Coffee Wars in India

895 Words4 Pages
Individual Case: Coffee Wars in India
Café Coffee Day is the leader specialist coffee chain in India, holding over 60% of market share. The major issue that C.C.D. is facing is the entrance of the dominant global brand, Starbucks, in India’s coffee business. Not only Café Coffee Day has to deal with it, but also face all other international brands currently at the market while having global ambitions. In these last years, the competition in the coffee market has been increasing and even though Café Coffee Day has been managing to maintain its place as the leader, the entrance of Starbucks with a positive and stronger brand image, could threat the whole business. The challenge and goal, for now, is for the management of Café Coffee Day
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The entrance of Starbucks in Indian coffee market offering global services standards, higher income to employees, strong partner and supplier and premium food, caught the curiosity of a lot of customers and, even though the price was aggressive, the movement around Starbucks was huge. Not only the international appeal and the Indian desire to try new brands contributed to that, but also the strong image of an innovative and strong brand image helped Starbucks to grasp the interest of a new affluent segment - people above 25 years old with enough money to afford high quality service and premium products - that CCD was not managing to get. CCD was lacking innovative actions to catch the affluent segment and aim to grow. Also, with low salary and recruiting staff from small villages, services was starting to drop the level and not even meet the customers’ expectations. In general, with the changes of the external environment, CCD was not competitive enough to sustain market leadership position in India.
In this scenario, there are a few possible actions to take in order to sustain its position and enhance competitiveness. The first one would be a slight course correction (fix operational issues, improve service and training, increase stores, advertising, remain with the youth segment as the main focus and wait to see what happens). The second is an aggressive course correction (fix operational issues, heavy investment in stores, salaries, services and branding
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