100 gms, 200 gms and 500 gms

2.

Jar
Nescafe, Bru 50 gms, 100 gms, 200 gms and 500 gms Narasus filter coffee, Leo filter coffee, AVT premium 100 gms, 200 gms and 500 gms

 Segmentation by Geography

South India

Prominent Brands: Amalgamated Bean Coffee Trading Co Ltd, Leo Coffee, AVT Premium Coffee and Green Label Coffee

Rest of the country

Prominent Brands: Nestle Nescafe and HUL BRU

Consumer Buying Behaviour

Rural Sachets, small SKUs like 5 gms and 10 gms

Urban Large size sachets and jar like 100 gms, 200 gms, 500 gms
Prominent Brands: Nestle Nescafe and HUL BRU

Segmentation by Price:
In price category BRU is the main competitor of Nescafe. Both operate in high price segment.

Both BRU and Nescafe have their products starting from rupee 1, so even though they belong to

high price segment they are trying to cater to the needs of low income group.
Both Nescafe and BRU portray that they are high priced products through their ads. Their ads are themed around the upper middle class youth.

Segmentation by Product Type

Instant coffee: Bru, Nescafe, Tata Coffee. Instant coffee mainly concentrates on the attributes of fast and easy to make and convenient. Filter coffee: Leo coffee, Tata Coffee's Mr Bean, Narasus coffee, Coffee Day Perfect. Filter coffee concentrates more on taste and culture. Unlike instant coffee, making filter coffee is a time consuming process.

Local players are involved more in Filter coffee segment.

Brand Positioning: Nestle Nescafe vs its Competition

Continued
Segmentation by Geography
North: Nescafe and Bru Nescafe and BRU revolve around the theme of freshness and youth. In Northern region, instant coffee is consumed in higher quantities. South: Narasus coffee, Leo coffee, AVT, Green label. Narasus and Leo coffee mainly concentrates on culture and tradition of south India. The southern part of the country consumes more amount of coffee and prefers hard and roasted

coffee.
Segmentation by SKU:

Nescafe and Bru are trying to cater to low income group people by introducing sachets from as low quantity as 3 gms.

A Bru ad also wanted to project that the amount of coffee one get from a Re.1 pack is more. Most of the local brands have not introduced low SKU packs.

Brand Positioning: Nestle Nescafe vs its competition

Continued
Segmentation by Level of Caffeine (Nescafe & Bru):

Since Caffeine is considered to be unhealthy, Nescafe doesnt highlight the caffeine content in their ads whereas in filter coffee caffeine content is mostly shown in ads. Instant coffee contains 60% coffee and 40% chicory whereas filtered coffee contains 7080% and chicory 3020%

Coffee Instant Filter coffee

B2B centric brands:

Size of cup 125 ml 125 ml

Caffeine content 50-60 mg 60-100 mg

In terms of B2B institutional, Major coffee brands are Nescafe, Bru and Tata Coffee.

Nescafes B2B sales is mostly concentrated into coffee vending machines.

Tata Coffees B2B sales is mostly concentrated in Tata group of hotels and caf chains.

SWOT Analysis
STRENGTHS:

Brand Name Nestl, which is the parent brand of Nescaf is a Swiss multinational food and beverage company headquartered in Vevey, Switzerland is the largest food company in the world by revenues. Nestl took the risk of entering the Indian market dominated by Tea drinkers only because of the strength they saw in their brand name. Entered in Indian market with the tagline Coffee with life in it, Ready in just 5 seconds.

Positioning Name : Nescaf is a combination of Nestl and Caf. Nes means miracle and Caf means coffee in Portuguese that positioned the brand as Miracle with Coffee.

Nescaf positioned itself more than a coffee manufacturer and tried to portray its users as

people who seek to be recharged, people who want to let others know that they have
important stations in life, those who want to start their day with something positive, etc.

Nescaf promoted its beverages as ideal for all occasions such as breakfast, midday, evening, night (when you want to stay awake), important days such as Valentines Day, etc.

SWOT Analysis
Creativity

Continued

Launched Instant Coffee in 1963 in a market where Indian coffee lovers were stuck with the idea that coffee is something that takes minute attention to prepare and cannot be instant.

The first company to launch Coffee Machines for SMEs and Corporates in India.
Redefined Coffee Blending. Creative Positioning by making it more than coffee with the Our look beyond the cup initiative.

Availability

Available in more than 10 variants like Nescaf classic, Gold, Alta Rica etc. Available in various price ranges starting from Re.1/- sachets that makes coffee available for almost anyone.

Promotion

Nescafs red mug and jingle pa parara pa ra ra adds to brand value and unique identity to its products. Nescaf chose celebrities like Deepika Padukone, Karan Johar, Purab Kohli as its ambassadors when they were at the peak of their Carrier.

SWOT Analysis
WEAKNESSES:

Continued

India, still a country dominated by Tea drinkers. Coffee not being a healthy drink is avoided by health conscious people Promotions are limited for various varieties as there as many products which are still unknown to people, which portrays Nescaf as a sole brand.

Still unable/did not enter the filter coffee segment. 90% of coffee consumed in India is in three south Indian states dominated by filter coffee and local players.

Have to manage a huge portfolio. The company has a complex supply chain management and the main issue for Nescaf India is traceability. The food industry requires high standards of hygiene, quality of edible inputs and personnel. The fragmented nature of the Indian market place

complicates things more.

SWOT Analysis
OPPORTUNITIES:

Continued

Can enter the filter coffee segment as the brand value is very strong all over the world. B2B market can be expanded by going beyond coffee machines in theatres & corporate. Highlight the health benefits of coffee.

Target House wives and old aged people as coffee consumers are high in this segment.
Focus on rural areas as their promotion is subject to urban lifestyle. Increase the number of Caf Nescaf outlets as average bill value in cities is app Rs(250-300) Can widen the cake by focussing more on the caf outlets as Caf coffee day and Barista are major market leaders in that segment. Bru is a big threat as Bru is second in most of the segments. Bru, being an HUL product has a very strong distribution in rural areas. Coffee not being a health drink cannot target students below the age of 14.

THREATS:

Private labels can cause trouble as coffee is still treated as commodity in most of the rural areas.
Other hot beverages like health drinks can draw source of business from coffee drinkers by promoting health consciousness. Targeting only youth can prove to be a threat.

Suggestions
Nescafe can venture into Filtered Coffee market and it should be in south India first They could launch a preserved filtered brew of filtered coffee beans as a new

product to make filtered coffee instantly

Launch a new product NesNico nicotine gum to attract smokers who want to quit

smoking
They can also launch Coffee flavored candy, health drinks, soft drink under the

Nescafe brand.
They can give small sized SKUs of premium and less aware brands as freebees to

strengthen these brands.

Nescafe can change the way of promotion to attract new consumers

Nestle Nescafe HUL Bru TATA Coffee Narasus Coffee Leo Coffee Green Label Coffee AVT Premium Coffee

Bibliography
www.indiacoffee.org www.casestudyinc.com www.coffee.wikia.com

www.timesofindia.indiatimes.com
www.slideshare.net www.techsciresearch.com

www.youtube.com

Thank You