Costa Coffee’s ambitious plans for India

The coffee house chain has refreshed its brand positioning and scaled its operations over the past year. 

From the house of Coca-Cola, Costa Coffee has scaled its operations in India and is now looking to target a younger, vibrant and expressive generation.

Speaking to afaqs! about its plans in India, Vinay Nair, general manager, India & Emerging Markets, Costa Coffee, says that the brand wants to position itself as a ‘fuel’ for people who’re passionate about expressing themselves.

Costa’s place in the Indian coffee market

The coffee culture in India picked up in the late-1990s and early-2000s. The era saw a number of coffee chains, like Café Coffee Day, Barista and Costa Coffee, enter the market. Then, global coffee giant Starbucks backed by Tata, entered the market. 

Although India is still a country of tea lovers, the coffee culture has picked up in Tier-1 cities over the decades. The coffee retail chain market is expected to be worth $855 million by 2025. 

Costa Coffee was established in 1971 by two brothers - Sergio and Bruno. The duo wanted to introduce coffee as a daily beverage in the UK. The brand expanded over the years and, in 2005, became the first international coffee chain to enter India. Its first store was in New Delhi. The brand was acquired by Coca-Cola in 2019. 

“We see great opportunities for value creation through the combination of Costa’s capabilities, and Coca-Cola’s marketing expertise and global reach. Our vision is to use the strong Costa platform to expand our portfolio in the growing coffee category,” James Quincey, CEO of The Coca-Cola Company, had said back then.

Asked where he places Costa Coffee in the Indian market today, Nair feels that the brand has a lot to offer in this emerging market. “India is an interesting coffee market. The country’s coffee consumption is growing across segments. There’s a lot of interest among the youth to actually understand coffee. Costa has a great role to play in this regard.” 

“Our coffee is special and our stores have a welcoming environment. We offer a range of coffee options to the consumer. More than a competitive outlook, I feel we have a role to play in expanding the market.” 

Expansion plans

From just 40 stores back in 2022 to 115 outlets today, the brand is looking to open more outlets across the top 8-10 Indian cities. 

“We have some very exciting expansion plans. This is at the back of the global expansion happening after the acquisition from the Cola ecosystem. We’re relying on the mothership of Cola to help and support us in India. In the backdrop of this expansion, we want to continue to be relevant to our current as well as upcoming coffee consumers,” shares Nair. 

“India is a focus area for us, at Costa Coffee, for all the right reasons. If I look at Coca-Cola’s India story, we want to bring a multiple category offerings to our consumers. We feel that India is quite keen on coffee."

Costa Coffee is also focussing on positioning its stores as a place where people can work on their said expression. The brand has collaborated with many international and Indian interior experts to design its stores in the country.

“We’re bullish and excited about the response to our store expansions. We’re the second market, outside the UK, to have got the new store designs in India. There’s room for a lot of creativity in our stores,” mentions Nair. 

“We will continue with our expansion plans, but will do so in clusters. It’s important, from a supply chain perspective. We started with North India and are pretty strong in Delhi-NCR, Punjab and UP markets. We’ve just entered Bengaluru (south) and Mumbai (west), and are quite optimistic.”

Advertising and marketing strategy 

The brand has launched a campaign, called ‘YOUxCOSTA’ that targets the youth and expressive coffee drinkers of the country.

The campaign is based on the insight that self-expression is important to the Indian youth today. The brand has also launched a film, called #LetsGetBrewing that captures how individuals can authentically express themselves through their passions and interests, with a cup of Costa Coffee. The campaign is supported by print, OOH and DOOH media. 

Speaking about the brand’s media plan, Nair states, “A lot of focus will be on the media that is relevant to the young consumers. We’ve got social media platforms, as well as platforms like Snapchat, Disney+ Hotstar and Voot onboard. So, we’re pretty much digital-first, as of now, as we want to target specific geographic areas. Eventually, as we grow, we may look at TV as well.”

The brand is also looking forward to collaborating with like-minded influencers, Nair adds.