Starbucks Case Study : Starbucks Case

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STARBUCKS CASE
Introduction
The Indian coffee is said to offer a subtle balance of refinement and stimulation. Just light and not too acidic, these coffees exude a distinct full-bodied taste and a fine bouquet. It has a rich cultural flavour too.
With over 170,000 coffee fields in India, growing nearly 900,000 acres of coffee plantations, India is the 5th largest maker of coffee in the world, out of which 75% is exported. The domestic market for coffee in India is $160 million, making it the second most popular beverage( next to tea), and exhibiting an increase of 40% year on year.( Please see APPENDIX 1 for data on domestic consumption) A set of factors that include favourable age profile of population, heightened purchasing power and increased out of home consumption of food and beverages -all contribute to this.
The domestic market
In the Indian market, a number of premium offerings of coffee were introduced by the companies such as Nestlé, HUL and Tatas( Coffee division) in 2012. This led to a trend of price in coffee as consumers demonstrated a willingness to spend.(Please look at Appendix 2 for Retail coffee prices in important centres in India)
Nestlé and Unilever continued to show the way for coffee in 2012 with a combined retail market value share of 67%. Nescafé garnered 36% of retail value sales in 2012 and was followed closely by Bru which accounted for 31%. Increased spend on promotions by the two organisations, along with in-store promotions, helped boost

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