Enhancing banquet program performance a case of heineken vietnam brewery

UNIVERSITY OF ECONOMICS HO CHI MINH CITY International School of Business TRAN BA KHOI ENHANCING BANQUET PROGRAM PERFORMANCE A CASE OF: HEINEKEN VIETNAM BREWERY MASTER OF BUSINESS Ho Chi Minh City – Year 2019 UNIVERSITY OF ECONOMICS HO CHI MINH CITY International School of Business TRAN BA KHOI ENHANCING BANQUET PROGRAM PERFORMANCE A CASE OF: HEINEKEN VIETNAM BREWERY MASTER OF BUSINESS SUPERVISOR: NGUYEN THI MAI TRANG Ho Chi Minh City – Year 2019 EXECUTIVE SUMMARY According to the development plan until 2020, the Vietnamese beer industry will reach an output about 4.1 billion liters by 2025 to 4.6 billion liters and 5.5 billion liters by 2035 However, beer consumption already reached more than billion liters by the end of 2018 Vietnamese beer industry has been maintaining a growth rate of over 5% per year while many other markets have moved sideways or negative growth in recent years Vietnam is becoming an attractive beer market that makes both domestic and international beverage businesses stand to fight Winning in the beer industry mainly depends on marketing technique secrets more than finance and product recipe Businesses seize market share by unique marketing strategy from advertising, communication to promotion in all channel such as on premise, off premise, modern on premise, modern off premise and brand building right at the initial customer level Mention about the communication and promotion in beer market Many customers and consumers always save an affection for many activations of Heineken Vietnam Brewery such as Heineken formula 1, Tiger street football, Trade loyalty, Fridge, Banquet ect From 2016, HVB discorvered that Banquet catering is a popular segment and had strongly impact to beer market share but HVB have not much focused on this channel before That is the main reason Banquet promotion program was piloted from 2016 With the successful of the first year ran promotion in small scope only two provinces, HVB continued to expand program with more than 30 provinces (in P3.2018) When expand the program so quick in the short time like that, it led to there was many problems and issuses that effected to performance of program and not adapt to the management’s expectation The research will explore the cause’s Banquet P3.2019 had not meet KPI The finding of study revealed that lack of RTMK to manage, deploy, push, check and support ST which played the most important role on poor performance of Banquet P3.2018 which compaired to other factors Moreover, some reasonable solutions would be recommended to improve performance of Banquet in the future ACKNOWLEDGEMENT With out the extremely enthusiastic encouragement, guidance and support of Associate Professor Nguyen Thi Mai Trang and orther teachers in ISB (International School of Business), the entire master-level project would not be completed with the highest qualified research I would like to say thank and appreciate to my advisors It has been a pleasure working with you on this project I also would like to thank my family, colleagues, classmates who have supported me while I have been studying in ISB and working on my research Your patience, understanding and respecting greatly appreciated CONTENTS EXECUTIVE SUMMARY ACKNOWLEDGEMENT LIST OF TABLES LIST OF FIGURES ABBREVIATION INTRODUCTION 1.1 Overview 1.2 Heineken performance in 2018 1.3 Competitors of Heineken Vietnam Brewery in 2019 1.4 Objectives and targets for Heineken Vietnam Brewery portfolio brands in 2019 1.5 Trade marketing plan in 2019 11 1.6 Commercial department structure 12 PROBLEM CONTEXT 14 2.1 Introduction about Banquet program in traditional off trade marketing 14 2.2 History of Banquet program 18 2.2.1 The Banquet program performance pilot phase in 2016 18 2.2.2 The Banquet program performance in 2017 19 2.2.3 The Banquet program performance phase 1.2018 20 2.2.4 The Banquet program performance phase 2.2018 21 2.2.5 The Banquet program performance phase 3.2018 21 PROBLEM INDENTIFICATION 25 3.1 Symptoms 25 3.2 Potential problems 28 3.2.1 Distraction of sales team to Banquet program 28 3.2.2 Unqualified agency service 31 3.2.3 Unattractive mechanism Banquet program 33 3.2.4 Unpredictable market factors 36 3.3 Problem validation 38 3.3.1 Eliminating agency, mechanism, and market factors as the main problems 38 3.3.2 Illuminating distraction of sales team to Banquet program as the main problem 39 3.4 Potential cause’s distraction of sales team to Banquet program .43 3.4.1 Lack of regional trade marketing to manage, deploy, push, check and support sales team 43 3.4.2 Sales team overloads with many activations 45 3.4.3 Sales team only focuses on sales volume and excellent outlet execution 46 3.4.4 Sales team misunderstands the role of related parties in Banquet program .48 3.4.5 Causes validation 49 3.4.6 Cause - effect tree 51 ALTERNATIVE SOLUTIONS AND JUSTIFICATION 53 4.1 Recruite regional trade marketing for regions 54 4.2 Develop the application management for Banquet program 57 ORGANIZATION ACTION 60 CONCLUSION 62 SUPPORTING INFORMATION 64 APPENDIX 97 Appendix 1: Roles and responsibilities of related departments in Banquet program .97 Appendix 2: Communication material Banquet program phase 3.2018 99 Appendix 3: Regional trade marketing – Job description 100 Appendix 4: Proposal the application management for Banquet program 102 REFERENCES 122 LIST OF TABLES Table 1: The BP performance pilot phase in 2016 Table 2: The BP performance in 2017 Table 3: The BP performance phase 1.2018 Table 4: The BP performance phase 2.2018 Table 5: The proposal budget for BP phase 3.2018 Table 6: The BP performance phase 3.2018 Table 7: Satistics performance per region in BP phase 3.2018 Table 8: Estimating the expense for five RTMK per year Table 9: Estimating the cost of application for Banquet per project Table 10: Action plan LIST OF FIGURES Figure 1: Organization HVB Figure 2: Commercial department structure Figure 3: Trade marketing roles in HVB Figure 4: The interaction structure between TMK and ST Figure 5: Sales department structure Figure 6: Banquet promotion program process Figure 7: The interaction of related parties in Banquet program Figure : Satistics performance per region in BP P3.2018 Figure 9: Satistics percentage of outlet types and party by outlet types in BP P3.2018 Figure 10: The initial cause - effect map Figure 11: Updated cause - effect map Figure 12: Workflows for related parties in Banquet program Figure 13: The final cause - effect map Figure 14: Cause - effect tree Figure 15: The recommended effectively structure with RTMK roles ABBREVIATION ASM: Area Sales Manager BP: Banquet Program HVB: Heineken Vietnam Brewery Limited Company NoP: Number of Party PO: Party Owner RTMK: Regional Trade Marketing ST: Sales Team SV: Sales Volume ToffT: Traditional Off Premise Trade Channel TMK: Trade Marketing INTRODUCTION 1.1 Overview Vietnam economy Vietnam’s GDP has positively increasing trend from 2016 until now: GDP in 2016 (+6.2%), 2017 (6.8%), 2018 (6.7%) and estimated in 2019 (7.08%) In other way, the low inflation rate also has derease trend from 2016 (4.7%) and stable in 2017 (3.7%), 2018 (4%) and estimated in 2019 (4%) Beer industry In recently, Vietnamese beer industry which is evaluated as a highly potential market when income increase year by year as well as beer consumption go up sharply from 2010 until now Beer industry growth rate in Vietnam increases always over 5% per year while almost market over the world went through and get lower rate in recent years Beer consumption in Vietnam get over billion liters in 2018, and is forecasted get over 4.6 billion liters in 2019 (Internal report HVB 2018) HVB product portfolio HVB own many favorite brands beer in Vietnam such as: Heineken, Heineken Silver, Tiger, Tiger Crystal, Strongbow, Desperados, Amstel, Afligem, Larue, Larue Special, Bivina, and Bivina Export HVB also has planned to release unique strategic actions to recover the SV of Heineken brand as well as increase the innovation with Heineken Silver for new targeting young, dynamic, high-income consumers who mainly live and works in big cities in 2019 About the implementation, two strategic plans recommended is upgrading Heineken brand (Heineken Silver) and creating a new brand (Amstel) for economy beer segment To implementing strategic actions, HVB will face to some potential challenges, as the attack from rivals, losing profits by increasing investment cost for new products, cannot gain the expected SV, or the higher tax from government HVB target customers Target customer: people aged from 20-50 with medium or high income, potential customers mainly live in urban or city They may be a professionals, employers, senior managers and employees Customer relationships: engagement by brand awareness, advertising, innovation HVB value proposition Key resources: Heineken have more than 165 breweries in more 65 contries, distribution networks, intellectual property Value proposition: HVB strategy concentrates on to achieve determined objectives Win in premium price led by Heineken Shape the cider category Lead in marketing and innovation Be commercially assertive Improve the productivity Maintain a better brewing in a world Channel activation: modern On, modern Off, traditional On, traditional Off Cost structure: raw material, production, distribution, quality control and assurance, tax Revenue streams: sales of products, distribution agreements, Heineken experience Key partners: investors, raw materials suppliers, distribution networks, technology suppliers, sponsorships Key activities: marketing and sales, distribution, production, quality control Figure 1: Organization HVB Source: internal oganization HVB 2019 Heineken Vietnam is corporated company with 60% from Heineken Asia Pacific and 40% from Satra 10 2.3.2 Caterers for a selected promotion Refer to “2.4 Caterer Management” 2.3.3 Promotion list Proposal list ID Description ID of proposal (auto increase) Rule: P + province ID + xxxxx Proposal name Name of proposal Type Type of promotion Area The area will be deployed the promotion Province The province where will be deployed the promotion Sub segment Outlet types will be deployed promotion Request date The date when proposal is submitted Start date & end date Timeline of promotion Duration Target & Mechanism of promotion Est payment Target: minimum require SV to get payment in gratis/cash/gift Number Caterer The number of proposed outlets that take part in the promotion Act volume (cases) Sum up from order Charged to account Account code to identify the promotion budget that charged for which department Payment Actual payment depends on mechanism and actual volume Input key word and press on “Filter” to filter promotion that existing any field value matching with key word To export the current promotion list into excel file To add new banquet promotion 2.4 Caterer management This screen will include all outlets of ToffT that interfaced from SIS Caterer list Caterer ID, Caterer name, Description These fields have to matching with SIS system Contact person, Phone, House, Street, Ward, District, Province, Email, Area, Region Input key word and press on “Filter” to filter caterers/outlets that existing any field value matching with key word To export the current caterer list into excel file To add new outlets if needed 2.5 Party order management When coming to “Order”, it shows order list of the current promotion program 2.5.1 Party order list Proposal list Description ID ID of order (auto increase) Banquet owner Full name of party owner Banquet type Type of banquet Include popular party in Vietnam such as “Đám cưới”, “Đám giỗ”, “Thôi nôi”, “Sinh nhật” ect Date & Time Date and time when the party happen Status Status of order, including  New: new order and not yet verified by hotline team  Verified: order has been checked and verified by hotline team  Waiting for delivery: order has been submitted by hotline team and is waiting for voucher delivery  Delivered: done for voucher delivery  Completed: order paid completely for both party owners and caterers Order quantity  Cancelled: party owner cancel the order Quantity of SKUs are ordered by party owner Actual delivery Actual delivery inputted by deliver or hotline team Phone Contact number of party owner House, street, ward, Address of party district, province Select a promotion program to show order list of the selected promotion program Default value will show the latest promotion program Filter order list by selected status Input key word and press on “Filter” to filter orders that is existing any field value matching with key word To export the current order list into excel file and “Bang xac nhan khuyen mai” for every party Refer template as the file “ Form A-Xac nhan khuyen mai.xlsx” To creat new order Refer to 2.5.2 for detail order To edit an order 2.5.2 Order detail Order Promotion Description Select promotion Inputted by hotline team only Caterer Select a Caterer that supply beer for the party order Inputted by hotline team only Banquet owner Input name of party owner Inputted by hotline team only Phone Contact number of party owner Banquet type Type of banquets Include popular party in Vietnam such as “Đám cưới:, “Đám giỗ”, “Thôi nôi”, “Sinh nhật” ect Inputted by hotline team only Region, Province, Area, Address of the party location District, Refer to sales structure in SIS Ward, House # Inputted by hotline team only Order date When party call to take order Inputted by hotline team only Date of party & time Date and time when the party happen Inputted by hotline team only Select when user change status of order  New: new order and not yet verified by hotline team  Verified: order has been checked and verified by hotline team  Waiting for delivery: the order has been submitted by hotline team and is waiting for voucher delivery  Delivered: done for voucher delivery  Rejected for review: hotline team reject the order for review  Completed: order has been paid completely for both party owners and Caterers Order quantity  Cancelled: party owners cancel the order Quantity of SKU is ordered by party owner Actual delivery Actual delivery is inputted by deliver or hotline team Phone Contact number of party owner House #, street, ward, Address of party district, province Select product item and input quantity Order quantity: quantity at the beginning Actual: actual quantity delivery  “+”: to add new item  “-”: to remove an item Auto show prize base on order detail iputted To open screen to scan QR code printed on voucher In case of scanning failure, user can input voucher code as well To open screen to take photos Limit at photos When capturing photos, the system have to get GPS information and date, time automatically (both online and offline mode) To vew photo on google map via GPS information Input key word and press on filter orders that is existing any field value matching with key word To export the current order list into excel file To add creat new order To edit an order To save order rmation inputted To delete the order To back the screen “order list” 2.6 User account Order Description User ID Input user name Full name code Input full name and code Password Set password for user name Report to Select a line manager User right Select a user role to access system Regional, Area, Allow multiple selection Province, District Add new user account To save information of a new user account or update information of a selected user account After saving, the scheme will appear in the user account list below Delete a selected user account 2.7 Report Refer to template in folder Report.7z Banquet statistic – Refer to “ Form B – Xac nhan so luong tiec.xlsx” Banquet payment detail – Refer to “ Form C – Danh sach toan chi phi-Caterer.xlsx” Banquet performance detail - Refer to “Banquet daily report.xlsx” and “Banquet weekly report.xlsx” Security level Define user role and securrity accessing level depend on businedd function The following is matrix to setting user authorization  View: user can view functional sheet  Add: user have authority to add new data  Edit: user have authority to edit (add or delete) data Mobile interface User interface need to be compatible with any devices (tablet or mobile phone).And also support multiple user language as well (at least Enghlish and Vietnamese) Summary This business requirement for the first development phase It is not only specify requirement about business logic and system architechture, but also reflex technical architechture that a software developer need to aware to develop the best system for longterm usage, integration, enhancement and maintenance And also, it interfaces with other systems in local HVB and global system REFERENCES Lunenburg FC Goal-setting theory of motivation International journal of management, business, and administration 2011;15(1):1-6 Parmenter D Key performance indicators: developing, implementing, and using winning KPIs: John Wiley & Sons; 2015 Shahin A, Mahbod MA Prioritization of key performance indicators: An integration of analytical hierarchy process and goal setting International Journal of Productivity and Performance Management 2007;56(3):226-40 Román S The impact of ethical sales behaviour on customer satisfaction, trust and loyalty to the company: An empirical study in the financial services industry Journal of Marketing Management 2003;19(9-10):915-39 Le Meunier-FitzHugh K, Massey GR, Piercy NF The impact of aligned rewards and senior manager attitudes on conflict and collaboration between sales and marketing Industrial Marketing Management 2011;40(7):1161-71 Kotler P, Rackham N, Krishnaswamy S Ending the war between sales and marketing Harvard business review 2006;84(7/8):68 Le Meunier-Fitz Hugh K, Piercy NF Does collaboration between sales and marketing affect business performance? Journal of Personal Selling & Sales Management 2007;27(3):207-20 Blattberg RC, Neslin SA Sales promotion Englewood Cliffs 1990 Baker WE, Faulkner RR Strategies for managing suppliers of professional services California Management Review 1991;33(4):33-45 10.Eagle L, Kitchen PJ IMC, brand communications, and corporate cultures: client/advertising agency co-ordination and cohesion European Journal of Marketing 2000;34(5/6):667-86 11.Kallmeyer J, Abratt R Perceptions of IMC and organisational change among agencies in South Africa International Journal of Advertising 2001;20(3):361-80 12.Rowley J Promotion and marketing communications in the information marketplace Library review 1998;47(8):383-7 13.Silva-Risso JM, Bucklin RE, Morrison DG A decision support system for planning manufacturers' sales promotion calendars Marketing Science 1999;18(3):274-300 14.Blattberg RC, Briesch R, Fox EJ How promotions work Marketing science 1995;14(3_supplement):G122-G32 15.Murry Jr JP, Heide JB Managing promotion program participation within manufacturer–retailer relationships Journal of marketing 1998;62(1):58-68 16.Royd‐Taylor L Cause‐related a newStrategic perspective on 2007;16(1‐2):79-86 achieving campaign objectives fast moving marketing: consumerteams goods change 17.Bishop SK.amongst Cross-functional project in functionally aligned organizations Project Management Journal 1999;30(3):6-12 18.Inderst R, Valletti T Third-degree price discrimination with buyer power The BE Journal of Economic Analysis & Policy 2009;9(1) 19.Maxwell S Rule-based price fairness and its effect on willingness to purchase Journal of economic psychology 2002;23(2):191-212 20.Steenkamp J-BE, Nijs VR, Hanssens DM, Dekimpe MG Competitive reactions to advertising and promotion attacks Marketing science 2005;24(1):35-54 21.Dodson JA, Tybout AM, Sternthal B Impact of deals and deal retraction on brand switching Journal of marketing research 1978;15(1):72-81 22.Leeflang PS, Wittink DR Competitive reaction versus consumer response: Do managers overreact? International Journal of Research in Marketing 1996;13(2):103-19 23.Ailawadi KL, Neslin SA The effect of promotion on consumption: Buying more and consuming it faster Journal of Marketing Research 1998;35(3):390-8 24.Ingram TN Future themes in sales and sales management: complexity, collaboration, and accountability Journal of marketing theory and practice 2004;12(4):18-28 25.Le Meunier-FitzHugh K, Piercy NF Exploring collaboration between sales and marketing European Journal of Marketing 2007;41(7/8):939-55 26.Levy M Customer service: a managerial approach to controlling marketing channel conflict International Journal of Physical Distribution & Materials Management 1981;11(7):38-52 27.Raman P, Wittmann CM, Rauseo NA Leveraging CRM for sales: the role of organizational capabilities in successful CRM implementation Journal of Personal Selling & Sales Management 2006;26(1):39-53 28.Matthyssens P, Johnston WJ Marketing and sales: optimization of a neglected relationship Journal of Business & Industrial Marketing 2006;21(6):338-45 29.Arnett DB, Wittmann CM Improving marketing success: The role of tacit knowledge exchange between sales and marketing Journal of Business Research 2014;67(3):32431 30.Kimball R An exploratory report of sales promotion management Journal of Consumer Marketing 1989;6(3):65-75 31.Massey GR, Dawes PL Personal characteristics, trust, conflict, and effectiveness in marketing/sales working relationships European Journal of Marketing 2007;41(9/10):1117-45 32.Webster FE Marketing management in changing times Marketing management 2002;11(1):18 33.Ford RC, Randolph WA Cross-functional structures: A review and integration of matrix organization and project management Journal of management 1992;18(2):26794 34.Lavack AM, Toth G Tobacco point-of-purchase promotion: examining tobacco industry documents Tobacco control 2006;15(5):377-84 35.Oliva RA The three key linkages: improving the connections between marketing and sales Journal of Business & Industrial Marketing 2006;21(6):395-8 36.Beard F Integrated marketing communications: New role expectations and performance issues in the client-ad agency relationship Journal of Business Research 1996;37(3):207-15 37.Beltramini RF, Pitta DA Underlying dimensions and communications strategies of the advertising agency-client relationship International Journal of Advertising 1991;10(2):151-9 38.Hotz MR, Ryans Jr JK, Shanklin WL Agency/client relationshipsas seen by influential on both sides Journal of advertising 1982;11(1):37-44 39.West DC, Paliwoda SJ Advertising client-agency relationships: the decision-making structure of clients European Journal of Marketing 1996;30(8):22-39 40.Cespedes FV Co-ordinating sales and marketing in consumer goods firms Journal of Consumer Marketing 1993;10(2):37-55 41.Dewsnap B, Jobber D The sales-marketing interface in consumer packaged-goods companies: a conceptual framework Journal of Personal Selling & Sales Management 2000;20(2):109-19 42.Kitchen PJ, Burgmann I Integrated marketing communication Wiley international encyclopedia of marketing 2010 43.Saunders RP, Evans MH, Joshi P Developing a process-evaluation plan for assessing health promotion program implementation: a how-to guide Health promotion practice 2005;6(2):134-47 44.Jones SC, Smith KM The effect of point of sale promotions on the alcohol purchasing behaviour of young people in metropolitan, regional and rural Australia Journal of Youth Studies 2011;14(8):885-900 45.Kerfoot S, Davies B, Ward P Visual merchandising and the creation of discernible retail brands International Journal of Retail & Distribution Management 2003;31(3):143- 52 46.Raghu G Impact of Visual Mechandising DSCE 2013;10(1):2011 47.Mehta R, Dubinsky AJ, Anderson RE Marketing channel management and the sales manager Industrial Marketing Management 2002;31(5):429-39 48.Neslin SA, Powell SG, Schneider Stone L The effects of retailer and consumer response on optimal manufacturer advertising and trade promotion strategies Management Science 1995;41(5):749-66 49.Strahle WM, Spiro RL, Acito F Marketing and sales: strategic alignment and functional implementation Journal of Personal Selling & Sales Management 1996;16(1):1-20 50.Krohmer H, Homburg C, Workman JP Should marketing be cross-functional? Conceptual development and international empirical evidence Journal of Business Research 2002;55(6):451-65 51.Guenzi P, Troilo G The joint contribution of marketing and sales to the creation of superior customer value Journal of Business Research 2007;60(2):98-107 52.Guenzi P, Troilo G Developing marketing capabilities for customer value creation through Marketing–Sales integration Industrial marketing management 2006;35(8):97488 53.Kim E, Lin J-S, Sung Y To app or not to app: Engaging consumers via branded mobile apps Journal of Interactive Advertising 2013;13(1):53-65 54.Kim SJ, Wang RJ-H, Malthouse EC The effects of adopting and using a brand's mobile application on customers' subsequent purchase behavior Journal of Interactive Marketing 2015;31:28-41 ...UNIVERSITY OF ECONOMICS HO CHI MINH CITY International School of Business TRAN BA KHOI ENHANCING BANQUET PROGRAM PERFORMANCE A CASE OF: HEINEKEN VIETNAM BREWERY MASTER OF BUSINESS... History of Banquet program 18 2.2.1 The Banquet program performance pilot phase in 2016 18 2.2.2 The Banquet program performance in 2017 19 2.2.3 The Banquet program performance. .. sales team to Banquet program as the main problem 39 3.4 Potential cause’s distraction of sales team to Banquet program .43 3.4.1 Lack of regional trade marketing to manage, deploy,