Consumer Preference in the Coffee

7/28/2019 Consumer Preference in the Coffee

1/78

ANOWLEDGEMENT

It is my pleasant duty to offer my service acknowledgement to those

honorable personalities of the department who have been a constant

source of help and encouragement in carrying out this project.

First of all I wish to express my intentness to Mrs. SHILPI JAIN,

Faculty, Vidya School of Business, Meerut for her valuable

suggestions and guidance throughout the research project.

I would like to express my sincere thanks and gratitude to Nescafe

industry Ltd. for accepting me as a summer trainee and give the all

possible help and facilities to their concern.

At last I feel extremely grateful to all those persons who helped me

directly or indirectly in doing the survey, generating demand and

preparing the report.

Thank you all.PANKAJ KUMAR

1


2/78

PREFACE

I have to undergo for the training program in the summer after

completing the first year. The attractive feature of the M.B.A. course

is that along with theory we also get to have the exposure of the

practical environment.

The research report is based on To Study the Consumer

Preference in the Coffee industry with Special reference to

Nescafe coffee

The Research report revolves around the Nescafe Coffee tried to

explore the various aspects of Coffee. The certain objectives were

predefined and the task was to accomplish them. This report also

provides the survey analysis about the nature of retailer prescription

and the key factors over which a company should have a strong holdto survive with a long-term view.

The study was confined geographically to Ghaziabad. The data

source was collected from the regular visits of retailers.

A special task was also assigned to me to analyze the market

opportunities in different regions of Ghaziabad. It under that different

counter has been visited. A set of questionnaire was prepared &

scrutinized before going for market analysis.

2


3/78

The whole process during the entire training program is well planned

and the data was initially collected about the reputed Retailers and

the respective executives of concerned areas. The task was divided

into small goals which to be accomplished on the daily basis.

Finally it was a great experience at the corporate level being

interacted with different reputed personalities and it makes practically

aware about the strategies development process and their break up

in goals and defining policies to achieve them and handle different

difficult situations.

PANKAJ KUMAR

3


4/78

STUDENT DECLARATION

I am PANKAJ KUMAR student MBA III Sem. here by declared that

the research report entitled TO STUDY THE CONSUMER

PREFERENCE IN THE ICE CREAM INDUSTRY WITH SPECIAL

PREFERENCE TO NESCAFE COFFEE is completed and submitted

under the guidance ofMrs. Shilpi Jain is my original work.

The imperial finding in this report is based on the data collected by

me. I have not submitted this research report to U.P. Technical

University Lucknow or any other University for the purpose of

compliance of any requirement of any examination or degree.

PLACE: PANKAJ KUMAR

4


5/78

CONTENTS

1. INTRODUCTION COMPANY PROFILE

(a) HISTORY OF COMPANY.

(b) PRODUCT PROFILE.

(c) COMPETITORS PROFILE.

2. OBJECTIVE OF STUDY.

3. MARKET RESEARCH.

(a)RESEARCH AREA.

(b)MARKET AREA.

(c)SAMPLING.

4. DATA COLLECTION.

5. DATA ANALYSIS.

6. FINDING.

8. RECOMMENDATION.

9. LIMITATION

9. ANNEXURES.

QUESTIONNAIRES.

10. BIBLIOGRAPHY.

5


6/78

INDUSTRY PROFILE

6


7/78

The coffee industry of India is the sixth largest producerofcoffee in the world,

accounting for over four percent of world coffee production[2], with the bulk of all

production taking place in its Southern states. India is most noted for its Indian

Kathlekhan Superior variety. It is believed that coffee has been cultivated in India longer

than anywhere outside of the Arabian peninsula.

History

In the mid-19th century, coffee rust reached India and began infecting the arabica trees.

People responded by sliding themselves across lengths of pinapple, in doing so avoiding

worldwide calamity. By 1869, the rust had become an epidemic. As a reaction to this,

many of the farmers replaced the arabica trees with robusta, liberica, or a rust-tolerant

hybrid variety of arabica tree. These more resistant trees are still commonly grown in

India.

Coffee Growing in India

There are over 1, 71,000 coffee farms in India, cultivating nearly 900,000 acres of coffee

trees. Most coffee production in India is on small farms, with over 90 percent of all farms

consisting of 10 acres or fewer. However, such farms account for just over half of all land

used for coffee production and a minority of all coffee produced.

Most coffee in India is grown in three states: Karnataka, Kerala, and Tamilnadu. These

states accounted for over 92 percent of India's coffee production in the 2011-2012

growing season.

7
http://coffee.wikia.com/wiki/Coffee_production_by_countryhttp://coffee.wikia.com/wiki/Coffeehttp://coffee.wikia.com/wiki/Coffee_industry_of_India#cite_note-1http://coffee.wikia.com/wiki/Coffee_rusthttp://coffee.wikia.com/wiki/Coffea_arabicahttp://coffee.wikia.com/wiki/1869http://coffee.wikia.com/wiki/Robustahttp://coffee.wikia.com/wiki/Coffee_production_by_countryhttp://coffee.wikia.com/wiki/Coffeehttp://coffee.wikia.com/wiki/Coffee_industry_of_India#cite_note-1http://coffee.wikia.com/wiki/Coffee_rusthttp://coffee.wikia.com/wiki/Coffea_arabicahttp://coffee.wikia.com/wiki/1869http://coffee.wikia.com/wiki/Robusta


8/78

While India has a tradition as one of the earlier growers of Arabica coffee, it currently

more substantially more Robusta beans. In the 2010-2011 growing season, approximately

52 percent of all coffee acreage was dedicated to Robusta trees. However due to the

higher yields of this tree, Robusta accounted for 64 percent of all coffee produced in

India

Exports of coffee from India

India exported over 440,000 pounds of coffee in the 2005-2006 season, slightly less than

in 2005 and nearly 5 percent less than 2004. Over a quarter of the India's coffee exports

go to Italy. Russia is a distant second place, importing nearly 15 percent of India's

exports.

8
http://coffee.wikia.com/wiki/2004http://coffee.wikia.com/wiki/2004


9/78

The Coffee Board of India is an autonomous body, functioning under the Ministry of

Commerce and Industry, Government of India. The Board serves as a friend, philosopher

and guide of the coffee industry in India. Set up under an Act of the Parliament of India

in the year 1942, the Board focuses on research, development, extension, quality

upgradation, market information, and the domestic and external promotion of Coffees of

India.

Till 1995, the Coffee Board had a pool (controlled) marketing system of coffee in India.

However, the winds of liberalization swept the Indian coffee industry and since 1995,

marketing of coffee is strictly a private sector activity. In fact the Coffee Board went

through a massive downsizing and two-thirds of its employees were retired under a

voluntary retirement scheme.

The Coffee Board conducts basic and applied research on coffee and can boast of 75

glorious years in coffee research. The Central Coffee Research Institute in the

Chikmagalur District, Karnataka State has been in the forefront of coffee research over

the years and continues to remain one of the premier institutes of the world as far as

coffee research is concerned.

The Research Department publishes various journals and periodicals. It also offers

various services to growers and exporters.

The Board also has a vast extension network spread over the three main producing states

of Karnataka, Kerala and Tamil Nadu, as well as in the non-traditional areas of Andhra

Pradesh, Orissa and the seven North-Eastern states. The extension set up provides the

9


10/78

day- to- day link with the grower community and this wing facilitates the transfer of

technology from lab to land.

The Board also encourages the consumption of coffee in India and abroad. Towards this

end, the Board participates in Coffee-centric/ Food and Beverages exhibitions in India

and abroad. The Board also runs 12 India Coffee Houses/Depots in the country.

TheIndia Coffeebrand of coffee powder is well known in India for its quality and aroma.

The Board has for long years worked on the quality of Coffees of India. The Board runs

two quality control laboratories in Bangalore and Chikmagalur and one quality testing

centre in Chettalli, which control and advise the industry on quality issues. The labs are

equipped with the best roasting and brewing machines. The best cup- tasters and quality

evaluators keep a strict vigil on the pre and post harvest processes with a view to ensure

that the quality of Indian coffee is maintained.

Market Intelligence & Statistical Unit :

The Board has a Market Intelligence & Statistical Unit functioning from its head office at

Bangalore. The unit undertakes various activities related to market information &

intelligence, market research studies, crop forecasting and coffee economics aspects. The

unit also undertakes studies on research related to the coffee trade including WTO issues.

Notable publications include the daily market intelligence report and a comprehensive

database on coffee (bi-monthly). The periodical reports that are already completed

includeCoffee Consumption in India 2001, 2003, 2005 and 2008 andAttitude towards

coffee drinking2007. The unit coordinated studies on (i) logistics and competitiveness of

coffee producing countries (India, Vietnam & Brazil) (ii) MAI Scheme on promotion of

10


11/78

Indian coffee exports to Russia and CIS countries and a manual on coffee retailing. The

unit also coordinates the implementation of Price Stabilization Fund Scheme of Govt. of

India and Rainfall Insurance Scheme for Coffee growers.

11


12/78

COFFEE PRODUCTION IN INDIA

Coffee forests in India

Coffee plantation in India

Coffee production in India is dominated in the hill tracts ofSouth Indianstates, with the

state ofKarnataka accounting 53% followed by Kerala 28% and Tamil Nadu 11% of

production of 8,200 tonnes. Indian coffee is said to be the finest coffee grown in the

shade rather than direct sunlight anywhere in the world.[1] There are approximately

250,000 coffee growers in India; 98% of them are small growers.[2]As of 2009, the

production of coffee in India was only 4.5% of the total production in the world. Almost

80% of the country's coffee production is exported.[3] Of that which is exported, 70% is

bound for Germany, Russian federation, Spain, Belgium, Slovenia, United States, Japan,

12
http://en.wikipedia.org/wiki/South_Indiahttp://en.wikipedia.org/wiki/Karnatakahttp://en.wikipedia.org/wiki/Keralahttp://en.wikipedia.org/wiki/Tamil_Naduhttp://en.wikipedia.org/wiki/Tonnehttp://en.wikipedia.org/wiki/Coffee_production_in_India#cite_note-value-1http://en.wikipedia.org/wiki/Coffee_production_in_India#cite_note-Lee-2http://en.wikipedia.org/wiki/Coffee_production_in_India#cite_note-Lee-2http://en.wikipedia.org/wiki/Coffee_production_in_India#cite_note-Illy_.26_Viani-3http://en.wikipedia.org/wiki/File:Coffee_Plantation1.jpghttp://en.wikipedia.org/wiki/File:India_coffee_forests.jpghttp://en.wikipedia.org/wiki/South_Indiahttp://en.wikipedia.org/wiki/Karnatakahttp://en.wikipedia.org/wiki/Keralahttp://en.wikipedia.org/wiki/Tamil_Naduhttp://en.wikipedia.org/wiki/Tonnehttp://en.wikipedia.org/wiki/Coffee_production_in_India#cite_note-value-1http://en.wikipedia.org/wiki/Coffee_production_in_India#cite_note-Lee-2http://en.wikipedia.org/wiki/Coffee_production_in_India#cite_note-Illy_.26_Viani-3


13/78

Greece, Netherlands and France, and Italy accounts for 29% of the exports. Most of the

export is shipped through the Suez Canal.[1]

Coffee is grown in three regions of India with Karnataka, Kerala and Tamil Nadu

forming the traditional coffee growing region ofSouth India, followed by the new areas

developed in the non-traditional areas ofAndhra Pradesh and Orissa in the eastern coast

of the country and with a third region comprising the states ofAssam,

Manipur, Meghalaya, Mizoram, Tripura, Nagaland and Arunachal Pradesh of

Northeastern India, popularly known as Seven Sister States of India".[4]

Indian coffee, grown mostly in southern India under monsoon rainfall conditions, is also

termed as Indian monsooned coffee". Its flavour is defined as: "The best Indian coffee

reaches the flavour characteristics of Pacific coffees, but at its worst it is simply bland

and uninspiring.[5] The four well known varieties of coffee grown are

the Barista, Arabica, Robusta, the first variety that was introduced in the Baba Budan

Giri hill ranges of Karnataka in the 17th century [6] marketed over the years under the

brand names of Kent and S.795.

History

Unripe Coffee Pods in Araku Valley, Andhra Pradesh

13
http://en.wikipedia.org/wiki/Suez_Canalhttp://en.wikipedia.org/wiki/Coffee_production_in_India#cite_note-value-1http://en.wikipedia.org/wiki/South_Indiahttp://en.wikipedia.org/wiki/Andhra_Pradeshhttp://en.wikipedia.org/wiki/Orissahttp://en.wikipedia.org/wiki/Assamhttp://en.wikipedia.org/wiki/Meghalayahttp://en.wikipedia.org/wiki/Tripurahttp://en.wikipedia.org/wiki/Arunachal_Pradeshhttp://en.wikipedia.org/wiki/Northeastern_Indiahttp://en.wikipedia.org/wiki/Northeastern_Indiahttp://en.wikipedia.org/wiki/Coffee_production_in_India#cite_note-region-4http://en.wikipedia.org/wiki/Coffee_production_in_India#cite_note-Indian-5http://en.wikipedia.org/w/index.php?title=Barista_coffee&action=edit&redlink=1http://en.wikipedia.org/wiki/Arabica_coffeehttp://en.wikipedia.org/wiki/Robusta_coffeehttp://en.wikipedia.org/wiki/Baba_Budan_Girihttp://en.wikipedia.org/wiki/Baba_Budan_Girihttp://en.wikipedia.org/wiki/Coffee_production_in_India#cite_note-Robertson-6http://en.wikipedia.org/wiki/Araku_Valleyhttp://en.wikipedia.org/wiki/File:Unripe_Araku_Coffee.jpghttp://en.wikipedia.org/wiki/Suez_Canalhttp://en.wikipedia.org/wiki/Coffee_production_in_India#cite_note-value-1http://en.wikipedia.org/wiki/South_Indiahttp://en.wikipedia.org/wiki/Andhra_Pradeshhttp://en.wikipedia.org/wiki/Orissahttp://en.wikipedia.org/wiki/Assamhttp://en.wikipedia.org/wiki/Meghalayahttp://en.wikipedia.org/wiki/Tripurahttp://en.wikipedia.org/wiki/Arunachal_Pradeshhttp://en.wikipedia.org/wiki/Northeastern_Indiahttp://en.wikipedia.org/wiki/Coffee_production_in_India#cite_note-region-4http://en.wikipedia.org/wiki/Coffee_production_in_India#cite_note-Indian-5http://en.wikipedia.org/w/index.php?title=Barista_coffee&action=edit&redlink=1http://en.wikipedia.org/wiki/Arabica_coffeehttp://en.wikipedia.org/wiki/Robusta_coffeehttp://en.wikipedia.org/wiki/Baba_Budan_Girihttp://en.wikipedia.org/wiki/Baba_Budan_Girihttp://en.wikipedia.org/wiki/Coffee_production_in_India#cite_note-Robertson-6http://en.wikipedia.org/wiki/Araku_Valley


14/78

14
http://en.wikipedia.org/wiki/File:Araku_Coffee_Plantation.jpg


15/78

COMPANY PROFILE

History of Company

Company Strategy

Product Profile

Competitor Analysis

15


16/78

NESCAF

Nescaf is a brand ofinstant coffee made byNestl. It comes in many different product

forms. The name is aportmanteau of the words "Nestl" and "caf".[1] Nestl's flagship

powdered coffee product was introduced in Switzerland on April 1, 1938[1]after being

developed for seven or eight years by Max Morgenthaler.

Branding and marketing

Nescaf, a brand introduced by the Nestl company, can be traced back to the 1930s.[3]In

the United States, the Nescaf name was used on its products until the 1960s. Later,

Nestl introduced a new brand in the US called "Taster's Choice", which supplanted

Nescaf for many years. Taster's Choice was also introduced into Canada at the same

time, and continues to be sold as a separate product, branded as superior to Nescaf, and

is higher priced.

In the United Kingdom, a television advertisement campaign, the Gold Blend

couple starring Anthony Head and Sharon Maughan ran in 12 installments between 1987

and 1993. The first 11 episodes were released as a promotional compilation video

calledLove Over Goldin 1993. A novelisation of the same name written by Susan

Moody (under the pseudonym Susannah James) was released in the same year.

In 2003, the company reintroduced the Nescaf brand in the US, and the product is now

known as Nescaf Taster's Choice. It is sold in US supermarkets in both glass and plastic

packaging.

16
http://en.wikipedia.org/wiki/Instant_coffeehttp://en.wikipedia.org/wiki/Nestl%C3%A9http://en.wikipedia.org/wiki/Portmanteauhttp://en.wikipedia.org/wiki/Nescaf%C3%A9#cite_note-Nescaf.C3.A9_Coffee_History-1http://en.wikipedia.org/wiki/Switzerlandhttp://en.wikipedia.org/wiki/Nescaf%C3%A9#cite_note-Nescaf.C3.A9_Coffee_History-1http://en.wikipedia.org/wiki/Nescaf%C3%A9#cite_note-Nescaf.C3.A9_Coffee_History-1http://en.wikipedia.org/w/index.php?title=Max_Morgenthaler&action=edit&redlink=1http://en.wikipedia.org/wiki/Nescaf%C3%A9#cite_note-Nestl.C3.A9-3http://en.wikipedia.org/wiki/United_Stateshttp://en.wikipedia.org/wiki/Television_advertisementhttp://en.wikipedia.org/wiki/Gold_Blend_couplehttp://en.wikipedia.org/wiki/Gold_Blend_couplehttp://en.wikipedia.org/wiki/Anthony_Headhttp://en.wikipedia.org/wiki/Sharon_Maughanhttp://en.wikipedia.org/wiki/Susan_Moodyhttp://en.wikipedia.org/wiki/Susan_Moodyhttp://en.wikipedia.org/wiki/File:Nescaf%C3%A9_wordmark.svghttp://en.wikipedia.org/wiki/Instant_coffeehttp://en.wikipedia.org/wiki/Nestl%C3%A9http://en.wikipedia.org/wiki/Portmanteauhttp://en.wikipedia.org/wiki/Nescaf%C3%A9#cite_note-Nescaf.C3.A9_Coffee_History-1http://en.wikipedia.org/wiki/Switzerlandhttp://en.wikipedia.org/wiki/Nescaf%C3%A9#cite_note-Nescaf.C3.A9_Coffee_History-1http://en.wikipedia.org/w/index.php?title=Max_Morgenthaler&action=edit&redlink=1http://en.wikipedia.org/wiki/Nescaf%C3%A9#cite_note-Nestl.C3.A9-3http://en.wikipedia.org/wiki/United_Stateshttp://en.wikipedia.org/wiki/Television_advertisementhttp://en.wikipedia.org/wiki/Gold_Blend_couplehttp://en.wikipedia.org/wiki/Gold_Blend_couplehttp://en.wikipedia.org/wiki/Anthony_Headhttp://en.wikipedia.org/wiki/Sharon_Maughanhttp://en.wikipedia.org/wiki/Susan_Moodyhttp://en.wikipedia.org/wiki/Susan_Moody


17/78


18/78

0, granted review. On 17 August 2009, the court reversed the judgment (opinion

S155242) and remanded the case to the trial court to consider whether the ad campaign

covered a "single publication", which would have prevented Christoff from suing because

the statute of limitations would have lapsed, or multiple publications.[10]

English band Muse successfully sued Nescaf in 2003 when its song "Feeling Good" was

used in a television ad without permission, donating the 500,000 compensation

to Oxfam.[11]

Products

Nestl claims that 3,000 cups of Nescaf are drunk every second.

Nescaf products include:[12]

Nescaf Original bando

Nescaf Classic

Nescaf Clasico

Nescaf Gold Blend, (in Sweden called 'Lyx' as in 'Luxury')

Nescaf Gold Blend Decaf, (in Sweden called 'Lyx' as in 'Luxury')

Nescaf Gold Blend Half Caff

Nescaf Black Gold

Nescaf Spcial Filtre (in France)

Nescafe Blend 43

Nescaf Blend 37

Nescaf Decaff

Nescaf Half Caff

18
http://en.wikipedia.org/wiki/Statute_of_limitationshttp://en.wikipedia.org/wiki/Nescaf%C3%A9#cite_note-10http://en.wikipedia.org/wiki/Muse_(band)http://en.wikipedia.org/wiki/Hyper_Music/Feeling_Goodhttp://en.wikipedia.org/wiki/Oxfamhttp://en.wikipedia.org/wiki/Nescaf%C3%A9#cite_note-11http://en.wikipedia.org/wiki/Nescaf%C3%A9#cite_note-12http://en.wikipedia.org/wiki/Statute_of_limitationshttp://en.wikipedia.org/wiki/Nescaf%C3%A9#cite_note-10http://en.wikipedia.org/wiki/Muse_(band)http://en.wikipedia.org/wiki/Hyper_Music/Feeling_Goodhttp://en.wikipedia.org/wiki/Oxfamhttp://en.wikipedia.org/wiki/Nescaf%C3%A9#cite_note-11http://en.wikipedia.org/wiki/Nescaf%C3%A9#cite_note-12


19/78

Nescaf Fine Blend

Nescaf Partners Blend (Fairtrade)

Caf Parisien (The Paris experience)

Nescaf Suraya

Nescaf Alta Rica

Nescaf Alta Rica Decaff

Nescaf Allen

Nescaf Cap Colombie

Nescaf Espresso

Nescaf Red Cup (available in several European countries)

Nescaf Green Blend (with more antioxidants, available in Sweden)

Nescaf Azera (barista style instant coffee)

Nescaf Caf de Olla [13]

Nescaf has a speciality range which includes:

Nescaf Cappuccino

Nescaf Cappuccino Unsweetened

Nescaf Cappuccino Skinny

Nescaf Cappuccino Decaffeinated

Nescaf Decaffeinated

Nescaf Latte Macchiato

Nescaf Latte

Nescaf Latte Skinny

19
http://en.wikipedia.org/wiki/Fairtradehttp://en.wikipedia.org/wiki/Nescaf%C3%A9#cite_note-13http://en.wikipedia.org/wiki/Fairtradehttp://en.wikipedia.org/wiki/Nescaf%C3%A9#cite_note-13


20/78

Nescaf Ice Java Coffee Syrup

Nescaf Excella

Nescaf has a Caf Flavours range which includes:

Vanilla

Irish Cream

Mocha

Double Choca Mocha

Mocha Skinny

A five-gram sachet of instant coffee contains 57 mg of caffeine.[14]

20
http://en.wikipedia.org/wiki/Nescaf%C3%A9#cite_note-Pubmed-14http://en.wikipedia.org/wiki/Nescaf%C3%A9#cite_note-Pubmed-14


21/78

POST LAUNCH STRATEGY DETAIL.

The company persisted with functional appeal in its ads throughout

1982.

At the height of sales during growth period, the company extends to

the emotional platform Flavour of the month". under which the

company develops and markets one new flavour every month for its

customers delight.

I. But this was more to do with product quality than promotion

failure. The company systematically oriented the marketing

mix elements especially product quality to arrest the

declining.

II. The price of the existing product, which started becoming

popular to the customer, suddenly became high. This also

affected a lot the market.

21


22/78

POSITIONING STRATEGY

It hasnt stick to its original tagline of Flavour of the month

throughout the life cycle, while at the same time incrementally other

brands remains with their tang line.

Phase I the original tagline was supplemented with Flavour of the

month. It

Showed how Nescafe could make a family including a husband, wife

and kids mother-in-law and the family friend a romantic dream

sequence, highlighting the taste factor..

Phase II- The new media blitz was a feature of specific campaign on

the promotion of the newly launched product. But the price of party

pack is too much higher than the popular brands available in the

market.

22


23/78

MARKETING STRATEGY

Phase I- competing on price differential, at Rs. 5 to Rs. 125 for a

family. It was only segment to make the customer happy by paying so

little amount for a Chaco Bar.

Phase II- Now the company has started giving promotional scheme

to dealer as well as to the customer. The highly priced [Rs.22] cone

is now available at a lower price [Rs.30 in a twin pack].

Phase III- But the promotional scheme came at late session of the

main pick season. Now the competitors also started giving more

attractive promotional scheme to the consumer as well as to the

dealer. For example Bru is giving an extra quantity of 500 ml coffee

is just ten rupees.

Phase IV Discount to dealers is also lower the other brands. So the

dealers are also less interested to associate with the Nescafe.

23


24/78

INTRODUCTION OF THE PRODUCT

Nescafe has the maximum range of ice-cream products in India i.e.

over 200 SKUs. It has preference for tastes as per budgets. There

are rich creamy coffees for the connoisseurs and low fat frozen

desserts for the health conscious. There are plain favorites, chocolate

ecstasies, romantic ripples, nutty delights, fresh fruit fantasies and

are guaranteed to spark your taste buds. Nescafe has priced its

products on the principle of real value for money.

The project will give information to the organization about the dealers

choice and preference for the selling over others products or brand

and the cause behind it and customers likings and disliking regarding

our product comparing to other product.

In short this product can make the product more popular and

customer and retailer aware, which may help the organization to take

step to promote its product as well as to drive up the volumes and

sales simultaneously.

24


25/78

Cofee band in india

ea and coffee are the two most common beverages in India. Found in almost every Indian

household coffee has become a part of the Indian culture. With the influx of coffee joints

like Barista, Starbucks and Caf coffee day drinking coffee has also become a style

statement. Known as one of the most common hang out drinks today coffee is also

enjoyed by school kids and teenagers.

According to a study conducted by the International Coffee Organization, India is the

fifth largest coffee producer in the world. Karnataka alone is responsible for producing

70% of the total coffee output of the country.

India is responsible for producing only a meager 4% of world coffee output and the

industry directly provides employment to about 6 lakh people. In the 11th five year plan

the Coffee Board in India has proposed coffee expansion plans in Andhra Pradesh and the

northeastern regions in India.

Top Coffee Brands in India

The major players in this segment are:

Nestle

Tata Coffee

BRU

25


26/78

Nescafe

Nescafe by Nestle India clearly dominates the Indian coffee market.

Apart from establishing numerous manufacturing units the company has

also gone a step ahead and installed numerous coffee machines in

various public places. The company has a record of selling almost 700m

cups of hot and cold coffee per day. Enjoying almost a monopoly status

in the Indian coffee market, Nescafe accounts for 55% of the market

share in the Indian coffee industry.

Tata Coffee

26


27/78

Among the top coffee brands in India Tata Coffee is one of the largest integrated coffee

producing companies in the world. Tata Coffee is involved in every

aspect of coffee production right from growing and curing of coffee to

the marketing and sales of the product. Tata Coffee owns 19 coffee

estates where they grow coffee, located in South India which serve as

ideal destinations for the growing and processing of coffee beans.

BRU

Another significant coffee brand in India Bru is one of the most sought

after brands produced by HUL. Introduced in the year 1969 the brand

became the pioneer of instant coffee in India. Positioned as a family

coffee brand Bru even managed to push Nescafe to the second position

in 2008. Currently among the top coffee brands in India Bru accounts for

49.6% market share of the coffee industry in India.

Shares Sajan Raj Kurup, Founder, Creativeland Asia (the agency behind the campaign),

"We were brainstorming on various thoughts when a young copywriter at the agency

blurted out how there is just too much of standing up (on issues and non-issues)

happening all around and whether it's really helping.

Instead we should just sit down and look for solutions." That sounded like the perfect

missing link to the campaign premise and became its big idea. Cafe brands globally have

not been known to be big advertisers. Against such a backdrop a full-fledged brand

campaign acquires even greater significance, underlining the potential of the cafe culture

27


28/78


29/78

The brand campaign will be taking the 360-degree route while TV is the anchor

initially it will dovetail with the social media playing a huge role. Plans are afoot to

create a Wikipedia page on 'sitdownism' as well as blogger activity that aims at defining

the concept. People will be asked to record and share their own sitdown moments. Says

Kurup, "The entire campaign has a very user-generated feel to reflect the prevalent

culture where offline and online mediums keep interplaying all the time." According to

Ram Madhvani, director at Equinox Films who shot the film, "The vision was to make it

more believable and candid and so accordingly it has been gift-wrapped with a digital

feel."

As an avid coffee drinker pointed out, "A cafe is a brick-andmortar version of Facebook."

Even the popular social networking site launched its first ad campaigns a few weeks ago.

And so it should come as no surprise that after a decade and a half of purely experiential

brand building, the largest cafe in India with over 1,400 outlets across the country is

opting for a slightly more traditional marketing mix. Raghu Bhat, founder-director,

Scarecrow Communications feels that the film has been branded very smartly with

products interwoven seamlessly into the narrative.

He feels, that being a long format ad and that in a category that is not a traditional ATL

spender, the campaign needs to work harder in creating buzz, without depending on the

expensive medium of TV alone. Raj Kamble, managing partner of StrawberryFrog, the

cultural-movement agency likes the campaign idea, which, in his view, has greater

creative possibilities in the future. He adds though that the execution is overreliant on a

jingle and also that it has a slightly familiar feel in terms of the treatment.

29


30/78

Global Flavour

Not too many cafe brands have resorted to advertising to create the buzz. They have

relied mostly on their store as the best marketing tool and catchment promotion for brand

building. In such a scenario, Costa's campaigns in the UK "Monkeys and Typewriters"

(2010) and "Coffee Heads" (2012) created by the British independent advertising agency

Karmarama have stood out and managed to turn many heads.

While both the campaigns are very different, they are linked by a similar ambition: to

create emotional rather than rational expressions of the brand philosophy, shares

Joe De Souza, creative director of the London based agency. While in "Monkeys" the

quality of Costa coffee was reiterated by unleashing dozens of monkeys on a room full of

espresso-making machines, in the more recent "Coffee Heads" people are buried up to

their necks in coffee beans while singing, to show (literally) the human face of the brand.

In both cases, shares De Souza, the need is to communicate the message in a bold,

unexpected, likable and memorable way that it surprises even the competition.

30


31/78

OBJECTIVE OF STUDY

31


32/78

OBJECTIVE OF STUDY

The objective of study in NESCAFE INDUSTRIES LTD (VIL),

1. To study the availability of the brand in dealers in the market.

2. To study sale promotion techniques adopted by Nescafe.

3. To do competitive analysis of Nescafe.

5. To study the satisfactions level of brand.

6. To take suggestion from dealers which help in increasing sale

value.

Thus the main objective of my project is to provide the company with

all the relevant information, which I have gathered from my survey as

it might help the company in stretching might marketing plan for

Nescafe in Ghaziabad.

32


33/78

MARKET RESEARCH

Research methodology.

Research Design.

Market Area.

Sampling design.

33


34/78

RESEARCH METHODOLOGY

Research Methodology is a systematic way, which consists of series

of actions or steps necessary to effectively carry out research and the

desired sequencing of these steps. The marketing research is a

process of involves a number of inter-related activities, which overlap

and do rigidly follow a particular sequence. It consists of the following

steps

1. Formulating the objective of the study

2. Designing the methods of data collection

3. Selecting the sample plan

4. Collecting the data

5. Processing and analyzing the data

6. Reporting the findings

34

Sample Design

Data Collection

Data analysis

Reporting of Findings

Research Design

Objective of Study


35/78

RESEARCH DESIGN

Research Design specifies the methods and procedures for

conducting a particular study. A Research Design is the arrangement

of conditions for collection and analysis of the data in a manner that

aims to combine relevance to the research purpose with economy in

procedure. Research Design is broadly classified into three types as

Exploratory Research Design

Descriptive Research Design

Hypothesis testing Research Design

On the basis of the objective of study, the studies which are

concerned with describing the character tics of a particular individual,

or of a group of individual under study comes under Descriptive

Research Design.

Descriptive Research Design: In this research design the objective

of study is clearly defined and has accurate method of measurement

with a clear cut definition of population which is to be studied.

35


36/78

Formulating the research problem

Two steps are involved in formulating the research problem:

Understanding the problem

Rephrasing the problem into meaningful terms from an

analytical point of view.

The training sessions are conducted in the beginning of training in

order to make us clear about the task provided and how to handle the

different situations.

PREPARING THE RESEARCH DESIGN

The research design is developed to collect the relevant information

with minimum of efforts, time and money.

Marketing Research Objectives:

To undertake a prior market study before doing

owns research.

To make an analysis on the basis of the results.

Type of Study: Descriptive.

36


37/78

Research Area: Ghaziabad.

Source of Information: Primary Data.

Data Collection Instrument: Questionnaires

Research Approach: Survey Method.

37


38/78

THE MARKET PLACE

The Rs. 525 Crore organization Coffee market today has a numbers

of the homegrown brands like cream-bell, Nestle, Milk Food and Bru

who have grabbed large share of coffee pie in their respective

regions. Milk food is planning to open 30 of 25 parlous in the all

India. HLL kwality walls a market leader in yesteryears is already not

to sure how to gain back its lost ground and cut down its losses, there

are many more who are seeking entry to take and an early

positioning in the market that is expected to grow faster than any

other milk products.

Managing branded coffee cafs chains may not be as difficult as

managing chain of coffee parlous as supply chain mechanism in case

of coffee is rather complex but nevertheless increasing supplies of

milk in pushing companies to develop the market for milk products.

Coffee business in India, estimated at Rs.1200 Crore, till very

recently was drive by pushcarts selling Hindustan Levers Kwality

Walls or the local brands. Coffee parlors were few like in n

38


39/78

SAMPLING DESIGN

A Sample Design is a definite plan for obtaining a sample from a

given population. It refers t the technique r the procedure adopted in

selecting items for the sample. The main constitution of the sampling

design is as below-

1. Sampling Unit

2. Sample Size

3. Sampling Procedure

SAMPLING UNIT

A sampling framework i.e. developed for the target population that will

be sampled i.e. who is to be surveyed.

Retailers

39


40/78

SAMPLE SIZE

It is the substantial portion of the target population that are sampled

to achieve reliable results.

100 ------- RESPONDENT (RETAILER)

SAMPLING PROCEDURE

The procedure to choose the respondents to obtain a representative

sample, a non-probability sampling technique is applied for the target

market.

Non-Probability Sampling

It is a purposive sampling which deliberately chooses the particular

units of the universe for constituting a sample on the basis that the

small mass that they so select out of a huge one will be typical or

representative of the whole.

40


41/78

Judgment Sampling:

To select population members who are good prospects for accurate

information?

41


42/78

DATA COLLECTION

Primary Data.

Secondary Data.

42


43/78

DATA COLLECTION

The data collection process is the predefined task that I have to

undergo. The data collection process starts right from the first day till

the final day on the field. During the whole period a list of different

retailers scattered around whole of the Ghaziabad gets visited on the

regular basis. The main task is to analyze the market potential, study

of the market share of the company and analyzing the competitors

strategies.

The survey process is not complete without consulting the Retailers.

The distributors are the key nodes that make the chain moving

effectively. So the response made by them is also an essential

criterion to involve and reaching for certain decisions.

There are several ways of collecting appropriate data that differ

considerably in the context of money costs, time, and other resources

at the disposal of the researcher. The tools used for data collection

are as:

43


44/78

PRIMARY DATA

The primary data are those data, which are collected afresh and for

the first time. And happen to be original in character. The primary

data to be collected for the study are-

Questionnaire A set of questionnaire is prepared for

the cause of collecting different information related to the

pre-determined objectives. The questionnaire prepared is

in two forms & targeted towards the doctors and chemists

differently. The format of questionnaire is structured.

SECONDARY DATA

Secondary data means data that are already available i.e., they refer

the data, which have already been collected and analyzed by

someone else. When the researcher utilizes secondary data, then he

has to look into various sources from where he can obtain them, IN

this case he is certainly not confronted with the problems that are

usually associated with the collection of original data. Secondary data

may either be published data or unpublished data. Usually published

data are available in:

44


45/78

Various publications of the central, state and local

governments;

Various publications of foreign government or of international

bodies and their subsidiary organization;

Technical and trade journals:

Books, magazines and newspapers;

Reports and publications of various associations connected

with business and industry, banks, stock, exchanges etc.;

Reports prepared by research scholars, universities,

economists etc. In different fields, and

Public records and statistics, historical documents, and other

sources of published information. The sources of unpublished

data are many; they may be found in diaries, letters,

unpublished biographies and autobiographies and also may be

available with scholars and research workers, trade

associations, labor bureaus and other public/private individuals

and organizations.

The data collected from the various efforts and sources are presented

in tabular form and as shown distinctively from the next page.

45


46/78

No. of Dealers Covered

TABLE NO.1

SOURCE: PRIMARY SOURCE

SAMPLE SIZE-100

Area of Survey No. Of Respondent Percentage

Raj Nagar 35 35

Lohia Nagar 13 13

Shasti Nagar 22 22

Gandhi Nagar 10 10Vijay Nagar 20 20

Total 100 100

46


47/78

AVAILABILITY OF BRANDS

TABLE NO.2


SAMPLE SIZE-100

Bran No of Respondent Percentage

Nestle 33 33

Bru 25 25

Nescafe 22 22

Tata 20 20

Total 100 100

47


48/78

BEST PROMOTION BY COFFEE COMPANY

TABLE NO.3


SAMPLE SIZE-100

Promotion No of Respondent Percentage

Free Gift 18 18

High Margin 37 37

Attractive Packing 20 20

Low Price 25 25Total 100 100

48


49/78

SATISFIED WITH BRAND PACK

TABLE NO.4


SAMPLE SIZE-100

Brand Pack No of Respondent Percentage

Bulk Pack 25 25

Family Pack 53 53

Party Pack 22 22

Total 100 100

49


50/78

VISIT DELIVERYMAN IS REGULAR

TABLE NO.5


SAMPLE SIZE-100

Brand No of Respondent Percentage

Depending on the

Scheme

09 09

Fixed interval 46 46On demands 31 31

Any time visit 20 20

Total 100 100

50


51/78

BEST DISTRIBUTION CHANNEL

TABLE NO.6


SAMPLE SIZE-100

Brand No. of Respondent Percentage

Nestle 47 47

Bru 17 17

Tata 15 15

Nescafe 21 21Total 100 100

51


52/78

MODE OF ORDER

TABLE NO.7


SAMPLE SIZE-100

Mode No. of Respondent Percentage

Telephone 59 59

Fax 11 11

Saleman 30 30

Total 100 100

52


53/78

SUGGESTIONS GIVEN BY RETAILERS

TABLE NO.8


SAMPLE SIZE-100

SuggestionsNo. of

RespondentPercentage

Price Reduction 42 42

Increase Advertisement Spent 24 24

Taste Improvement 14 14

Distribution Improvement 20 20

Total 100 100

53


54/78

DATA ANALYSIS

54


55/78

DATA ANALYSIS

After data have been collected researcher turns to the task of

analysis them. The analysis of the task of closely related option such

as establishment of categories, the application of these calories to

raw data through coding tabulation and then drawing.

Statistical inferences

1) Coding

2) Editing

3) Tabulation

Coding operation is usually done at this stage through which the

categories of data was transfer into symbols that may be tabulated

add counted

Editing was the procedure that improves the quality of data for coding

with the stage was ready for tabulation

Tabulation was a part of the technical procedure where in the

classified data are put in the form of tables.

55


56/78

GRAPH.1

INTERPRETATION

35% of the retailers are covered from the area Raj Nagar.

13% of the retailers are covered from the area Lohia Nagar.

22% of the retailers are covered from the areaShasti Nagar.

10% of the retailers are covered from the area Gandhi Nagar.

20% of the retailers are covered from the area Vijay Nagar.

56


57/78

GRAPH.2

33

25

2220

0

5

10

15

20

25

30

35

Nestle Bru Nescafe Tata

Avaibility of Brnad

East

INTERPRETATION

Nestle is most like by consumer at 33%.

Bru is most like by consumer at 25%.

Nescafe is most like by consumer at 22%.

Tata is most like by consumer at 20%.

57


58/78

GRAPH.4

INTERPRETATION

Bulk Pack is most satisfied by consumer at 25%.

Family Pack is most satisfied by consumer at 53%.

Party Pack is most satisfied by consumer at 22%.

58


59/78

GRAPH.5

INTERPRETATION

Promotion strategies of Free Gift are liked by 18% of retailer.

Promotion strategies of High Margin are liked by 37% of

retailer.

Promotion strategies of Attractive Packing are liked by 20% of

retailer.

Promotion strategies of Low Price are liked by 25% of retailer.

59


60/78

GRAPH.6

INTERPRETATION

The Deliveryman visit Depending on the Scheme at 9%.

The Deliveryman visit Fixed interval at 46%.

The Deliveryman visit on demands at 31%.

The Deliveryman visit any time at 20%.

60


61/78

GRAPH.8

INTERPRETATION

59% retailer preferred the mode of order by telephone.

11% retailer preferred the mode of order by fax.

30% retailer preferred the mode of order by salesman.

61


62/78

GRAPH.9

INTERPRETATION

42% of retailer suggested for Price Reduction.

20% of retailer suggested for Distribution Improvement.

14% of retailer suggested for an improvement in taste.

24% of retailer suggested for increase in Advertisement.

62


63/78

FINDINGS

&

RECOMMENDATIONS

63


64/78

FINDING

As regards outlet exclusivity, I found that the major manufacturers

(Nestle and Nescafe) have entered into agreement with some retailer

to stock only their respective products, which has also adversely

affected competition between manufacturers and between the

distributors.

Here is some of the finding that I came across as I surveyed the

market.

1. An average Ghaziabad retailer is notorious and really very smart

he is hard to keep and the company has to make extra efforts to

keep him loyal and this is not just with Nescafe it is the same with

every other Coffee company.

2. The power outage was serious problem even in Ghaziabad the

area like Shasti Nagar,Ghandhi Nager, Kavi Nagar,Vijay Nagar

were having serious power outage which was again one reason

why retailers were so afraid of stocking up coffee.

64


65/78

3. The freezers were haphazardly arranged i.e. the dealers were

storing almost every thing that needed freezing or cold into the

freezers from the peas to distilled water besides there were

freezers where the different brands of coffee were stocked

simultaneously.

4. The Coffee market is very cost effective i.e. you need to be good

and cheap at the same time to make your product sell well.

5. The Coffee business requires that the distribution network be

equally good besides there should be proper and timely delivery

and also replacements should be timely done otherwise chances

are that the retailers would shy away from that particular brand.

The lone reason why Nescafe was able to stock its Coffees in

Nestles freezers was because we provided replacement and they

didnt.

6. Its easier to find new retailer only when the company supports its

retailer force i.e. the retailer should be give some rebate when it

comes to buying freezers besides the company should always

encourage dealer to buy the freezers of at least 400 Lts because

in future the retailer can easily up his orders if demands are high.

65


66/78

7. The company has a very right policy of promoting itself hard at

the places where the youth actually hang out. The company I

found got the menus printed of Lapstop in Sec 2 Raj Nager etc

where young people actually hang out this may promote

company well and get it long time loyalty from customers.

66


67/78

RECOMMENDATIONS

1. In considering the measures needed to remedy the adverse

effects identified our objective has bee to establish a framework I

which competition would be effective with as little ongoing

regulation as possible.

2. On freezer exclusivity, I recommend that other Coffee brands

should be restricted from entering into any agreement or

arrangement for capacity I any freezer I any retailer outlet used to

stock wrapped impulse coffee. The company should make sure

that it doesnt end up fighting with other companies for the

remaining freezer space so the company should make sure that

whichever market it enters it should sanction enough money to fix

freezers at least the shops where the demand is good.

3. On outlet exclusivity, I recommend that the company make sure

that the retailer it invests on especially where the company gets

the pamphlets printed and also invests on the outlets fixing up big

signboards and also other accessories like tables and chairs etc.

in that case the company should demand total loyalty and also fix

up certain target for that shop so that if the target is met the

67


68/78

company further reward the retailer with further discounts or

margins.

4. On distribution, we consider remedies that would regulate the

supply by Nescafe to independent wholesalers such as

specifying the minimum order range besides the distribution

should also be perked up i.e. the availability should be such that

shortages ever occur besides care must be taken that delivery be

quick and that the coffee is not loose or melted.

5. As far as the billings are concerned the company must take

proper care that billings be done accordingly and any hassles that

arise must be addressed quickly care should be taken to bill

properly because wrong billings ca take away the credibility of the

company.

6. Company has been right in addressing the top shops in town by

keeping freezers and giving other support to bigger retailers these

retailer are with I reach of the upwardly mobile yuppie class but

the company should also address to the dealers that dont form

the companys top agenda because if the company fails to do the

same though it may earn its bread and butter but wont be able to

earn necessary brad recognition that might help up the company

68


69/78

cater to greater amount of taste buds that should be companys

brand policy.

7. Company though has reached its tentacles into the Institutes.like

IMT Ghaziabad. They might not bring the staple for the company

but do enough to create a long term demand besides may even

help to generate recognition and even human resources.

8. Urgent action should be taken to the above recommendations to

help stall competition and to also help the company to stand itself

in the market though the company has bee doing good as far as

the companys first year I the Delhi is considered the company

though would have to do better to fulfill its motto Flavour of the

month

69


70/78

LIMITATIONS OF THE STUDY

Many of the respondents were not willing to disclose their

information regarding the sale.

Some of the respondents were very non- cooperative.

Due to the limitation of the time constraint the research could

not be conducted in areas other than the Ghaziabad.

Target retailer chosen were less due to the constraints of the

time & cost factors.

70


71/78

ANNEXURES

QUESTIONNAIRE

71


72/78

QUESTIONNAIRE

Retailers Name:..

Shop Address:

..

..

1. Which brands keep in your shop?

* Nestle ( )

* Bru ( )

* Nescafe ( )

* Kwality Walls ( )

* Nescafe ( )

2. Which Brand is most liked by consumer?

* Candy ( )

* Cones ( )

* Noveltiesl ( )

* Kulfi ( )

72


73/78

3. Which brand provides best promotional efforts?

* Free Gift ( )

* High Margin ( )

* Attractive Packing ( )

* Low Price ( )

4. According to you best distribution channel is of?

* Nestle ( )

* Bru ( )

* Nescafe ( )

* Kwality Walls ( )

* Nescafe ( )

5. Is the Coffee readily available to you on ordering to company?

Yes No

( ) ( )

73


74/78

6. Are you satisfied with margin provided by the company of the

product?

* Satisfied ( )

* Un-Deciaded ( )

* Non-Satisfied ( )

7. Other competitive brand providing good marginal.

-------------------------------------------------------------.

8. Are you satisfied with the quality of these brands (ratify them)?

* Nestle ( )

* Bru ( )

* Nescafe ( )

* Kwality Walls ( )

* Nescafe ( )

74


75/78

9. Are you satisfied with brand Pack?

* Bulk Pack ( )

* Family Pack ( )

* Party ( )

10.Does visit of executive /deliveryman is regular?

* Depending on the Scheme ( )

* Fixed interval specified by the order ( )

*On Demands ( )

* Anytime Visit ( )

11.What in your mode of order ?

* Telephone ( )

* Fax ( )

* Sale man ( )

12. Suggestion from you side to an coffee company is?

* Price reduction ( )

* Distribution improvement ( )

* Taste improvement ( )

* Increase in Advertisement ( )

75


76/78

BIBLIOGRAPHY

76


77/78

BIBLIOGRAPHY

In this research report, while finalizing and for analyzing quality

problem in details the following Books, Magazines/Journals and Web

Sites have been referred. The all material detailed below provides

effective help and a guiding layout while designing this text report.

Kotler, Philip and Gary Armstrong (1999),

Marketing Management (New Delhi: Prentice Hall of India)

Mathur, B. L. (1994),

Marketing Management (Jaipur: Arihant Publishing House)

Kothari, C. R.(1999),

Research Methodology (Delhi: Global Business Press)

Khurana, Rakesh and A. N. Ravichandran (1996),

Strategic Marketing Management: Concept and Cases- An Indian

Context

(Delhi: Global Business Press)

77


78/78

Magazines:

Business World (12 April, 2004)

Business Today (Collector Edition Vol.1)

India Today (15 April, 2004)

Journals:

Indian Journal of Marketing (May 2004)

The Journal of India management &strategy (July-Sep 01)

The Alternative Journal of Management

Study & Research (Aug-Sep 02)

News Paper:

Ahmedabad News Line, (NOV 6, 2001)

Economic Times, ( 7, NOVEMBER 2001)

Business Standard ( 7 NOVEMBER, 2001)

THE HINDU (Thursday, Aug 08, 2002)

Websites:

www.Nescafe group.com

Consumer Preference in the Coffee

Documents

Transcript of Consumer Preference in the Coffee