Issues with respect to Branding
Café Coffee Day (CCD) enjoyed the first mover advantage in the Indian markets for nearly a decade and thus didn’t pay much attention towards its brand elements. Once, the competition started to pour in the country that is when they took their branding exercises seriously.
Café culture which primarily originated on the basis of experience (taste of coffee, service, and ambience) focused only on the people of age 15-25(in case of CCD). Half of this age group does not fall under the working class population and hence failed to or were averse to spending the premium price charged by CCD to enhance the overall experience.
CCD stood vulnerable against its competitors because unlike the international giants such as Starbucks and Barista Lavazza, who had their USPs in place (Biggest coffee chain in the world for Starbucks and true taste of Italian coffee for Barista Lavazza), CCD was foraying into multiple areas with simply no USP and the only thing working in its favor was the comparative low prices of its offerings.
CCD lacked a connect with the high end consumers who were in the upper income class of the society which is why in the exhibits the respondents have given a higher ranking to Barista Lavazza when asked about how they associate the two chains with sophistication, feeling of pride, esteem, luxury and feeling of westernization. However CCD later realized this open nerve ending and introduced a premium chain of Cafés, Café Coffee Day Lounge, with various offerings in place, sophisticated ambience, improved service and high prices.
With gradual expansion where the Café chains plan to make themselves an integral part of our lives, they have simply failed to do so as the non loyal respondents rate Cafés very low while associating them as a place for everyday coffee lovers (exhibit 1).
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