Presented By:

Rajiv Adlakha 39 Rakesh Kumar 41 Saurabh Maitra 51 Shantanu Kumar 53 Sohail Rana 58 Ankitesh Kumar Tiwari 74 Sushant Agrawal 79

Brief Summary
y

y y

The given case study mainly focuses on three main players in the Indian coffee market Barista, CCD and Qwikys. The Case study deals with the development of the Indian coffee market. The case study has made comparisons as to how Barista, CCD and Qwikys are different from each other. Comparisons have also been made regarding their market strategies adapted by each of the three players. The case study has also given us an idea on the ambience of the three stores and the way they attract customers.

Brief Summary Cont...

y y y

The case study has given us an idea about the rapid expansion as well as the spread of various coffee outlets all over India. An overall idea is also obtained with regards to the target audience of the three outlets. One also gets to know about the various innovations in the products of their respective stores and also about how the customers get educated about the products. An overall idea is also obtained as to why customers are getting attracted towards these coffee outlets. It is not only just the coffee factor, the case study has also highlighted various other factors that has made these stores popular such as promoting caps, T-Shirts and Coffee mugs.

Overview of Coffee Industry in India

Region South India Rest of India Per capita consumption 240 gms or 50 cups per annum 4-5 gms or 1 cup per annum

Increased exposure to international life style Rise of demographic class people are looking for more leisure. People spending more time outside their homes. The target segment to 20-34 year olds is expected to increased fro 220 million to over 300 million by 2010.

Barista
Good friends great coffee
 

     

Entered in the Indian market in 2000. The company had 105 outlets and was planning to have 250 outlets by March 2003, go global, starting with a store in Sri Lanka by October 2002 in current year. Annual sales of Rs. 650 million as of 2002. Good ambience at its outlets. Target customer lifestyle oriented. Alliance with premium hotels such as TAJ properties. Tie ups with Planet M & PVR cinemas. Tata Coffee has a stake of 34.3% in Barista.

CCD
A lot can happen over coffee
 

     

Entered in the Indian market in 2000. The company had 50 outlets in 9 cities and planning for another 100 outlets by December, 2002. Annual sales of Rs.100 million as of 2002. Relaxing ambience with eye-catching crockery and bright dcor. Target customer college crowd and teenagers who formed the mass market. Alliance with premium hotels such as Taj properties Tie ups with Planet M & PVR Heavy promotions with CNBC, Singapore airlines

Qwiky Qwikys

Question 1:

Differentiation and cost leadership are the two generic strategies that a company can adapt to create a competitive advantage in a market. What are the strategies that Barista, CCD and Qwikys have adapted? Which strategy do you think is suitable for the Indian market? Give reason to justify your answer

Strategies adapt by Barista, CCD and Qwiky Qwikys

Barista, CCD and Qwikys have obtained the differentiation strategy to gain competitive advantage in the market. yAs far as Indian market is concerned, differentiation strategy is best suited to the Indian market. This is because:
 Indian market potentially is a very huge market. In order to survive in the Indian market, one needs to be different from others that can help distinguish from one another in the market  If the market players are following the same strategy, there are chances that a saturation point will be created sooner or later which does not help the development factor  Differentiation is a major factor which is very much essential in the Indian market. But this differentiation must be accompanied by creativity as well as innovation which will play a major role as far as the survival factor is concerned

Differentiation enables market players to have that competitive edge over their rivals. One should always try to exploit the weakness of their nearest rivals and on the other hand also try to convert its weaknesses into strengths In order to survive in a market, one must have something that distinguishes itself from their rivals. This distinguishing factor can be enhanced through differentiation. This will help the firm to stay one step ahead of their nearest competitors So, in short, it can be said that for a market like India, the differentiation strategy should be adapted. One must have the ability to distinguish itself from the others otherwise it wont be possible for a firm to survive especially in a Country like India

Question 2:

Barista, CCD and Qwikys target different segments. What is the segmentation strategy adapted by the three players? Also comment on the potential of the each segment

Target Customers


Barista, CCD and Qwikys have differentiated themselves on the basis of ambience, dcor, service, price, quality and customer relationships Barista have mainly targeted the youth from the premium sector of the society CCD has targeted the mass market. CCD perceives the whole market to be its playground Qwikys have targeted the youth in the age group of 18 to 30

Target Customers
y

The potential of each segment can be highlighted as follows:

 Barista have targeted the youth from the premium sector. It is expected that this sector will be well off as regards income and livelihood . This segment will have relatively high potential as youths are many in numbers and are very enthusiastic and vibrant in nature CCD has targeted the mass market. In this case, the potential will be huge as it is trying to cater to the needs of entire gamut of people ranging from lower class people to the absolute elite class of the society Qwikys have targeted the youth in the age bracket of 18 to 30. This age group are found in huge numbers across the country and are very much modern in their outlook. They respond very quickly to the changes in the society and have huge potential within them

Question 3:

Starbucks is planning to enter the Indian Coffee retailing market. Of the three players discussed in the case, who do you think is competitively better placed to face competition form Starbucks and maintain their growth?

A Note on Starbucks

Competition of Starbucks


Out of the three players discussed in the case, CCD is better placed to face competition from Starbucks and maintain their growth.

This is because:


 

CCD has targeted the mass market consumer. They have considered the whole Indian market as their playground. This strategy has not been adapted by Barista and Qwikys. Moreover CCD is unable to keep pace with barista, it is growing steadily all over India and have catered to the needs of the entire gamut of people. CCD has also priced its products 20% lower than its competitors. This strategy has been adapted by CCD in order to attain competitive edge over their nearest rivals. CCD has a trend of Indian restraunt where as Barista & Qwikys have an Italian way of service in India. The above mentioned points will help CCD to face competition form Starbucks and maintain its steady growth in the market.

Question 4:

Do you think that the intense competition in the coffee retailing business is likely to cause consolidation? Explain with reasons

The case of consolidation seems to be unlikely in this scenario.

This is because:


Each of the three coffee parlors have their own way of functioning. They have different identities, different ambience, different prices, quality and customer relationship. Each of these coffee parlors have their own way of operation and are vying for the top position in the Indian Coffee market in their own way. Each of these coffee parlors have their own way of looking at things and the way they go about carrying on their business. Each of these coffee parlors will always have something different to offer to the customers. All these above mentioned factors distinguishes one firm from another thus putting light on the differentiation factor.

  

Thank You