MARKETING & PROMOTION STRATEGIES

a) Introduction: This will cover the background, rationale/ need /

justification, brief review of literature, objectives, methodology (the
area of the study, sample, type of study, tools for data collection,
and method of analysis), Limitations of the Study, and Chapter
Planning.
b) Conceptual Framework / National and International
Scenario: (relating to the topic of the Project).
c) Presentation of Data,Analysis and Findings:(using the tools
and techniques mentioned in the methodology).
d) Conclusion and Recommendations: In this section, the
concluding observations based on the main findings and suggestions
are to be provided.

A) Introduction
Background
In todays world we all are surrounded by brands. Starting from the toothpaste (Colgate) that
we use in the morning, to the pillow (Sleepwell) on which we sleep in the night, all products
no matter how small or big are associated with brands. And this is what the marketing
department of an organisation fight with other competitor. Fight to capture the mind space of
its user, i.e. potential as well as end user. For example, most of the Indian consumers prefer to
say Aquaguard instead of water-purifier and so we can say the marketing department of said
company has won the competition that way. But unlike production, marketing is a continuous
process. It does not end with sales or after sales-service. In order to survive in the market, one
has to continuously market its product in order to let other know about their existence.
But before marketing a product one must know what marketing is. Marketing is about
identifying and meeting human needs. One of the shortest good definitions of marketing is
meeting needs profitably. The American Marketing Association offers the following
definition: Marketing is an organisational function and a set of processes for creating,
communicating, and delivering value to customers and for managing customer relationship
in ways that benefit the organisation and its stakeholder. Marketing management is the art
and science of choosing target markets and getting, keeping and growing customers through
creating, delivering, and communicating superior customer value.
Managers sometimes think of marketing as the art of selling products, but many
people are surprised when they hear that selling is not the most important part of marketing.
Selling is only the tip of the marketing iceberg. P.F. Drucker puts it this way: There is
always, one can assume, the need for some selling. But the aim of marketing is to make
selling superfluous. The aim of marketing is to know and understand the customer so well
that the product or service fits him and sell itself. Ideally, marketing should result in a
customer who is ready to buy. All that should be needed then is to make the product or
service available.

A business can gain competitive advantage over its rivals by tailoring their products
or services to meet the demands of the individual customer. This tailoring can be done
through the means of the product/service offered, price, promotion, and distribution. The
above are known as the marketing mix. Promotion is the method we use to spread the word
about our product or service to customers, stakeholders and the broader public. People
generally advertise, do personal selling, referral selling and public relation in order to
promote their products or services. Before selecting the promotional strategy one must keep
in mind that the money and resources that they are using for promoting the products/ services,
should be effective and reach the target audiences/ customers. And for that, proper market
information and research is required. If it not best at least it should be as good as the
competitors, in order to get competitive edge.
Rationale of the Present Study
The coffee market in India has been growing due to the demand for Ready-to-Drink
coffee and has become a part of an individuals daily consumption basket. Due to changing
cultures, consumers are becoming aware of domestic and foreign brands, which are boosting
the consumption levels.
The export promotion schemes and other subsidies by the GOI, and increasing trend of eating
out coupled with the rising share of young population has driven the market. Well-established
coffee shop chains, such as Cafe Coffee Day (CCD) and Barista, enhanced their pan-India
presence in the latter part of the review period. In 2010, Cafe Coffee Day and Barista had 970
and 200 stores, respectively, and they aim to continue expanding in the next few years.
Meanwhile, several relatively new players, such as Costa Coffee, Coffee Bean, Gloria Jeans
and Java Coffee, are trying to establish a footing in Indian coffee retailing. Both these factors
drove on-trade consumption of fresh coffee beans in 2010, with volumes growing by 12%.
On-trade sales have emerged as the primary sales channel for fresh coffee beans, in the
absence of any appreciable off-trade consumption.
In 2010, the average bill amount at coffee outlet was between INR 135 and 150. This is
expected to rise to INR 245 by 2016. With customers paying significant amount for their
coffees, they are also expecting a lot from an outlet. Factors such as menu, ambience, service
and brand name are playing an important role while choosing a coffee outlet.
Indian Coffee Chains market is quite mature which is evident from the fact that Caf
Coffee Day alone maintains more than 1000 Cafs in 141 cities in India. Whereas though
Barista has lesser outlets than CCD, but still it holds fair amount of market share. Since these
two companies are the leaders in the coffee industry, it will be interesting to see what
marketing and promotional strategies they follow and compete with each other.
Review of Literature
Adebisi and Bayode (Year) in their study concluded that every organization that
must continue to survive in its operating environment must be able to adequately promote its
product. For the organization to achieve its aim of profit making as a manufacturing
organization it must make sure that, its promotional activities achieve its aim of making the
product acceptable and bought by the target market. The promotion of any product must be
accessible to the people that the product will be useful for and at the same time, must be able
to encourage new customers to purchase andrepurchase the products.In conclusion, every

organization must have a properand well monitor promotional activities and must be ableto
tailor it in such a way that it will increase it sales therebyincreasing the profit of the
organization.
Bansal (2010) in his report of CCD: A Case Analysis suggested that Caf Coffee
Day has done extremely well so far to project itself as an affordable youth- oriented brand.
But there are still certain areas where their brand needs to be much stronger. With regard to
the physical evidence associated with the brand, Caf Coffee Day needs to do a lot of work if
they hope to catch up with Barista. He recommended that Caf Coffee Day need to clean up
the dcor at veryoutlet, wherever unnecessary advertising is taking place. Although it might
be an important source of revenue, long-term customer perception of the brand isnt very
positive. Caf Coffee Day would do better to provide promotional space for its partners with
the use of clever collaborations, and not printed advertisements and posters
everywhere.Increase promotional plan like T.V channels, boarding radio programs.
In a report made by IIPM (2005) named as Barista vs. Caf Coffee Day a
comparative study(2005) it was concluded that Barista has an extremely strong brand image,
but they need to work hard on improving their customer perception of being and expensive
brand. Barista and Caf Coffee Day have almost identical pricing, but Barista is still
perceived as the more expensive brand. Customers are not happy with the behaviour and
service of the staff, and Caf Coffee Day is lagging far behind Barista is this aspect.
Objective of the Study:
The objective of my study is to compare two prominent service-centric companies on a
common platform
to understand how Coffee industry develop, plan and implement useful marketing and
promotional strategies that are result orientated.
Analyze their marketing and promotional strategies, and highlight what they are doing
well, while providing suggestions and recommendations for improvement
Research and methodology
For the present research, we have prepared 2 research tools: one is a structured questionnaire
and another is TOWS analysis, to find out the relevant primary data pertaining to the
functioning and working of both Barista and Caf Coffee Day. The data was collected based
on information provided by:
1. The management of the organization.
2. Customers visiting Barista and Caf Coffee Day outlets.
Besides the primary data collected with the help of the questionnaire, I have also collected the
relevant secondary data from various sources like magazines, books and Internet and
newspapers. Based on the relevant primary and secondary data, a comparative analysis has
been done so as to find out the areas of excellence and areas of improvement of both
organizations. The areas of excellence and improvement have been identified based on
factual information, in light of which recommendations and suggestions have been provided
for the overall improvement of the organizations in the future. This project was conducted in
2015 in Kolkata, India; so the information is relative to this city.
Limitation of Study
Since the entire project was done in Kolkata so it was difficult to get overall data of Barista
and CCD as a whole. It possible that in national level consumer might have different

perception about these two companies. The sample size is very low and hence there maybe
high probability of error.
Chapter Planning

B) Conceptual Framework
Evolution of business concepts
The production concept is one of the oldest concepts in business. It holds that consumers
will prefer products that are widely available and inexpensive. Managers of productionoriented business concentrate on achieving high production efficiency, low costs, and mass
distribution. For example Lenovo in China (high populated country).
The product concept proposes that consumers favor products that offer the most
quality, performance, or innovative features. Managers in these organizations focus on
making superior products and improving them over time. However, these managers are
sometimes caught up in a love affair with their products that they forget that a new or
improved product will not necessarily be successful unless its priced, advertised, and sold
properly.
The selling concept holds that consumers and business, if left alone, wont buy
enough of the organizations products. The organization must, therefore, undertake an
aggressive selling and promotion effort. The selling concept is practiced most aggressively
with the unsought goods, goods that buyers normally do not think of buying, such as
insurance and encyclopedia. Most firm also practice the selling concept when they have
overcapacity. Their aim is to sell what they make, rather than make what the market wants.
The marketing concept emerged in the mid-1950s. Instead of a product-centered,
make-an-sell philosophy, business shifted to a consumer-centered, sense-and-respond
philosophy. The job is not to find the right customers for your products, but to find the right
products for your customers. Dell Computers doesnt prepare a perfect computer for its target
market. Rather, it provides product platforms on which each person customizes the features
he desires in the computer.The basis is that all policies and practices of the business should be
based upon the goal of satisfying the customers.
In order to use the marketing concept, four steps need to be achieved:
1.MARKET RESEARCH - determining the demands or needs of the customers.
2.MARKET STRATEGY - analysis of the competitive advantage.
3.TARGET MARKETING - selecting which specific markets to serve.
4.MARKET MIX - determining how to serve the needs for the target markets.
MARKET RESEARCH:
The gathering of information about the present and prospective customer needs. This is
most commonly done through questionnaires and surveys.
MARKET STRATEGY:
Small Businesses can gain a competitive advantage over larger competitors by tailoring
their products or services to meet the demands of the individual customer. This tailoring can
be done through the means of the product/service offered, price, promotion, and distribution.

The above are known as the marketing mix. Another advantage is that small businesses offer
a more personalized interaction with the customer.
TARGET MARKETING:
Small businesses often have constraints or limitations to the amount of resources available
for marketing theirproducts or services. Therefore, they need to target a few specific markets
in which to concentrate their efforts. In order to choose the optimal market(s) to target a
segmentation of the total market is needed. The three ways to segment the markets are:
1.Customer segmentation - identifying and marketing to the group(s) of people that will be
the heavy consumers.
2.Product Segmentation - identifying and marketing the existing best-selling products or
services to gain market share before marketing any new ones.
3.Geographical Segmentation - identifying and marketing to the specific geographical area(s)
that contain the heavy consumers.
MARKET MIX:
This involves determining the proper mix of the product or service offered, promotion,
price, and distribution in order to meet the needs of each of the target markets.
Product/Service Offered - need to choose whether to produce a specialized product/service
for certain customers or produce a more generic product/service for a wide range of people.
Promotion- determining the proper channels or means for promotion. This might include
advertising through direct mail, flyers, point-of-purchase displays, mass media, etc.
Pricing - the price of the product/service must be competitive, although small businesses can
often charge slightly more due to the personalized attention that they offer.
Distribution - involves the choice between whether to distribute the products/services through
a retail or a wholesale means. Also it involves the location of the business.

Importance
Most aspects of ones business depend on successful marketing. Finance, operations,
accounting and other business functions will not really matter if there isnt sufficient demand
for products and services so the company can make profit. The overall marketing umbrella
covers advertising, public relations, promotions and sales. Marketing is a process by which a
product or service is introduced and promoted to potential customers. Without marketing,
business may offer the best products or services in an industry, but none of the potential
customers would know about it. Without marketing, sales may crash and companies may
have to close.Marketing is tricky and so companies like Levis, General Motors, Kodak, Sony
all have confronted newly empowered customers and new competitors and have had to
rethink their business models. Thus marketing is the most important section of an
organization. One must do enough research in order to know and understand the market
where the producer going to offer his/her product/service.

Awareness
For a business to succeed, the product or service it provides must be known to potential
buyers. Unless the business is known in the community and has communication with
customers readily available, one has to use marketing strategies to create product or service
awareness. Without marketing, the potential customers may never be aware of business
offerings and the business may not be given the opportunity to progress and succeed.
Sales growth
As awareness becomes a reality, new customers start to spread the word, telling friends and
family about this amazing new product they discovered. The sales will steadily increase as
the word spreads. Without employing marketing strategies, these sales may not have ever
happened; without sales, a company cannot succeed.
Companys goodwill
The success of a company often rests on a solid reputation. Marketing builds brand name
recognition or product recall with a company. When a company reaches the high expectations
of the public, its reputation stands on firmer ground. As reputation grows, the business
expands and sales increase. The reputation of company is built through effective
communication with consumer, maintaining the quality of product/service, environmental
awareness and good internal labor policy.
Healthy Competition
Marketing also fosters an environment in the marketplace for healthy competition. Marketing
efforts get the word out on pricing of products and services, which not only reaches the
intended consumers, but also reaches other companies competing for the consumers
business. As opposed to companies that have a monopoly on products and services that can
charge almost any price, marketing helps keep pricing competitive for a business to try to win
over consumers before its competition does. Without competition, well-known companies
would continue to sell while lesser known companies or new companies would stand little
chance of ever becoming successful. Marketing facilitates the healthy competition that allows
small businesses and new businesses to be successful enter and grow in the marketplace.

Advantages and Disadvantages of Marketing& Promotion Strategy

Marketing strategy is created and adopted to gain advantage in marketplace, but one must be
aware of the disadvantages of marketing strategy. A strategy should always be flexible with
the changing scenario of market and consumers tastes and preferences. Following are the
advantages and disadvantages of marketing strategy which a firm must consider before
implementing any strategy.
Advantages:
Market Share
If a firm increase advertising and promotion expenditures, it stand a good chance of capturing
market share, especially if its competition is cutting back on ad spending. That way the firm
let the buying customer know that they are maintaining a robust effort to remain vital in the
marketplace.

Higher Sales Growth

Businesses that increase advertising and promotion during recessions actually experience
higher sales growth during the recession and for three years after, according to Paul Dunay of
Marketing Profs. This could be because customers are more willing to shop around during
tough economic times.
Increasing Value to the Customer
Increasing advertising and promotions forces the firm to think about offering more value to
the customer. They need something to advertise, and the best thing to advertise is better
value. If they can find a way to put goods and services on sale, bundle services to customers
who spend more and promote special offers, then they can increase value to the customer and
drive sales higher.
Improved Reputation
Visibility of firm through advertising and promotion builds their reputation with the
customer. They draw customers towards themselves, because the consumer read the signal of
increased advertising and promotion as increased success of its business. Although most
advertising is through word of mouth, that word of mouth starts with awareness that
customers have gained about the firm through its advertising and promotions.
Disadvantages:
Failure
An obvious disadvantage to a promotional strategy is its potential for failure. For example,
the firm could invest time and money designing and advertising a sale, and sacrifice normal
profits during the promotion, only to achieve moderate results. Worse, its long-term benefits
might not offset the costs of the promotion. Careful research and expert advice from a
marketing consultant can help maximize the chances for success, but nothings guaranteed.
Decreased Value
The longer a sales promotion lasts, the more likely the firm will decrease the perceived value
of its product or service. For example, if a restaurant offers a steep discount for childrens
meals to attract families, parents might balk at paying more after they get used to the low
prices. Keeping promotions short to prevent long-term damage to the overall pricing strategy.
Predictability
If the promotions occur in a predictable pattern, potential customers might wait for a sale
rather than buy the product or service at full price now. For example, if a retail clothing store
offers a sizable discount on most holidays, sales will be low between holidays, and relatively
few customers will ever pay full price.
Bargain Hunters
New customers might learn to love the product or service and become long-term clients. Or
they might abandon the firm as soon as the promotion is over and continue to hunt for
bargains. Converting bargain hunters to permanent customers depends on developing brand
loyalty. For example, if excellent customer service or high-quality products of the firm
impress them, they are more likely to stay with it even after prices return to normal levels.

Presentation of Data/ Analysis and findings

Barista
Barista is an Indian chain of espresso bars that operates in South Asia and the Middle East.
Established in February 2000, it was taken over by Lavazza in 2007. In 2014, it was taken
over XYZ co. after Lavazza moved out. At present there are 14 branches in Kolkata.
Marketing Mix of Barista
Product:
Core product: Caffeinated drinks, Non-caffeinated drinks, RTE foods.
Augmented product: Merchandise, Product of other companies, AC as well as
Lounge facilities,
Place:At present there are 14 branches on Kolkata. And almost every cafe is in posh area or
where class of crowd is mostly upper middle class or higher class. For example, Lake Road
caf, Hindustan Road caf. Apart from that, Barista is operating two of its branches in two
shopping malls, namely South city and Avani riverside mall.
Price:Compared to CCD, here in Barista the price is little high. But it was accepted positively
by the consumers as gradual increase in their price doesnt lead to customer loss. Price here is
higher because their target customer is working class people (who can afford easily) and rich
people (to feel snobbish). And so to maintain this, they never compromised with quality of
food or service. In barista the average bill amount is around `225 for one person.
Promotion:since the company is going through a new phase as the owner is new so their
promotion mix is not so noticeable.
Caf Coffee Day
Caf Coffee Day (abbreviated as CCD) is an Indian caf chain owned by Coffee Day Global
Ltd (Earlier known as Amalgamated Bean Coffee Trading Company). In 2010, it was
announced that a consortium led by Kohlberg Kravis Roberts would invest 1,000 crore
(USD 200 million) in Coffee Day Resorts, owned by the company. The same year, the logo
was changed to the current logo, which the company stated was to showcase the chain as a
place to talk. This was done with major changes in the layout of the stores, including the
addition of lounges and a total revamp of the interiors.
The company is known for being vertical integrated to cut costs: from owning the
plantations, growing the coffee, making the coffee machines to making the furniture for the
outlets.

Marketing Mix of Caf Coffee Day

Product:
Core Product: Caffeinated drinks, Non-caffeinated drinks, RTE foods.
Augmented product: Merchandise, Product of other companies, AC as well as
Lounge facilities,
Place:In almost every residential area, private hospitals, malls, food courts, inside apparels
stores, near school and colleges to acquire as many customers as possible. So far there are 76
stores in Kolkata including lounge and express outlet (as in takeaway counter).
Price:As their mission says To be the best Cafe chain by offering a world class coffee
experience at affordable prices. Average billing per person is around Rs. 200. Price is little
lower than barista so that teenagers can afford it.
Promotion: Print ad
TV ad
Covert ad
Sponsorship
Discounts
Combo offers

SWOT Analysis of CCD and Barista

Barista: Even the ambience is very classy and soothing. They used orange colour to give a
welcoming and soothing feel. And they complemented it with matching furniture and retro
English music.