Café Coffee Day (CCD), India’s largest organised retail café chain, had done a great job of creating a distinct brand identity and communicating it successfully to its TG. In a three-pronged approach adopted by the company, CCD had revamped its logo, altered the look ‘n’ feel of its cafés and created a unique brand positioning to win customers over time. CCD in its new “avatar” was targeted at the young or the young at heart and was promoted as an every day hang-out that was essentially about good coffee and affordable fun. The case provides a vivid narration of the journey of CCD since its inception in 1996 and illustrates all significant events therein. Besides this, the case describes the beginnings of café culture in India, the changing café consumption habits of urban Indians, and the spread of café culture beyond the metros and into the tier I, II and III cities. All major recent events in the Indian café industry, such as the growth of new café chains in the country, the entry of multinational companies in the market, changing consumer tastes and preferences, and changing market dynamics etc. are also showcased. Finally, the problem of competing brands offering an increasingly similar café experience and the threat of a “me too” perception are highlighted. Readers are required to assess the impact of all recent events on the specialist coffee chains and suggest alternative strategies to help ensure distinctiveness and growth for CCD in future. Keywords Café chain, Café market in India, Café Coffee day, ABCTCL, Brand positioning, Building distinct brand identity, Specialist coffee chain
Introduction Siddharth, Chairman of Coffee Day, and the man behind Café Coffee Day, a successful coffee café chain in India, was deep in thought. Should he dismiss the comments as mere musings over a cup of coffee or was there really a reason for concern. Turning back to his laptop, Siddharth re-read the postings on the consumer’s blog. The blog read – In a service category like coffee cafes where a number of me too brands *Correspondence details and a biography for the author are located at the end of the article. The Marketing Review, 2009, Vol. 9, No. 3, pp. 251-271 doi: 10.1362/146934709X467811
ISSN1469-347X print / ISSN 1472-1384 online ©Westburn Publishers Ltd.
The Marketing Review, 2009, Vol. 9, No. 3 exist, and good coffee, ambiance, service, music and snacks can quickly become generic, cafes need to understand what more could they offer to the customers to remain relevant in the market and to enjoy a distinct identity of their own. Siddharth, whose long and close association with coffee and cafés had kept him abreast of the changing nature of the Indian café industry, felt there was no real reason for concern. Coffee retailing, in his opinion, was poised for great and interesting times ahead. However, despite his confidence in a promising future for cafes in India, Siddharth found it hard to dismiss the blogger’s comments. Not only did the blogger appear to enjoy good coffee but seemed to have a good understanding of the café industry as well. Sentiments voiced by the blogger could well be a timely reminder of the impending issues and challenges in the Indian café industry. Company background Café Coffee Day, the leading retail café chain in India, was a division of the Amalgamated Bean Coffee Trading Company Ltd. (ABCTCL), one of the largest coffee conglomerates in the country. Popularly known as Coffee Day, ABCTCL was a Rs.40billion, ISO 9002 certified company, run by Siddhartha (Chairman, Coffee Day), a successful technology venture capitalist from Bangalore. In what may be called a golden phase of his life, Siddhartha had made a killing in a personal bull run in the stock markets between 1985 and 1992, and used the proceeds to purchase coffee plantations that were being sold at a...