Capturing India’s Percolating

Coffee Market

COFFEE-STORY

Previously only a South-Indian drink

Confined to the Rich Brahmin class

Places for lawyers and educated class to hold

discussion.

The drink has now become more of a concept

COFFEE-STORY

Café bars have flocked like CCD, Barista, Mocha, Qwiky’s etc

Became famous and even 5 star hotels started cashing on it.

Coffee house started emerging at various places in the country.

COFFEE SECTOR IN INDIA

The 6th largest producer of the coffee in the world.

Indian coffee has created a niche for itself in the

international market.

Arabica coffee from India is also well received in

international market.

Coffee production in India: Karnataka, Kerala and

Tamilnadu.

which contributes about 99% of total coffee production

CASE OVERVIEW

Untapped market

Targeting and positioning of market

Increasing the coffee consumption

Creating a new entry point

Expanding network

Road block of ahead

COFFEE CONSUMPTION

0

2

4

6

8

10

12

1412

109 8.7 8.4 8.2 7.9

6.86

4.5 4.6 4.4

0.085

Country

Kil

ogra

ms

Tit

le

COFFEE CONSUMPTION

Per capita consumption of coffee is just 85 grams in compare to other countries.

In the annual output of 300,000 tons, domestic consumption is only a third(100,000 tons)

India is predominantly a tea drinking nation.

Coffee is a staple only in the southern part of the country

GLOBAL COFFEE GIANTS EYES ON INDIA

Market expansion on a faster rate

Urbanization is expanding

Coffee drinking – Fashion

Growth in the disposable income

MARKETING SITUATION

Niche coffee retail formal is growing at 10 to 12 percent a year

Organized coffee retail business-Rs 25 bn

Coffee consumption in India has increased from 55,000 tones to 75,000 tones in the last three years

3 % of the world coffee production

Export 80 % of the total produce.

“ I may be young, But please take me Seriously”

Youth – between 15-35 years

Students form a majority of customer base

Likes to be in group

Likes to sit, talk and relax

Drinks a cup of Gourmet coffee with added flavours

prefers snacks rather than meals

TOP COFFEE BRANDS IN INDIA

• Nescafe

• Tata Coffee

• BRU

MAJOR COFFEE PLAYERS IN INDIA

MARKET SHARE IN INDIA

34%

40%

20%

4% 2%

Barista

CCD

Mocha

Qwicky

Georgia

(Source: from case study)

RICH QUALITYQ POOR QUALITY

LOW PRICE

HIGH PRICE

COMPETITIVE STRATEGY

STRATEGY BEHIND EXPANDING THE NETWORK

Joint Venture Favorable Government Policies Revamp in the menu card New location Different Flavor

CREATING A NEW ENTRY POINT

1. Pilot-testing Bru World Café in Mumbai with four outlets

2. Roast green coffee beans in partnership with the Tatas.

3.

franchise agreement with Domino's pizza chain

CREATING A NEW ENTRY POINT

deals with leading oil companies like HP,BP Indian oil for setting up cafes in gas

stations across India.

4.

5. Java Green from the Reliance Group began life as a cyber café in

2003

CHARTS OF OUTLETS

• RETAILERS• PRESENT• FUTURE• Dunkin Store• 1 ( by 1st Quarter 2012)• 30• Gloria Jeans• 16• 200• Costa Coffee• 73• 300• The Chocolate Room• 2• 40• CCD• 1132• 4000

RETAILERS PRESENT FUTURE

Dunkin Store 1(by 1 quarter 2012) 30

Gloria Jeans 16 200

Costa coffee 73 300

The chocolate Room 2 40

Café coffee Day(CCD) 1132 400

HURDELS

1. Huge real estate cost

2.High rent cost

3.Low menu price

4.Manpower

5.High turnover

TIPS TO IMPROVE THE COFFEE SHOP REVENUE

Eliminate low-margin item

Prepaid gift card program

Discount coupons and discounts

Control waste and theft

Evaluate hours of operation

Eliminate bottlenecks in the ordering process

Run employee sales contests

Raise prices to bolster your company’s brand image

CONCLUSION

Coffee market focus on promotion rather than expansion of outlets.

Tapped the market with new outlets and offering new services.

Capture the upper segment of the middle class

Strives to deliver the best international standard of cafe experience

With more players entering the arena, the challenges around managing costs

WEBLIOGRAPHY

• www.indiacoffee.org• www.casestudyinc.com• www.coffee.wikia.com• www.slideshare.net• www.youtube.com

THANK YOU