Dr. G.D.

Pol Foundation

Project Report

On

Submitted TO:

Prof. Reshma Ghorpade

Submitted By;

Name Roll No

Manoj dhomane 09

Dipak palve 34

Priyesh singh 56

Sudhesh puri 46
 ACKNOWLEDGEMENT

It is our privilege to express our sincerest regards to our project coordinator,

Prof. Reshma Ghorpade, for their valuable inputs, able guidance, encouragement,
whole-hearted co-operation and constructive criticism for our project. We deeply
express our sincere thanks to our professor for encouraging and allowing us to
present the project on the topic “RETAIL OUTLET”.

We take this opportunity to thank our director Dr.C.Babu, for providing best
library facility. We pay our respects and love to our parents and all other family
members and friends for their love and encouragement for our career.

Last but not the least we express our thanks to our friends who have directly
or indirectly helped us for the project preparation.

Thanking you

Sincere Regards from,

All team members.

MARKET ANALYSIS
ON
 MMS-I
SECTION - A

GROUP MEMBERS ROLL NO

Manoj Dhomane 09
Deepak Palve 34
Priyesh Singh 56
Sudesh Puri 46

SUBMITTED TO:
PROF. RESHMA GHORPADE
Costa Coffee is a coffee house company based in the United Kingdom founded in
1971 by Italian brothers Sergio and Bruno Costa, as a wholesale operation
supplying roasted coffee to caterers and specialist Italian coffee shops. In 1995, the
company was acquired by, and is now a subsidiary of, the Whitbread company

THE COSTA STORY:

A drop of history in every cup:-

Costa coffee was first poured on shores in 1971 at 9 Newport Street, London, by
Sergio and Bruno Costa. Today, just a few metres away from where they first set
up, the Costa Roastery produces the same unique Mocha Italia blend that the Costa
brothers worked so hard to create.

The perfect combination.

When you walk into a Costa store you'll notice it's different to other coffee shops.
First of all, there's the warm and welcoming atmosphere. Then the great range of
authentic coffee drinks. Next the Ferrari of coffee machines. And finally, the most
passionate and well trained baristas around. It's this unique combination that makes
us stand out from the others, and we're incredibly proud of it.
The most important ingredient in a cup of coffee.
Hand-making
making a cup of coffee is an art. It takes time and skill to perfect. That's why
every single barista, in every single Costa store is professionally trained in the art of
coffee by our experts. It's a little thing, but it makes a big difference, because it means
you'll get a perfect cup of Costa coffee every time.

Countries currently with Costa Coffee locations

• Bahrain Bulgaria
• Croatia China
• Cyprus Czech Republic
• Egypt Greece
• Hungary India
• Ireland Jordan
• Kuwait Lebanon
• Montenegro Oman
• Pakistan Poland
• Qatar Romania
• Russia Saudi Arabia
• Serbia Slovenia
• Syria United Kingdom
Corporate Profile –
The Coffee
Costa coffee is the second largest international coffee shop chain in the world.
Marketing:
“Marketing is the management process responsible for identifying, anticipating
and satisfying consumer’s requirements profitably!”
Putting the right product in the right place, at the right price, at the right time.
(1) The Marketing Mix (7 P's of Marketing)

The major marketing management decisions can be classified in one of the

following four categories:

1) Product
2) Price
3) Place (distribution)
4) Promotion
5) People
6) Process
7) Physical Evidence

These variables are known as the marketing mix or the 7 P's of marketing. They
are the variables that marketing managers can control in order to best satisfy
customers in the target market. The marketing mix is portrayed in the following
diagram:
The firm attempts to generate a positive response in the target market by blending
these four marketing mix variables in an optimal manner.

1) Product

The product is the physical product or service offered to the consumer. In the case
of physical products, it also refers to any services or conveniences that are part of
the offering.

Product decisions include aspects such as function, appearance, packaging, service,

warranty, etc.

• What does the customer want from the product/service? What needs does it
satisfy?
• What features does it have to meet these needs?
• How and where will the customer use it?
• What does it look like? How will customers experience it?
 • What size(s), color(s), and so on, should it be?
• What is it to be called?
• How is it branded?
• How is it differentiated versus your competitors?
• What is the most it can cost to provide, and still be sold sufficiently
profitably?

Products (Costa Coffee):

Brand Name: -
Their brand name is their signature. The name of costa signifies luxury, excellence
and perfection all over the world. In today’s market environment, along with
quality,
Image and Status are also all important. The quality and excellence that is
has made this brand name a trademark that is recognized and pursued.

Image/Theme:
Luxury and Comfort:-

The image of costa is luxury. The theme has been designed specifically with the
consumers in mind. The emphasis is on luxury and comfort- with style. The
ambiance provided is trendy as well as soothing. The sobriety of invites
consumers to spend a pleasant time with their company without the tacky flash and
glitter.
Service:
Costa s reputation for excellence applies not only for the exceptional coffee but
also the insistence on perfect service. Recruiting and retaining highly motivated
and talented people is essential and great emphasis is placed on improving the
skills, expertise and performance of our people through award-winning, industry-
leading training and developing programs.

Product variety:

Here's core coffee range, so you can work out what you fancy.

Single Shot , Double Shot, Steamed Milk, Chocolate , Ristretto, Frothed Milk

Espresso:- Short, strong, sweet and black: just what you need to start the day and
perfect after a meal.

Americano :- Espresso with hot water: a longer coffee with an espresso taste.

Espresso Doppio :- A double shot of espresso: twice the strength for an extra kick

Cappuccino :-Espresso topped with steamed, frothed milk and a sprinkling of

chocolate: breakfast coffee you can enjoy all day.
Ristretto :- A very short espresso: The ultimate strength shot
Caffè Latte:- Espresso with steamed milk: plenty of milk and lots of flavour
Macchiato :- Espresso with a dash of frothed milk: A smoother flavour with all the
taste.
Mocha:-Espresso with chocolate, topped with steamed, frothed milk and a
sprinkling of chocolate: spoil yourself with the ultimate coffee indulgence
As well as offering the finest coffee, Costa has a wide range of alternatives
including hot chocolate, teas and infusions, iced coffees & frescato. See our full in
store menu for more details

2) Price

Pricing decisions should take into account profit margins and the probable pricing
response of competitors. Pricing includes not only the list price, but also discounts,
financing, and other options such as leasing.

• What is the value of the product or service to the buyer?

• Are there established price points for products or services in this area?
• Is the customer price sensitive? Will a small decrease in price gain you extra
market share? Or will a small increase be indiscernible, and so gain you
extra profit margin?
• What discounts should be offered to trade customers, or to other specific
segments of your market?
• How will your price compare with your competitors?

Prices (Costa Coffee ):

Coffee is internationally renowned for is unique blend of Italian Coffee, first- rate
service, Highest regard for quality and a determination to provide the best handmade
coffee for the most discerning consumers worldwide. The consumers appreciate these
efforts and are loyal to. They will value s commitment to their satisfaction and realize
that luxury comes at a cost. A cost that will not deter them from pursuing the excellence
of the coffee at .The prices of all the products are comparatively higher at . But this is
offset by the outstanding quality and discerning tastes at One of the reasons for choosing
the privileged and higher middle classes in the target market is the prices.
3) Place

Place (or placement) decisions are those associated with channels of distribution
that serve as the means for getting the product to the target customers. The
distribution system performs transactional, logistical, and facilitating functions.

Distribution decisions include market coverage, channel member selection,

logistics, and levels of service.

• Where do buyers look for your product or service?

• If they look in a store, what kind? A specialist boutique or in a supermarket,

or both? Or online? Or direct, via a catalogue?

• How can you access the right distribution channels?

• Do you need to use a sales force? Or attend trade fairs? Or make online
submissions? Or send samples to catalogue companies?

• What do your competitors do, and how can you learn from that and/or
differentiate?

Place (Costa Coffee):

Our Locale / Setting:
Our first ventures are greatly anticipated and we intend to meet and go beyond
these expectations.
4) Promotion

Promotion decisions are those related to communicating and selling to potential

consumers. Since these costs can be large in proportion to the product price, a
break-even analysis should be performed when making promotion decisions. It is
useful to know the value of a customer in order to determine whether additional
customers are worth the cost of acquiring them.

Promotion decisions involve advertising, public relations, media types, etc.

• Where and when can you get across your marketing messages to your target
market?
• Will you reach your audience by advertising in the press, or on TV, or radio,
or on billboards? By using direct marketing mail shot? Through PR? On the
Internet?
• When is the best time to promote? Is there seasonality in the market? Are
there any wider environmental issues that suggest or dictate the timing of
your market launch, or the timing of subsequent promotions?
• How do your competitors do their promotions? And how does that influence
your choice of promotional activity?

Promotion (Costa coffee):-

The promotional strategy for the Launch of costa has been mostly low key.
Though it is a coffee house and the coffee house culture is building up as an
upcoming trend , a lot of advertising is unnecessary. This is so because costa’s
brand name is enough for them to muster the required target market. Most of the
awareness will be through the word of mouth of people amongst the masses. Hence
the reputation is more that counts.
5) People (Costa coffee ):

People at Costa Coffee Day believe that “People are hired for what they know
but fired for how they behave”. Motivation and personal skill are laid emphasize
upon.
6) Process (Costa Coffee):

The order process at Costa Coffee is based on self-service, where the customer
goes to the counter to place his order. Whereas they have a flexible delivery
process, where they wait for some time for the customer to pick up the order but if
the customer takes too long then the order is delivered on his table.
7) Physical Evidence (Costa Coffee):

a)Color Scheme :
The theme of costa, from the brand logo, the color scheme of the premises, to the
entire feel of our business is warm tones & relaxing colors. The dominant color in
the logo and the premises of costa is brown with touches of black, white & green.
The color theme is chosen for relaxation & comfort as well as being upbeat &
trendy.
b) Décor & Architecture:

Costa Coffee had gone in for image change and revamping of interiors in the last
quarter. Costa interiors have been given a whole, new look. In a change from the
largely wood and granite based interiors, there is more of steel and lots more color
now. The young colors of today, lime green, yellow, orange, and purple
predominate.

c) Literature:
The literature provided by Costa Coffee is indicative of its youthful image. The
menus, posters, pamphlets are all designed to attract young and young at heart.
 (2) Segmentation strategies

"Dividing a market into smaller groups of buyers with distinct needs,

characteristics or behaviors who require separate products or marketing mixes. The
company identifies different ways to segment the market and develop profiles of
the resulting market segment".

Four major segmentation bases for consumer markets will be:

1. Geographic segmentation
2. Demographic segmentation
3. Psycho-graphic segmentation
4. Behavioral segmentation

1) Geographic segmentation:
Subdividing markets into segments based on location, the regions, countries, cities
and towns where people live and work is geographic segmentation. The reason for
this is simply that consumer wants and product usage often are related to one or
more of these subcategories. Geographic characteristics are also measurable and
accessible.

2) Demographic segmentation:
Demographics are the most common basis for segmenting consumer markets. They
are frequently used because they are often strongly related to demand and
relatively easy to measure. The most popular characteristics for demographic
segmentation are age, gender, family, life-cycle, income and education.

3) Psycho graphic segmentation:

Psycho graphic segmentation divides buyers into different groups based on social
class, lifestyle or personality characteristics. People in the same demographic
Group can have different psycho graphic makeup. So psycho graphic segmentation
helps the marketer in examining attributes related to how a person thinks, feels,
and behaves.

4) Behavioral segmentation:
Some marketers regularly attempt to segment their markets on the basis of product-
related behavior, they utilize behavioral segmentation. Behavioral segmentation
divides buyers into groups based on their knowledge, attitudes, uses or responses
to a product.

(3) Consumer preference while buying product

Consumers

Generally consumer is an individual who buys products or services for personal

use and not for manufacture or resale. The literal meaning of the word ‘consumer’
is one that consumes.

According to the legal definition of consumer, it is an individual who purchases,

uses, maintains, and disposes off products and services.

The Marketing dictionary defines consumer as an ultimate user of a product or

service. The consumer is not always the purchaser of a product. In the case of pet
food, for example, the pet is technically the consumer because it is the ultimate
user, although of course the advertising is aimed at the pet owner.

Consumer Behavior

Customer behavior is defined as the mental and physical activities undertaken by

household and business customers that result in decisions and actions to pay for
you, purchase and use products and services. Examples of mental activities are
assessing the suitability of a product or service brand, making inferences about a
product or service’s qualities from advertising information, and evaluating actual
experiences with the product. Physical activities include visiting stores, reading
consumer reports, talking to sales people, and issuing a purchase order. In short,
Consumer behavior understands how and why consumers behave.

As consumers, we can benefit from a better understanding of how we make our

decisions so that we can make wiser ones. Marketers can benefit from an
understanding of consumer behavior so that they can better predict what consumers
want and how best to offer it to them.

There are two major forces that shape who we are and what we buy. Our personal
motives, attitudes, and decision-making abilities guide our consumption behavior.
At the same time, our families, cultural background, and the ads we see on TV, and
the sites we visit on the Internet influence our thoughts and actions.

Consumers buying behavior is influenced by following factors:

1) Cultural factors
2) Social factors
3) Personal factors

Cultural factors exert the broadest and deepest influence on consumers

buying behavior.
 Following image shows internal and external factors that affect consumers
buying behavior:

(4) Decision making process

“Need can never be created, it can be aroused!”

Every customer goes through a five

five-stage decision-making
making process in any
purchase. This is summarized in the diagram below:
 Need
Recognition

Information
Search

Evaluation
of
Alternatives

Purchase
Action

Post
Purchase
Evaluation
 Customer Survey

Survey Methodology:
To judge the customers decision making process a survey was conducted,
consisting of a sample of randomly selected people, in the age group of 18-25. This
survey aims to find out how Café Coffee Day’s target market, rate their products
and services.
Comparative Rating:

The survey also asked the customers to rate the following parameters on a scale of
1-5 (1being the worst, 5 being the best), for Costa Coffee :
1. Taste & Quality of products.
2. Prices of products.
3. Order/ Delivery time & Order/ Delivery process.
4. Performance of staff.
5. Ambience.
6. Availability of products.
7. Value for money of products.
8. Overall performance.
Parameters Rating (Costa Coffee)

1) Taste & Quality of products 4/5

2) Prices of products 3/5

3) Order/ Delivery time & 3.5

Order/ Delivery process

4) Performance of staff 3.5/5

5) Ambience 3/5

6) Availability of products 4/5

7) Value for money of products 3.5/5

8) Overall performance 3.5/5

Survey shows that, above all factors affects to the customer’s decision making
process while entering into Costa coffee.

(5) Retailer’s response in making purchases

The staff at any service establishment plays a very important role in the proper
functioning and success of that establishment. Especially in the restaurants – the
staff makes or breaks the place. For the purpose of this study, the sample was
asked to rate the staff at a costa on four counts: Behavior, Manners, Helpfulness
and Service. This would help give us an insight on how customers feel about their
interactions with the staff of a costa, and how this affects their overall experience.

Counts Rating
1) Behavior 3.5/5
2) Manners 3.5/5
3) Helpfulness 4/5
4) Service 3.5/5

Behavior (3. 5)
The behavior of the staff directly contributes to the customer’s overall experience.
Their actions, reactions and conduct while interacting with the customers will
directly affect the level of customer satisfaction.
Manners (3.5/ 5)
Perhaps the most important aspect of interacting with customers is the way an
employee speaks to them. His mannerism and etiquette should be polite and
courteous.
Helpfulness (4/5)
The staff should be able to assist and help customers with their queries and needs.
A little help or assistance goes a long way in improving the customer’s view of the
organization and building strong bond.
Service (3.5/ 5)
A customer’s visit to a coffeehouse doesn’t end with his purchase of coffee. He
goes there for the service the organization provides, and this service is provided
directly by the staff.

Conclusion:

After survey we came to the conclusion that, almost every person entering into
costa coffee expects an attention and a good response in terms of behavior,
manners, helpfulness and service from staff/waiter. This ultimately results in
purchases as well as building strong customer relationship which at large results
in repeated visits.
 (6) Time spend in buying a product

During the survey we also asked the respondents how much time they would
usually spend on a single visit to a coffee shop. The following graph shows that
half of them would spend between 1 hour and 2 hours, and 40% would spend
between ½ hour to 1 hour:

Avg time spent in a Costa coffee

50%
45%
40%
35%
30%
25% 1-2 hrs
1/2-1hr
1hr
20% 40% 50% Sales
15%
10%
5% >2 hrs
0% 10%

1st Qtr
2nd Qtr
3rd Qtr
 (7) Accompanies while buying

Average group size:

Avg group size in Costa Coffee

50%
45%
40%
35%
30% 3-55 people
25% 50%
20% Sales
15% 2 people
10% 30%
>5 people
5%
20%
0%

1st Qtr
2nd Qtr
3rd Qtr
One of the important factors to consider is the size of the groups that go to the
costa coffee. This would help us identify consumer patterns, and enable us to
create customer- specific policies. In this survey, we observed that 50% of people
visiting to the costa coffee were in a group of 3-5, 30% with a single person and
20% of people were in a group of more than 5.
As the graph shows that 50% of the respondents visit costa in groups of 3-5 people.
This would indicate that they are usually accompanied with common friends, who
have similar tastes, and buying patterns. The remaining 40% either went with only
1 person, or in a group of more than 5 people.

(8) Store choice

There are several important factors that influence consumer store choice behavior.
Although the influence of these elements differs, depending on such variables as
the type of product purchased the type of store (such as discount, department or
other). They include store location, physical design assortment, prices, advertising
sales promotion personnel and services.

Store location

Location has an obvious impact on store patronage. Generally the closer

consumers are to a store, the greater their likelihood to purchase from that store.
The farther away consumers are from a tire, the greater the number of intervening
alternatives and thus the lower the likelihood to patronize that store Research on
the influence of location on store choice has taken several directions.
As from segmentation strategies we came to know that the target customer’s of
Costa Coffee are high class people who have willingness to pay so costa Coffee is
always targeting such areas where high class people resides. This is the major
strategy they have undergone for earning maximum profit.

Costa Coffee have opened their retail stores in high class areas. For instance if we
consider Navi Mumbai, Vashi is being considered as high class area so Costa
Coffee have opened their retail store in Vashi. Similarly they have their retail
stores in high class areas like Bandra, Charni-road, Goregaon, Juhu, Pali-
hill,kharghar.
 (9) Effect of window display

Retailing begins with the quest to attract more people to the store. The exterior
of the store is the first attraction for the passers-by. A well-decorated store front
can make the people stop and at least have a look at the displayed items. For the
visual merchandisers, the retail window displays are free advertising spaces.
These are the means to urge the people to come inside the store to buy the
products or services. So these turn the common people into customers. The
designers of these spaces utilize these to the maximum effect by using various
methods of display. The techniques of graphic design, different types of
illumination, and placement of the product in the retail window displays are key
elements of window dressing.

The retail window displays are guided by the store philosophy and profile.
Whether the display shall feature expensive or economic products, how frequently
the display shall change, and whether the prices shall be displayed on a regular
basis are some of the aspects that the visual merchandisers consider while going
about their work.In the exhibitions, where you are provided with a temporary stall
and do not have the benefit of a permanent window display space, the visual
merchandisers design and decorate the entire stall to make it look appealing for the
onlookers. Whether it is the placement of the mannequin, its dressing, the
placement of product, the exhibition stand design, the design of chairs and tables,
the lighting, the billboards, the posters, and other POP material, these are used
judiciously to attract the maximum number of customers.

If there are some events to be held, such as the fashion shows, the music concerts,
weddings, etc., the event dressers utilize the space to provide the perfect ambience
both for the visitors or guests and the clients using this facility.
The designers and dressers of the retail window displays, events, and exhibitions
use the computers to maximum the effect for deciding the right design, layout, and
dressing of the spaces. They use several types of software, such as 3D Studio Max,
Illustrator and Photoshop, etc., to do the 3D modeling. By using these, they can
suggest how the space will come up by using the different mix of design, lighting,
POP material, placement, etc. This helps in the proper planning and execution of
the project. It is important to save cost, time, and effort in trying out the different
options before selecting the right one. The 2D models are used to design the
cardboards, billboards, and other 2D displays with which the store or stall front can
be decorated.Whether these are the retail window displays for a store chain in the
busy market location or for your store or boutique, having a look at the display
techniques and methods of other stores also helps. At first, it helps provide fresh
ideas for the visual merchandiser. Second, it helps aid the designing effort by
creating something different from the nearby stores.

So all these methods are essentially the ways and means to promote the sales effort
of the store, thereby increasing its business.
ANALYSIS:

The findings above notify that Costa has very strong market intensification
potential. We can observe that Costa has exceptional sales all through its first year
after entering the market. The rationale following this is the unique taste and the
highly reputed image of Costa in the European markets. The word of mouth only
has played a significant role in their success.
The cash inflows are projected to increase much this year and in the next
yearwith the development plans. After expansion Costa will be able to establish a
firm and strong foothold in all the major markets . Since the targeted market
segments include only the higher middle and elite classes, therefore the venture is
even more successful. The sales forecasts give you an idea about the market share
of students and youngsters and the professionals increasing spectacularly over the
span of these three years. This is due to the quick adaptation by our youth and their
fondness towards the new trends.
The professionals on the other hand, always seem to be in the hunt for
calming and serene locations to carry out unofficial or official business meetings.
Costa has proved to be a first-rate spot for the purpose, as the sales figures suggest.
Apart from this the professional sales with relation to media will also increase
since there is a very strong showbiz industry . From the beginning a number of TV
channels have already started airing their programs art Costa. Hence this would
certainly increase the revenue generation

Summing up, we can say that Costa has entered and has maintained an excellent
marketing strategy inviting the customers and providing them services that will
create a niche of Costa in the market very soon
RECOMMENDATIONS:

The sales forecast of Costa are very promising but the franchise has not adopted
any above or below the line promotional methods. This should be considered.

Costa should adopt some low key promotional strategies.

They can go for advertising through bill boards or giving out brochures.