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Submitted BY: Ansup Babu Kumaresh Roy Sadaseeb Choudhury Somdeep Sen MARKET RESEARCH REPORT
23

Consumer Behavior Analysis: A study of Cafe Coffee Day

Jan 27, 2015

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Technology

Somdeep Sen

The Project Hypothesis:
Mean age of the CCD store traffic ranges from 25-35 years
Cafe Coffee Day is perceived as a place to hang out
Convenience is the most important factor influencing visits

Consumer Behavior Analysis: A study of Cafe Coffee Day had been conducted by Sadaseeb, Ansup & Myself. Despite of the small sample size, it provided us an opportunity to learn and apply the analytical tools and concepts in the domain of marketing research.
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Page 1: Consumer Behavior Analysis: A study of Cafe Coffee Day

Submitted BY: Ansup Babu

Kumaresh Roy Sadaseeb Choudhury

Somdeep Sen

MARKET RESEARCH REPORT

Page 2: Consumer Behavior Analysis: A study of Cafe Coffee Day

AGENDA About The Industry

Brief of the Company

Purpose of the study

Hypotheses

Methodology

Limitations

Analysis and Findings

SWOT Analysis

Conclusions

Annexure

Page 3: Consumer Behavior Analysis: A study of Cafe Coffee Day

ABOUT THE INDUSTRY The Indian RTD tea and coffee industry stands at an estimated Rs 1,100 crore

The market is expected to grow to a whopping Rs 2,250 crore by 2017

Factors triggering growth:

- Improving disposable income

- Changing life styles

- Increasing influence of western culture

- Younger population

Top three players: Cafe Coffee Day, Barista and Costa Coffee

The competition in the market is likely to heat up with the entry Starbucks

Source: Zee Business

Page 4: Consumer Behavior Analysis: A study of Cafe Coffee Day

BRIEF OF THE COMPANYYear of Establishment 1996

Founder V. G. Siddhartha

Revenue US$450 million (As on 2012)

No. of stores 1481

Products Food & Beverage

Price Differential Pricing Strategy

Distribution Strategically located at six verticals

Promotion Sponsorships, collaborations, sales promotion, Cafe Coffee Day Card

Other Merchandize Coffee Makers, Coffee Mugs, Men/Women T Shirts, etc.

Other Facts

Market Share: 60% (as on 2012)Follows Backward integrationDoesn’t go for franchisingDivision of the largest coffee conglomerate- ABCTL

Source: Wikipedia & Hindustan times

Page 5: Consumer Behavior Analysis: A study of Cafe Coffee Day

PURPOSE OF THE STUDY

To find out information about:

Consumer Profile

Brand Recall

Customer visit details

Customer Spending and consumption Pattern

Customer Satisfaction

Page 6: Consumer Behavior Analysis: A study of Cafe Coffee Day

HYPOTHESES Mean age of the CCD store traffic ranges from 25-35 years

Café Coffee Day is perceived as a place to hang out with friends

Convenience is one the most important factors influencing customer visits

Page 7: Consumer Behavior Analysis: A study of Cafe Coffee Day

Store Location Hazra: Near Asutosh college

Bhawanipur: Near Forum Camac Street Total Sample

Size

Sample Size Break up 20 15 15 50

Sample Size

Sampling Method

Convenience Sampling

Data Collection Method

• People visiting CCD was interviewed through questionnaires to collect the primary data

• Internet had been used to collect secondary data

METHODOLOGY

Page 8: Consumer Behavior Analysis: A study of Cafe Coffee Day

LIMITATIONS

The study has been conducted over a very short duration

Due to the short duration

-The sample size is very small

- Non Probabilistic method of sampling has been used

Hence the findings should be taken as indicative

Page 9: Consumer Behavior Analysis: A study of Cafe Coffee Day

ANALYSIS & FINDINGS

Page 10: Consumer Behavior Analysis: A study of Cafe Coffee Day

DEMOGRAPHICS

Mean age of the respondents: 26 years

52% of the respondents are female

50% of the respondents are students; rest are working professionals

All the respondents have household hold income of Rs. 28,000 or more per month

16-24 25-33 >33

10

20

30

40

50

46 44

10

Age (%)

60%

40%

Household income per month in Rs

28-34K >34K

Page 11: Consumer Behavior Analysis: A study of Cafe Coffee Day

BRAND RECALLRespondents (%) TOM Recall order

961. Café Coffee Day2. Barista3. Can't Say

41. Starbucks2. Café Coffee Day3. Barista

All the respondents mentioned Café Coffee Day as well as Barista

4% of the respondents mentioned Starbucks- the newest entrant in the Indian coffee retailing

Page 12: Consumer Behavior Analysis: A study of Cafe Coffee Day

PURPOSE OF VISIT

Student Working Professional

10

20

30

40

50

42 40

84

6

Purppose of visit(%)

To hang out with friends To consume food and hang out Others

Value df P Value

Pearson Chi-Square 3.691 2 0.158

82% of the respondents look at CCD as a place to hang out

As per Chi-Square value there is no association between occupation & purpose of visit

Page 13: Consumer Behavior Analysis: A study of Cafe Coffee Day

FREQUENCY OF VISIT

Students prefer to visit the outlets at least once a week

The ‘once in a two weeks’ bracket is popular among the working professionals

Student Working Professional0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

26

48

30

16

Once in a monthOnce in two Weeks>3 times in a week1-3times in a week

Occupation

Freq

uenc

y of

Visi

t %

Page 14: Consumer Behavior Analysis: A study of Cafe Coffee Day

PREFERRED DAYS OF VISIT

76% of the respondents prefer to visit the shop on weekdays

Student Working Professional

50

2624

Weekdays Weekends

Occupation

Pref

erre

d D

ays

(%)

Page 15: Consumer Behavior Analysis: A study of Cafe Coffee Day

MOST FREQUENTLY VISITED BRAND

Brands Mean Degree of Frequency

Café Coffee Day 3.9 High

Barista 0.68 Least

Costa Coffee 0 -

Others 0 -

CCD has emerged as the most frequently visited brand

Only 42% of the people have visited Barista

None of the respondents have visited other competitor brand like Costa Coffee

Page 16: Consumer Behavior Analysis: A study of Cafe Coffee Day

FACTORS INFLUENCING VISIT

Convenience & quality of service at a coffee shop has emerged as the most important factors

It is a tribute to the strategically located outlets and highly skilled manpower of CCD

Factors Mean Score Degree of importance

Convenience 5.00 Most

Quality of Service 4.60 Most

Availability of preferred item(s) 4.06 High

Ambience 2.80 Moderate

Page 17: Consumer Behavior Analysis: A study of Cafe Coffee Day

PREFERRED ITEMS

Student Working Professional

10

20

30

40

50

8 6

6 6

36 38

Combo DealsFoodBeverages

Occupation

Pref

erre

d It

ems

%

df P Value

Pearson Chi-Square 2 0.774

74% of the respondents have shown preference for combo deals

As per chi-square test, such preference is same across both set of occupations

Page 18: Consumer Behavior Analysis: A study of Cafe Coffee Day

SPENDING PATTERN

28-34K >35

20

40

60

2 4

54

20

4

16>200 (Rs)100-200(Rs)50-100(Rs)

Household income per month

Am

ount

Spe

nd %

74% of the respondents prefer to spend Rs. 100-200 during their visit

Page 19: Consumer Behavior Analysis: A study of Cafe Coffee Day

CUSTOMER SATISFACTIONBarista Café Coffee Day

Factors Mean Satisfaction Level Mean Satisfaction Level

Quality of Items 4.4 Very High 4.4 Very High

Availability of preferred items 4.3 Very High 4.4 Very High

Service Delivery Time 4.0 Very High 4.4 Very High

Staff Behavior 4.4 Very High 4.3 Very High

Value for Money 2.0 Low 4.2 High

Store Ambience 4.4 Very High 4.1 High

Overall Infrastructure 4.3 Very High 4.3 Very High

•Customers are highly satisfied with the offerings of CCD & Barista

•Value for money is an emerged as a difference maker

•Customers perceive CCD has a quality brand that provides value for money

Page 20: Consumer Behavior Analysis: A study of Cafe Coffee Day

SWOT ANALYSISStrength

High degree of brand awareness Strong distribution network Cost reduction through backward integration Wide variety of product Excellent service Strong presence over the digital space

Weakness

• Absence of franchising may deter expansion activities

Opportunities High growth potential of the RTD market Merchandizing Tapping the smaller towns Focusing on the food segment Globalization

Threats

•Presence of strong competition (direct & generic )

•Entry of Starbucks

Page 21: Consumer Behavior Analysis: A study of Cafe Coffee Day

CONCLUSIONS High growth potential of he RTD tea and coffee market

Target Group: Youth in the middle and higher income

Perceived CCD as a place to hang out

Most frequent visitors: The 16-24 age bracket

Most important factor influencing visit: Convenience

Perceived as:

-Place to hang out

- Quality & value for money brand

Page 22: Consumer Behavior Analysis: A study of Cafe Coffee Day

ANNEXURE In cases where 5-point rating scale has been used, the interval for the range in

measuring the parameters has been calculated as : (5-1) / 5 = 0.8 , as below

Score Degree of

1 to 1.8 Least

1.81 to 2.6 Low

2.61 to 3.4 Average

3.41 to 4.2 High

Above 4.2 Most

Page 23: Consumer Behavior Analysis: A study of Cafe Coffee Day

THANK YOU