Branding strategy of Cafe Coffee Day

If I am going to sing like somebody else, I don’t need to sing at all…

                                                                                                                        -Billie Holiday

                   How true is this particular saying of the famous singer in building a branding strategy? And how truly it has been followed by V G Siddhartha to make him now virtually the coffee king of India? V.G.Siddhartha, chairman of the Bangalore-based Amalgamated Bean Coffee Trading Co. (ABC) is the man behind India’s largest coffee chain, Café Coffee Day (CCD).On October 11,2011 Siddhartha was awarded as the Next Gen Entrepreneur award by Forbes India.

                   But this was not a cake-walk for Siddhartha. From setting up its 1st cafe outlet in 1996 on Brigade Road in Bangalore, CCD is now bubbling with 1232 stores and counting, with another 6 stores outside India in Vienna and Karachi. No doubt that he made the juice worth the squeeze.

                   Your brand is more than your logo, name or slogan — it’s the entire experience your prospects and customers have with your company, product and service. This is where CCD pulled a master stroke of changing the whole calculus of coffee consumption in a tea drinking country like India.

                   Belonging to a coffee plantation family Siddhartha was quick to capitalize on the advantage of having an estate of coffee shrubs rolling over 10,000 acres. Taking a leaf out of South East Asia’s strategy (beer instead of coffee), Siddhartha started serving free coffee to whoever came to his internet café .This was just the stepping stone, where he used internet just as bait for the people. It was all part of a strategy of convincing customers not that they liked coffee, but liked the fact that they are holding and sipping a coffee.

                    Cafe Coffee Day is India’s favorite coffee shop, for the young and the young at heart. CCD today has definitely become the largest youth aggregator.”Although demographically, a typical consumer would be male or female between 15-29 years of age, belonging to middle or upper middle class, we call our consumers young or young at heart. We are about juke boxes, good and affordable coffee and food.” Sudipta Sen Gupta, ex-marketing head, CCD. CCD focuses on projecting a feeling of togetherness, friendship, romance or informal office meetings over a cup of coffee and celebration which are critical core values. Accordingly the cafe ambience, the look and feel inside is maintained. Other than the regular stores (SQUARE) CCD has is having the premium formats (LOUNGE) where one can be what s/he is best at being…oneself. Moreover they have coffee day express, coffee day beverages (coffee day wakeup), coffee day fresh n ground and coffee day exports thus catering to every aspect of coffee.

                   With its vision to be the friendly and stylish social hub for the young and the free spirited to get together and converse over a cup of coffee, and complementing this is the fact that half of India having being born after 1983,the company rightly calls itself “India’s largest youth aggregator.” And with their simple yet sensitive objective “A great cup of coffee. From bean, to cup. Every time”, they have hit the right notes.

                    Having zeroed in on the youth and the young at heart as the target market, CCD is just the place away from home or office where you can relax all by yourself or with others. An atmosphere where you can discuss the best ideas and solutions in your mind or with those around you. And of course, at the heart of it all, you must have your cup of fresh brew of the mysterious coffee bean that indulges all the five senses and leaves a long lasting magical effect on everyone. “Some of my best ideas have come out of the hours I have spent in a café. A café is the place where I can be all by myself and take in the world of beautiful people around me” said India’s most loved young author Chetan Bhagat. Nowadays, with youth having higher disposable income/pocket money, they don’t mind spending Rs 150 over a cup of coffee coz it will cost them that much out of the house anyway. But does this prove their brand loyalty? “Why not? I mean, it’s definitely a cool place to hang out, but if my parents start visiting it often, I would rather prefer another place.” said Debnath Ganguly, a post graduate student living in Delhi.

                     Over years CCD has undergone total café rebranding, with jumping to an all new ‘smart’ menu for in-house and take away food, changes in ultra-comfort furniture design and seating, new uniforms, cutlery. These changes are designed to facilitate a more interactive in-café experience for customers and enhanced customer service. Taking special notice on elements such as pricing, food, music, ambience and promotion CCD has created a friendly, clean and sober café environment that offers affordable and excellent range of products, being an essential part of everyone’s lifestyle.

                 A significant change in the rebranding strategy is the transformation of the famous square Café Coffee Day logo to a ‘Dialogue Box’ – with the words Café Coffee Day written in a distinct, specially created font. The new trendy ‘dialogue’ logo symbolizes the essence of what a Café Coffee Day café is all really all about – a perfect place to ‘relax and dialogue’. And as we all know, a lot does happen over coffee!

              But all said and done the path for success was not a bed of roses. In their early stage CCD neither had a mention-worthy presence nor definite brand recognition. It surrendered to Barista, founded in 2000 by Amit Judge. Positioning itself as an up market, premium coffee cafe and targeting executives, Barista slowly but steadily set up some 85 cafés around the country, while Coffee Day had just 35. But Siddhartha had bigger plans. He understood the demand of the Indian youth of experiencing culture of world class nature yet easily accessible and affordable. Thus the “third place” away from home concept evolved for the young and the young at heart. On the other hand, Barista by frequent changing of ownership lacked a focus. They wanted to be “everything for everyone” but ended up being just the opposite. Now, Barista under the Lavazza group, targeting the young adults has opened 230 stores and is considered to be the closest rival of CCD. Recent entrants in the Indian market include Gloria Jeans, Coffee Bean & Tea Leaf and Illy Café. By number of coffee outlets, CCD’s retail chain today figures among the top six globally, behind Starbucks, Dunkin’ Donuts, Tim Hortons, Costa Coffee and McCafe, some of which are part of bigger chains..New entrance in the Indian coffee market of the global coffee giant, Seattle-headquartered, Starbucks teaming up with the Indian mega conglomerate, the Tata Group doesn’t need an immediate “putting on the thinking cap” for CCD. Instead it can be a blessing in disguise for CCD as more no of people will be become aware and will be experimenting with the coffee consuming habit outside home and office, at a “third place”. Sharper locationing of the outlets also gave CCD the competitive edge.

                CCD’s consumers can be categorized into those who want to have coffee; there are the youngsters who wish to hangout and then there are those who want to grab a quick meal. Targeting the third segment CCD in trying out the Rajma Chawal meal in select stores in Delhi and NCR; the parathas at CCD stores in Punjab and Chandigarh. Making better use of technology both in the front and the back end is its key focus as of now. Making the cafes Wi-Fi enabled, digitizing the in house magazine Café beat, building loyalty programmes and using technology such as Bluetooth to stream music across the café will not only attract the customers attention but will create a whole lot of excitement and positive vibe around it.CCD then could capitalize by building communities and thus increasing their brand equity.

                  With coffee consumption growing at 6% plus per annum compared to 2% globally, India coffee market is definitely a place you would want to be in. With plans of domestic(2000 outlets by 2014) as well as international(200 outlets in East European region, West Asia and the Asia-Pacific region by 2014) expansion, CCD is definitely showing some aggressive branding strategy which till now has stood them in a good stead.

               CCD has definitely connected well with coffee lovers as we are seeing higher growth in cafés.  Café Coffee Day has played an essential role in awakening India to the coffee café culture by giving people an enjoyable ambience, from cozy seating to ordering the finest selections of coffee brews, beverages and food. And above all, it has given a place where India could go and spend a while to think and talk about things they like.

References:

1.http://www.casestudyinc.com/coffee-day-brand-strategy-india

2.http://businesstoday.intoday.in/story/cafe-coffee-day-in-promising-companies-list/1/18661.html

3.http://www.cafecoffeeday.com/

4.“Marketing Management” by Philip Kotler (13th edition).

[The article has been written by Sayantan Bhowmik. He did his schooling from St. Xaviers, Haldia, West Bengal and graduated from Calcutta Institute of Technology and Management. He is presently pursuing his MBA from Fostiima Business School, Delhi. He is a sports loving person and likes to play computer games, watch movies and quiz shows and solve puzzles in his leisure time. He is a firm believer in “Even sky is not the limit !”]