This presentation tells us the various Corporate level, Business level and Functional level strategies adopted by Cafe Coffee Day

2. Mission
“To be the best café chain by offering a world
class coffee experience at affordable prices.”

3. Country Analysis
• Median Age – 27 years
• 65% of the population is below the age of 35 years
• The proportion of working population (25-59) is expected to increase from
40% in 2000 to 46% in 2020
• By 2020, 35% of the total population will be residing in Urban cities
• By 2020, there will be 109 miilion people in India earning between 3 lacs
to 6lacs per annum and 100 million people earning between 6 lacs to 30
lacs
• Spending on discretionary products will increase to about 64% of total
spending by 2020

4. Industry Analysis
• Current size of the café market in $70 billion and is expected
to grow to $151 billion by 2020

5. Competitor Analysis
Biggest competitors are:
• Starbucks
• Costa Coffee
• Barista
• Gloria’s
• Coffee Bean & Tea Leaf
• Many stand-alone coffee shops are coming up.
• McDonalds and Dunkin Donuts have started selling coffee.
• Many substitutes in the form of Slush, Iced Tea, Flavored Juices, Fruit Punch etc are
available.
• Revenues are rising but losses are also on the rise.

6. About Café Coffee Day
• Café Coffee Day, owned by Coffee Day Global is the largest coffee chain in
India.
• It was founded by Mr. V.G Siddhartha.
• With 1538 outlets across India, it is 3 times bigger than its major
competitors such as Starbucks, Barista and Costa Coffee.
• It also has a presence in Austria, Czech Republic, Dubai, Malaysia and
Egypt.
• It is also the largest producer of “Arabica” beans in Asia exporting to
various countries including USA, Europe and Japan.

7. in India, we operate a highly optimized and vertically integrated coffee business which ranges from procuring,
processing and roasting of coffee beans to retailing of coffee products across various formats.
We set out below a description of the formats of coffee businesses we operated as of December 31, 2014:
Format Branding Offerings Target segment Footprint
C
a
f
é
N
e
t
w
o
r
k1
Café Coffee
Day outlet
Café Coffee
Day
a mix of coffees,
teas and other
beverages and food
options
value-conscious youth
segment
1,423 outlets across 209
cities in India and 16
international outlets
across Austria, Czech
Republic and Malaysia
Café Coffee
Day
The Lounge
outlet
The Lounge a mix of exotic
coffees, teas,
cocktails and
international
cuisines options
trendy and affluent
customers with a
higher disposable
income
42 outlets across seven
cities in India
Café Coffee
Day The Square
outlet
The Square specialty coffees
and teas and fine
dining options
coffee connoisseurs
who seek the theatre of
coffee
seven outlets across four
cities in India
I
n
H
o
m
e
Vending
business
Coffee Day
Beverages
a variety of coffees
and teas; coffee is
freshly brewed
corporate and
institutional clients
28,777 vending
machines across India
Fresh & Ground
outlet
Coffee Day
Fresh &
Ground
22 exclusive
varieties of freshly
brewed coffee
powder
residential households
consumption and a
large number of
restaurants and eateries
across South India
424 outlets across seven
states in India
O
u
t
o
f
H
o
m
e
Coffee Day
Xpress kiosks
Coffee Day
Xpress
basic offerings of
coffees and teas
and light snack
options
caters to ‘Coffee on-
the-go’ consumers
590 kiosks across 12
cities in India
Production,
Processing &
Exports
Coffee Day
Exports
green coffee beans large roaster and coffee
traders
one of the largest
exporters of Indian
coffee beans, primarily
to Europe, Japan and the
Middle East
Café Coffee Day as on December 31, 2014

8. Competitive Advantage
First Mover
Vertical
Integration
Loyal
Customers
Residential
College
Lowest
Price

9. Strengths
1. Highest number of stores
2. High brand equity among the youth
3. Low prices
4. Vertical Integration
Weaknesses
1. Not seen as a premium brand
2. Ordinary ambience and décor
3. Complaints about customer service
Opportunities
1. Growing coffee culture in India
2. Rising income of people
3. High potential in Tier-II and Tier-III cities
4. Enter foreign markets
5. Introduce new varieties of snacks and
beverages
Threats
1. Growing competition from global and local
coffee chains
2. Rising attrition rate
SWOT

10. Porter’s Five Forces
Industry
rivalry
(HIGH)
Threat of
new entrants
(HIGH)
Supplier’s
bargaining
power
(LOW)
Threat of
substitutes
(HIGH)
Buyer’s
bargaining
power
(LOW)

11. Abell’s Framework
Customer Group
(18-30 years)
Distinctive Competencies
Low cost, Larger reach, Better
connect with the people
Customer Need
Informal place to
relax and have fun

12. Determinants of Shareholder Value
To increase shareholder value,
managers must pursue
strategies that increase the
profitability of the company
and grow the profits
CCD has used certain strategies, like going for IPO - Rs 1,150-crore
for its growth and expansion purpose, ultimately helping the
shareholders to make profit

13. Coffee Day has ties up with Swiggy and will start the service in Bengaluru where it
has mapped 50 cafés to deliver orders within a 3-4km radius.
Rs 1,150-crore IPO in October 2015 .
Cafe Coffee Day to invest Rs 450 crore to add 400 stores in 3 years.
•
Current Information on CCD

14. Industry Life Cycle
Organized Café
chain Industry
currently is in
the Growth
Phase

15. Strategic Groups
Café Coffee Day
Independent
Café chains
Barista
Costa Coffee
Starbucks
Coffee Bean &
Tea Leaf

16. Quality Map
Costa
Coffee
Barista
Coffee
Bean &
Tea Leaf
CCD
Starbucks

17. Functional Level Strategies
Efficiency
1. Highest number of stores
2. High brand equity among the youth
3. Low prices
4. Vertical Integration
Customer Responsiveness
1. Not seen as a premium brand
2. Ordinary ambience and décor
3. Complaints about customer service
Innovation
1. Growing coffee culture in India
2. Rising income of people
3. High potential in Tier-II and Tier-III cities
4. Enter foreign markets
5. Introduce new varieties of snacks and
Quality
1. Growing competition from global and local
coffee chains
2. Rising attrition rate
Competitive Advantage
LOW COST

18. Customer Groups and Market Segment
Café Chain
Market
CCD stores and
Kiosks
Middle Income
College Students
CCD Lounge and
CCD Square
Premium
Corporates

19. Value Creation Frontier
Costa
Coffee
Barista
Coffee
Bean &
Tea
Leaf CCD
Starbucks

20. Business Level Strategy
Business Level
Strategy used by
Café Coffee Day

21. Crossing “The Chasm”
Gloria Jean’s
Coffee had to
shut shop in
India as it
couldn’t pass
the Chasm
CCD successfully
crossed the Chasm
as it understood
the needs of
majority of Indian
consumers

22. CCD’s current
strategy

23. Coffee
Plantations
Conversion in to
coffee beans
Selling coffee
through retail
chains
Vertical Integration of Café Coffee Day

24. Existing PRODUCTS New
MARKET DEVELOPMENT
Opening of Café chains in
internationally
DIVERSIFICATION
Vending machines
MARKET PENETRATION
Café Chains
PRODUCT
DEVELOPMENT
1. Coffee exports
2. Premium cafes such as
Lounge and Square
3. Home Delivery Service
ExistingMARKETNew