Marketing Plan. The Mission Statement of Cct

¶ … marketing plan.

The mission statement of CCT is to encourage and cultivate the human spirit: one individual, one cup, and one community at a time. There are total 213 cafes that are currently operating in all the major cities of India and are owned by Cafe Coffee Time. The cafe Coffee Time is the part of Coffee Time which is Rs. 200 crore ISO 9002 certified. CCT positions itself as a brand name for anybody who likes coffee. CCT's products mix makes up a large variety of items that appeal largely to standard coffee enthusiasts. Considering that CCT's existing customer profile is rather young, their rates are mainly low-cost, and at par with their rivals. Every CCT outlet is run by the owners themselves, and not franchised out to anybody.

Provide the company's mission statement and company introduction.

The mission statement of CCT is to encourage and cultivate the human spirit: one individual, one cup, and one community at a time.

Amalgamated Bean Coffee Trading Company Limited came into being because a family owned some acres of coffee estates in Chikmagalur. This coffee company is commonly known as the Coffee Time. Coffee Time began to export their coffee across Europe, Japan and USA in the early 1990s when there was a deregulation of the coffee board. This tradition of growing coffee had been there since 1875 but it increased a lot in the nineties. 27,000 tons of coffee was exported to these above mentioned countries by Coffee Time in the year 2000 alone; hence, Coffee Time achieved the position of Indian's largest coffee selling brand for the second time in the 7 years since it had first been established. These 27,000 tons of coffee exported by the Coffee Time was valued at U.S. $60 million (The Indian institute of planning and management, 2011).

There are over 48 agents as well as approximately 50 collecting depots, where the coffee is grown and collected from, for Coffee Time. Hassan and Chikmagalur are the two major places where the Coffee Time has the major productions from and more than 70,000 tons of coffee is produced at these two places each year. This makes Coffee Time the biggest coffee producing company in India (The Indian institute of planning and management, 2011).

There is very highly equipped roasting equipment present at the Coffee Time which roasts the coffee beans exactly in accordance with the demands of the costumers under the supervision of professional workers. The most amazing and unique factor of the Coffee Time is that it makes the coffee that it serves itself (The Indian institute of planning and management, 2011).

There are total 213 cafes that are currently operating in all the major cities of India and are owned by Cafe Coffee Time. The cafe Coffee Time is the part of Coffee Time which is Rs. 200 crore ISO 9002 certified (The Indian institute of planning and management, 2011).

3. Provide the company's branding, pricing, and distribution plan.

Brand Image:

CCT positions itself as a brand name for anybody who likes coffee. Their items, services and outlets are more like the standard European cafe, where individuals would meet up for the love of coffee, as well as for an intellectual attractive time. They place their outlets as a location "where the world satisfies," and they aim to attract anybody in the 14- 60 age group that likes excellent coffee and tries to find a good peaceful time.

Products:

CCT's products mix makes up a large variety of items that appeal largely to standard coffee enthusiasts. Their items themselves are standard items with conventional names. Meals products like croissant, pastas, as well as sandwiches are complimentary to their coffee, and extend an extremely traditional photo of CCT. Their merchandising likewise includes mostly coffee associated items like coffee grains, coffee equipments, and so on.

Prices:

Assuming that CCT is attempting to target a market whose age variety is in between 18 and 60 years, a price policy attracting this section is tough. Very reduced costs work as a deterrent to some clients who may concern it as a sign of quality, while really high rates cannot be managed by many of the young people. However considering that CCT's existing customer profile is rather young, their rates are mainly low-cost, and at par with their rivals.

Distribution Plan

Every CCT outlet is run by the owners themselves, and not franchised out to anybody. CCT can hence manage and make fast modifications to its whole retail chain. CCT presently runs in over 100+ outlets all over the nation, and at their existing rate, they are opening a brand-new outlet around every 12 days. They have a market presence in over 25 cities. Mumbai alone hases more than 30 outlets, and the lot of outlets in the city are enhancing at an extraordinary rate.

CCT has a thumb policy for choosing cities and places for the circulation of outlets.

Place:

This is a prime aspect in figuring out the success of their retail chain. Nevertheless, CCT Coffee has actually taken on a top down method, wherein they initially determine the cities then select accurate places within its restrictions.

Picking a city: CCT has actually committed significant management time as well as effort in fixating the cities where they are presently located. The option of the cities was based upon the following standards.

Significant populace of execs, pupils and households.

High disposable earnings with individuals trying to find brand-new vistas in leisure as well as higher living oriented principles.

High level or arranged retail tasks.

Rapid socio- financial advancement.

Level of industrial significance (Industrial cities, state capitals and so on).

Lot of instructional facilities and chances for work are in abundance.

Distribution of Stock

The circulation of stock at CCT starts from the coffee grains being sent out abroad for roasting. The roasting occurs in Venice, and the grains are then provided to the major storehouse in Delhi. Stock is then dispersed to the different Regional Storehouses, then to the neighborhood Storehouses. The outlets get their stock from the Regional Storehouses. CCT makes use of a Re-Order Level system for the circulation of their stock.

CCT out sources its transport needs from exterior companies, and presently makes use of trucks as the favorable method of distribution.

4. Provide the IMC and customer satisfaction plan.

In order to develop a customer satisfaction plan the company needs to develop Customer Redress systems (CRS). All businesses, in spite of the extent or the cost of their merchandise, require a valuable policy for organizing customer complaints and questions (Gilly and Hansen, 1992). However, most companies spend 95% of their resources responding to individual complaint and less than 5% analyzing and using them (Adamson, 1993, p.439). Successful "customers redress systems" (CRS) improves a business's status, develops customer assurance and reliability, and interests fresh clientele (Phau and Sari, 2004). According to Adamson (1993), speed of response is consistently identified as being one of the attributes which most influence perceptions of a successful customer response system. The research shows that response time that are less than 4 hours will lead to 70% of satisfaction (Adamson, 1993).

By complaining when they assume they have not been given the right value for their money, customers provide the company a chance to rectify the instant trouble and reinstate favorability (Kim et al., 2003). Preceding research studies have shown that customers who protest about goods and services carry on dealing with the company and purchase the merchandise they criticize-if they consider the objection was solved justly and promptly (Halstead et al., 1993; Singh et al., 1991; Dolinsky, 1994). According to Adamson (1993), the three major root causes of customer problems are staff, company actions and customers themselves. Employee's actions only cause about 20%-30% of problems while company and customer are equally responsible for 70-80% of it (Adamson, 1993). Hence, it is important to have a good complaint handling system.

Gaps in customer expectations and experiences will also be addressed via CRS. Successful "customers redress systems" (CRS) results in augmented selling, superior goods, enhanced performance of workforce, and corporate wealth (Bosch and Enriquez,, 2005). Understanding the general root causes of customer problems can play a major part in maintaining and improving quality levels, as well as keeping the customer loyal (Adamson,1993, p.439). Complaints are a free resource of researching marketplaces (Singh et al., 1991). When appropriately collected, complaint statistics can designate how customers deduce business marketing (Mitchell and Critchlow, 1993); how merchandise and services have been perceived (or not perceived) by the customer (Ross, 1996), how teaching handbooks and other customer data can be enhanced (Wood, 1996), and how goods can be outlined better (Wagner, 1994). To achieve long-term prevention and improvement benefits requires in-depth analysis and correct use of past complaints and results (Adamson, 1993, p.439). Hence, all these factors explained why we need a CRS.

In addition, "customers redress systems" (CRS) may indicate a requirement for improved arrangements of quality management in the manufacturing phase (John et al., 1994). They might inform the administration of the developments that can be completed in the teaching and management of sales and service workforce (Clark at al, 1992). To keep customer loyal and happy, company must integrate information based on complaints into established and trusted sources of intelligence within the company (Adamson, 1993, p.444).

5. Provide the following information about the marketing strategies:

a. Discuss the company's competitors, and its strengths and weaknesses.

The existing market share is concentrated at the top with brands such as Starbucks, Caribou Coffee, Coffee Bean and Tea Leaf, Diedrich (Gloria Jean's) and Peet's Coffee take the bulk of the shares. At the bottom, the share is quite fragmented and split. The strategy assumed by the top shareholders relies heavily on the location of the outlet. Most companies choose locations that are convenient for the drivers and pedestrians. Characteristic locations include suburban or downtown retail centers, university campuses office buildings and shopping malls. Some outlets are more spacious than other outlets. The decisions to have bigger or smaller outlets vary by the size of the local market and the location of the outlet. Some outlets, located primarily in airports and large malls and stores, even offer a kiosk format, i.e. without sitting space (Altmann, 2007).

Strengths of current American coffee industry:

In the past the major reason why people preferred not having coffee was that it was considered to be very harmful for the health, but recently approximately 19,000 studies have been conducted to understand the advantages or disadvantages of drinking coffee and many of these studies were focused on finding out the relationship between the consumption of coffee and diseases like cancer or high blood pressure but no relationship has been found between these diseases and coffee, in fact, according to these researches it has become evident that the consumption of coffee is actually good for health. For the people of America and the American coffee industry this is very good news. According to Tomas DePaulis, PhD, who is a research scientist at Vanderbilt University's Institute for Coffee Studies, an institute that itself studies the effects of coffee on health says that It has become evident from the researches that coffee is far more advantageous than it is harmful for health. Since it has become apparent that for majority of people coffee is very healthy, it can be very beneficial news for the coffee industry (Franchise Direct, 2011).

Opportunities in the current American coffee industry:

The stimulating effect that the coffee has on people is one of the reasons why its consumption is increasing day by day. The extent to which the coffee industry is established in the American society can be judged by the fact that approximately 54% of the adult American population drinks it every day, which means that 400 million cups of coffee are consumed on daily basis in America. Not only do the people go to the coffee houses to get themselves coffee but this trend of socializing in the coffee houses, meeting people and going there just for the sake of relaxing has also proved to be a factor in increasing the consumption of coffee (Franchise Direct, 2011).

In America although the coffee industry is really established but there is still a lot of room for more coffee houses and bars as the demand for the specialty coffee is increasing day by day. This can be estimated by the fact that Italy has around 200,000 coffee bars while their population is only 60 million, whereas, U.S. has the population of around 290 million with only 21,400 coffee houses (Franchise Direct, 2011).

Although the specialty coffee market is not growing at the rate that it used to in the early nineties when the growth for the specialty market used to get doubled every two-year but this demand is still increasing. The reason that is given for this increase in demand is the growing trend of the American population towards the consumption of the premium-priced and up-market coffees. The availability of opportunities and the room for development in the coffee industry could be estimated by the fact that it was expected that the coffee sales would increase by up to 125% from 2005-2010 and that they would reach $18,839 million in 2010 (Franchise Direct, 2011).

The coffee industry has undergone a lot of change with regards to the way they used to serve the coffee, for example; now the trend of drive-thru, carts and kiosks has increased a lot, mainly because the 'on-the-go' American people who prefer getting their coffees this way in order to save time. All these drive-thrus and kiosks require very little investment to set them up and therefore, further prove the fact that there are a lot of opportunities available out there. In fact Massimo Zanetti Beverage Cafes USA INC has been offering the chance to franchise a Chock Cafe Kiosk for an investment cost as low as $20,100. A licensing agreement was signed between Borders Books and Music and Seattle's Best Coffee in 2004 according to which Seattle's best coffee was going to open their cafes in all the Border Books and Music Stores (Franchise Direct, 2011).

Emerging threats for (and from) the current American coffee industry:

One common threat that all the businesses and industries can face is of the economic recession which can not only reduce the revenue because of the inflation but can also reduce the customer's intake. This is exactly what is happening now-a-days as recession has over taken almost every business. This problem can be overcome by introducing offers to ensure that the customers get back to the stores and start consuming the coffee again, for example; Starbucks closed 7,100 stores all over the country in order to train their employees so that they could deal with the customers in a better way in order to ensure that they get an increase in the number of customers coming to their stores. Similarly, Seattle's Best Coffee introduced the buy one get one free offer to increase the flow of customers to their coffee houses (Franchise Direct, 2011).

One of the things that one has to keep in mind while running or planning to run a coffee house is the possibility of an increase in the costs of the dairy products which can't really be predicted but they can have a huge impact on the business (Franchise Direct, 2011).

The good thing about the coffee franchise business is that it is very diverse, for example; if a person doesn't have enough capital to open up a standalone coffee house he/she could open a drive -thru or kiosks, which require a lot less capital than a standalone coffee house would require. A good example of this kind of business is the Cuppy's Coffee and More Inc. which offer franchises for the Kiosks, Cart Unit, Mobile Unit and Full Service Units. Therefore, someone with even low investment capital can start a business as the franchise cost varies from $2,500 for a single Cart Unit to somewhere around $25,000 for a Complete Service Unit. However, the total beginning cost for a Cart Unit is approximately $27,000 to $56,900 and this cost includes the cost of the cart as well (Franchise Direct, 2011).

Before starting any kind of business there are a lot of things that needs to be kept in mind and same is the case with the coffee business. One not only needs to have a very solid business plan but also know your target market, an attractive location etc. All this is where using the franchise can help new entrants as they can provide the franchisee with good brand names, operating systems, extensive training program, trade mark, location, purchasing power and also lets them not worry about some of the hurdles that are always there while setting up a new business (Franchise Direct, 2011).

b. Determine the differentiation strategy in relation to the closest competitor.

The products that are being offered by the Cafe Coffee Time have a very distinct Indian taste to them and it is very evident that they had been trying to target the Indian customers with the coffee as well as the eatables. The products that they have in their stores are samosas, tikka sandwiches, biryani, masala sandwiches etc. (The Indian institute of planning and management, 2011). They have decided to diversify these products and add those products that offer a very distinct American taste to them in order to attract the American consumers.

Prices:

In India Cafe Coffee Time has priced its products by keeping the young age group that it caters to in mind, for example; a cup of coffee at Cafe Coffee Time costs from Rs. 17- 54. Also, no drastic change in their pricing strategies has been noticed since the time that it has come into being and what little prices they have changed, they are because of the government taxes etc. (The Indian institute of planning and management, 2011). It is looking for the same pricing strategy in America as well and show stability in its prices over the short medium and long-term.

Interior Decoration and Architecture:

With regards to the decor and the architecture there has been a lot of changes in the interior of the Cafe Coffee Time stores. Where before there used to be a lot of granite and wood, now one sees the use of a lot of steel and very vibrant colors like orange, lime green and yellows. Therefore, the look of the stores has been completely changed (The Indian institute of planning and management, 2011). It is looking for the same energy and dynamism in its American Franchise as well.

Literature:

Since, in India, Cafe Coffee Time mainly caters the youth or the people who are young at heart, the literature provided at the cafe is mainly focused on the youth. They also have a magazine which is known as "Cafe Beat." This magazine is published at the Bangalore head office of the Cafe Coffee Time and then later on it is distributed to all the stores (The Indian institute of planning and management, 2011). It has adopted a similar strategy in United States and joined hands with a strong local magazine brand for its promotion and advertising.

c. Explain whether the company's intention is to be a leader or follower within the industry.

The company intends to be the leader in the industry and it aims to do that by targeting consumers of all ages and all income levels in the community they have outlets in. They package and present their products so as to entertain all sections of the society. They compete with them by utilizing the "local-media" along with "local-store-marketing" program. Their main focus and funds are directed towards "local-store-marketing," which are followed by radio and print media. Using other forms of the media are also considered at a later stage in the franchise business (Altmann, 2007).

The primary focus is directed towards enhancing awareness in the neighborhood they are operating. Their marketing programs allow people to understand values and services. Their products are not only fairly-priced but also highly standardized. This ensures top-quality "word-of-mouth" advertising (Altmann, 2007).

In India, Cafe Coffee Time may not be involved in any mass media promotion. However they may carry out advertising through the field that they know target their customers. Following are some of the marketing, advertising and other promotional strategies that can be and are being assumed in India by CCT (The Indian institute of planning and management, 2011).

Through television:

A contest was held on the Zee English by the Cafe Coffee Time. This contest was based on the very famous T.V show Friends in which the six youngsters were shown sitting around talking in a coffee house and since this show was very famous in the youth, Cafe Coffee Time based the contest on this T.V show according to which the winners used to get the Friend's merchandise (The Indian institute of planning and management, 2011).

Ticket sales:

Promotions through the ticket sales are something that the Cafe Coffee Time has been involved in a lot. They have been involved in the ticket sales of the shows done by Bryan Adams, WWE, Enrique Iglesias and Elton John (The Indian institute of planning and management, 2011).

The reason why ticket sales is such a popular way of promotion is that with it both the organization arranging the events as well as the one advertising gets benefits from. The organization get benefit as it wants people to know where they can get the tickets from and Cafe Coffee Time gets the recognition since its logo has the information about the event. Also, promotions of this kind are widely liked by the customers (The Indian institute of planning and management, 2011).

Tie-ups:

Tie-up is another promotional strategy that is being used by Cafe Coffee Time. In this technique they have collaborated with the youth bands to come up with different promotional strategies such as with Levis they conducted a contest etc. (The Indian institute of planning and management, 2011).

Another tie-up that they have is with HDFC. The deal that they have with HDFC is that in 26 branches of the Cafe Coffee Time there are debit machines of HDFC because it wanted to promote its Debit services (The Indian institute of planning and management, 2011).

Association with movies:

The next huge step that was taken by the Cafe Coffee Time was to promote themselves on the big screen i.e. Bollywood. For this purpose coffee house scenes were shot in a few Tamil and Telugu films as well as in the Bollywood film 'Bus Yun Hi'. Later on they also promoted themselves by making an appearance in the Bollywood movie 'Main Hoon Na' and 'Khakee' (The Indian institute of planning and management, 2011).

Many serials have also been shot in the Cafe Coffee Time such as the famous Hindi serial 'Kahani Ghar Ki' (The Indian institute of planning and management, 2011).