(Tiểu luận) principles of marketingmarketing innovation plan for lotteria

NATIONAL ECONOMICS UNIVERSITY SCHOOL OF ADVANCED EDUCATIONAL PROGRAMS PRINCIPLES OF MARKETING Marketing innovation plan for Lotteria Group 8: Mai Thị Hà Anh – 11200174 Vũ Ngọc Bích – 11200524 Nguyễn Quỳnh Chi – 11200610 Hoàng Đàm Hạnh Dương – 11200950 Trương Ngọc Huyền – 11205561 Class: Advanced Finance 62B Lecturer: Le Thi My Linh, Assoc.Prof.Dr Words count 5,366 Hanoi - 11/2022 TABLE OF CONTENT I.SITUATION ANALYSIS COMPANY DESCRIPTION PRODUCT DESCRIPTION II MARKETING ENVIRONMENTS MICRO-ENVIRONMENT 1.1 1.2 The Company Suppliers 1.3 Publics .5 1.4 Customers 1.5 Competitors .6 1.6 Marketing Intermediaries MACRO-ENVIRONMENT .7 2.1 Demographic: 2.2 Economic: 2.3 Natural environment: 2.4 2.5 Technological Political .9 2.6 Cultural .9 III UNIQUE SELLING POINT .10 IV SWOT ENTERNAL ANALYSIS 11 V STP 12 Targeting 16 Positioning 17 VI MARKETING MIX STRATEGY 19 REFERENCES 21 INTERVIEW TRANSCRIPT 22 I.SITUATION ANALYSIS COMPANY DESCRIPTION In order to provide customers with products and services that would support globalization and diversification, Lotte Co was founded in Japan in June 1948 (Lotte Co Ltd 2012) In order to provide its customers with a contemporary food industry and a high-standard lifestyle, Lotte Co Ltd founded the Lotte Group in 1967 (Lotte Group 2012) With operations in over 50 countries, a variety of business areas, and over 4,700 workers, Lotte has become an international company (Lotte Co Ltd 2012) The food and beverage industry, which is the Lotte Group's core expertise, has had sustained expansion in the international market, particularly in Japan, China, Russia, and Vietnam Lotte made 522.0 billion in revenue overall in 2011 (2012) Lotte Co Ltd Lotte entered the Vietnamese market with food and beverages as their specialization Lotte did not enter the Vietnamese market until December 2008, when the first Lotte Mart opened in Ho Chi Minh City Lotteria, together with KFC, is the main player in the Vietnamese fast-food franchising sector (Tuoi Tre 2012) Lotte's goal is to provide high-quality services and commodities that enrich their customers' lives through creativity discovery and challenge confronting PRODUCT DESCRIPTION Lotte joined the Vietnamese market as a specialist in food and drink The first Lotte Mart opened in Ho Chi Minh City in December 2008, marking Lotte's entry into the Vietnamese market The dominant player in the Vietnamese fast-food franchising market is Lotteria, along with KFC (Tuoi Tre 2012) The mission of Lotte is to offer premium goods and services that improve the lives of their clients through exploration, challenge, and creativity Due to the economy's rapid growth and consumers' busy daily schedules, quick and affordable meals are becoming popular Numerous fast-food chains have entered the developing Vietnamese market in response to this expanding demand, giving consumers more dining options Customers can purchase products from them for affordable prices and with a lot of availability The two biggest fast-food franchises in Vietnam today are KFC and Lotteria, each of which has more than 250 locations around the nation (Tuoi Tre News 2012) Despite having a large selection of fast food items, the franchise's specialty—the hamburger—remains Lotteria's core focus in Vietnam But because popular hamburger brand Burger King only recently entered the market, Lotteria has decided to launch a marketing campaign to strengthen and maintain Lotteria's position II MARKETING ENVIRONMENTS There are a number of factors that directly or indirectly affect how Lotteria's marketing is managed; they aid the business in establishing and preserving strong bonds with its target clients To give an example, the marketing environment is made up of the macro environment and the micro environment MICRO-ENVIRONMENT 1.1 The Company According to Lotte (2012), Lotteria was a component in the Lotte Group's growth Additionally, Lotteria has opened 117 branches nationwide since its launch in 1998, with roughly 50 of them in Ho Chi Minh City (Lotte 2012) In order to raise consumers' living standards, Lotte Group is a powerful firm with effective management and commercial plans The senior management, finance, R&D, buy operations, and accounting departments of the Lotte Group can all have an effect on marketing The manufacturing team can plan to develop items that are appropriate, preventing potential customers from switching to competitors' products, for instance, while the finance department can manage the marketing budget Furthermore, given that Lotteria's customer base has expanded quickly in recent years, the marketing division helps to build and maintain solid ties with them Its client, Lotteria, has expanded significantly in recent years 1.2 Suppliers In the company's customer value system, suppliers are crucial The producers of beverages (Pepsi, Vinamilk), chicken farmers, and vegetable growers are among Lotteria's suppliers Additionally, managing the partnership with them can support the delivery of highquality goods and services Marketing managers must keep an eye on price trends as well as supply availability and forge long-term partnerships with suppliers because rising supply prices may have an effect on marketing and sales volume 1.3 Publics Media Public: Advertisements for lotteries in publications, on television, and in the media They generate public opinion, shape it, and are a great way to raise consumer awareness Internal Public: They work for Lotteria Their compensation will be determined by how well they perform at work They may serve as public opinion leaders, shaping attitudes about Lotteria's workplace and its goods and services, building the company's brand in the process Therefore, Lotteria ought to offer a comfortable working atmosphere General Public: Customer reviews are always gathered in order to understand public sentiment Because a product or activity's reputation and sales may be impacted by the general public's attitudes and behaviors toward it 1.4 Customers Any marketing strategy should aim to understand and satisfy the needs of the target market Lotteria can raise the company's long-term objective by increasing customer happiness by taking their relevance into account Lotteria runs the risk of losing clients to formidable rivals if they not cultivate customer loyalty and satisfaction Lotteria has a sizable clientele, which consists of: Customer Markets: Teenagers and young adults who like fast food and the flavor of Korean cuisine are Lotteria's primary target market Since they are the ones that directly profit the business by utilizing our goods and services, Lotteria should always be mindful of their requirements and offer the highest quality goods and services International Customers: Lotteria has more than 140 locations in Southeast Asia, and as a result, they serve clients from all over the world The scale of the global marketplaces illustrates the company's high capacity for market penetration 1.5 Competitors Vietnam is a developing nation with a youthful population, making it a viable market for the fast food business Nowadays, finding a nice restaurant is prioritized over saving time As a result of the proliferation of fast food chains created to satisfy consumer demand, the fast food market in Vietnam is extremely competitive Direct Competitors: KFC is Lotteria's primary rival in Vietnam Chicken meals, hamburgers, and snacks make up the bulk of KFC's offerings There are about 100 stores opening in major cities, and KFC presently dominates the fast food industry in Vietnam with a market share of more than 60% It might affect them Other direct competitors: In terms of selling burgers, Jollibee Burger King and Carl's Jr., Burger King, which entered the Vietnam market in 2012, would soon compete fiercely with Lotteria Indirect Competitors: They are the companies that help a company market, sell, or make a good or service available The stores of Lotteria instantly satisfy their clients' wants and requirements with goods and services Marketing service providers help with market research, strategy formulation, and the production of promotional materials to build a brand and strengthen the connection between the product and its present customers Additionally, physical distribution companies are transportation companies that help with the daily delivery of supplies for Lotteria businesses while preserving the quality of the food and other supplies along the way They work together with Lotteria as partners to deliver the greatest goods and services to clients, so Lotteria should work with these intermediaries to establish shared values both with customers and among themselves 1.6 Marketing Intermediaries Document continues below Discover more from: Kinh tế Chính trị Mác-Lê Nin KTCT01 Đại học Kinh tế Quốc dân 999+ documents Go to course 12 Phân tích trình hội nhập kinh tế quốc tế tác động tích cực Việt Nam Kinh tế Chính trị Mác-Lê Nin 100% (48) Vo ghi triet hoc Mac - Lenin 17 Kinh tế Chính trị Mác-Lê Nin 99% (69) Tiểu luận Kinh tế Chính trị Mác-Lênin 14 Kinh tế Chính trị Mác-Lê Nin 98% (100) Tài liệu tổng hợp Kinh tế trị Mác LêNin 63 Kinh tế Chính trị Mác-Lê Nin 98% (134) KTCT - Tài liệu ơn tự luận 57 16 Kinh tế Chính trị Mác-Lê Nin 98% (64) Thực trạng cơng nghiệp hóa, đại hóa ở Việt Nam Kinh tế Chính trị Mác-Lê Nin 100% (21) They are the companies that help a firm promote, market, or make a product or service available Lotteria enterprises responded quickly to their clients' wants and aspirations by providing their products and services Marketing service businesses help with market research, marketing strategy development, and promotional material execution in order to brand products and improve customer loyalty Furthermore, physical distribution firms are transportation organizations that provide Lotteria stores with daily material deliveries while assuring the quality of food and other supplies along the route They collaborate as partners with Lotteria to provide clients with the best products and services possible Therefore, Lotteria should collaborate with these intermediary organizations in order to give additional values to both the customers and to one another MACRO-ENVIRONMENT 3.1 Demographic: The CIA World Factbook estimates that as of July 2012, there were about 91 million people living in Vietnam (CIA 2012) Vietnam is thought to have a young population because there are more than 40% of workers there (Tong Cuc Thong Ke 2012) Every day, Vietnamese consumers' purchasing power increases, accelerating every industry's rapid expansion Additionally, the statistical reach of the Internet has increased, with the majority of the domains coming from Generations Z and Y (Cimigo NetCitizens 2012) Through a very active and well-used channel, Lotteria may now send messages more economically More than 26 million people, or almost the population of Texas, lived in urban areas in 2009 (Tong Cuc Thong Ke 2012) Additionally, there is a growing tendency of people relocating from rural to urban locations As a result, economic hubs in Vietnam are growing, particularly in Hanoi and Ho Chi Minh City The demand is rapidly increasing as more people choose to live in large cities 3.2 Economic: The GDP of Vietnam reached 1,300 USD per person in 2011 (Tuoi Tre 2011) Compared to 2010, there was an increase of 5.89% in that figure (VnExpress 2011) Accordingly, given the high level of societal consumption, there are prospects for corporate growth At the time, consumers' shopping habits are more centered on quick products, emphasizing convenience and ease of use (VnEconomy 2009) Due to the importance of preserving their health, consumers are more conscious of their eating habits (Viet Bao 2006) Lotteria has an early-mover edge in the fast-food sector by providing Western dishes with an Asian flavor 3.3 Natural environment: The environment in Vietnam is also badly polluted An estimated 120,000 to 150,000 hectares of forest are lost each year (Lan Huong, 2008) Despite the positives, Vietnam's economic progress is also placing a lot of strain on the environment (The World Bank 2011) Additionally, there is a lot of air pollution due to the rise in the number of automobiles on the road Businesses must have a respectful attitude toward the environment if they want to succeed in the Vietnamese market Lotteria uses cardboard food packaging, wax paper burger packaging, and other materials at the moment However, Lotteria continues to utilize plastic bags for takeout food, harming the environment Lotteria ought to adjust this in light of its popularity and the volume of takeout orders If Lotteria does not fix this, it will harm their reputation as a brand (Lotte 2012) 3.4 Technological Nowadays, more and more people, particularly in cities, have access to the Internet Cimigo (2012) estimates that there were about 35 million Internet users in 2011 In 2011, there were 58% of all cities with Internet access (Cimigo NetCitizens 2012) There are chances for corporate development due to the quick development of information gadgets and communication services Lotteria has seized this chance and introduced numerous communication platforms, like Facebook, Instagram, etc These methods of communication are widely used, making it simple for customers to access special offers, updated menus, and —most importantly—24-hour Lotteria's ordering online from the comfort of their own homes Lotteria uses cutting-edge and successful marketing techniques Nevertheless, there are still a few response issues with the website, but Lotteria will soon fix these issues 3.5 Political Since ithe icountry ihas ijoined iWTO iin i2007, iVietnamese igovernment iis imore iopened ito i foreign iinvestment i(WTO i2012) iThe imarket ialso iopens ito idifferent ibrands ifrom ioverseas iand i therefore iit iis iconsidered ian iopportunity ifor iLotteria ito iexpand iits imarket iin iVietnam 3.6 Cultural People in Vietnam place a great value on culture, which is impacted by a person's social rank, financial circumstances, and, most importantly, the items that person owns, purchases, or consumes As life becomes increasingly hectic, one of the latest fads among young people is fast food The dominating Korean way of life influences the young Vietnamese generation as well Lotteria's popularity among clients is anticipated to grow given that it is a Korean brand III UNIQUE SELLING POINT This kimchi fast food chain's combos (packages of things like as meals and beverages together) are also extremely diverse in order to meet various market demands By doing so, Lotteria can easily attract customers in Vietnam market considering their advantages and experiences in not only Asia but also global Product uniqueness has always been the number one goal for Lotteria to make a standpoint in Vietnamese customer's habit Lotteria is implanting the product diversification strategy to attract the widest range of Vietnamese from the starting days of introducing to the market This has established Lotteria brand image as easily accessible and welcoming to all citizens, which bring Lotteria a big amount of loyal customers The origin experienced of Lotteria in Korea has also helped the company to make a statement in Vietnam Considering the hype Vietnamese youth has for Korean culture, Lotteria has taken this to their advantage to penetrate the market However, the company also keep a respective approach to the market that they are in by having Vietnamese flag up at all branches In addition, customer service has always been set as a priority for Lotteria The target customers for Lotteria has always been youth and family, with this Lotteria has the decoration and the welcoming vibe that children and teenagers would love Stepping into any franchise, customers would feel at home while having good food Lotteria provides customers a sense of love and loyalty, which would attract more and more customers Besides giving the customers a welcoming feeling, Lotteria also provides every need of the customers, whether they want food, tissue, additional dressing, etc The services process of Lotteria is not only fast, convenient, but also fullfilling 10 IV SWOT ENTERNAL ANALYSIS Strength Vietnamese consumers' Weakness are Customers must periodically wait for similar to those on Lotteria's menu, making palates their orders at Lotteria, although it is a fast- adaptation to the meal straightforward food restaurant As a consequence, Lotteria's Lotteria's dominance in the market is aided service should be improved to make it more by the fact that there are stores in almost efficient and easy every major city across the country Although hamburgers are Lotteria's Lotteria draws a diverse variety of target main menu item, there is little advertising for industries and has a sizable market share due them to its inexpensive pricing, which is lower ongoing, long-term marketing strategies for than that of its competitors the burger product category Lotteria maintains a high degree of food safety and hygiene, which provides clients the impression that the service and product is ecologically friendly Lotteria makes things easier for clients by offering home delivery 11 Lotteria must therefore develop V STP Segmentation Children Teenagers Young adults Adults to 12 years old 12-17 18-30 Under 35 Geographic Age They were born and raised in Vietnam Country They could be foreigners living in Vietnam, mostly from Asia, Europe, and the United States They reside in a number of cities, including Hue, Da Nang, HCM City, and Hanoi Density Lottery shops are frequently positioned right in the middle of a city or neighborhood Demographic Male & Female Family size Family 1, 1-2 1-2, 3-4, 5+ Married with Young, single or children divorced Young, without Married children married without Divorced/Single with children children life Cycle Young, married Divorced without children with children Single Income Middle to allowance high Middle to allowance high Middle to high wages allowance Occupation or Middle to Middle to highly Middle to paid College university students 12 high wages Highly jobs paid jobs or White workers collar White collar workers High Education Generation Nationality school High school Kid garden, Secondary to high graduated, graduated, primary school school Undergraduate, Undergraduate, Graduated, Graduated Y (1977-1994) Y (1977-1994) Z (born after 1994) Z (born after 1994) Mostly Vietnamese, Asian (Korean, Japanese, Chinese, Taiwanese, Thailand, Singaporean, etc.) and European, American Psychogrpahic Social Class Lifestyle Personality Middle class, upper class and high class Discover new things Fun, curious Discover Lifestyle new things Personality Fun, curious Lifestyle Personality Behavioral Spending time with family and friends is difficult when Occasion Hanging out with Hanging out with you have a busy family family and friends schedule with work and school, ordering fast food is Spending time with friends and family Fast food must be ordered when one has a busy schedule between work and school necessary Benefit sought - Foods that are - Korean Due to their - They look for tasty and easy culture and insufficient high-quality to music have an financial items impact on friendly setting eat require but little - food to digest them, and as a resources for living are preferred by result, they are expenses, 13 They seek a for their family young folks search for high-quality products at reasonable prices - Because they are busy with children - Furthermore, they would be attracted by a vibrant environment - drawn to work and Korean goods school, they and services, could look including for handy food services like are fast food and work, themselves home could look for with delivery handy services they also seek - They might like fast meals out come across and a warm and delivery To enjoy friends, large spaces and crowded quick service environments establishmen t get-togethers - Because they busy at they home when engaging with friends and family as well as when they are hanging out alone User status First-time users Regular users who Regular users Individuals who who are typically are open to trying who are frequently use fast- accompanied food services and by new goods and are accustomed to their parents, fed already familiar and find using 14 find them new foods, and convenient encouraged to try new things They may become patrons eventually with fast food devoted services who Non- fast-food services users: Despite not convenient; they eating fast food are also willing to themselves, they check out the new may still purchase it are products familiar with and for their family or children adore our brand Loyalty Due to the appropriate flavor and excellent service, most of them are familiar with Status and remain loyal to Lotteria - Positivity regarding discounts and special offers Attitude toward product regarding positive Positive discounts and outlook on Favorable special offers outlook on the menu's attitude about Korean food change the kids' menu and culture Although (music, hesitant to taste service) the unfamiliar Positivity different meal, curiosity regarding opinions on still exists discounts and fast special offers services and - Positivity - on the menu's Various change people may have food Western cuisine 15 western meal customs, although occasionally willing to employ eating Korean Possibly apathetic to the fusion of culture Positive outlook and Targeting a Targeting Based ion ithe isegmentation itable iabove, iLottetia iis icurrently Variables i targeting ivarious isegments ithat iare iaged iunder i35 Vietnam has ia irelatively ihigh ipopulation idensity, iparticularly iin Segment size and growth i the ilarger icities ilike iHo iChi iMinh, iHa iNoi, iDa iNang, ietc iPeople i who ilive iin ithese iplaces itypically ihave ibusy ischedules; ias ia i result, ithey i rarely ihave itime ifor ileisurely imeals iand imuch i prefer i fast ifood iVietnamese icitizens iare ilikely ito ibe iactive iand iopen- minded i because ibig icities ithere iwelcome imany idifferent i international icultures iAdditionally, ibecause iVietnamese ipeople i tend ito ibe iinterested iin iforeign ibrands, ia iKorean ifood ibrand ilike Lotteria iwill ihave ia igreat iopportunity ito iattract iattention Market icompetitors iinclude iKFC, iJolibee, iPizza iHut, iDominos i Structural attractiveness i Pizza, iand imany iothers i In iaddition, iVietnam iInvestment iReview i (2012) inoted ithat iKFC iis iLotteria's iprimary irival iin ithe ifast ifood i industry, iholding i60% iof ithe imarket ifor ifried ichicken iacross iits i 125 ioutlets inationwide iBut iLotteria iis ibest iknown ifor iits iburgers, i which iaccount ifor iup ito i60–70% iof ithe imarket Additionally, isubstitute i goods i come iin ia ivariety i of iforms, isuch i street isnacks, iwhich iconsumers i can iuse ito iget iquick, iinexpensive i food ithat iis isimple ito ifind ion ithe istreets i However, ithe iKorean i waves ihave ihad ia isignificant iimpact ion iVietnam's iyouth, iand i as ia i result, iLotteria iare ibetter iequipped ito igrow itheir businesses b Profile of target markets: Vietnamese urban regions are quite densely inhabited, with a total population of 27,888,200 and an annual growth rate of 10,3%, according to the General Statistics Office of Vietnam (2010) Despite the fact that the majority of the country is the fast food industry's target market Urban and wealthy communities will be targeted more since fast food is thought to be slightly more expensive People in these areas could be single, divorced, married with or without 16 children, and they would probably have high-paying jobs The fast food sector is international, so all nationalities will be taken into consideration Due to the energetic and contemporary nature of these target groups, fast food will appeal to people who are juggling job and school Additionally, gregarious and open-minded individuals would make wonderful targets When families gather together or when busy people who spend their time working and studying want to grab something convenient, like fast food and home delivery, a lotteria would be a fantastic option Lotteria, according to ProGuide (2011), would be a strong rival in terms of supplying unique cuisines to adventurous Vietnamese clients who appreciate trying new things, as well as exclusive bargains and discounts c Targeting strategy: Lotteries provide a diverse assortment of foods with diverse tastes and flavors, such as burgers, chicken, rice, salads, milkshakes, and other delectable treats A differentiated marketing approach is characterized as having a wide range of commodities that aim to suit the needs of many market groups at the same time (Kotler et al 2009) Positioning a Competitive advantages Lotteria can easily be differentiated from competitors in the industry amongst three different criteria  Product differentiation: Considering its origin, Lotteria is a Korean fast food franchise Having its start in an Asian country, it came no surprise that Lotteria can develop recipes which are suitable and curated to the Asian taste for food A prime example can be seen in the Vietnamese market, Lotteria products are widely loved by Vietnamese customers  Service differentiation: Lotteria branches are scattered in all across Vietnam, especially at the intersection, high-profile street or in the shopping mall This attracts not only new and curious customers but also provide conveniency for old and loyal customers In addition, Lotteria also provides 24/7 at home delivery services, which provide customers’ every need regarding whether they are outdoor or at home 17 Image differentiation: In recent years, the youth in Vietnam are becoming more  and more interested in Korean culture Having these advantages, Lotteria develops its brand image similarly to the market interest b Overall positioning strategy Price Benefits More The same Less More More for more The same More for the same Less More for less The same for less Less for much less c Positioning Map VI MARKETING MIX STRATEGY Recommendation Existing Product Recommendation a Marketing Channel: Vietnam is developing in a rapid speed with increasingly amount of rural area being urbanized, Lotteria should take advantage of the opportunities to open more franchises The more franchises Lotteria has available, the more convenient the customers would be; thus, the profit would be higher However, they should consider the amount and location of the 18 branch Although the new branch can provide more profit, it could also possibly be a bad move for the company b Marketing Intermediaries: Lotteria has always been aiming for conveniency while having a massive number of customers They need to support their sustainability and ability to provide their customers need A new and innovative production chain should regularly be put into the supply chain New product recommendation Self-service has always been a tradition of Lotteria Being put into practice for over a decade, we can analyze that customers are fully aquainted to this kind of service and would rarely meets any difficulties The best innovation suggested would be to get robotics into the service process Customers would order from a machine with AI (Artificial Intelligence) technology Not only can the robotics innovation take orders faster but also can give out instant recommendations based on the number of customers AI can also detect exactly the stock and quality of the food This can make sure no food can be gone to waste or gone bad, which can sustain the product quality of Lotteria In addition, as we can all see from the Covid-19 pandemic, many businesses had to shut down due to no physical contact allowed However, if at the time, a fully operating business run by robots and AI, customers would be able to enjoy fast food while still protecting their health Robots would replace the employees, which would cut the resource cost down to almost a minimum However, a full reliance on only robots to run a franchise is risky to any company Supervisory staff should always be at the branch, in case of robotic malfunction, customers’ emergency, etc 19