KIRLOSKAR INSTITUTE OF ADVANCED MANAGEMENT

STUDIES

An assignment report on consumer

behavior
Submitted by:
Harihar
Shreel dwivedi (49)
Rounak kumar (45)
Swaroop bv (54)
Pune
Ipshita shukla

CAF COFFEE DAY

Overview
Coffee has been around in India since the 17th
century. Caf coffee day pioneered the caf
concept in 1996 with its first outlet inauguration in
Bangalore. It was one of its kinds, as it was initially
opened as a cyber caf, but later with a burst of
cyber caf in India, it went back to its core
competency, COFFEE. CCD saw the potential of
the youth market and embarked on a dynamic
journey to become the largest organized retail caf
chain with a brand identity of its own.
CCD is a part of Indias largest conglomerate,
amalgamated been coffee trading company Ltd
(ABCTCL), the first to come out with an idea of
coffee bar in India. As of March 2015, there are
about 1555 outlets of CCD across 29 states of
India. Cafe Coffee Day has also expanded outside

India with its outlets in Austria (Vienna), Czech

Republic, Dubai, Malaysia & Cairo, Egypt. CCD
grows coffee in its own estates, with Asias second
largest network of coffee estates of 1200 acres.
Not only this, CCD is also the only vertically
integrated coffee company in India with its cafs
functioning in every nook and corner of the
country.
In October 2009, CCD unveiled a new logo, a
dialogue box, to weave the concept of power of
dialogue. With a new brand identity, CCD planned
to give a new look to all of its outlets by the end of
2009. No doubt that the company was going well
along with its mission, that is to be the best caf
chain by offering a world class coffee experience at
affordable prices . It is a youth oriented brand with
majority of its customers between the age group of
15-29. Depending on the size, each caf attracts
between 400 to 800 customers daily. CCD is a
place where customers come to rejuvenate
themselves and be themselves.

Abstract

Caf Coffee Day has 1,555 outlets, across India. It

has mapped 50 cafs in Bengaluru to deliver
orders within a 3-4km radius. Customers will be
able to place an order from a caf that falls within
their delivery radius through the Swiggy app and
will extended in other cities too.
Nagaraj says that the CCD brand has evolved and
matured over the years, with premium concepts
such as Lounge and Square. She says, "The Lounge
and Square, they are like toppings on the cake."
the economy grows and people can afford to pay a
premium for their cup of java.
Caf Coffee Day already enjoys a loyal base of
beverage and caf food lovers. With this move, we
plan to create a 360 degree interaction with our
customers strengthening CCDs foothold in the
food space as well, said Bidisha Nagaraj ,group
president marketing, Coffee Day.
Customers are demanding a differentiated food
experience. The caf chain is also in plan to launch
multi cuisine culinary experience along with coffees
and beverages in the home delivery sect. The CCD
food menu will be long and diverse in kind.

The home delivery string of CCD has also kept in

choice bulk orders for corporate meetings or small
gatherings.

Facts and Figures

Each CCD averages daily food and beverages sales
of about Rs 11,927 ($184). In comparison, a
competitor like Starbucks makes over five times
that amount, according to retail consultancy firm
Techno Park. However, CCD has many more outlets
than Starbucksthe American coffee company had
64 cafs in India as of Dec. 2014and cheaper
offerings.
In 2014, CCDs same store sales growththe
percentage change in sales over the previous year
stood at a healthy 9.13% according to the draft
red herring prospectus filed by the company with

market regulator, Securities and Exchange Board of

India.
Today, the company owns and manages a network
of 1,550 cafs in 209 cities. It has the largest
network of food outlets in the country. International
fast-food chains such as McDonalds (300-350),
Dominos (921) and Subway (531) trail CCDs store
count. Cafe Coffee Day will invest up to INR 4.5
billion over the next three years to open 400
outlets in the country.
More facts:
1.All-Day Refresher, most selling product of
C.C.D. whose selling cost is Rs. 100 has a
prime cost of just Rs. 35 & rest all is profit to
C.C.D.
2.C.C.D. does not use sugar as raw material in
any of its preparations but uses milk cream &
Sugar Free as raw material.
3.Ice-creams & other eatables are out-sourced
from Amul & local vendors of reputed brands.

Today, the coffee chain market is more than Rs.

1,000 crore and is growing at almost 30 per cent
each year. The market is dominated by a few

brands with CCD the largest in terms of turnover

and the number of outlets in India, followed by
Barista a distant second. Other players are Costa
Coffee, Mocha, Coffee Bean & Tea Leaf and Gloria
Jeans. Currently, India has about 1,800 coffee
outlets, or cafes, and business sources claim India
can accommodate another 2,700 cafes.
Coffee Day Enterprises is the largest IPO on the
food services side. Shares set apart for institutional
investors were subscribed 4.38 times in the threeday initial public offering, while the retail and noninstitutional investor categories were subscribed
90% and 53%, respectively. The portion reserved
for employees was subscribed 84%. CCD was one
of the largest issues in recent past, and saw almost
twice the subscription. That sends a strong signal
that a company with a good track record can sell in
the market.

Analysis
The coffee market in India has been growing due to
the demand for ready to drink coffee and has
become a part of an individuals daily consumption
basket. Caf coffee day is a chain of coffee outlets

run by coffee day global Ltd, Which is a subsidiary

of coffee day enterprise Ltd (CDEL). Presently, CCD
operates in around 1500 outlets across 209 cities
and has 16 international outlets across Malaysia,
Austria, and the Czech Republic. As on March
2015, CCD market has dominated the Indian
chained coffee outlets with 46% share market
share. Apart from coffee, the company also
operates in technology parks, logistics, financial
services and hospitality. In 2013, CCD was
bestowed with the prestigious ISO 22000:2005
certification by the internationally acclaimed DNV
Business Assurance Food Safety System for its
Food Safety management systems in cafes. This
certificate covers the mandate of handling,
preparing and serving food and beverages in the
Caf Coffee Day (CCD) cafes, Coffee Day Lounge
cafes (CDL), Coffee Day Square cafes and Fresh
Assembly Centres (FACs wherein caf food is
assembled before sending them out to cafes
across).

Competitors
Direct Competitors
Barista

Caf mocha
Costa coffee
Beyond coffee
Gloria Jeans
Minerva coffee shop.

Indirect Competitor
Mcdonald
Haldirams
Global Competitors
Star bucks.

Its different divisions include:

Coffee Day Fresh n Ground (354 Coffee bean and
powder
retail outlets)
Coffee Day Xpress (341 Coffee Day Kiosk)
Coffee Day Take away (7000 Vending Machines)
Coffee Day Exports
Caf Coffee Day
Coffee Day Perfect (FMCG Packaged Coffee)
division.

PRODUCT:

Caf Coffee Day product mix constitutes a wide

range of products like samosa, biryani, masala
sandwich, tikka sandwich etc. The best-selling item
in summer is frappe, which is coffee and ice cream
blended together. The young people favor it. In
winter it is cappuccino. Their merchandising
includes funky stuff like t-shirts, caps etc.
PRODUCT
Hot Coffee
Cold Coffee
Smoothies
Granites

SERVING SIZE
210 ml
350 ml
350 ml
350 ml

PRICE:
Considering that Caf 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.45 to Rs 80. From the time it first started
its operations, there has been only minor changes
in the pricing policy of Caf Coffee Day. The
changes have been more due to the government
taxes than anything else.

Segmentation

Current market situation

 Average Footfalls: 400 to 800 per caf per day.

Growing young population and promotion of
coffee culture.
Regional Distribution:
Targeting expansion in smaller towns
New caf formats in metros
Lounge
Square
Demographic
Major chunk of CCD customers falls within the age
group of 20 to 30 which accounts for 57% of the
overall percentage.

Income Basis:
Middle class
High class

Article analysis of caf coffee day

With its vast network of cafes, CCD is aiming to
offer an order-in option for not only beverages but

also a multi-cuisine experience with a range of

caf-oriented and meal-oriented offerings at
consumers doorsteps. It has tied up with online
food delivery startup Swiggy for the initiative.
Competitors like Starbucks - as also a host of
smaller snacking, beverage and dessert ventures
including Corner House, Juice Junction, Vasudev
Adigas and Goli Vada Pav - already offer home and
office delivery. But the scale at which Cafe Coffee
Day can do it would probably dwarf everybody,
given that it has 1,555 cafes across 219 cities.
For now, the initiative is restricted to Bengaluru,
where it has designated 50 cafes from where
Swiggy will pick up the orders. Customers need to
place their orders through the Swiggy application.

Cafe Coffee Day to extend home delivery to

Mumbai and Delhi

Cafe Coffee Day will extend its home delivery

business model to Mumbai and Delhi over next
three to four months which will include lunch and
dinner options in its retail cafe menu.

The Bengaluru-based cafe chain had run a pilot in

the city earlier this month, for which it tied up with
hyper-local restaurant delivery company Swiggy to
offer customers delivery option for a specially
curated food and beverage menu.
The consumer has little time and wants the same
kind of F&B experience and product mix at their
doorstep, therefore delivery is the right thing to do.

For home delivery, CCD plans to rope in third-party

logistics players. "As we move to other cities, we
will look at other partners in addition to Swiggy,"
Nagaraj said. "At present, it is clocking in around
200 deliveries a day with an average ticket size of
Rs 350 per order. In 2016, the company will focus
on food in a big way with additions of lunch and
dinner options to its retail cafe menu. 2016 will be
about food for CCD, at a high level, it will be
looking at introducing more items. From a
consumption standpoint, fragmentation of meals
has gone down as consumers want everything in
the same place,.

CCD will also look to add popular selling items from

its delivery menu to its cafes and has already
introduced a few. The chain has 1,555 cafes in 219
cities, across formats. It plans to open 135 cafes in
2016.

Conclusion
In this era of hard core competition, people have
real less time to hang out as they used to do in the
past. These people are more engaged in their work
as compared to the past, and with the ever
increasing competition in the market, one can
assume the high stress level of this working class.
These people still need that refreshment ability of
coffee, so why not deliver it to them at their
workplace, so that the stress release and work
could go hand in hand.
Moreover, the trends are changing, working
conditions, it has become more time consuming
and hectic, as a result the leisure time of the
people have reduced, therefore people generally
working in class segment get lesser time for
themselves. In such a situation, if one is getting

his/her favourite coffee delivered at their door

steps, it is surely going to get a good market share.