Báo cáo môn Marketing dịch vụ về Highlands coffee
1 Hanoi University Faculty of Management and Tourism HIGHLANDS COFFEE Service Marketing Report Lecturer: Mr. Tran Tuan Anh Tutor: Mr Tran Tuan Anh Tut 1 BA10 Group members: Hoàng Diệu Linh 0804000055 Tô Thanh Loan 1004000044 Phạm Thị Yến 1004000101 Phan Thị Hoàng Yến 1007040216 ACKNOWLEDGEMENT In the process of doing this assignment, we highly appreciate the contributions and suggested ideas of many people. Without their help, we could not have accomplished this report. Our great gratitude firstly goes to Mr. Tran Tuan Anh – our lecturer and our tutor of Service Marketing for their dedication and enthusiasm in teaching and guiding us in every single lecture and tutorial. All the interesting examples and precious instructions they provided have helped us very much in finishing our assignment. We would like to express my thankfulness to staffs and customers of Highlands Coffee for their co-producing our service experiences and their helpful information. We also thank our tutorial-mates in Tutorial 1 – BA10 for all their meaningful helps and timely exchange of information, as well as knowledge relating to the course. Finally, we also owe a great deal to the authors of many websites and books, especially the author of our current text-book Services Marketing – Lovelock,C., Patterson,P., Walker,R. for providing us fundamental concepts and techniques which are really necessary for the completion of this assignment. Executive Summary 2 Highlands coffee is a brand of Viet Thai international Joint Stock Company (VTI) and was established by David Thai with the objective is the leading high-grade retail industry in Vietnam. Highlands coffee not only gives the customers the feeling of traditional value in Vietnam but also make them experience the part of modern active lifestyle. Especially, the shop located at number 6, Nha Tho street, Hoan Kiem, Ha Noi is one the famous shop of Highlands coffee attracting many customers from Vietnamese to foreigner. According to that shop, our report draws attention to the external factors including the situation, market description and buyer behavior and finds out how these factors affect Highlands Coffee’s strategy; particularly positioning strategy, service blueprint, physical evidences, pricing strategy, promotion strategy and internal marketing. Table of Contents 3 4 Viet Thai International Joint Stock Company (VTI) was established in 1998, the main activities are in the service sector and coffee production. With the rapid development, VTI has owned about 60 coffee shops with a famous trademark Highlands Coffee all over the country. Proud to be a Vietnamese brand, Highlands’s philosophy is to combine the modern world with traditional, classical values of Vietnam. 1. Situation analysis In this quick-changing world, along with the busy working pace and dynamic style, the way Hanoi people enjoy life is much different from the past. Consequently, the service section, includes coffee shops, has many improvements to fit this trend. According to AIM research about coffee drinking habit, 65% Vietnam consumers use coffee 7 times a week, men account for higher rate (59%). Regarding instant coffee, 21% Vietnamese consumers use it 3 to 4 times a week, female group is slightly more (52%). The rate of drinking coffee at home and outside is equal 49% - 51%. Coffee shops in Vietnam can be found in every corner to create the most convenience for customers. Hanoi has a huge number of coffee shops but not all cafés are attractive to everyone. The most popular cafés are consistent with the unique style. Hence, though quite fussy business environment, there are still many opportunities for this type of business which should be provided in a professional manner. Higher living standard leads to higher demand and expectation from customers. They are willing to pay more for products that give them technical, functional, or emotional benefits. Today, people coming to the cafés is not just for drinking but to seek interesting experience with impressive space, beautiful design and professional service delivery. As a result, adding determinacy attributes to customers is extremely essential. When dynamic, modern trends overflow into Hanoi streets, coffee shops gradually renovate in attempt to meet demand diversity. And specialization is a rising trend in this industry. Some coffee shops bring the comfortable atmosphere by the decorations. Instead of formal tables and chairs, they use only small and short tables with many buffers for sitting. Some others are designed in ancient Hanoi style or country style. Bar-coffee is a good choice for those who are interested in live music. They can also give some shows. Other kinds of coffee shops are “Cat” 5 café like Ailu Cat, game coffee (Dice) and “Book” café such as Tùng book, Lollybooks, AIM, Sách which are a mix of coffee serving with another utility. It can be seen that the market for coffee shop is becoming more and more competitive, and threats to Highlands café come from both their direct and indirect competitors. Highlands’s target customers are 18 to 45 year-old people. Clearly, its core rivals are other luxurious cafés which serve the same target customers like The Coffee Bean & Tea Leaf restaurant chain, The My way coffee and restaurant chain, Ibox or ILU coffee. However, Highlands holds the strength of delicious coffee and good reputation. Besides, the growth of substitutes like tea shops (Lipton, Dilmah, Taiwan milky tea) or yogurt shops also raise the risk for Highlands. Although these kinds of shop target customers are teenagers, Highlands and other coffee shops are still under the risk of losing customers if they cannot manage their business well. 2. Target market description 2.1. Highlands coffee’s target customers The target customers Highlands coffee has been serving are the middle class, the office staffs and the active young generation because drinking coffee here with the prestigious coffee brand helps them confirm their status in the society. Moreover, Highlands coffee always focuses on creating the comfortable and exciting atmosphere for customers to enjoy coffee every day. Therefore, this is an appropriate place the office staffs who want the quiet and less luxurious space to discuss with their friends and enjoy coffee with pastry-the Western style. In addition, Highlands also targeting customer group are young businesses who used to study abroad so they are familiar with the style of European-American like drinking coffee at a chic restaurant that impress the style of the place they used to live. Another, the customers of Highlands coffee are foreigner living and working in Vietnam. 2.2. Customer expectations regarding service performance Expectations occur at the pre-purchase stage of a service which have much affected on customers’ satisfaction evaluations. To Highlands coffee, it is always evaluated as high quality coffee shop. Consequently, customers who choose Highlands usually have formed this prior attitude toward this coffee shop. Furthermore, Highlands also has done very well in using marketing communications. Customers know Highlands through words of mouth, blogs, magazines and TV interviews. Thanks to the good service quality, it aids to build a very outstanding image in customers’ mind. All those things contribute to enhance customers’ expectation regarding Highlands’s service performance. Before they come to this coffee shop, they expect to receive good drinks, affirm their status and enjoy a quiet space for relaxing or 6 talking to their friends. The more expectation they have the more dissatisfied they are if Highlands can not satisfy their requirements. Therefore, it is not an easy job for Highlands coffee to please customers constantly. 3. Buyer behavior 3.1. Customer’s perceived risks and strategies When the customers going to Highlands coffee are overcrowded, there will be no longer blank tables for them and the mixing drink unit may overload which make the waiters of the restaurant serve slowly then the customers wait for them and feel anxious. Moreover, Highlands is equipped the cool air so some customers sense too cold. Therefore, Highlands coffee has some strategies to reduce customer risks. Firstly, as the customers are crowded and the restaurant has not enough tables to serve Highlands coffee prepare additional tables and chairs to guarantee that the customers will have enough seats. However, if customers are overcrowded with large numbers and the Highlands does not have ability to serve, the Highlands coffee does not make customers wait too long with a bad impression. Therefore, the staffs are willing to notice the overloaded of the restaurant and then introduce them to other Highlands coffee at discounted price so that they do not go to the restaurant of competitors. Another, Highlands always follows the sale of drinks that were best-selling in order to estimate in case of overload. Additionally, Highlands Coffee also bases on the sale of previous periods to make predictions about period that will have the largest customers to pre- mix drinks in the bottles or cups and increase the number of the staff to serve customers on the peak hours. 3.2. Customers’ perceived benefits, motivation & involvement Highlands coffee will give the precise experiences to customers when they drink coffee because it is created by finest coffee beans. Whereby, they feel differently from other coffee shop because of combining the quintessence of the modern world with the charming and traditional values of Vietnam. Especially, Highlands creates the comfortable, cheerful atmosphere, warm style of service, friendly smile and enthusiastic of staffs to customers. 3.3. Level of customer-provider interaction Since coffee shop services belong to high contact that involves much contact between provider and customers. If customers have any problems or complaints, most of them will be solved through face to face. So, there is an implication for Highlands coffee that building up a good team to solve the problems that happen at times. 3.4. Services description According to four characteristics of a service, Highlands coffee’s service can be described in terms of intangibility, heterogeneity, perishability and inseparability. Firstly, to intangibility feature, customers do not obtain ownership of the drink or food they order. What’s more, different 7 customers may perceive Highlands’s services in different levels of performance quality. Since the quality of services are varied by many factors, not only originating from customers themselves but also from employees. Maybe one employee is very gentle or helpful in answering the customers’ complaints but another may be arrogant or unhelpful. Those factors make it hard for Highlands to control their quality and offer a consistent service. In term of perishability feature, in time when the demand of customers is very high, normally it’s hard for them to go into Highlands coffee since the shop uses up all their capacity and no vacancy. A very important point is that customers are a part of the service performance. When Highlands coffee provides services, customers also need to take part in process by ordering the drinks and cakes. 4. Positioning strategy Clearly drawing up the positioning strategy at the very first stage of developing a business project plays a critical role in enhancing the business success. The positioning strategy focus on the two important questions: which place the firm is currently on the customers’ mind and which place they want to hold on the market. 4.1. The place the firm currently holds in customers’ mind Interviewing customers in Highlands Coffee shop and collecting judgments from many forums, we found out that in customer’s mind, Align offers a rendezvous, a good coffee and a beautiful view. Located at the first floors of Asian Tower, Highlands Coffee is an ideal place for officers coming during their time break or even for business meeting. During our interview time we also took notice that nearly half of the customers were the youngster, which is rare comparing to other Highlands coffee shops. Phong, a young customer explained that because this Highlands coffee shop is located on the centre of the city, it would be more convenient to him to meet his friend here. The supplementary services such as toilet, music and food are also highly rated (Foursquare, 2012) However, there are many complaints regarding to the service quality at Highlands coffee 6 Nha Tho, mostly about the long waiting time or the noise. “The serving is too slow”, “I normally have to wait about half an hour to enjoy my coffee”, “This place has the most annoying blender machine on earth”, said the customers. From some information from customers that the reporters collected during the shop visit and websites, it can be seen that Highlands Coffee shop is really a special coffee shop to customers, since they offers high quality core product to customers and has the variable supplementary services; however they needs to professionalize the staff to build better image on customers’ mind. 8 4.2 The place the shop wants to hold. Highlands Coffee Shop positions itself as a high price, high quality coffee shop. The shop owners want to emphasize that, the high price means high service quality as well. Since customers are enjoying a more special service, so they should also pay a higher price for what they are getting. 5. Service blueprint Highlands Coffee’s service is of high contact one. Almost activities are visible to the customers. Business is done through face to face communication. For example, the waiter brings the menu to the table, the customer read the menu then order foods or drinks, if they have any question or any request, they speak immediately. These characteristics put pressures on the setting up a clear blueprint in which stages in service production and delivery are shown. The blueprint on the operation of Highlands Coffee cafe is represented as follows: The coffee shop’s document determines that the customers are welcome at the gate by the guards who are required to say greeting to visitors, keep the motorbike and guide them to come into. Then, the waiter staff opens the doors for customers, say hello and give the menu. After taking note the order from customers, they go into the bar and pass that order to kitchen staff for preparing. Then, the drinks or foods are brought to customers. When customers want to go, they 9 Highlands Coffee “Bệt” Coffee High quality Trung Nguyen Coffee Low quality Low price High price ask the waiter to take the bill and pay money afterward. The very clear and detailed description on the tasks, duties, responsibilities make it easier and quicker to deliver the services. Located on one of Hanoi’s centre old street, with a small front space, sometimes, especially peak time like weekends, there is no vacancy to park the motorbike and the car. In that case, the staff has to apology the customer that they are full. Moreover, the service delivery process seems to take place in short time period, almost time is spent on producing the services. Therefore, critical and potential bottlenecks likely occur in this phase. For instance, at weekend, customers 10 Highlands coffee [...]... tickets,airport shuttle,golf service, spa service, and city tour To celebrate 11 thbirthday of Highlands Coffee on November, customers get a promotion of 22.000đfor milk coffee and ice coffee (regular prices are respectively 33.000đ and 35.000đ In addition, Highlands Coffee is also an active sponsor of a series of charity, culture, and sports events The list of programs that Highlands Coffee has been funding... ecru curve representing wave in a cup of coffee It helps to identify Highlands as a specialized coffee brand deeper and deeper (Thanh Van, 2007) 6.2 Store decoration Highlands Coffee focuses lots on placement Highlands Coffee stores are located at center of city or famous shopping malls, which are all crowded areas The first impression when coming to a Highlands Coffee store is a luxury space with two... strategy Information about Highlands Coffee is updated and publicized on the website of company www.Highlandscoffee.com.vn In addition, advertisements of new products like Espresso Full City Roast are put on e-newspapers such as on VnExpress, Zingme, Dantri A Facebook Page Community Coffee was created to post information about coffee, event or discount promotion Highlands Coffee delivers customers that... Tournament 9 Analysis of service quality, satisfaction, perceived value and customer retention efforts Highlands coffee is running its business well, is one of top coffee store chains in Hanoi There are more and more new as well as loyal customers coming to Highlands for its appealing services cape and good service quality This partly indicates high customer’s satisfaction with Highlands However, as we... Besides, Highlands Coffee sold voucher on the website: www Nhommua.com With the expansion of large-scale stores and to develop brands, Highlands Coffee made a wide variety of occasion promotions On 3rd September, the Board of Directors of the Mercure- new brand of International Hotels group Accorhad announced collaboration with Highlands Coffee on co-brand advertising Customers when drink Jelly Freeze coffee. .. capacity, Highlands has total cost of 6,500,000 VND per day which means 18,000 VND per cup Therefore, a Highlands shop gains average revenue about 7 millions per day In addition, the cost of making a cup of coffee and service is not low, so Highlands charges that level of price, on the one hand, to cover the cost, on the other hand, to assert brand against other competitors Furthermore, Highlands coffee. .. red and black The red lanterns which are strongly attached to Highlands Coffee store network createthe warmness and orient Besides, HighlandsCoffee brings Western values to their stores through the wooden tables & chairs, large armchairs With outdoor stores, HighlandsCoffee put emphasis on the big white umbrellas, which reminds of outdoor coffee shops in Italia or France Tables & chairs of such stores... Western style is At first, Highlands Coffee chose red as their identified color to differentiate themselves with other coffee brands which often attach with brown- the color of café It also fits with their positioning strategy which brings not only coffee products to customers but a friendship space as well Later, when Highlands had acquired a certain position in customer’s minds, 11 Highlands added ecru... professional There are also nearbyshop windows full of various types of cakes and other food 6.3 Staffs Highlands Coffee s staff all wears uniform which includes red clothes and black aprons Different people may experience different serving in different Highlands Coffee stores My group experience in Highlands Coffee at 6thNhaTho street is general delighted The staff was young, dynamic, polite and helpful... And customers seeking for a cozy and comfortable place can be satisfied with Highlands They select Highlands as a reasonable price in Western-style place In Highlands, price of coffee and other beverages fluctuates from 25,000 to 50,000 VND, as shown in the appendix It is not cheap in comparison with other coffee shops But Highlands s target customers are middle class, office workers and youngsters, . University Faculty of Management and Tourism HIGHLANDS COFFEE Service Marketing Report Lecturer: Mr. Tran Tuan Anh Tutor: Mr Tran Tuan Anh Tut 1 BA10 Group members: Hoàng Diệu Linh 0804000055 Tô Thanh. members: Hoàng Diệu Linh 0804000055 Tô Thanh Loan 1004000044 Phạm Thị Yến 1004000101 Phan Thị Hoàng Yến 1007040216 ACKNOWLEDGEMENT In the process of doing this assignment, we highly appreciate. Tran Tuan Anh – our lecturer and our tutor of Service Marketing for their dedication and enthusiasm in teaching and guiding us in every single lecture and tutorial. All the interesting examples