Essay on Coffee Wars in India

892 Words Oct 27th, 2015 4 Pages
Individual Case: Coffee Wars in India
Café Coffee Day is the leader specialist coffee chain in India, holding over 60% of market share. The major issue that C.C.D. is facing is the entrance of the dominant global brand, Starbucks, in India’s coffee business. Not only Café Coffee Day has to deal with it, but also face all other international brands currently at the market while having global ambitions. In these last years, the competition in the coffee market has been increasing and even though Café Coffee Day has been managing to maintain its place as the leader, the entrance of Starbucks with a positive and stronger brand image, could threat the whole business. The challenge and goal, for now, is for the management of Café Coffee Day
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Yet, considering that the coffee market was at an early stage since 1996, from Porter’s 5 forces perspective’s the coffee market - presenting a CAGR of 6,8% from 2001 to 2011- was a very attractive market for other brands to explore. Therefore, they did. CCD’s pioneers and its knowledge about the Indian culture also played an important role on better attending the customer’s needs and expectatios, e.g. the revenue from food were 35% compared to 15% to other international coffee chains. The indirect competitors, such as tea customers does not threaten so much the coffee business, due to the fact that they are not mutually exclusive, coffee is currently a trend in India, people might shift habits and it also gives a estimative of the size that the coffee market could reach. CCD focused its marketing efforts on targeted promotional activities instead of media advertising, and in the end, managed to build a strong emotional connection with its target group. Supposing that the young segment could not afford to pay much and with the goal of having more customers in the long run, CCD often tried to maintain a more affordable price than all competitors. Their own vertically integrated business model could also be considered another competitive advantage and source of value in customers’ eyes. It helped with cost savings, achieving better quality with the same price and it from the customers’ view, they were trustful and

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