PROJECT

ON
A STUDY ON CONSUMER PREFERENCE TOWARDS
RETAIL COFFEE CHAINS IN LUDHIANA BARISTA,
CCD and COSTA COFFEE

SUBMITTED IN PARTIAL FULFILLMENT OF MASTER

OF BUSINESS ADMINISTRATION
(2012-2014)
PUNJAB TECHNICAL UNIVERSITY, JALANDHAR

Submitted To-

Submitted By-

Prof. Harleen Mahajan

Devinder Singh
1274357

PUNJAB COLLEGE OF TECHNIVAL EDUCATION

BADDOWAL, LUDHIANA
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CERTIFICATE BY THE GUIDE

This is to certify that Mr. Devinder Singh student of MBA-2nd year, Punjab College of
Technical Education, Baddowal has undertaken the project entitled A Study on consumer
preference towards retail coffee chains in Ludhiana- Barista, CCD and Costa Coffee under
my guidance and supervision for fulfillment of major project. In my opinion, this study embodies
the results of his work.

Date:

Prof. Harleen Mahajan

(Project Guide)

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ACKNOWLEDGEMENT

I extend my sincere thanks to all those who helped me in the completion of this project. Without
their undying help and guidance, this project would not be what it is.
I specially extend my heartfelt thanks to my Faculty guide Prof. Harleen Mahajan for helping
me at every step, and guiding me in every way possible. This project would not have been
successful without her help and continuous guidance throughout.
A special note of thanks also goes out to the people from various fields for giving me their
precious time and helping me with this project.
I also thank my dear friends, I shall ever remain under debt for their encouragement, love, moral
support and every possible help without which it would have not been possible to accomplish
this work.
In the end, I sincerely acknowledge all those who directly or indirectly helped me.

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TABLE OF CONTENTS

S.No.
Chapter-1

PARTICULARS

INTRODUCTION
HISTORY
o Barista
o CCD
o Costa Coffee

PAGE NO.
5
6-8
9-10
11-12
13-14

Chapter-2
Chapter-3

REVIEW OF LITERATURE
15-16
NEED, OBJECTIVES AND METHODOLOGY OF 17-18
RESEARCH

Chapter-4
Chapter-5
Chapter-6

Research Objectives
Research Methodology
Research Design

DATA INTERPRETATION AND ANALYSIS

CONCLUSION
AREAS NEEDING IMPROVEMENT

Barista
CCD
Costa Coffee

17
17
18
19-35
36
37
37
37

Chapter-7
Chapter-8

RECOMMENDATION AND SUGGESTIONS

BIBLIOGRAPHY

37
38-39
40

Chapter-9

ANNEXURE

41-42

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QUESTIONNAIRE

INTRODUCTION

Today Coffee has become a lifestyle. Also, it has caught the fancy of today's generation - youth.
These were not the typical coffee drinking target customers. But now they are a big part of the
target base for coffeehouses. And it is fashionable to be seen at the Coffee Pubs. It is in a way, a
lifestyle statement.
That is bad news for tea - still the favorite brew for a majority of Indians, which has been losing
out to coffee in recent years. India is one of the world's largest exporters of tea and also one of its
biggest consumers. But it is coffee drinking which is increasingly becoming a statement of young
and upwardly mobile Indians.
And coffee bars, an unheard of concept till a couple of years ago, are suddenly big business.
Corner bars like these are offering more than just coffee and snacks to their customers. For many
of their regular patrons, a visit to these bars is also a part of the western lifestyle they so much
want to identify with.
The Coffee retailing sector in India is booming today, with several companies active in the
market. Some are local entities, some have come from abroad and have tied up with local
companies, and some seem to prepare themselves for an entry sooner or later. The market growth
is expected to be 20 to 30% annually in the next couple of years.
Caf Coffee Day (CCD) pioneered the caf concept in India in 1996 by opening its first caf at
Brigade Road in Bangalore. Till about the late 1990s coffee drinking in India was restricted to
the intellectual, the South Indian traditionalist and the five star coffee shop visitor. As the pure
(as opposed to instant coffee) coffee caf culture in neighboring international markets grew, the
need for a relaxed and fun hangout for the emerging urban youth in the country was clearly
seen.

Coffeehouse
A coffeehouse shares some of the characteristics of a bar, and some of the characteristics of a
restaurant, but it is different from a cafeteria. As the name suggests, coffeehouses focus on
providing coffee and tea as well as light snacks. This differs from a caf, which is an informal
restaurant, offering a range of hot meals, and possibly being licensed to serve alcohol. Many
coffee houses in the Muslim world, and in Muslim districts in the West, offer shisha, powdered
tobacco smoked through a hookah. In establishments where it is tolerated - which may be found
notably in the Netherlands, especially in Amsterdam - cannabis may be smoked as well.

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From a cultural standpoint, coffeehouses largely serve as centers of social interaction: the
coffeehouse provides social members with a place to congregate, talk, write, read, entertain one
another, or pass the time, whether individually or in small groups.

History
Since the 15th century, the coffeehouse has served as a social gathering place in Middle Eastern
countries where men assemble to drink coffee (usually Arabic coffee) or tea, listen to music, read
books, play chess and backgammon, and perhaps hear a recitation from the works of Antar or
from Shahnameh. In 1457 the first coffeehouse, Kiva Han, was opened in Istanbul, just four
years after its conquest by the Ottomans. Coffeehouses in Mecca soon became a concern as
places for political gatherings to the imams who banned them, and the drink, for Muslims
between 1512 and 1524. In 1530 the first coffee house was opened in Damascus, and not long
after there were many coffee houses in Cairo.
In the 17th century, coffee appeared for the first time in Europe outside the Ottoman Empire, and
coffeehouses were established and quickly became popular. The first coffeehouses in Western
Europe appeared in Venice, due to the traffics between La Serenissima and the Ottomans; the
very first one is recorded in 1645. The first coffeehouse in England was set up in Oxford in 1650
by a Jewish man named Jacob. Oxford's Queen's Lane Coffee House, established in 1654, is still
in existence today. The first coffeehouse in London was opened in 1652 in St Michael's Alley,
Cornhill. The proprietor was Pasqua Rose, the Armenian servant of a trader in Turkish goods
named Daniel Edwards, who imported the coffee and assisted Rose in setting up the
establishment. Boston had its first in 1670. Pasqua Rose also established Paris' first coffeehouse
in 1672 and held a city-wide coffee monopoly until Francesca Procopio dei Coltelli opened The
Cafe Le Procope [2]in 1686. This coffeehouse still exists today and was a major locus of the
French Enlightenment; Voltaire, Rousseau, and Diderot frequented it, and it is arguably the
birthplace of the Encyclopdie, the first modern encyclopedia.
Though Charles II later tried to suppress the London coffeehouses as "places where the
disaffected met, and spread scandalous reports concerning the conduct of His Majesty and his
Ministers", the public flocked to them. They were great social levellers, open to all men and
indifferent to social status, and as a result associated with equality and republicanism. More
generally, coffee houses became meeting places where business could be carried on, news
exchanged and the London Gazette (government announcements) read. Lloyd's of London had its
origins in a coffeehouse run by Edward Lloyd, where underwriters of ship insurance met to do
business. By 1739 there were 551 coffeehouses in London; each attracted a particular clientele
divided by occupation or attitude, such as Tories and Whigs, wits and stockjobbers, merchants
and lawyers, booksellers and authors, men of fashion or the "cits" of the old city center.
According to one French visitor, the Abb Prvost, coffeehouses, "where you have the right to
read all the papers for and against the government," were the "seats of English liberty.

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The banning of women from coffehouses was not universal, but does appear to have been
common in Europe. In Germany women frequented them, but in England and France they were
banned. milie du Chtelet purportedly wore drag to gain entrance to a coffehouse in Paris. In a
well-known engraving of a Parisian coffeehouse of c. 1700, the gentlemen hang their hats on
pegs and sit at long communal tables strewn with papers and writing implements. Coffeepots are
ranged at an open fire, with a hanging cauldron of boiling water. The only woman present
presides, separated in a canopied booth, from which she serves coffee in tall cups.
The traditional tale of the origins of Viennese coffeehouses begins with the mysterious sacks of
green beans left behind when the Turks were defeated in the Battle of Vienna in 1683. All the
sacks of coffee were granted to the victorious Polish king Jan III Sobieski, who in turn gave them
to one of his officers, Franciszek Jerzy Kulczycki. Kulczycki began the first coffeehouse in
Vienna with the hoard. However, it is now widely accepted that the first coffeehouse was
actually opened by an Armenian merchant named Johannes Diodato.
In London, coffee houses preceded the club of the mid-18th century, which skimmed away some
of the more aristocratic clientele. Jonathan's Coffee-House in 1698 saw the listing of stock and
commodity prices that evolved into the London Stock Exchange. Auctions in salesrooms
attached to coffeehouses provided the start for the great auction houses of Sotheby's and
Christie's. In Victorian England, the temperance movement set up coffeehouses for the working
classes, as a place of relaxation free of alcohol, an alternative to the public house (pub).
Coffee shops in the United States arose from the espresso- and pastry-centered Italian
coffeehouses of the Italian-American immigrant communities in the major U.S. cities, notably
New York City's Little Italy and Greenwich Village, Boston's North End, and San Francisco's
North Beach. Both Greenwich Village and North Beach were major haunts of the Beats, who
became highly identified with these coffeehouses. As the youth culture of the 1960s evolved,
non-Italians consciously copied these coffeehouses. Before the rise of the Seattle-based
Starbucks chain, Seattle and other parts of the Pacific Northwest had a thriving countercultural
coffeehouse scene; Starbucks standardized and mainstreamed this model.
In the United States, from the late 1950s onward, coffeehouses also served as a venue for
entertainment, most commonly folk performers. This was likely due to the ease at
accommodating a lone performer accompanying themself only with a guitar, even with limited
floorspace; the political nature of much of 1960s folk music made the music a natural tie-in with
coffeehouses with their above-referenced association with political action. A number of well
known performers like Joan Baez and Bob Dylan began their careers performing in
coffeehouses. Blues singer Lightnin' Hopkins bemoaned his woman's inattentiveness to her
domestic situation due to her overindulgence in coffeehouse socializing, in his 1969 Coffeehouse
Blues.
From the 1960s through the mid-1980s, many churches and individuals in the United States used
the coffeehouse concept for outreach. They were often storefronts and had names like The
Gathering Place (Riverside, CA), The Lost Coin (New York City), and Jesus For You (Buffalo,
NY). Christian music (guitar-based) was performed, coffee and food was provided, and Bible
studies were convened as people of varying backgrounds gathered in a casual "unchurchy"
setting. These coffeehouses usually had a rather short life, about three to five years or so on
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average. An out-of-print book, published by the ministry of David Wilkerson, titled, A

Coffeehouse Manual, served as a guide for Christian coffeehouses, including a list of name
suggestions for coffeehouses.

International variation
American coffee shops are also often connected with indie, jazz and acoustic music, and will
often have them playing either live or recorded in their shops. Coffeehouses are often gathering
places for underage youths who cannot go to bars.
In the United Kingdom, traditional coffeehouses as gathering places for youths fell out of favour
after the 1960s, but the concept has been revived since the 1990s by chains such as Starbucks,
Coffee Republic, Costa Coffee, and Caff Nero as places for professional workers to meet and
eat out or simply to buy beverages and snack foods on their way to and from the workplace.
In France, a cafe also serves alcoholic beverages. French cafes often serve simple snacks such as
sandwiches. They may have a restaurant section. A brasserie is a cafe that serves meals,
generally single dishes, in a more relaxed setting than a restaurant. A bistro is a cafe / restaurant,
especially in Paris.
In Australian cities, a traditional European cafe culture is thriving as a result of significant
immigration from mainland Europe in the 19th century and 20th century. These establishments
often cluster along certain streets and with the weather allowing curb side seating much of the
year certain areas resemble a large party on a Friday or Saturday evening.
In Malaysia and Singapore, traditional breakfast and coffee shops are called kopi tiams. The
word is a portmanteau of the Malay word for coffee (as borrowed and altered from the
Portuguese) and the Hokkien dialect word for shop. Menus typically feature simple offerings: a
variety of foods based on egg, toast, and kaya (jam), plus coffee, tea, and Milo, a malted
chocolate drink which is extremely popular in Southeast Asia and Australasia, particularly
Singapore and Malaysia.
In parts of the Netherlands where the sale of cannabis is decriminalized, many cannabis shops
call themselves coffeeshops.
In modern Egypt, Turkey and Syria, coffeehouses attract many men and boys to watch TV or
play chess and smoke shisha.

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(A)

Barista

Barista Coffee is a chain of espresso bars in India. Headquartered in Delhi, Barista currently has
espresso bars across India, Sri Lanka and the Middle East. It was founded in 1997, p Led by the
dynamic duo of Ravi Deol & the marketing ace Sandeep Vyas; Barista was the fastest brand to
make it to the list of super brand's and is ranked among the top 50 phenomenons that changed
India. Starbucks corporations decided to enter into an agreement that allowed Barista Coffee to
use the brand for cafes as long as it allowed Starbucks to use the brand "Barista" for brewing
equipment. Italy's Lavazza has now acquired Barista.
Barista Coffee in India can be easily called the pioneers of coffee culture in India. Established
in February 2000 to recreate the ambience and experience of the typical Italian neighborhood
Espresso Bars. Barista Coffee aims to provide a comfortable and friendly place for people to
relax and unwind over a cup of coffee.

Ownership: Barista Coffee Company is owned by Lavazza, Italys largest coffee company.
Lavazza is one of the most important roasters in the world, a leader in Italy with a 46.5% share
of the retail market (in value, source: Nielsen). It operates in over 80 countries, in the Home and
Away-from-Home sectors (Foodservice, Vending and Retailing). In 2006 sales totalled USD 1.2
billion.

Outlets: Barista at present has over 200 Espresso Bars and 7 Barista Crmes in over 30
locations: Delhi, Gurgaon, Bangalore, Hyderabad, Kolkata, Mumbai, Chennai, Pune, Ghaziabad,
Noida, Chandigarh, Mohali, Dehradun, Shimla, Mussorie, Jaipur, Kanpur, Lucknow, Bhopal,
Indore, Bhubaneshwar, Ahmedabad, Baroda, Cochin, Coimbatore, Manipal, Guwahati etc.
making it one of the largest retailers of specialty coffees in Asia. Barista further has laid
international footprints in Sri Lanka (4 outlets), Oman and UAE (6 outlets).

Ambience: Barista Coffee is not just about drinking coffee but also about the entire experience.
At Barista the Joy of Coffee is reflected in the warm ambience, the exotic flavours and the
friendly service provided by the brew-masters. To add to the informal ambience, Barista
Espresso Bars offer games like Scrabble, Pictionary and Battleship for the guests. Barista
Espresso Bars were the first place where the customers were called by their first names to create
an atmosphere of informality and friendliness. Barista in its outlets have Wi-Fi enabled corners
for executives-on-the-go. Open seven days a week, most Barista Espresso Bars begin brewing
from 10 a.m. and are open till late night.

Coffee: Barista Coffee places strong emphasis on the quality of coffee beans and the process of
preparing, rich aromatic coffee. The coffee is created with carefully hand picked mature cherries
of the Arabica coffee plant, ensuring a uniform and high quality harvest. This 100% Arabica
coffee is sourced from Tata Coffees plantations in Karnataka, India. House blend beans are
sourced and roasted in India by Tata Coffee. The international coffees such as Costa Rican,
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Kenyan and Jamaican Blue Mountain are sourced from the respective countries and custom
roasted in Italy.

Food: In an attempt to further enhance the experience at the Barista Espresso bars, it has on
offer a delicious snacks and dessert menu. On offer are authentic Italian food items such as
biscottis, paninis, wraps, twisters, puffs, sandwiches and other munchies to go along with its
wide coffee range. To cater to the sweet tooth, Barista also offers mountains of ice creams,
oodles of chocolate, chunks of crumbly apple pies, walnut brownies etc.

Awards
Barista the Super Brand
Barista received the coveted Retail Award, voted by consumers as the 'Most admired retailer of
the year 2007: Catering Outlets' at the 4th IMAGES Retail Awards (IRA) 2007, felicitating
Indias top performing companies and professionals in the business of retail. Barista has also
been voted Barista has been recognised by the HTSuperbrand two years in succession. Food
Guide as the best place to have coffee. It is also the recipient of the Caf of the Year award
given by The Times Group in the Times Food Guide.
A huge shot in the arm and validation of the companys efforts has been the recognition given
independently by BBC, The Times of India and Business Standard as the Brand of the Year
(2002).
Barista was also awarded the TOPS award for Specialty Coffee Excellence by the Specialty
Coffee Association of America (SCAA) which recognizes specialty coffee retailers who
differentiate themselves through better business practices.
Recently Barista was also recognized by the HT Food Guide as the best place to have coffee as
well as Caf of the Year award given by The Times Group in the Times Food Guide.
For the year 2003-05, Barista has been selected as one of the 100 superbrands in the country and
is amongst the youngest brands in the list, to achieve this status.

(B)

Caf Coffee Day

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Caf Coffee Day is a division of India's largest coffee conglomerate, Amalgamated Bean Coffee
Trading Company Ltd. (ABCTCL), popularly known as Coffee Day, a Rs. 300 crore ISO 9002
certified company. Coffee Day sources coffee from 5000 acres of coffee estates, the 2nd largest
in Asia, that is owned by a sister concern and from 11,000 small growers. It is one of Indias
leading coffee exporters with clients across USA, Europe & Japan.
With its roots in the golden soil of Chickmaglur, the home of some of the best Indian Coffees and
with the vision of a true entrepreneur nurturing it, Coffee Day has its business spanning the entire
value chain of coffee consumption in India. Its different divisions include: Coffee Day Fresh n
Ground (which owns 354 Coffee bean and powder retail outlets), Coffee Day Xpress (which
owns 341 Coffee Day Kiosk), Coffee Day Take away (which owns 7000 Vending Machines),
Coffee Day Exports and Coffee Day Perfect (FMCG Packaged Coffee) division.
Caf Coffee Day (CCD) pioneered the caf concept in India in 1996 by opening its first caf at
Brigade Road in Bangalore. Till about the late 1990s coffee drinking in India was restricted to
the intellectual, the South Indian traditionalist and the five star coffee shop visitor. As the pure
(as opposed to instant coffee) coffee caf culture in neighboring international markets grew, the
need for a relaxed and fun hangout for the emerging urban youth in the country was clearly
seen.
Recognizing the potential that lay ahead on the horizon, Caf Coffee Day embarked on a
dynamic journey to become a large organized retail caf chain with a distinct brand identity of its
own. From a handful of cafs in six cites in the first 5 years, CCD has become
Indias largest and premier retail chain of cafes with 498 cafes in 85 cities around the country.
Enthused by the success of offering a world-class coffee experience, CCD has opened a Caf in
Vienna, Austria and is planning to open other Cafes in the Middle East, Eastern Europe, Eurasia,
Egypt and South East Asia in the coming months.

Cafe Formats
Caf Coffee Day has been experimenting with caf formats for quite sometime. Backed by the
motivation of providing customers with exciting choices as well as constantly redefining the
caf experience, CCD has ventured into the following formats:
Music Cafs provide customers with the choice of playing their favourite music tracks on the
Digital Audio Jukeboxes installed at the caf! There are around 85 cafes with such jukeboxes. 32
cafes also provide customers with the visual treat of watching their favorite music videos by
means of Video Jukeboxes.
Book Cafs offer the perfect solution to people who think that the coffee experience is
incomplete without browsing through the bestsellers or reading a classic. CCDs book corners
accentuate the age-old combination of coffee and books. This exciting concept has been
successfully tested at 15 cafes in 12 cities across India and the numbers are set to grow
exponentially. CCD has tied up with English Book Depot, one of Indias leading book
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distributors for placement and rotation of reading materials appealing to Caf Coffee Days
discerning customers.
Highway cafs on the Bangalore Mysore highway and NH-8, presents the traveler en route not
only with good coffee and scrumptious snacks amidst great ambience but also with clean
restrooms to get rid of that weariness from the road!
Lounge cafs at Hauz Khas, Delhi and Southern Avenue, Kolkata(Southern Avenue) and
Hyderabad (Jubilee Hills) combines the style and luxury of a lounge with the lively ambience
and comfort of a caf. With exquisite interiors, exotic menu and thematic music CCD Lounge
offers a whole new experience to the connoisseur while assisting the latter through its team of
hostesses who are poise and style incarnate and are looked upon as fashion icons.
Garden cafs at M.G Rd, Bangalore and GKII, New Delhi combine the joy of rejuvenating
amidst verdant landscapes and pots of coffee.
Cyber cafs at Brigade Rd, Bangalore, Airport, Bangalore and Airport, Delhi combine the urge
to surf, not to mention get connected through the internet while enjoying perfectly brewed cups
of coffees, both domestic as well as International blends!
Mission statement
To be the best caf chain in the world by offering a world class coffee experience at affordable
prices.
Brand association
CCD has emerged as an interactive alternative media for brands to communicate with the young
at heart.
Other media, such as electronic, print and outdoor, offer brand communication through visual
and audio modes to a large section of the populace, both relevant and irrelevant. Caf Coffee
Day offers a much more interactive, targeted communication, sometimes adding even a taste
dimension to a brand idea!
Various in-caf collaterals used to impart visibility to a brand inside a caf or to add the element
of interactivity to a campaign are Posters, Tent Cards, Danglers, Leaflets, Brochures, Coasters,
Drop boxes, Contest Forms, Stirrers, Standees etc.
Over the years, CCD has successfully promoted a number of brands/products/events through
various innovative tactics and promo ideas. Cashing in on its mass captive audience, we at CCD
have entered into tie-ups and promotions which are well knit with our brand promise and which
can be creatively used to woo the Indian Youth.

Awards
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Cafe Coffee Day: the best Indian Food Services Brand Business World November 8th, 2004
Food services top 5
1. McDonalds
2. pizza hut
3. caf coffee day
4. barista coffee
5. dominos

(C)

Costa Coffee

Bruno and Sergio Costa founded a coffee roastery in Lambeth, London, in 1971, supplying local
caterers. Costa branched out to retailing coffee in 1978, when its first store opened in Vauxhall
Bridge Road, London.
In 1995, the business was acquired by Whitbread, becoming a wholly owned subsidiary. In 2009,
Costa celebrated the opening of its 1,000th store - in Cardiff. In December 2009, Costa Coffee
agreed to acquire Coffee Heaven for 36 million, adding 79 stores in central and eastern Europe.
By the end of 2010, the company had overtaken Starbucks in the UK, reaching a 37.6% market
share measured by revenues.
Locations
Costa Coffee operates 1175 outlets in the United Kingdom as of January 2011. Internationally, it
operates 442 stores throughout the world in 35 countries.
Costa Coffee outlets can be found in airports and within Waterstone's bookstores, WHSmith,
Homebase branches, Marriott Hotels, Odeon Cinemas, Some Premier Inn Hotels, Waitrose and
Tesco stores, Pizza Hut branches, Beefeater Pubs, Moto and RoadChef motorway services and in
some hospitals. Smaller sub-units are also set up in railway stations and airports throughout the
UK. Many of Costa Coffee's branches located in airports, cinemas and hospitals are either
individual or corporate franchises. Costa Coffee also has small outlets positioned on out-of-town
business parks, often among other food retailers, and on site at various businesses. Its largest
branch is located in Dubai and can seat 321 people.
Costa Coffee currently has branches in many countries.
Costa Express
Following Whitbread's 59.5m acquisition of Coffee Nation, a chain of coffee machines, the
machines were re-branded as Costa Express.The company plans expand to target hospitals,
universities and transport interchanges. These coffee bars will use the same coffee beans as are
used in Costa stores and will use fresh milk.
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Coffee production
Costa Coffee has its own roastery. The blend served in retail stores is known as "Mocha Italia"
and contains six parts arabica beans to four part robusta beans (60% Arabica - 40% Robusta).
Costa Coffee employs Gennaro Pelliccia as a coffee taster, who had his tongue insured for 10m
with Lloyd's of London in 2009.
Costa Book Awards
Costa Coffee has been the sponsor of the Costa Book Awards (formerly the Whitbread Book
Awards) since 2006.
Zoning and opposition to franchise locations
In 2011, it was reported that two Costa Coffee outlets in Bristol had opened without correct
planning permission. An investigation into whether a third Costa coffee shop in north Bristol
opened without the correct planning permission was launched in January 2012.The planning
appeals against the refusal of planning permission and enforcement action were upheld by an
independent government appointed Inspector on 14 August 2012, who also awarded full costs
against Bristol City Council in relation to one of the stores. The decision received criticism from
councillors across the political spectrum.
In 2012, Costa faced opposition to its plans to open an outlet in Totnes, Devon. However, an
open letter was issued by Costa in conjunction with local authorities to state that because of the
unique nature of the town and local pressure it had decided to pull out. Also in 2012, residents in
Southwold tried to campaign against the opening of a Costa coffee shop in their town. Planners
turned down the original planning application by Costa but it was awarded planning permission
on appeal. January 2014 saw another license application rejected, this time in Hinchley Wood,
Surrey. The village had previously seen attempts by McDonalds to purchase property on the
same street in 1999. However Whitbread Plc have appealed this, with a decision to come in
March 2014.

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REVIEW OF LITERATURE

1. Barista vs Cafe Coffee Day(2005)- A Comparative study- The study was done to
compare and study Barista and Cafe Coffee Day and identify their areas of excellence
and needing improvement, Also to provide suggestion for such improvements. On the
basis of Findings both cafes are performing well in certain areas and there are certain
areas where they need improvement like Average taste and Quality of Products in Case of
Barista and Ambience and Decor of Cafe Coffee Day.
2. The Coffee Shops: Social and Physical factors influencing place attachment (By Lisa
Waxman) (2006): The Study Explode the characterstics that encourage gathering
behaviour and contribute to place attachment in selected coffee shops in the context of
literature suggesting Social gathering places contribute to social capital. 18 interviews
were conducted and surveys were collected to reveal patron attitude towards the physical
and social aspect of the coffee shop. The Key Findings regarding the physical
characterstic showed the top5 designed considerations including cleanliness appealing
aroma adequate lighting comfortable furniture and the view to outside.
3. Customer perception and attitude towards retail coffee chains:- A Study in Delhi,
w.r.t. barista, CCD, Nescafe (2006-2008):- The Study shows that how coffee has become
a lifestyle for the people specially todays generation. It took three cafers to identify the
perception of the youth regarding these cafes. The findings show that Cafe coffee day has
been positioned for younger generation usually college goers. Where as Barista cofee has
been positioned for executive class of customers who prefer premium taste and Nescafe
is for youngsters who like to sip a coffee and have a chat with their friends at really low
prices.
4. Branded coffee houses a rage in India(Anuradha Shenoy in Mumbai) (July 16, 2005)
Go to any of the mushrooming coffee bars and what do you find? The menu displays not
just a range of coffees, but an ever increasing list of soft drink concoctions and other
beverages mingling with snacks and mini-meals. Strange? Maybe. With more than 500
coffee cafes in the country, up from 175 in 2002, coffee was the most happening
beverage. And the players, from Barista Coffee Co to Bangalore-based Cafe Coffee Day,
were opening outlets practically every weekend. So far so good. Today, at Barista Coffee
Co, coffee sales are much less than its other offerings. Sixty per cent of its sales are
brewed from teas, smoothies, food items and merchandise. At Bangalore-headquartered
Cafe Coffee Day, 70 per cent of its sales come from beverages including coffee. At Cafe
Mocha, coffee sales are up from 3 per cent three years ago when it first started to 17 per
cent today. What does all this mean? Coffee sales have not really stirred the storm they
were expected to be. But this has not deterred the coffee cafes from stretching their
brands.
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5. The Motivational Reasons behind Consumer in Branded Coffee Shops(Sophie Alice

burge)(2013):- The coffee shop industry has been undergoing substantial change during
the latter part of the twentieth and early part of the twenty-first century, reflected by
continous changes in consumer behaviour. The aim of the study is to improve the
understanding of the motivational reasons behind customer choice in branded cofee shops
both international and local. A quantative data collection of 300 questionnaires was used
in the UK to assess consumer behaviour to branded coffee shops. The findings concluded
that most respondents visit coffee shops with friends, with locally branded coffee shops
are most influenced by three factors:past experience/ familiarity: convenience of
location/travel:and friends and family. With family staff, high quality of coffee and food,
good atmosphere and good reputation the most important aspects for branded coffee
shops. Recent exposure of tax avoidence from companies such as Starbucks has had
negative influence on consumer choice of branded coffee shops.
6. Storm in the coffee cup-(In the late 1990s), a silent cafe revolution was sweeping urban
India. Coffee drinking was increasingly becoming a statement of the young and upwardly
mobile Indians. Coffee bars, an unheard concept till a couple of years ago, had suddenly
become big business and coffee bars like Barista, Cafe Coffee Day (CCD) and Qwiky's
had become quite popular. Though being a late entrant, Barista took elite India by storm.
With 105 branches in 18 cities and annual sales of Rs. 650 million, Barista was clearly
the leader in the coffee retailing business in 2002. What made Barista different from
others was the ambience at its outlets.

RESEARCH OBJECTIVES
To know Preference regarding choice of Coffee chain.
To know Factors affecting the customer choice regarding coffee chain.
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 To do Comparative analysis between different coffee chains.

RESEARCH METHODOLOGY
While making a study we very often look for what type of research methodology is to be used in
this type of study. For implementation of a proper research methodology we have to first
understand the meaning of research.
Research is a scientific as well as systematic process, which includes defining and redefining the
problem to develop hypothesis, to collect and define the information/data, to analysis the
information and bring out the results.
The first step in research after defining the research problem and objectives is data collection.
The word data means any raw information, which is either quantitative or qualitative in nature,
which is of practical or theoretical use. The task of data collection begins after a research
problem has been defined and research design chalked out. While deciding about the method of
data collection, the researcher should keep in mind that there are two types of data primary and
secondary.
1. Primary data: -This is those, which are collected afresh and for the first Time, and thus
happen to be original in character. There are many ways of data collection of primary
data like questionnaire, observation method, interview method, through schedules,
pantry Reports, distributors audit, consumer panel etc.
2. Secondary data: -These are those data, which are not collected afresh and are used
earlier also and thus they cannot be considered as original in character. There are many
ways of data collection of secondary data like publications of the state and central govt.,
website, journals, companies reports, reports prepared by researchers, reports of various
associations connected with business, Industries, banks etc. For this project secondary
data was taken from companys reports and websites.
This project is a survey project. In this project first the secondary data will be collected through
websites, magazines and journals. Based on this information a questionnaire will be designed for
the target respondents. The primary data collected through this fieldwork will be analyzed and
used to generate results.
Target respondent The target respondent are the people who have visited any of the
coffeehouses in Ludhiana.

RESEARCH DESIGN
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Type of research: Descriptive research

Sources of data: Primary Data & Secondary Data
1
2

Primary Data - Questionnaire

Secondary Data magazines, Websites, Journals

Data collection method: Survey Method

Survey instrument: Questionnaire
Method of communication: Personal interview
Sampling technique: Convenient sampling, Judgemental sampling
Sample size: 50
Sample unit: People who visit coffee houses in Ludhiana
Area of survey: Ludhiana

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DATA INTERPRETATION AND ANALYSIS

1. How many cup of coffee do you drink per day?

(a)None (b)1 (c)2 (d)More than 2

Options

Number

Percentage(%)

None

33

66

12

24

More then 2

10

%age
35
30
25
20
15
10
5
0

%age

None

More than 2

Comments- 66% of people drink 1 cup of coffee per day, 24% drink 2 cup of coffee per
day and 10% drink more than 2 cup of coffee per day.

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2. How frequently do you visit a coffee house?

(a)Every day (b)Alternate day (c)Weekly (d)Fortnightly

Option
Everyday
Alternate day
Weekly
Fortnightly

Number

Percentage(%)

10
8
22
10

20
16
44
20

Percentage(%)
50
45
40
35
30
25
20
15
10
5
0

Percentage(%)

Everyday

Alternate day

Weekly

Fortnightly

Comments- 20% of people visit coffee house everyday, 16% of people visit coffe house
alternate day and 44% visit coffee house weekly.

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3. Are you a regular visitor to a specific coffee shop?

(a)Yes (b) No

Option
Yes
No

Number

Percentage

34
16

68
32

Percentage

Yes
No

Comments- 68% people are regular visitor to a specific coffee shop.

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4. Out of these coffee houses, which one do you visit the most?
(a)Barista (b)CCD (c)Costa Coffee (d)Any other

Option
Barista
CCD
Costa Coffee
Any other

Number

Percentage(%)

5
39
2
4

10
78
4
8

Percentage(%)
90
80
70
60
Percentage(%)

50
40
30
20
10
0
Barista

CCD

Costa Coffee

Any other

Comments-10% people visits barista , 78%people visits CCD , 4% visits costa

coffee and 8% visits other coffee houses.

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5. How important are the following factors while visiting the coffee
houses?

(a)Variety of coffee

Variety of Coffee
60
50
40
30

Variety of Coffee(%)

20
10
0

Comments- In case of Variety of coffee 20% of people think its very important, 50% thinks its
important and 10% people thinks its not important.

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(b) Taste of Coffee

Taste Of Coffee
80
70
60
50
40
30

Taste Of Coffee (%)

20
10
0

Comments- In case of taste of coffee 75% people think its very important, 25% people think its
important.

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(c) Quality of Coffee

Quality of Coffee
90
80
70
60
50
40
30
20
10
0

Quality of Coffee(%)

Comments- In case of Quality of Coffee 80% of people thinks quality of coffee is very
important and 20% thinks quality of coffee is Important so Quality of coffee is Important factor.

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(d) Price

Price
50
45
40
35
30

Price(%)

25
20
15
10
5
0
Very Important

Important

Less important

Not Important

Comments- In case of price of coffee 20% of people thinks its very important, 30% thinks its
important, 45% less important and 5% thinks not important.

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(e) Ambience

Ambience
60
50
40
Ambience(%)
30
20
10
0
Very Important

Important

Less Important Not Important

Comments- In case of ambience 54% people thinks its very important, 34% thinks its important,
8% less important, 4% thinks not important.

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(f) Location

Location
60
50
40
Location(%)
30
20
10
0
Very Important

Important

Less Important Not Important

Comments- In case of Location 10% people thinks its very important, 19% important,
56%thinks less important, 15% thinks not important.

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6. Consumers experience with the following coffee-chains?

(a) Barista

Barista
Very Satisfied
Satisfied
Less Satisfied
Not Satisfied

(b) CCD

CCD
Very Satisfied
Satisfied
Less Satisfied
Not Satisfied

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(c) Costa Coffee

Costa Coffee

Very Satisfied
Satisfied
Less Satisfied
Not Satisfied

Comments- As shown above in the pie-charts that People are more satisfied with CCD as
compared to Barista and Costa Coffee. The percentage of satisfied customers are more of CCD.

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7. Coffee chains in order of preference.

Preference of coffee chains

80
70
60
50

40
30
20
10
0
Barista

CCD

Costa Coffee

Comments-In case of preference of coffee house according to survey 20% of

people prefer barista, 74% prefer CCD and 6% prefer Costa Coffee. So among
people CCD is most preferable coffee house.

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8. How important is your decision for visiting a coffee house with following?

(a) Your own instinct

60
50
40
30

20
10
0
Very Important

Important

Less Important

Not Important

Comments- - In this case 57% people says their decision is very important while visiting coffee

shop , 25% says its important and 3% says its not important.

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(b)Family

45
40
35
30
25
20
15
10
5
0
Very Important

Important

Less Important

Not important

Comments- In this case 24% people says their decision is very important while visiting coffee
shop with family , 40% says its important and 15% says its not important.

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(b) Friends

60
50
40
30

Friends(%)

20
10
0
Very Important

Important

Less Important

Not Important

Comments- - In this case 48% people says their decision is very important while visiting coffee
shop with friends , 25% says its important and 8% says its not important.

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(c) Work Group

45
40
35
30
25
%

20
15
10
5
0
Very Important

Important

Less Important

Not Important

Comments- - In this case 15% people says their decision is very important while visiting coffee
shop with Work group , 27% says its important and 39% says its not important.

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CONCLUSION

Barista Coffee: - Positioned for Executive class of customers who prefer premium taste
but not too high prices. Barista coffee customers are particular about taste and a peaceful
atmosphere. Usually these outlets have dim lighting and exclusive treatment.

1. Strong Brand Image:

Barista has a strong and clear brand image. Their customers can easily identify and relate to the
Barista brand. This helps increase and maintain brand loyalty.
2. Excellent Human Resource:
According to the survey, Barista received an excellent rating for the service and behavior of their
staff. This is a huge advantage, especially in a service organization. Barista must strive to keep
this advantage.
3. Ambience & Dcor:
Another significant area of excellence is the kind of ambience and dcor Barista cafs have.
Respondents to the survey, including whose who chose Caf Coffee Day as their choice of caf,
gave Barista a near perfect rating for their Ambience & Dcor.
4. Strong base for expansion & growth: Barista have worked hard on heir brand image and
human resources, and have a strong base for future expansion and growth- whether nationally or
internationally.

Cafe Coffee Day: - This has been positioned for younger generations usually college
goers and young people. With outlets strategically positioned near colleges, companies and
places where they can target customers. On analysis it can be seen that majority of the
customers are of 18-30 age group. People prefer coffee day location for treats.

1. Highly rated Taste & Quality of products:

Caf Coffee Day got a high rating in the market survey, for the Taste & Quality of their products.
If they work on this aspect, there is huge potential for them to attract customers, just based on the
taste and quality of products. This is also helped by the fact that they grow their own coffee
beans, and this provides an important base for future expansion and growth.
2. Value for money proposition:
Caf Coffee Day is projected as an affordable brand. This strategy has worked extremely well
so far, and Caf Coffee Day got a high rating, both for their prices and for their value for money,
in the market survey.
3. Strong youth orientation: The Caf Coffee Day brand is, and always has been, extremely
youth- oriented. There is huge potential for Caf Coffee Day to become one of the citys largest
youth brands. The untapped market share and potential for growth is enormous.

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Costa Coffee: -Its not much popular in Ludhiana, they dont have there own oulets they have
only one outlet in a mall so the ambience there is not gud and their is no any privacy. The main
emphasis is on the quality of coffee and not on the ambience. So thats why Costa Coffe is not as
such popular among consumers in ludhiana.

Areas Needing Improvement

Barista, Caf Coffee Day and Costa Coffee have under performed or not lived up to potential in
certain areas. The areas are weaknesses, which need to be improved upon, as that both can
eliminate any disadvantage that may have, and improve customer satisfaction.

Barista
1. Average taste & quality of products:
According to the market survey, other than their Dessert, Barista got only an average rating for
the taste & quality of their products. Considering their strong brand image of being the coffeelovers traditional caf, they have not performed up to expectations in this area.
2. Perceived as an expensive brand:
Customer perceptions of Baristas prices and value for money are quite negative. Even though
the prices of Barista, Caf Coffee Day and Costa Coffee are almost identical, Barista is still
perceived as the more expensive brand.

Caf Coffee Day

1. Weak brand image:
The Caf Coffee Day brand, although clearly a youth- oriented brand, lacks the power and
strength expected to maintain brand loyalty. The brand doesnt project a clear image to customers
about what Caf Coffee Day is all about.
2. Ambience & Dcor:
The Ambience & Dcor of Caf Coffee Day outlets received a below- average rating from
respondents of the market survey. A lot of respondents did not like the fact that Caf Coffee Day
outlets and literature served as prime space for a lot of advertising and promotions.

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Costa Coffee
1. More Outlets/ franchisees:
Costa Coffe should open some more outlets in Ludhiana so that it became more popular among
consumers. At present there is only one Costa Coffee outlet in a mall.
2. Ambience:
The Ambience of Costa Coffee outlet received a below average rating from respondents. They
need to improve on the ambience of coffee outlet.

RECOMMENDATION & SUGGESTIONS

Barista
Barista has an extremely strong brand image, but they need to work hard on improving their
customer perception of being and expensive brand. Barista,Caf Coffee Day and Costa Coffee
have almost identical pricing, but Barista is still perceived as the more expensive brand.
Thats why my first recommendation for Barista is, to carry out a promotion campaign to
ensure that their target market is well aware of their current low prices. This would help change
customer perception and turn Barista into an affordable brand.
Another backlash of having such a strong traditional caf brand image is that customers have
very high expectations of the taste & quality of products. Barista needs to work hard at this
aspect, especially for coffee and eatables products.
On a smaller note: the Barista delivery process should change, so that a caf attendant
delivers the coffee to the table. This may seem insignificant, but it can go a long way in
improving customer satisfaction.

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Caf Coffee Day

Caf Coffee Day has done extremely well so far to project itself as an affordable youthoriented 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. My first recommendation for Caf Coffee Day
is to clean up the dcor at every outlet, wherever unnecessary advertising is taking place.
My second recommendation is that Caf Coffee Day looks at its current recruitment, selection
and most importantly, its current training policies.
Customers are not happy with the behavior and service of the staff, and Caf Coffee Day is
lagging far behind Barista in this aspect.

Costa Coffee
My first recommendation to Costa Coffee is that they should open some more outlets in
Ludhiana.
Costa Coffee should advertise its brand to make it popular among customers.
Bigger space

More outlets/ franchisees

Keeping a good ambience

Clean and hygienic cafeterias
Improving customer service by enhancing on the 'feel good' factor

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BIBLIOGRAPHY

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ANNEXURE

QUESTIONNAIRE
Please tick the relevant answer

Q1. How many cup of coffee do you drink per day?

i.
ii.
iii.
iv.

None
1
2
More than 2

_________
_________
________
________

Q2. How frequently do you visit a coffee house?

i.

Every day

ii.

Alternate day

iii.

Weekly

iv.

Fortnightly

______________
______________
______________
______________

Q3. Are you a regular visitor to a specific coffee shop?

i.
ii.

Yes
No

__________
__________

Q4. Out of these coffee houses, which one do you visit the most?
i.

Barista

ii.

CCD

iii.

Costa Coffee

iv.

Any other (specify) ____________

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____________
____________
____________

Q5. How important are the following factors while visiting the coffee houses?

Factors

Very
Important

Important

Less
Important

Not
Important

Variety
of
coffee
Taste of coffee
Quality of coffee
Price
Ambiance
Location
Customer
service
Offer/disc./coupo
ns
Time for serving

Q6. Rate your experience with the following coffee-chains on the following
scale
Very Satisfied

Satisfied

Less Satisfied

Not Satisfied

Barista
CCD
Costa Coffee

Q7. Rank the following coffee chains in order of preference. 1being most
preferred, 3 being less preferred
i. Barista

_______________

ii. CCD

_______________

iii. Costa Coffee

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_______________

Q8. How important are the following in your decision making for visiting a
coffee house
Very
Important

Important

Less
Important

Not
Important

Your Own
Instinct
Family
Friends
Work Group

PERSONAL INFORMATION
Gender:

Male
_________
Female _________

Name:

__________________________

Address: ______________________________________________________________________
Phone/Mob: ______________________
Profession: _____________________

Age:

less than 20
_________
21-30
_________
31-45
_________
46 and above ________

Thank you for your time.

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