Business Research Methods Group Project

COFFEE SHOP (More than a coffee Experience)

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Introduction : Background to the Problem India has always been predominantly a tea drinking nation. Coffee had been only moderately popular in some southern states. However, there has been a sudden change in this trend with coffee becoming more and more popular in recent times especially among the youth. Thanks to the new entrants in the segment including Barista, Caf Coffee Day (CCD) and others. Cafs are increasingly becoming more than places to sip coffee. A lot many things in life and work happen over a cup these days. India has now become one of the fastest growing coffee markets in the world. It is taking great strides on both counts; making its presence in the world market as well as in the domestic retail arena as more and more Indians prefer the drink. A single visit to a shopping mall, high street or a neighborhood market, school, college, hospital or any public place makes us realize the growing popularity of coffee shops in India. The brands available are not just the local brands, rather lot of international brands have also managed to grab the share of coffee market in India. Whether it is a school or a college friends meet, an official interview/meeting or even sharing some moments of happiness with loved ones, the best place to meet is over a cup of aromatic coffee. Coffee shops have become the most popular places to relax after a grilling day at work. Not only are caf shops pleasurable for working class, but it is heaven for shoppers who can rest their feet in a caf after a hectic day of shopping. All these benefits have led a large number of national as well as international caf chains to expand their network via the franchise route. Let us find out the factors that have encouraged the growth of caf brands before reading about these brands and their success journey. Encouraging factors
Dominance of youth segment: Beverages like coffee is especially preferred by youth. About 50 per cent of the countys population is 25 years or younger. This amounts to the growing popularity of cafes. This trend is sure to pick up in future because researches show that the youth population is expected to reach 55 per cent by 2015. Increase in disposable income: Students get a higher pocket money to spend on cafes with their friends. Earning class also does not mind to spend a few extra bucks on having a delicious cup of coffee in comfortable ambience of a caf. Cafs as a social hub: With coffee culture brewing up pan India, it has become a great social hub for all kind of people to chat and relax over a cup of coffee.

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Increase in private offices: The increasing MNC culture has also helped in the popularity of caf chains. Working professionals usually prefer to hang out at these places during their free time. Low cost kiosks: The foremost factor for growth of coffee culture is its low cost benefits. Any interested entrepreneur can take a coffee kiosk due to low investment needed. Availability factor: Caf outlets or kiosks are available at mostly all places. Customers can also opt for take-away coffee if they are running out of time due to its easy availability. Franchisees pan India. It popularly operates through its kiosks which require 50-100 sq.ft area and a location that has high footfalls. International players ready for foray. These are few of the brands which have become popular in caf industry via the franchise route. Costa Coffee, Gloria Jeans Coffee are some international brands which have made their mark in India. With the purpose to investigate these precise factors that affect attitude and buying behavior of type of consumers mainly the ones who prefer homemade coffee or branded coffee shops in India

Literature Review Evolution of a Coffee Caf It all began around 1000 A.D. when Arab traders began to cultivate coffee beans in large plantations. They began to boil the beans creating a drink they called qahwa Which translates to that which prevents sleep. The drink became widely popular, and the need for coffee beans grew. The Coffee Caf Industry The Coffee Caf industry is currently one of the biggest and fastest growing Sectors in business. The industry consists of a mix of individual cafs, hotel cafs and retail caf chains. The main bulk of revenue is earned by small, individual cafs, run mostly by families and friends. It is a relatively unorganized sector. There are millions of such cafs around the world, and they provide customers with a homely, casual experience. The bulk of these cafs are mainly in Europe, where every little town or village has local cafs, where people gather together for a conversation over coffee, or just to be alone with their thoughts. Individual Cafs These cafs have been the birthplace and sanctuary for various creative minds, revolutionaries and thinkers of our time. The most recent example is the author J.K. Rowling, who has written most of the Harry Potter series of books, sitting at her local caf.
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These cafs set themselves apart from retail chain cafs and hotel cafs because they provide customers with a homely, classic appeal, which cannot be emulated. Hotel Cafs: Ever since the popularization of coffee, hotels all over the world started opening 24-hour coffee shops where visitors to the hotel could walk in for a cup of coffee and some food at any time. These coffeehouses are extremely important, because they provide international visitors to the hotel with a universal drink- coffee. Any customer can walk into any major hotel in the world, and enter the coffeehouse, and know what to expect. These cafs are not really major players in the coffee caf industry, but rather provide supplementary services to the hotel industry. Retail Caf Chains: The last, and the most organized sector in the coffee caf industry, is the retail caf chain. Off late, these chains have become extremely popular and are growing at an Ever-increasing pace. These retail chains have work with an organized structure of man, material and money. The work on developing a recognized brand consistent to all their outlets, which customers can easily relate to, wherever they go. They provide customers with a standardized level of service and quality at each of their outlets. Indias Growing Coffee Cafe Culture Although tea is the main drink of choice in India, now hundreds of trendy western-influenced coffee bars have emerged across India in Tier I and Tier II cities. The bean has become big business, so large that it now competes against the once dominant tea on menus everywhere. For coffee fans, India offers a few notable coffee bar chains. The significant growth in the number of coffee retail chains in India is due to the changing lifestyle patterns of Indian middle class families and an increase in their disposable income. Although the coffee bars contribution to Indias total coffee consumption may not be significant, these coffee cafes have added more visibility to coffee and opened up an outlet for various value added food items. Barista Lavazza One of India's largest franchised chains of coffee bars, the Barista Lavazza coffee company operates around 205 outlets across India 15 crme lounges and the rest espresso coffee bars. It plans to open 300 new stores over the next three years and has begun aggressively marketing its products outside Indian borders into neighboring countries. Considered the Starbucks of the East, Barista offers many of the same menu items like espresso, lattes, cappuccino and various pastries, in addition to basic coffee. Despite being Indian, Barista sticks closely to its Italian roots by serving Italian coffees exclusively. (www.barista.co.in), Caf Coffee Day A later entrant than Barista, Caf Coffee Day (CCD) offers nearly everything coffee-related, from take-home products and equipment to fully operational stores. Since the grand opening of the first store in Bangalore in 1996, Caf Coffee Day has grown to become India's largest coffee retailer, with exports into Europe and the Middle East. Like Barista Lavazza, CCD tends to be in every major Indian metro area. Caf Coffee Day currently has 810 outlets in over 100 cities. (www.coffeeday.com).
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Costa Coffee The British influence isn't entirely missing from Indian cities, as the UK's largest coffee retailer has been setting up shops alongside other coffee competitors. The London-based Costa Coffee Company specializes in imported Italian coffees and made-to-order coffee concoctions like risteretto (a coffee stronger than espresso) and "Flat Whites" that feature custom barista designs in the froth. Qwikys Coffee Pub The coffee house offers about 101 varieties of coffee, serving drinks such as espressos, lattes, cappuccinos, mochas, americanos and friazzos. It also offers grilled sandwiches, pastries and ice creams. Qwiky's clothing brand, greeting cards, magazines, books and coffee Caf Pascucci Italian coffee brand Caf Pascucci has entered India with the launch of its outlet in Bangalore. Madhura Beverages India Pvt. Ltd., the exclusive master franchisee for this brand in India, plans to set up 60 outlets across the country. Coffee consumption in India Estimated Domestic Consumption (From 1995)
Calendar Year 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 Quantity (in MT) 50000 50000 50000 50000 55000 60000 64000 68000 70000 75000 80200 85000 90000 94,400

2010 (prov.)

102,000 108,000

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Objectives: Statement of the Problem

To compare famous Coffee brands in relation to the factors that affect consumer buying behavior. The main investigation is to find out what the most important factor of different consumers when buying coffee.
To find the reasons of Indian consumers for visit to a coffee shop ( such as ambience , social purpose, relaxing , or coffee itself ) To develop a comparative analysis of consumer preferences towards the various coffee shop brands available in Hyderabad. To analyze consumer preference of other food and merchandise items in addition to coffee.

Research Design Type of research design

The types of basic research methodologies this unit will introduce you to are: Quantitative research Qualitative research Participatory research

Within this context, this unit also looks at: Conducting surveys Conducting interviews Conducting focus groups

Each of these methodologies helped us find out different things in different ways. We have used these different methods

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Quantitative research
Overview
Quantitative research (the word quantitative comes from the word quantity) involves information or data in the form of numbers. This allows us to measure or to quantify a whole range of things. For example: the number of people who live below the poverty line; the number of children between specific ages who attend school; the average spending power in a community; or the number of adults who have access to computers in a village or town. A common way of conducting quantitative research is using a survey. Surveys usually involve filling in a questionnaire. The usefulness of a survey is that the information you get is standardized because each respondent the person who fills out the questionnaire is answering the exact same questions. Once you have enough responses to your questionnaire, you can then put the data together and analyse it in a way that answers your research question or what it is you want to know. How these varied responses become numbers is in the way they are analysed. From the example questions above, one might be able to say: 20 out of the 30 (66%) respondents use a particular brand of computer, while 5 (16%) use another. The remaining five respondents all used different brands of computers which you would list. You might then want to provide some examples of how the computers are used. Surveys
Surveys can be conducted in a number of ways. The most important thing is to think clearly through the kind of questions you want to ask, and to make sure that the responses will answer your research question. Besides being very careful about the kinds of questions we ask, and what the answers are telling us, it is often helpful to limit the kinds of answers respondents can give. You may want to phrase the questions in such a way that tick boxes can be used, so yes or no answers are possible, or the respondent fills in numbers instead of descriptions.

Using the Internet for surveys

A good way to conduct a survey is through an online questionnaire. The Internet is useful for giving your survey geographic reach. Using the Internet, you can survey many different people from all sorts of countries something that would not have been possible before or else too expensive. To do this, you can either distribute a questionnaire via e-mail or create a simple online form. An easy way is to use SurveyMonkey.com (http://www.surveymonkey.com). SurveyMonkey is an excellent online tool that helps you create and manage your own online survey easily. With the online form, the responses will be e-mailed straight back to you. Many people dont have a lot of time to answer surveys, and online forms are often quicker for them to complete. However, keep in mind who you want to reach. Do they have reasonably fast access to the Internet? Do they have access to the Internet? You may want to provide a fax number for faxed responses, an e-mail address for e-mail responses and an online form to cover all of your bases. Dont forget that you can even post a survey questionnaire using snail mail although this is likely to be quite costly, and you may not get that many responses (this often depends on how persistent you are,

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how well the people you are surveying know you, or if you are offering them prizes or money for completing the survey). Using the Internet to conduct a survey may not be useful when surveying a specific community. Here you may want to send a team of researchers into the street to collect responses or conduct a focus group (see Research tip: Focus groups below).

Advantages of surveys1 Good for comparative analysis. Can get lots of data in a relatively short space of time. Can be cost-effective (if you use the Internet, for example). Can take less time for respondents to complete (compared to an interview or focus group).

Disadvantages of surveys Responses may not be specific. Questions may be misinterpreted. May not get as many responses as you need. Dont get full story.

Qualitative research
Overview
The aim of qualitative research is to deepen our understanding about something, and usually this means going beyond the numbers and the statistics. Qualitative research helps us to give reasons why the numbers tell us what they do. It is often contrasted to quantitative research and they are very often used together to get the bigger picture of what we are trying to find out. Qualitative research helps us flesh out the story.

Face-to-face interviews and focus groups

The most common forms of qualitative research are face-to-face interviews and focus groups. Face-toface interviews are just that: Meeting someone in person and discussing various issues. The informant or person you are interviewing may be an expert in a particular field (e.g. the editor of a newspaper) or they may be someone who is affected by the issues you are researching (e.g. someone who is HIV positive or who reads the media). Although it is very important to develop a list of questions you want to ask someone, face-to-face interviews usually involve more than yes or no answers. The point is to try to understand the complexity of the issues you are researching. The nature of face-to-face interviews is that they are usually quite discursive.

Some of the advantages and disadvantages of various methodologies mentioned throughout are informed by Carter McNamaras Basic Business Research Methods, http://www.mapnp.org/library/research/research.htm [Accessed November 2004]

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Focus groups involve discussions with two or more participants. While questions for focus groups need to be prepared to guide and focus the discussions, the responses are often free-ranging, as the participants are encouraged to explore the issues at hand in an in-depth way. While focus groups and interviews will help you develop explanations for quantitative data, sometimes they can provide you with quantitative data themselves. For example, you might find that 20% of the participants in a focus group discussion did not like the way HIV/AIDS positive people were portrayed in the media (quantitative data). Then you might find that the reasons (qualitative information) they gave were that: They found it demeaning; They thought that it was insensitive; They thought that HIV/AIDS positive people were treated as others.

With focus groups and interviews, it is usual to write up the responses to your questions, to arrange and analyse the responses in a careful and meaningful way, and to include the most relevant ones in your research report.

Research tip: Face-to-face interviews

Always prepare a set of questions to ask the informant; It is a good idea to record your interviews, so that you can check your facts later. Take notes during the interview, if you feel comfortable doing this; Remember: Interviews take time, and the informant is giving you his or her time for free. Interviews shouldnt really take more than an hour, unless the informant wants to spend more time talking to you. Usually 10 questions are enough for this amount of time; Sometimes people transcribe the interview recordings. This usually makes analysing the results easier, but it also takes time and can be quite an effort. Consider including a budget in your research proposal for transcription, and then pay someone else to do it; Sometimes you may need to ask the informant if they are prepared to be identified in your research, or if they would like to be quoted anonymously. This is usually the case if their identity needs to be protected, and sometimes if you are researching a controversial topic; You may want to consider letting your informant review any direct quotes you use before publishing the research report. However, this takes time and sometimes can delay the research process; Ask the informant if you can include their contact details in your research report; Ask the informant if he or she would like to be alerted when the research is published, and let them know where they can read the report if it is publicly available.

Advantages of face-to-face interviews Can allow for in-depth knowledge sharing; Helps to develop the bigger picture; Helps with analysis of results; Good for networking (e.g. you may be referred to other people to interview).

Disadvantages of face-to-face interviews Can be time consuming; May be difficult to arrange an interview time; Can be difficult to compare and analyse information.

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Research tip: Focus groups Focus groups can sometimes take time to arrange, so prepare in advance. Try to find an intermediary to help you (an organization or individual in close contact with the potential focus group participants); Think about who you want to participate in the focus group by referring to your research question. What age group should they be? Should they be male or female? Should they come from a particular income bracket? You may want to consider holding separate focus groups for different age groups, or for different genders. For example, it may be important to hold a separate focus group for males and females if you are discussing sex and sexuality; Issues of power: The focus group facilitator holds an immense amount of power in the discussions. You need to keep this in mind. If a male facilitator questions young girls about sexuality, will that affect the research results? Some researchers will not let the people commissioning the research (e.g. government) be present in the focus group sessions. In some cases, special rooms are built with one-way glass so that the session can be observed unobtrusively; You need to find out if it is normal to pay focus group participants, and what the going rate is. Often focus group participants come from poorer communities. If it is not normal to pay participants, you may want to consider it and set a trend!

Advantages of focus groups Good for community participation (grassroots input); Helpful in developing ideas and sharing latent, or hidden, knowledge spontaneously; Enables you to get information from a number of individuals simultaneously.

Disadvantages of focus groups Can be difficult to set up; Participants may need to be paid; Need to be sensitive to who the facilitator is; May need a translator; Sometimes difficult to organize and analyse information.

Site visits and observation

Site visits (e.g. when you visit an organization, a manufacturing plant, a clinic or a housing project) are very useful, and sometimes even necessary ways of gaining additional insight and making your theoretical information concrete in your mind. Site visits will help you understand your information better and will make the research process a much more rewarding experience. They allow you to observe what is going on, and to ask questions you may not have thought about. Be curious!

Even if site visits are not part of your research methodology, it is recommended that you include at least one in your research process, so you can form a mental picture of whats happening on the ground.

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Observation is simply a way of gathering information. This may involve a site visit but it can also involve visiting a community, or a place, and watching what people do (e.g. stand in a street). Like a site visit, it is a good way to concretize your research, and to help you understand your research results better. Advantages of site visits and observation Help you understand your research better; Help you ask questions you may not have thought of; Concretize your research; They are fun!

Disadvantages of site visits and observation Take time; Can be expensive (depending how far you need to travel); With observation in particular, you need to be careful how you interpret what you see. With site visits, you may want to make sure you have a guide so that you can ask questions.

Case studies

Information needs Data collection from secondary sources Scaling techniques Sampling techniques Questionnaire development and pre-testing Sampling techniques Sample size Field work Analysis method

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Population and Sample Size The population of this research constitutes a total of 200 respondents. Such respondents are randomly selected of IBS Students and General Consumers in coffee shops in Hyderabad. Survey Instrument A structured attitude questionnaire is applied in the research. Informal interviews are also facilitated, if possible. Data Collection Primary Data is gathered through survey method. This will serve as the primary source of data collection. Meanwhile, secondary data include related literature about the subject of the research. Since this is a combination of quantitative and qualitative research approaches, we opted to access all potential sources and means of data collection so as to have variety and extensiveness. Questionnaire Design:
1. We will start by using dichotomous filter questions so that we consider only coffee drinkers as our sample units 2. There are six identified factors that affect consumer buying behavior , identified through secondary data from various research papers and articles . 3. Below are the attitude variables that we analyzed = QUALITY PRICE SITUATIONAL FACTORS COFFEE PRESENTATION LOCATION VARIETY AMBIENCE

Direct Interviews (Survey) with people in Coffee shops (Branded and Un Branded):
1. We randomize the interview process by selecting different customers from different coffee shops and ask about coffee experience and their preferences. 2. We do consider views of Coffee shop owners and servers for reference check, having error free responses from customers.

FROM WHICH 5 ARE MEASURED ON ATTITUDE RATING SCALES (USING NUMERICAL SCALE) and SITUATIONAL FACTORS (such as social purpose, relaxing or coffee
itself) will be asked as a separate question

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Editing Fully completed, consistent and reliable filled in questionnaires would only be considered for data analysis. Responses would be adjusted if necessary for partially unfilled with due consideration of previous responses within sample size. Deviations from objectives of problem statement are soughted out and completely taken out of research analysis. Coding Will be done for required data for the purpose of statistical analysis Data Analysis We use inferential statistics (through SPSS) in order to draw a concrete conclusion. Inferential statistics is use to be able to know a populations attribution through a direct observation of the chosen population or simply the sample. This is because it is easier to observe a portion or a part than observe the whole population. However using a sample has also its own disadvantages; hence, there is a need to choose the most suitable sample from any population. Result of the study will be put in tables and graphs for easy understanding of the findings of the research.

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References http://indiacoffee.org/indiacoffee.php?page=CoffeeData http://www.hawaiifruit.net/E09MXMAKAI_Appendix4_CoffeeAnnual2 010.pdf http://coffeetea.about.com/od/reviews/Coffee_and_Tea_Drink_Equipme nt_and_Media_Reviews.htm

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