The coffee industry is not an integral aspect of our economy yet. However, given the fact that India is the sixth largest coffee producing nation in the world, and with a huge consumer base available, one can clearly foresee good times ahead for the industry. Venu Madhav, COO, Café Coffee Day shares his views on the industry.
Aadeetya Sriram (AS): According to various coffee chiefs, the market is vastly fragmented. What is your take on this?
Venu Madhav (VM): The market is definitely fragmented, but at the same time, it is very urban- centric. Even in urban cities, there is fragmentation in the type of coffee that is consumed – while filter coffee rules the South, it is instant coffee that is a hit in the North. Therefore, there is a wide variety of panorama that is available for the coffee industry. But going across the café route, where people are understanding the implication of espresso, cappuccino etc, we have seen a significant uptake of coffee consumption in these areas, which has gone up from 60,000 tonnes to one lakh tonne. So we have to reach out to the customer by making him experience the coffee, getting him to understand the coffee nuances, grow on the coffee and then start experimenting with various available flavours.
AS: How familiar is the Indian customer with the dynamics of coffee in general?
VM: A consumer, who doesn’t know what a cappuccino is, is not familiar with the dynamics of the coffee structure across the country. Brands like CCD catch the attention of the consumer by offering varied tastes and styles. With the trends following the path of convenience, the instant coffee products are a viable form of coffee for the consumer.
AS: How do conferences like IICF benefit a brand like Café Coffee Day?
VM: With the help of conferences, there will be a lot of local interested parties looking to be a part of the industry by looking for opportunities at different levels in the coffee industry. Also, the foreign experts who visit the conferences get hindsight as to how and where the coffee sector is moving in the country. The trends visible in the market and potential tie-ups with Indian brands are a possibility through this initiative.
AS: CCD being the head sponsor for the event, what role have you been assigned?
VM: As the head sponsor for IICF, we will make sure that through our vast range of coffee outlets across north India, the concept of this conference is explained. We will undertake various activation programmes with IICF, which will further benefit the entire conference. Our basic role is to promote coffee across non-traditional areas in the country, such as Srinagar, which are not well known for its coffee consumption.
AS: How would you define the coffee market in a layman’s term?
VM: The coffee industry is ripe and awareness has definitely been created of late. People in the non- traditional areas are much more comfortable with the consumption of coffee compared to earlier times and the awareness created by the cafes across the cities have played a huge role in this regard. The way forward in this sector is to target the youth, who are heavy coffee consumers in the country.
AS: With the FDI in retail not that far away in the country, how exactly is the implementation going to impact the industry?
VM: In the café market, the induction of FDI in retail is hardly going to be that impactful. There are almost six international brands present in the country. So the further entry of brands will provide greater impetus for the growth of the sector in the country. There is a strong need for aspirational brands that can form a part of this ever-growing sector.