It is aimed to ensure the customer have a quiet, uninterrupted visit and provide an escape from the daily pressures of life.
This is good sign when compared to Coffee Day whose main customers are Youth. Though it has wide range of products such as food items, ice creams, sandwitches but appealing primarily to traditional coffee lovers.
It is failing to prove its strength in South India which has strong filter coffee culture than North India, But Coffee day is strong in south India.
- What are the possible alternatives with regard to pricing, product mix and franchising decisions and their implications to Barista’s current positioning? What are your recommendations?
Coffees & Teas Refreshing Alternatives Eatables
Coffee with Milk Smoothies Sandwiches
Black Coffee Milk based items Rolls
Dessert Coffees Ice Creams Pastas
Cold Coffees Other Food
Iced Tea Desserts
It offers both Veg and Non-Veg eatables.
Product Mix:
Alternatives:
It could add fresh fruits juices and Wines which is missing in this product mix people prefer usually in addition to the exisiting products.
Implications:
In India, we see increasing trend that people consume high volume of fruits and juices outside. This will increase high
Recommendation:
Though Veg and Non-Veg eatables are there in the shop, Pure-veg lovers will get confident only if its displayed seperately and served seperately.
In India, we see increasing trend that people consume high volume of fruits and juices outside. This can be addition and also serving wine in the shop can also be considered.
Pricing:
Alternatives:
Barista need to implement ‘Skim Pricing Policy’. They began with a higher price, and skimmed the cream for the market.
They can competitively match their prices against Café Coffee Day’s prices. The prices are constantly changing though, mostly reductions in prices.
Implications:
This gradual price reduction meant that Barista could maintain its profit- maximization policy until it could earn large cost savings because of the benefits of high volume. The main factors that affect their pricing are their cost of goods sold. The costs are quite high because imports a majority of its products and product- sources.
Recommendation:
With the sudden spurt of growth in number of outlets, came the benefits of economies of scale. Because of this, they have been able to gradually lower their prices, and appeal to different segments of their target market.
Considering that Barista is trying to target a market whose age range is between 18
and 60 years, a pricing policy appealing to this segment is difficult. Extremely low
prices act as a deterrent to some customers who might regard it as an indicator or
quality, while very high prices cannot be afforded by most of the youth. But since
Barista’s current consumer profile is quite young, their prices are mostly inexpensive,
and at par with their competitors. But the Francise model small shop should aim to offer reasonably low price than the Big shops price to attact the economic class.
Franchising:
Alternatives:
Barista made visiting pubs to have drinks and eat for tast buds in addition to leisure experiricene, aspirational and respectable to customer. This way it is targetting only the upper middle class and upper class segment. It is recommended to adopting a franchise route for expansion, setting up shops in increasing numbers in urban and commercial places in major cities and also in smaller towns. This means the investments is less and product mix is less, so ultimately affordable pricing to cover the middle class market.
Implications:
Since the franchise model increases the strong foot print in this food and beverage shop, the sales volume surely be expected to very high.
Recommendation:
Carefully selected location to issue Franchise in urban areas and small towns. Continous monitoring is required to ensure that quality is maintanied at regular intervals.
- Recommend a growth strategy and formulate 2006-2007 marketing plan for Barista Coffee Company Ltd.
Barista and Café Coffee Day were chosen because of their identical pattern of
functioning and growth. They are the only two major players in the national coffee café
industry, and their customers consider both as interchangeable brands. This is why it is
important to study how these brands differentiate themselves from each other, and
attempt to improve brand loyalty amongst their customers.
To differenciate the Pure Veg items, it can have a zone inside the shop for Vegitarian eaters.
They could start merchandising also consists of primarily coffee related products like coffee beans, coffee machines, etc. Including Fruits Juice mix and Wine to attract more crowd.
