International Marketing (Project plan-Entry plan for an SME)

INDIVIDUAL TASK COVER SHEET

Executive summary

This marketing report Identifies the areas to investigate when Expanding Café Coffee Day to Turkish Market. Analysis on the impacts of cultural factor while planning to expand to Islamic countries is very necessary, along with the knowledge of the local market, consumer behavior on new entrants, marketing plans and roles of the major competitors in the market. The key findings are that Turkish people. Mode of entry is a valuable strategy by licensing Franchise with one of the most popular companies in the Arabic nations. With a great heritage, Turkey has a long-established coffee culture that has been rooted in many areas of Turkish society. Using the hybrid strategy of standardize and localize accordingly, can introduce a new concept of Indian tastes bites, western beverages presenting in Turkish tradition.

Introduction

Café Coffee Day

Café Coffee Day (CCD) is one of India’s most popular youth enterprises. This company primarily owns café chain outlets and in the recent period it involved in producing retail sales of coffee beans and powers for household consumption and other eateries. CCD has generated a whopping revenue of S$744 Million in the period of March 2019.

CCD was urged to deliver a world-class coffee experience to the outside world, As CCD is planning to enter the Turkish market. Below report provides in-depth analysis on Introducing CCD in turkey. This marketing study offers a summary of the company's information, analyses of cultural environment in the Turkish market, describes the target consumer and a key business competitor. In addition, it suggests a mode of market entry, defines the intended international marketing goals and explains the components of the relevant marketing mix for Cafe Coffee Day.

CCD First Outlet in Bangalore, India.

Audit and critical analysis

It is important to consider the whole laws of trade etiquette and unique practices of each cultural community while creating commercial ties, seeking partners for commercial and growing private industries on the terries of another country. It should be recalled that the presence of Islam, although not expressed recently, is embodied in many aspects of the Turkish company’s culture, and has a profound cultural significance. Turkey has long been a democratic country with a European way of doing business.

It is a very commonly discussed issue that culture has a profound influence on the business world, especially in Turkey. Wealth and schooling are the two important determinants in the social class. You need at least a university degree to be admitted into an urban educated class. Wealthy business owners are accepted as very high-ranking, key administrators in the government and other high-level authorities. The middle class in urban areas is a mix of civil servants, small to medium-sized business owners, professional employees, for the most part, are university students. This community of people is more geared towards Turkish culture. The more westernized you are, the more modern and high-class you are in Turkey. They cannot find a long-term career; some workers just depend on the season. That because a small proportion of the population of urban areas of the lower class has a graduation from high school. Turkish workers are indeed traditional. The difference in opinions in these subjects leads to the extreme disagreement between religions and sexual issues. These are very sensitive subjects and one must be familiar with and understand the details. Humour is well appreciated in turkey. But one should know that they may end up with a different impression if they do not know about local humour.

Coffee has played an important role in Turkish culture and environment since the days of the Ottoman Empire when the denizens of the empire were the world's biggest coffee consumers, and now very known for their Turkish coffee. In Turkey, women are supposed to know how to make coffee and often their skills are tested. This would help to measure how good the women are. The coffee culture in Turkey was so rich that even households had special rooms to socialize with coffee. It is evident that at least in the 21st century that coffee culture has been brought forward, this will contributor to succeed in Turkey. The consumer characteristics that contributed to the growth of CCD in India vary greatly. Indian history and culture have been significantly different from Turkey. CCD was thus the first coffee chain with India in a friendly sit-down environment similar to the cafes in Italy. This is one feature of the CCD which has drawn customers and contributed to becoming a large MNC. Another popular factor of growth is the geographic segmentation. About three-quarters of Turkey's population live in metropolitan regions. A substantial part of the population lives in or around the city of Istanbul.

Organisational Profile

About The organisation

Cafe Coffee day operated by Amalgamated Bean Coffee Trading Company Limited (ABCTCL) are familiar to everyone and today are very popular in all parts of India. The first outlet ever opened by CCD was in the brigade road, which is in the heart of Bangalore, India. In 1996, BG Siddhartha’s (founder) strategy was to link technology and coffee, to grab the market’s attention and placing the first few outlet in a socially frequented area. influenced by the founder of the Tchibo, Germany’s most significant coffee brand. Mr. Siddhartha had been inspired and introduced a new vision to the world of coffee. With a similar concept he carried out a project that he was able make it to the billion-dollar field, cup by cup. It is because of his dream to offer diverse coffee products at reasonable prices to people all around the world. The firm has over 20,000 acres of its own agricultural land and is one of the largest Arabica bean producers in Asia, and exports to the Middle East, Europe, and Japan. CCD is the largest coffee chain with over 1700 outlets, 48,000+ coffee vending machines and 500+ Express Kiosks in India. Currently, this organisation holds various coffee divisions: Café Coffee Day Outlets, CoffeeDay Beverages, CoffeeDay Exports, Internationally Cafés, The square, Caffe Coffee Day Value Express and Coffee Day fresh & ground. The organisation is also aiming to reach the international market by the establishment of more numbers of retail coffee shops worldwide. The first step was 15 years ago, the launch of the first outlet in Vienna Austria in the international café market.

RANGE OF PRODUCTS

A broad variety of products, mostly appealing to Indian lovers of coffee and snack, are sold by the café day. the products, whether it is food or coffee, have a determined Indian flavour. most eatables are adopted for Indian taste buds. List of some of the recommended products currently served at CCD Outlets:

The scale of serving each product is measured for the value of money but not just for quantity, the average serving size is detailed in the table below:

The Edibles at CCD are catered from various vendors, for example, Samosa’s by Patsiers Gallery, Ice Creams are by Cream Bell & Amul, Milk form Amul as well. As CCD aims to maintain a good quality of beverages served, edibles are mostly outsourced. Quality control has been at the top priority, even though the food is not solely made by CCD, it is the duty of the food control team to maintain a good procedure from the point of outsourcing till storing it well before consumption.

Target Market

Cafés offer a variety of items to its customers. Customers usually select and connect to certain cafés for many reasons, like their interests, social life, circumstances, and motivation. The main requirements of an ideal café are firstly, hygienic environment, comfortable seating, bright lighting, good scent, and mainly good locality. The concept of the café is also important for customers who need it to be convenient. Ideally seated by or close to a wall, with great exterior views. Extra space outdoors for a smoking area, and customers accompanied by dogs.

Usually, cafés are a hangout spot for customers in the age group of 15 to 30-year-olds. Customers who visit CCD in India are served with the best coffee by polite and knowledgeable workers who are uplifting and energizing the atmosphere. 52% of them are students, 25% fall under the teenage category, 37% fall in the age group between 20 to 24 and another 24% between the age group of 25 to 29, 14% fall under the age group 31 to 45. It is reported that 18% of the customers visit the cafés daily and 44% visit each week.

At the time of launch in Turkey, the targeted demographic market will be the higher and middle-class income society, since these two groups are more driven and/or go for discounted goods. CCD will always reflect on customer preferences and shares its coffee specialty with customers. Out of the population of eighty-two million as of 2019, 25 per cent of people were under the age of 15 and only 9 per cent were over the age of 65. The primary target demographic will be between 18 and 30 years of young professionals. The CCD policy will also involves positioning its stores in picky neighborhoods, underground main entrances, and commercial centers. CCD will also seek to market coffee and tea items through other networks, including restaurants, hotels, colleges and universities and other offices, in addition to sales through its company-operated retail stores and authorized retail operations. The stated aim of CCD is to become the leading retailer and coffee brand in each of its target markets and to accomplish this objective through the continued rapid growth of retail locations owned by the company.

Competitor analysis

Gloria Jean's Coffee, which entered the Turkish market in 1999 and has 60 cafes in 8 cities, is known to be one of the main CCD competitors in Turkey. Gloria Jeans's started as a small coffee and gift shop in Chicago and they are considered the co-leaders of the Turkish market. They have about 1000 stores around the world serving 8.5 million visitors per day, located in 40 + countries. The organization re-launched its growth strategy after the economic recession in 2001, which was to aim for a strong position and high brand recognition by opening retail branches in successful places in a controlled manner. The ambitions were to extend to other big cities to keep up with the market for the long term. In addition, to improve revenue and lower costs, the organization aimed to acquire strategic alliances for store specific operations. To promote the take-away concept, which reduces overall costs, they had to continue to differentiate between competitors by opening smaller stores and kiosks.

Gloria Jeans' service process, is by serving their customers at the table instead of a self-service method that applies to the Turkish market, would be the key difference between Gloria Jeans and CCD.

SWOT analysis for Gloria Jean Coffee:

Market Entry

CCD's market entry strategy into Turkey will be planned through licensing franchising. CCD can successfully capture a significant market share due to the strategic partnership with conglomerate Alshaya Group. A Leading trading partner and licensee, they operate with more than 3,500 stores in seven various industries (Fashion & footwear, Health & beauty, food, organic, Pharmacy, Home furnishing and leisure & entertainment), and managing over 500,000 employees under the group. It is recognized as the leading and most influential retailing franchises in the region. Through this partnership can access to vast regional expertise and local market knowledge. CCD in Turkey will be a new entrant to the market, as such, to face competitors it needs to hit the ground running. It should carefully analysis competitor to be sustainable in the market. This was facilitated by the partnership with an expert in the local market and their choice of savvy young, western-educated employees.

The business will rely on the local partner's experience for its licensing activities. The partners selected are often the most influential players on the industry, with in-depth market experience, including access to appropriate retail locations. This strategy can be quick and easy to enter a foreign market, with less restriction over border and tariff barriers. There are potential chances for a large Return on investment, there is also the risk to be considered while looking into this strategy, the franchiser will have a low level of control over the activities in the market, might lose on intellectual properties, also poor quality management can cause poor brand reputation. Therefore, a franchise partnership with a well-reputed organization has high chances of gaining success in the new market like turkey.

International Matketing objectives

Marketing Mix

Product

The organization has an ongoing phase of product innovation aimed at delivering new products to attract new consumers and maintain its current consumers, mainly because the company needs to create a diverse population of consumers to the market. The product marketing blend also includes modified products, food and other merchandise that are specifically chosen and crafted to suit the needs and desires of its Turkish target customers. CCD will continue to innovate its product range to increase its market share in the food and beverage industry. In the purpose of growing its product range and its market share, the company can incorporate or change its product lines. For, example CCD also draws attention of non-coffee consumers with innovative products like Frappuccino. The organisation has creative specialists working to ensure that more ground-breaking products are developed to capture a large market share around the globe.

Price

CCD also practices value-based pricing by selling products in various sizes, such as small, medium, and large. Usually a cup of coffee is priced at around 45 - 75 Rupees, i.e. 6-10 Turkish Lira. CCD also offers premium range of drinks that include add-ons such as chocolate syrup or double cream. So, the pricing methods are not fixed, and it caters to consumers in various industries such as students and corporate workers by its versatile and varied rates. For other sales opportunities, CCD leases vending machines to other company consumers and advertisement space at its stores.

PLACE

Café Coffee Day opens its stores in strategic areas such as shopping centres and main streets where there are heavy pedestrians. It has three styles of outlets, such as coffee shops, CCD lounge, and CCD Square. For several groups, CCD stores are where they can enjoy coffee, snacks, and spend time with their community. Lounges are for sections in a niche. There are luxury stores targeted at sophisticates who want to pay a premium price for a very good space and a great cup of coffee. Square outlets sell a selection of single-origin coffee from the host country. It also has a wide variety of foods from various cuisines.

CCD in Turkey can gain advantage by opening their first ever store in the major city where a much broader demand is driven by the urbanization of Turkey and the 'in' place for the fashionable and wealthy will congregate.

Promotion

CCD promotes under both above the line and below the line promotions in a wide range. But the percentage of mass marketing campaigns is slightly lesser. In spaces where its target market is accessible, Café Coffee Day conducts promotional events. In print media, CCD utilizes advertising commercials, co-branding of film and TV shows. Sales such as happy hours, combo offers, and discounts are also offered. Café Coffee Day joins hands with brands and offers them permission to advertise on the walls of its outlets. For successful advertising, it holds tournaments and uses membership cards at its cafes.

Degree of Adaptation

In Turkey, the hybrid marketing approach is being used by CCD. In this hybrid marketing approach, the general picture of the Starbucks brand and customer interface is standardized for the Turkish market, whereas both standardized products and localized products are to be sold.  Turkish coffee will be the only major distinction on the menu in Turkey compared to any other CCDs around the world. In order to produce a product that has a significant presence in the consumer culture in Turkey, Localization approach to customise the product to the demand for greater recognition. This is a hybrid form of forward innovation that can adjust to the conditions of host countries when providing a new product that the organisation has not been familiar to supplying.

Conclusion

Café Coffee Day is a successful Indian pioneer of Coffee, as it is aiming to expand globally in various countries where countries have excessive demand for coffee. It is necessary step for any brand looking into for global entrance to form an International marketing plan. This would help in analysing the potential growth and sustainability in the host country. Conducting a Competitor analysis and the target market will narrow down the goals to focus when entering globally. An assessment of the international market has been accomplished to determine the windows of opportunities to ensure that the marketing campaign can be successful in achieving its targets.

Reference List

BrandLine. (2020). Cafe Coffee Day- Brand Restoration. BrandLanes Blog. https://www.brandlanes.com/blog/swot-analysis-of-cafe-coffee-day.

Ferreira, J. (2019). Turkish Coffee Culture: An Intangible Cultural Heritage. CoffeeBI | Coffee Business Intelligence. https://coffeebi.com/2018/09/10/coffee-culture-in-turkey/

Joshi, M., & Bansal, S. (2011). Café Coffee Day (CCD): A Case Analysis. SSRN Electronic Journal, 6. Doi.10.2139