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To be a leader, you have to be ready to support failure: K. Ramakrishnan

Interview with President-marketing, Cafe Coffee Day

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Abhilasha Ojha

From a cyber café that also served coffee to the country’s largest café chain, it is innovation that has driven Café Coffee Day’s growth, K Rakamrishnan tells Abhilasha Ojha

When a brand is small, it is easy to have control over quality. How has Café Coffee Day maintained quality while expanding rapidly?
Coffee is our middle name and that is our mainstay. Our coffee is grown on our estates (Chikmagalur); it is roasted and packed centrally and then sent out to our cafés across India. A fundamental rule for brands to ensure quality is to have strong control over the basic, most important ingredient that is offered to the consumer (in our case, coffee). What is also key to sustaining quality is to look at processes very closely, in detail. At Café Coffee Day, for instance, in terms of not just our coffee but also our food, we have, in the last one year, centralised the process in that the food reaches our distribution centre and from there it is sent out to cafés. For a brand to succeed, not just processes need to be in place but also the training of people who define the brand needs to be closely looked at. In sectors like retail and hospitality particularly, employees at the front end become the face of the brand. They reflect the brand and so their training becomes important. At Café Coffee Day, we have an evolved and a strong training structure. We focus less on classroom learning and emphasise on-the-job learning, learning by observation and through tools and learning aids that are visual in nature. We have more than 1,400 cafés currently, and by 2014, we want the number to grow to 2,000 cafes. So, training the people and our growth will go hand-in-hand.

 

When one is a leader, others just follow. How do leaders go back to the storyboard and constantly innovate? At Café Coffee Day, for instance, you are expanding services and offerings and selling even coffee machines and not just a cup of coffee.
See, whatever has been your strength, whatever has taken you from point A to point B, need not necessarily take you to point C. Never stop being a student, keep learning, that is the key. Then, it’s also essential for companies (and not just leaders in the category) to have a back-up plan. At Café Coffee Day, at any given point of time, we have lots of pilot projects that, if successful, can go national easily. But, what it fundamentally means is that our brand is always experimenting. For example, most of our cafés were table service models. We realised that at any given point of time, our team member was making 14 visits to one table (going with the menu, returning back to take the order, returning back with the order, bill, cash…). We figured it was not good either for the team member or for the customer. We eliminated the process and now our cafes are semi-table service model in that the consumer places the order on her own but we deliver it to her at the table.

We are considered a youth brand but we address every segment. We look at ourselves as a mass brand that is addressing students, corporate employees, offices and homes. Wherever there is a need for a beverage, there should be a need for Café Coffee Day. That’s how I see it. Our ‘lounge’ concept, for instance, is totally different. It’s a café which is a hangout zone with a purpose. We have other models targeting hospitals and offices. We give vending machines for coffee delivery within offices.

The key to leaders being successful (or going back to the storyboard) is to constantly experiment, keep learning and be happy to support failures. Failure is the process of experimentation and learning. If you don’t fail, you don’t learn. So many drinks we launched, we had to pull back, drop from the menu list because they didn’t work. So many locations we had to pull out from because they didn’t work. But let the experimentation happen, believe in it.

Achieving stickiness towards a brand is tough, especially for youth-centric brands. How can brands then create and grow a loyal base of consumers?
We need to constantly maintain quality standards and not just look at consumer growth but also consumer connect. So, for a youth centric-brand like ours, our focus on digital media and social media becomes very important. Actually, it is what keeps us on our toes all the time. We already have 3.2 million ‘likes’ on Facebook and, through this engagement, we are in constant touch with a huge base of people who are our valued consumers. Given that we are a growing brand, slip-ups are inevitable but through the social media, we ensure that we rectify errors and mistakes. One of our consumers, for instance, put up a picture of sofa sets and chairs in our café in Udaipur, remarking unhappily that they were not in the best shape, and were old and worn out. We got proactive and within a few days, we replaced them with brand new sofa sets. A few days later, a picture was uploaded by the same consumer, with a comment: ‘CCD heard me.’ So, yes, the target age-group consumers on the social media may be unsparing but to be fair, they are also willing to give a chance to the brands. And through such endeavours, connect with brands happen. From fumigating flies in one café within minutes to making sandwiches available at another café, as a result of social media, as a connection with our core consumer, the bond with the brand is only getting strengthened.

Co-creation is also critical for youth-centric brands. In fact, on our social media pages, we are clear that we are happy to see people conversing. We only moderate when we feel we really have to. We provide sparks for conversations and get a sense of subjects that our core consumer may be interested in. Our music playlist, food menu, and many other things have been co-created with Café Coffee Day fans. When we changed our food menu last year, it was based on feedback on the social media. We invited people to test our offerings offline and then share their views online. So, the constant mix of online and offline initiatives can help strengthen the bond, particularly with the youth-centric brands.

Brewing the business
  • Café Coffee Day pioneered the café concept in India in 1996 by opening its first outlet on Brigade Road in Bangalore. It was a coffee shop-cum-cyber cafe
     
  • From a handful of cafés across six cities in the first 5 years, CCD has today become not only India’s but Asia’s (by number of outlets) largest retail chain of cafes with over 1,420 cafes in 185 cities. Café Coffee Day has four cafes in Vienna, Austria.
     
  • The chain has also acquired a Czech Republic-based coffee chain with 11 outlets spread across Prague, Brno and Olomouc
     
  • Café Coffee Day grows the coffee it serves across its cafes. It also offers its consumers the option of purchasing packaged coffees.
     
  • The range of merchandise now also extends to coffee makers, including the recently launched ‘Coffee Day WakeCup’ machine
     
  • It recently announced Lounge Journals, an innovation that allows customers to interact with photographers, writers, musicians, dancers and other creative professionals

You have employed many differently-abled people at your cafés. How can companies make CSR relevant rather than just be a token exercise for the benefit of the company’s image?
We at Café Coffee Day do CSR from the heart. There are three broad spokes of corporate responsibility for us — employability, education and hunger. In all these aspects, we do relevant work. We are proud of our ‘silent’ brewmasters. They may be differently abled but their sense of smell is so heightened that they genuinely are fantastic brewmasters, they make very good coffee. We have identified that strength. We have a vocational training college in Chikmagalur where we train youth who are in tough circumstances (children from broken homes, or of parents who might be offenders and are in jails). We provide them with free training, accommodation and food to make them employable in the hospitality industry. We also award scholarships to children in need. We have tie-ups to provide food on a daily basis through money gathered at different cafés. So, yes, we continue on this path because there is need to train and employ people.

Coffee consumption is growing year- on-year, according to the Coffee Board of India, so is the competition among cafés. How are you, as the largest coffee chain in India, gearing up for the challenge?
We started as a cyber café in 1996. At that time, the assumption was that internet would not be too easily available for retail customers in India. So, we let internet be the centre of our business and surrounded it with beverages. In two-three years, however, internet became freely available and the model (of internet with beverage at a café) was replicated. That’s when we tweaked and said, okay, coffee will now be the centre of our business and everything else will surround that. From 2000-2005, we stuck to this and also ended up expanding to different parts of India. However, we found that we needed to change that approach too. So, we became ‘beverage agnostic’, in that conversation became the centre of our business and we surrounded it with the beverage, which was coffee.

So, what was happening throughout was reinvention and being relevant with the consumers. I think, brands always need to experiment and reinvent themselves. We were successful as a cyber café but we took the initiative and simply decided to make a flip and do something else. Coffee is in our genes anyway, flips just happened.

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First Published: Jan 28 2013 | 12:28 AM IST

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