Global Marketing: Cafe Coffee Day's China Market Entry Strategy

This presentation analyzes the potential for Cafe Coffee Day (CCD) to expand into the Chinese market. It begins with a brief overview of CCD and the rationale for international expansion, followed by an industry analysis using Porter's Five Forces framework. The core of the presentation focuses on market entry strategies, specifically franchising, and the application of the EPRG framework (geocentric orientation). A detailed PESTLE analysis (Political, Economic, Social, Technological, Legal, and Environmental factors) of the Chinese market is provided, highlighting opportunities and challenges. Recommendations include utilizing STP analysis to identify target markets and adapting products to meet local consumer demands. The conclusion emphasizes the growth potential of the Chinese café market for CCD, while also acknowledging the need to address intense competition through strategic marketing efforts. References are included.

GLOBAL MARKETING
Café Coffee Day

INTRODUCTION
 The intent of this presentation is to present a
paper highlighting the analysis of the
Chinese market for the expansion of Café
Coffee Day in the country. This presentation
is comprised of brief Chinese market analysis
and the strategies that a company can adopt
to enter in the market. For analyzing the
Chinese market, the PESTLE framework is
applied.

BRIEF ANALYSIS OF CAFÉ COFFEE DAY
 Café Coffee day is an Indian chain of café
and also the division of Coffee Day
Enterprises Limited. It is popularly called CCD
and considered to be one of the favorite
spots for the Indians to hangout. The
company is in the contact of thousands of
small coffee planters for the sourcing of
coffee (Café Coffee Day, 2019).

JUSTIFICATION
 Operating a business in the abroad market
leads to increases sales of the business. The
increased sales mean more revenue for the
business that can most of the time result in
the further expansion of the business. Along
with this expanding business, it helps in
getting access to enter new markets and
cultures.

INDUSTRY ANALYSIS (PORTER FIVE
FORCE FRAMEWORK)
 Competition in the industry – The
competition in the Chinese café industry is
high.
 New entrant threat – This threat is high in
the café industry.
 Substitute product threat – The substitute
product threat is moderate to high.
 Power of customer – The power of
customer is high.
 Power of supplier – The supplier power is
low.

MARKET ENTRY STRATEGY
 Market entry strategy is the delivery and
distribution method that a business decides
to sell its products and services (Tielmann,
2010). To cover the Chinese market, the
market entry strategy that Café Coffee Day
can adopt is franchising.

EPRG FRAMEWORK
 EPRG Framework was introduced to focus on
the company’s international marketing
operations and the diverse attitude of the
involvement of the company in the
environment. It is comprised of 4 approaches
that are adopted by the business (Bhasin,
2019). The four approaches are ethnocentric
orientation, regiocentric orientation,
geocentric orientation, and polycentric
orientation. To operate in the Chinese market
CCD will adopt geocentric orientation.

RECOMMENDATION
 Café Coffee Day to succeed in the Chinese
market can adopt the STP analysis as under
this it can identify the ideal target market to
which it can sell its services and products
and focus its marketing efforts towards them.
Besides this, by the use of geocentric
orientation, the company can easily identify
the change in the taste of the Chinese
customer and home market and accordingly
prepare its products to meet their demand.

PESTLE ANALYSIS
 Political Factor
China is considered to be one of the powerful
nations across the world. The government of
China is famous for making disturbing
alternations in the policies which impact the
foreign as well as Chinese traders (Xu, Yuan,
Jiang and Chan, 2015). This results in also
impacting the business concept that is
prepared in China for business.

PESTLE ANALYSIS
 Economic Factor
China is ranked at 2nd position in terms of
having the largest economy across the world in
terms of GDP. But, in terms of purchasing
power, the Chinese economy is the largest
across the world. But, to meet this economic
development the country has faced some
challenges such as environmental damages,
quick urbanization, and inequality that is
important to consider before expanding
business in the country (Banerjee, Duflo and
Qian, 2020).

PESTLE ANALYSIS
 Social Factor
With a population of around 1.4 billion, China is
called to be the most populous nation across
the world (Liu, Zhou and Wu, 2015). This shows
that the market is massive for the consumer
products which offer growth opportunities for
the new businesses to operate and
international businesses to expand in.

PESTLE ANALYSIS
 Technological Factor
China have biggest online population with
around 829 million users (Statista, 2020).
There is the availability of some of the big
giants in the field of technology such as
Alibaba, Tencent, and Baidu. These companies
are so powerful in the market due to which
many big companies in other countries have
failed.