Case Study Of Starbucks Marketing

Starbucks is a “premier roaster, marketer and retailer of specialty coffee” (Marketline 2012). This company is globally recognized because of their vast amount of stores, consisting of more than 17,000 retail stores in over 55 countries. Most retail stores are in highly populated areas, like “downtown and suburban centers, office buildings, university campuses and in select rural and off-highway locations” (Marketline 2012).

Starbucks is one of the leaders in coffee industry. Starbucks has entered into many new markets and today it has more than 16,000 outlets across the globe (Johnson, Scholes and Whittington 2011). Due to unlimited business opportunities, Starbucks Corp has set strategies to enter India as it is next major hub for development in near future. Previously Starbucks has gained wide success in China and Japan due to high consumption of coffee and tea. Since its inception, Starbucks has tapped the major markets across the world, India was left untapped. In India, Starbucks has setup alliances with TATA Global Beverages which is a unit of TATA Group of Companies. Starbucks along with TATA has started with an investment of $80 million and plans to open 50 coffee shops in a year. Currently few coffee shops has been setup by Starbucks, however in near future, it is expected that the company will achieve its target in capturing Indian market (Lamb2009). Thus, besides sourcing coffee beans from TATA, Starbucks can now explore more Asian markets (Hitt, Ireland and Hoskisson 2012).

Café Coffee Day (CCD) is an Indian coffee retailer that was established in 1995. Founded by V.G. Siddhartha, this company has quickly grown to become the leading coffee retailer in India with 60% of the market share, 1,469 locations, and 22,000 vending machines throughout the country. (Yoffie) What makes Café Coffee Day special is its complete ownership of its coffee beans from the growing at its plantations to the brewing in its retail outlets. CCD is owned by Amalgamated Bean Coffee Trading Company Limited, which owns and produces coffee beans from its own plantations and these coffee beans are the same ones that are used at Café Coffee Day. Due to ABC’s ownership of its own plantations it has no middle man that would increase costs to CCD.

The Beverage Industry in India constitutes around 230 million USD among the 65 billion USD food processing industry. The major sectors in beverage industry in India are tea and coffee which are not only sold heavily in the domestic market but are also exported to a range of leading overseas markets. Half of tea and coffee products are available in unpacked or loose form. Among the hot beverages manufactured in India, tea is the most dominant beverages that is ruling both the domestic and international market today. The supply of tea and coffee is insurmountable in the Indian beverage industry.

The Government of India at that time had loosened the regulations where foreign single brand companies could start investing in India, but, despite the norms being more relaxed, Starbucks had decided to use other ways of entering into India. Starbucks had met up with Tata Global Beverages whereby they had both discussed their interests to enter into a partnership to operate Starbucks in India. Starbucks had considered a partnership with Tata because they knew

One of the goals of CCD could be to increase its customer base which has predominantly been Students or youngsters. The customer base of Starbucks has been much more wide in its range.

The paper analyses the entry prospects of Starbucks Coffee into India. The analysis is based on the framework provided by the Eclectic Paradigm and the PESTLE analytical structure and shows that in spite of previous setbacks the current conditions in India are highly conducive for the likes of Starbucks to set up shop and be successful.

This case mainly talks about the Café Coffee Day company, and their competitive position with the challenge of the world’s largest global brand coffee chain——Starbucks in five parts. The first part introduces the history of India’s coffee market in total and the detailed information about each of the company is specified in the following two parts. The last two parts focus on elaborating CCD’s “slight course correction” that the management is confident with and raises the discussion about the central question that whether a further response is needed.

A division of Amalgamated Bean Coffee Trading Company Ltd. (ABCTCL), it is commonly known as Coffee Day or CCD. It opened its first cafe in 1996 on Brigade Road in Bangalore, and today has the largest cafe retail chain in India - with 650 cafes in 110 cities.

India, like many other Asian countries, has a tea drinking culture, but the coffee market is catching up and growing fast. This case talked about the stories of Café Coffee Day (CCD), the Indian coffee industry market leader, along with its competitor Starbucks from USA. CCD was founded in 1996 and by April 2013 it had around 3,000 stores within the Indian market. CCD had not faced any severe threat up till 2012 when Starbucks made its entry into the Indian market through a joint venture with Tata. As the world’s largest coffee chain company, Starbucks wanted to get a slice of the cake. In 2013, it opened 11 stores in Delhi and Mumbai.

There are 3 main competitors for Starbucks Coffee Company if Starbucks want to entry India markets which are Café

Giving customers a high quality coffee experience along with comfortable and spacious facility where they could spend their time with friends and family. According to a research report on coffee chain, “Very few of Indian consumers order a

India is traditionally a country of tea having consumed 10 times the amount of tea than coffee in 2011. Originally sold in mom-and-pop Shops and later in supermarkets, coffee culture began to take shape when Café Coffee Day opened its first store in 1996. Originally founded by V.G Siddhartha as a way to maintain and further his previous business venture of Amalgamated Bean Coffee Trading Company Limited. He originally established internet cafés under the brand name of Coffee Day Fresh, but by 2000 the internet became more available to the masses. This lade to a shift in tactics leading to a path of coffee dominance. Due to a nonexistent bar culture Café Coffee Day, or CCD, quickly became a place for people to safely meet for a drink. CCD stared to target the Indian youth by becoming a place to hang out with friends. CCD stores opened in urban areas with large youth populations. CCD would specifically target campuses, malls, and IT business areas. They also hit a windfall with the growing dating culture making their establishments an excellent place to have secret meet ups. With each of these factors in place they rapidly hit their goal of seeding café culture in multiple cities. Continuing to push their target demographic, CCD would often align themselves with youth culture. They would sell concert tickets, host contests and appear in movies. They would also push their Baristas to become friends with regular clients. This push worked well, with approximately 60% of their

is about. In contrast, Starbucks has had a presence in North America since 1971. In

In India café coffee day and barista are most popular and well-known café. These companies sell similar products but their positioning and target audience are very different from each other. Despite of serving to different audience, these players compete among themselves. Each player fights for its share of market. They try to differentiate themselves by the way of product or price or promotion. Café coffee day got a high rating in the market survey, for the quality and taste of their products. If they work on this particular aspect, there is a huge potential for them to attract customers, simply based on the taste and quality of their products.