case study on ccd

case analysis of coffee cafe day

1. Café Coffee Day : Case Study Case 2 Anurag Sharma 819004

2. Cafe coffee day(CCD) was the first-ever coffee chain opened in India.VG Siddhartha was the man behind making coffee popular in a nation of tea-lovers. Also, CCD owned Asia’s single largest coffee estate and India’s best coffee brand.

3. It was the one with the tag line ‘A lot can happen over coffee’, Café Coffee Day was the one who touched the hearts of millions of Indian youth, assuring them that all they need is a cup of coffee and a peaceful place to talk it all out!

4. India was strictly a tea-loving country. Let us discuss everything from pin to plane about the brand who successfully made coffee popular in a country full of tea lovers.

5. HOW CAFE COFFEE DAY STARTED V G Siddhartha from Chikmangaluru district of Karnataka was the man behind changing the beverages culture of India with a variety of drinks and side dishes hard to resist. Coffee Day Global which is the parent of the Cafe Coffee Day chain was incorporated in 1993.  The first CCD outlet was set up on July 11, 1996, at Brigade Road, Bangalore, Karnataka. V.G. Siddhartha opened the first CCD outlet with an initial investment of ₹ 1.5 crores.

6. https://www.youtube.com/watch?time_continue=67&v=qoUSKvI1ce8 Siddhartha happened come across a German business owner, who was interested in buying coffee beans from him for his “leading coffee brand in Germany –  Tchibo ”. During that brief discussion with the German businessman, he told his story of how his brand had started in a small 10 ft. shop in Hamburg. This inspiring tale of the Tchibo gave Siddhartha an outlook of a different world altogether & opened his eyes and it also gave him a wonderful idea. Idea behind ccd

7. Challenges Faced By CCD Having done with the initial foundation, the major challenge faced by the cafe coffee chain was to make a revolutionary change in the Indian culture where the majority of the population prefer drinking tea rather than coffee. After the initial struggle, the homegrown cafe chain came a long way, credited with the start of coffee shop culture in India but then it finds itself facing tough competition not just from the international chains such as Costa Coffee, Starbucks or Barista but also from various domestic players and concept cafés.  

8. How Ccd Overcome Challenges To stand up against the competition, CCD has built its retail strategy and named it 3As strategy : Affordability Accessibility  Acceptability

9. Affordability What worked best for the Indian cafe coffee chain was its combination of aspiration and affordability. Even as it gave coffee an attractive makeover, CCD’s prices stayed well below its rivals. Ensuring that it remained the favorite hangout choice for school and college students or young adults on meager paychecks from their first jobs.

10. Accessibility   It wasn’t just restricted to the metro cities. If there’s one singular claim that Coffee Day can makeover all of its rivals, it is that it took coffee to cities and towns across the country, and offered the same experience everywhere.  They always believe in serving an experience along with the coffee.  They have ensured that the cafes are at an arm’s reach.

11. Acceptability Today, coffee is not just seen as a beverage but a social glue that brings people together to relax and unwind. “Let’s catch up at CCD,” is probably one line most Indians have said or heard at one point or the other over the last two decades.

12. Marketing and advertising strategies of CCD As we have discussed above, CCD’s strategic approach was based on the 3 A’s i.e. Affordability, Accessibility, and Acceptability. 3A’s are the significant factors contributing to the growth of the brand.  Secondly,  Digital Marketing  has become an integral part of Café Coffee Day’s marketing plan. CCD’s fan base is overwhelmed with over 5 million fans on its social media pages and consistently engaging customers on Facebook, Instagram, Twitter, Youtube , etc. 

13. The youth was the key target and early adopters of trends, they also evolved their strategy and became more digital-centric as they engaged with the new age world. CCD marketing also constantly ensures the continuous active engagements of the consumers, like they conducted the ‘Latte Art Festival’ – where customers were served coffee topped with creative latte art designs. As CCD goes digital, it is also looking at innovation in user experiences by adopting new technologies to enhance customer service. https://www.youtube.com/watch?v=G6BF4KLl2hQ https://www.youtube.com/watch?v=MnAqhVdngTE

14. SWOT ANALYSIS OF CAFE COFFEE DAY

15. BUSINESS EXPANSION AND GROWTH CCD founder V.G. Siddhartha who feared of achieving a target of 500 tones, ends up selling 6,500-7,000 tones of branded coffee, exports about 28,000 tones of coffee and sells another 2,000 tones locally each year and has a curing capacity of 75,000 tones (largest in the country). Additionally, his cafes attract at least 40,000 to 50,000 visitors per week. The company, opened its first store in 1996 in Bengaluru, is presently operating 1,740 CCD stores in around 250 cities. As of 2015; CCD makes revenues worth $450 Million approx., employees 5000+ people, and has 1530 outlets across India, Austria, Czech Republic, Dubai & Karachi. 

16. Other Businesses of CCD COFFEE DAY EXPORTS Coffee Day Exports is all about growing, trading, retailing and exporting world-class coffee. It has a heritage of over 130 years. One of the largest exporters of green coffee in India, since 1999. We also export to the Middle East, Europe and Japan. Coffee Day Exports has invested in research and development and applied the learning successfully to improve the promotion of various coffee blends and augment its exports.

17. Visit  www.coffeedayexport.com  for more details.

18. COFFEE DAY HOTELS & RESORTS 2008 was a landmark year for Coffee Day Global Limited. Coffee Day Hotels & Resorts was formed as a subsidiary of Coffee Day Global Limited, the Chikmagalur resort of The Serai was declared open. Visit  www.theserai.in for more details.

19. MILESTONES AND AWARDS ACHIEVED 1. Café Coffee Day won the “Times Food Award” under the category of “Best Coffee Bar” in 2007 2. Café Coffee Day won the Burrper’s Choice Award by users of burrp.com in 2008. 3. Coffee Day Global won an award for “Retailer of the Year” by  Asia Retail Congress 2009 4. Café Coffee Day won the Indian Hospitality Excellence Award in 2010” 5. Café Coffee Day was ranked as 26th Most Trusted Service Brand in India and by Brand Equity (Economic Times) in 2012 6. Café Coffee Day won the Best Coffee Bar Award in 2012 7. Café Coffee Day was awarded “The NCPEDP – Shell Helen Keller Award 2013” by National Centre for Promotion of Employment for Disabled People. 8. Coffee Day Global got awarded for “Best Customer Service in Café Restaurant” by Star Retailer Awards 2013

20. 9. Café Coffee Day won the Brand Excellence Award in the retail sector in 2013 10. Coffee Day Global was awarded the bronze prize by the Coffee Board of India for being the third-best exporter of green coffee in  2012 11. Coffee Day Global was awarded as “Retailer of the Year” for the retail excellence by ABP News in 2014 12. Café Coffee Day was ranked as 22nd Most Trusted Service Brand in India, as 27th Most Exciting Brand in India under the category of “Food Services” in Indian 2014 13. The Promoter, Mr. V G Siddhartha was awarded ‘ET Retail Hall of Fame’ for his contribution to the growth in the retail sector in 2014

21. Downfall of Cafe Coffee Day I personally like the business model of CCD, but it has a lot of drawbacks.  Lets discuss about major reasons of the DOWNFALL of CCD BSR associates was their main auditor who used to audit their outlets. The auditor wrote a letter to the shareholders of CCD that they have not audited  40 subsidiaries of Cafe coffe day.  This was the reason the share holders backed off, and denied to provide further funds.  Meanwhile, the Income Tax (IT) department raided on Cafe Coffee Day (CCD) retail chains and found about Rs 362 crore concealed income. VG Sidhartha in his letter mentioned that Income tax department was attaching their shares on two separate occasions to block their Mindtree deal and then taking the position of their Coffee Day shares, although the revised returns have been filed by them. Because they were in such a heavy debt, they started taking short term loans in form of debentures with high interest rates to pay off their long term debt.  This resulted in more heavy debt burden. 

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