History Of Coffee Essay Sample

Day should enhance the in-house experience by upgrading furniture and improving the overall ambience of its coffee lounges. Offering value-added features like free Wi-Fi and designated play areas for children can further enhance the appeal to customers.

It is crucial for Cafe Coffee Day to create a customer friendly atmosphere in order to retain loyal customers and attract more. To achieve this, Venu Madhav and Siddhartha need to review their selection, recruitment, and training procedures to ensure staff can competently handle customers' needs. Additionally, using social media platforms to interact with customers is a strategy that provides vital feedback that can be used to improve product and service quality and address customer needs satisfactorily.

Important Competitive Advantages And Challenges

Coffee Cafe Day has significant competitive advantages including an extensive presence in the Indian coffee market, strategic location, and widespread vending machines. The company also owns several coffee plantations in India (Yoffie & Bijlani, 2014).

More than 30% of Cafe Coffee Day's raw materials are sourced from plantations, which plays a crucial role in keeping prices competitive and offering frequent customer discounts. This advantage is an essential part of the company's pricing strategy, enabling it to effectively compete with Starbucks. Additionally, Cafe Coffee Day has strategically positioned its outlets in prime high street locations across major cities.

One of the main obstacles faced by retailers in India is the high cost of real estate. New retailers must make significant investments to establish stores at strategic locations, making it difficult to overcome Cafe Coffee Day's current location advantage. Another advantage held by Cafe Coffee Day is its presence in the vending machine segment, with machines located in corporate offices and other key

locations, strengthening the company's presence in major cities. However, the biggest challenge comes from the entry of Starbucks, which enjoys a global reputation and poses a threat to Coffee Cafe Day's dominance in the Indian market.

The suggested approach to tackle this challenge is to invest in advertising and promotions in order to increase the visibility of Cafe Coffee Day.

Starbucks' Competitive Advantage And Challenges

One of Starbucks' competitive advantages lies in its global presence and reputation. When the company enters a new market, it capitalizes on its reputation to attract customers, as many individuals eagerly seek a Starbucks experience. As a result, advertising itself is not necessary in these new markets. Additionally, Starbucks' partnership with the Tata group in India serves as a significant competitive advantage due to Tata's extensive understanding of the Indian market and wide networks throughout the country (Sarbapriya, 2013).

Starbucks was able to establish itself quickly in India through its partnership which resulted in the opening of numerous stores in prime locations. However, the main obstacle for Starbucks is its pricing strategy, as the Indian market is price sensitive. The premium prices for coffee charged by Starbucks may not be enticing to Indians. This pricing challenge is an opportunity for Caffe Coffee Day, as it can undercut Starbucks by offering lower prices, leveraging its lower production and raw material costs. Additionally, the expensive real estate in India could hinder Starbucks' plans for expansion.

Recommended Response for Siddartha and Madhav

Cafe Coffee Day holds the majority market share, so Siddartha and Madhav should avoid hasty or hostile reactions towards Starbucks' threat. Instead, they should adopt a two-fold strategy: immediate enhancements and

a gradual long-term plan. In the short term, they should prioritize minor adjustments like offering personalized experiences, expanding beverage options, improving the food menu, and implementing incentives to retain employees. Additionally, establishing outlets in key urban locations such as colleges, airports, and train stations is crucial. For the long term, Siddartha and Madhav must focus on bold actions to solidify their position.

Firstly, Starbucks should focus on the upper middle class, which represents their primary target market. Additionally, they should increase their advertising budget to enhance brand visibility. Moreover, Starbucks should expand their presence to smaller cities that are not currently being targeted. Ultimately, Siddartha and Madhav need to establish an internationalization strategy and open stores in markets outside of India.

Conclusion

Notwithstanding its long-standing presence in the Indian market, Caffe Coffee Day is being strongly challenged by Starbucks, which is capitalizing on its worldwide reputation to establish a presence in India. In response, Cafe Coffee Day must implement short-term and long-term measures to safeguard its dominance and market share.

The pricing strategy is crucial for Siddartha and Madhav to counter Starbucks' challenge. In a price sensitive market like India, as long as Cafe Coffee day keeps their prices low, they are unlikely to lose customers to Starbucks.

References

1. Roshini, S., Ahammed, T., Pandian, G., Varun, G.A and Jayaraj. M. (2016). Starbucks Vs CCD: A Comparison the Great Coffee Shop Battle in Chennai City, International Journal of Advanced multidisciplinary Research, 3(4), 11-18
2. Sarbapriya, R (2013). Strategic Alliance in India under Globalized Economic Scenario, Advances in Asian Social Science, 4 (2), 824-835
3. Yoffie, D. & Bijlani, T. (2014). Coffee Wars in India: Cafe Coffee Day Takes On the Global Brands. Boston, MA: Harvard Business
   

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