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Dining In The Dark Ho Chi Minh City, Vietnam, and evaluate the key factors influencing the performance of the establishment.ABSTRACTBusiness-level strategy is an essential part of any bu
FOREIGN TRADE UNIVERSITY FACULTY OF BUSINESS ADMINISTRATION -*** - PRINCIPLES OF MANAGEMENT REPORT ANALYZE THE BUSINESS-LEVEL STRATEGY OF ‘NOIR RESTAURANT’ - NOIR DINING IN THE DARK GROUP : 02 COURSE : Principles of Management CREDIT CLASS : QTRE303(HK1-2324)1.2 INSTRUCTOR Ph.D Đỗ Hương Giang : Hanoi, September 2023 LIST OF MEMBERS No Full name Student ID Ngô Thiên An 2211530002 Đỗ Hoàng Dũng 2211530011 Nguyễn Việt Bảo Huy (Leader) 2212530020 Nguyễn Hoàng Lân 2212530023 Lê Anh Minh 2213530028 Ong Khắc Trọng Phúc 2213530039 Hoàng Nam Quyền 2211530042 Phạm Đăng Tiến 2213530044 TABLE OF CONTENTS INTRODUCTION ABSTRACT .4 CHAPTER 1: AN INTRODUCTION TO NOIR: DINING IN THE DARK 1.1 General information about Noir Dining In The Dark .6 1.2 History of establishment and development of dark restaurants and Noir Dining In The Dark 1.3 Core values 1.4 Scale and Operation .7 CHAPTER 2: AN ANALYSIS OF BUSINESS-LEVEL STRATEGY IN NOIR DINING IN THE DARK 2.1 Theoretical basis on business-level strategy: .9 2.1.1 Theoretical definitions 2.1.2 Types of business-level strategy 2.1.3 Importance of business-level strategy and its impact on a business .11 2.2 Analysis of business-level strategy in Noir Dining in The Dark 11 CHAPTER 3: AN EVALUATION OF THE BUSINESS-LEVEL STRATEGY IN NOIR DINING THE DARK 14 3.1 Some factors resulting in the success of the business-level strategy applied in Noir Dining In The Dark 14 3.1.1 Differentiation .14 3.1.2 Social responsibility and Inclusivity 14 3.1.3 Marketing and promotion 15 3.2 Risks of the business-level strategy to Noir’s performance 16 3.2.1 Misunderstanding the core value of the restaurant 16 3.2.2 Rate of customers coming back is not high 16 3.2.3 Difficult for firm to scale-up 17 3.3 The failures the business-level strategy of Noir Dining in the Dark .17 CONCLUSION .19 REFERENCES 20 INTRODUCTION Intense modern-day business competitiveness has placed organizations in a position where they must plan strategically to gain an advantage over their rivals Businesslevel strategy refers to a company's deliberate and purposeful actions to achieve competitive advantage within their specific market segments It involves making critical choices about how to allocate resources, differentiate offerings, and create unique value for customers By effectively implementing a well-defined business-level strategy, companies can carve out a distinct position in the market, attract customers, and drive sustainable growth Therefore, it is believed that business-level strategy is an indispensable part of a business’ success To gain more insight into business-level strategy, this report will research and analyze the business-level strategy of the Noir Restaurant – Noir Dining In The Dark (Ho Chi Minh City, Vietnam), and evaluate the key factors influencing the performance of the establishment ABSTRACT Business-level strategy is an essential part of any business as it provides a clear roadmap for organizations to achieve competitive advantage in their specific markets A report on business-level strategy will present a comprehensive overview of the company’s actions and plans to achieve an edge in the marketplace and a generic way to think about providing value to customers by exploiting their core competencies We have chosen Noir Restaurant – Noir Dining In The Dark to research business-level strategy because it has successfully applied product differentiation in a very niche market of fine dining, with regard to the theory applied in the principle of management The scope of the report is limited to the business of Noir Dining In The Dark from 2014 to 2022 The majority of data upon the business of this restaurant are secondary sources, including journal articles, social media reviews and posts, and some primary data such as the autobiography website Based on the information found via various online sources, we believe that the business implemented business-level strategy and concentrated on focused differentiation strategy for the most part of its business This report will benefit the study of the principle of management in university and provide valuable insight into how a business can compete in a market and bring value to customers The report about Noir Dining In The Dark’s business strategy helps identify benefits as well as drawbacks for businesses that are attempting to follow the focused differentiation strategy This allows students to prepare for possible future eventualities Furthermore, this report is helpful for any business looking towards winning in their particular market segments and creating value to customers To clarify, this report will analyze the business-level strategy, and determine how the business applied it in their business and its impacts on the business’ performance CHAPTER 1: AN INTRODUCTION TO NOIR: DINING IN THE DARK 1.1 General information about Noir Dining In The Dark Noir restaurant, or the full name is Noir Dining in the dark is the most unique restaurant in Vietnam Noir Dining in The Dark is also one of the 10 best fine dining restaurants in Ho Chi Minh city (According to tripadvisor.com) Noir dining in the dark is the concept that originated in Europe in which you dine in complete darkness, guided and served by visually impaired staff The idea is to challenge your perception of food and enhance your other senses, while also raising awareness and empathy for the blind community They have brought another career for the blind and visually impaired Through our innovative training techniques, they improve these talented individuals’ self-confidence and career trajectory 1.2 History of establishment and development of dark restaurants and Noir Dining In The Dark First experience of a dark restaurant took place in Paris, set up by Michel Reilhac and called ‘Le gout du noir’ in 1997 During summer 1999, a temporary restaurant opened in the Montorgueil district in Paris In 1999, the first permanent restaurant, Blindekuh (Blind man’s buff in Germany) also opened by a blind clergyman, Jorge Spielmann in Zurich, Switzerland In 2003, Edouard de Broglie, a French entrepreneur in cooperation with the blind foundation Paul Guinot established the first international chain of restaurants in the dark, called ‘Dans le Noir’ In the next few years, the opening of three restaurants was followed by other dark restaurants in cities in Europe, North American and Asia The most significant is the Opaque, another chain operation in the US after Dans le Noir In 2014, the two founders of Noir: Dining In The Dark Vu Anh Tu and Germ Doornbos quitted their jobs to set up project ‘Journey of Senses’ (JOS), which was owned by An Viet Nam LLC At the same time, they opened Noir Dining In The Dark at located at 180D Hai Ba Trung St., District 3, Ho Chi Minh city Document continues below Discover more Financial from: Management Trường Đại học Ngo… 182 documents Go to course 15 Pfizer case management Financial Management 100% (6) BAI TAP TAI Chinh CONG Financial Management 92% (12) Test 16 February 2016, 36 questions and answers Financial Management 100% (5) Group project-TB 31 Financial Management 100% (2) Tutorial-2 - for financial study Financial Management 100% (1) Lth banking cần nhớ Financial Management In 2017, JOS opened Blanc, a restaurant with deaf servers 100% (1) In 2019, JOS opened the flower store ‘La Hoa’ and Noir Spa with deaf servers In 2020, JOS opened Noir Café In The Dark Since 2014, JOS have welcomed over 74,000 visitors at business locations, with around 60 visitors per day 1.3 Core values Noir is a restaurant served by visually impaired employees, aiming to awaken the senses of the customers, diners in a stronger way through the experience of eating in the dark Vision accounts for 83% of the human senses, so people often rely too much on what they see, without thoroughly perceiving things through the remaining wonderful senses While eating, the current human condition is that the mouth is still chewing and swallowing food; but eyes are glued to the phone screen, wondering if the food is good or not But once the vision is covered, the other senses will arise, clear The sense of smell becomes more refined Taste becomes sharper Hearing becomes more acute Touch becomes more sensitive and sensation becomes deeper Only then can we truly awaken within ourselves to what this world has to offer us: the deliciousness of food and the wonder of our senses that are still serving us every day The Dining in the Dark model has been present in many countries, offering an experience that helps the senses connect and become the fullest But Noir is a special model when it integrates the social impact factor because most of the service staff here are blind and deaf Statistically, in Vietnam, the unemployment rate of the blind and visually impaired is up to 94%, in Saigon, this number is 4,000 people They face many difficulties in finding work 1.4 Scale and Operation Noir Dining in the Dark is the member of Journey of the Senses - a social impact business operating sustainable business models with unique, friendly and professional product/service experiences provided by staff who are deaf and visually impaired: Journey of the Senses system, including: Noir Dining in the Dark; Noir Spa and Noir Coffee in the Dark — served by visually impaired staff; Blanc — restaurant served by deaf staff; La Hoa (Flowers Speak) — a deaf flower shop CHAPTER 2: AN ANALYSIS OF BUSINESS-LEVEL STRATEGY IN NOIR DINING IN THE DARK 2.1 Theoretical basis on business-level strategy: 2.1.1 Theoretical definitions Business-level strategy refers to the combined set of moves and actions taken with an aim of offering value to the customers and developing a competitive advantage, by using the firm’s core competencies, in the individual product or service market It determines the market position of an enterprise, in relation to its rivals Business-Level Strategies are mainly concerned with the firms having multiple businesses and each business is considered as Strategic Business Unit (SBU) It determines how the firm is going to compete in the market within each line of Business, i.e SBU Further, it focuses on how the firm will compete successfully in each line of business and how to effectively manage the interest and operations of a specific unit So, these strategies are the course of action selected by a firm for each line of business or SBU individually and intend to attain competitive advantage, in separate lines of business, which the firm is having in its portfolio currently 2.1.2 Types of business-level strategy: The first high-level decision to make is how a firm want to attract customers: With a lower price of its product With its product being different from the competition Developing business strategy further, company should choose a competitive scope: Broaden market – offering products to a diverse market Narrow market – offering products to a niche market Combining these two approaches can further refine the business strategy into a focused cost leadership strategy and a focused differentiation strategy Here is a more detailed look at several different types of business-level strategies: Cost Leadership Strategy This business strategy relies on offering products at a low cost thus becoming the least expensive producer or provider of goods and services in a particular industry To achieve this, companies need to cut costs across the entire value chain, so they can offer their products or services at higher prices than rivals By being cost leaders, businesses can draw in customers who are looking for affordable products, expand their market share, and possibly increase their profits Differentiation Strategy Differentiation strategy focuses on offering products or services perceived as superior or distinct from competitors Companies pursuing differentiation aim to provide unique value, features, quality, innovation, customer service, or brand image that set them apart in the eyes of customers Focused Cost Leadership Strategy Companies using this business strategy gain an advantage in cost within a particular and specific market segment They concentrate on serving a specific group of customers with affordable products This allows them to optimize their operations, processes, and products to create cost-efficient solutions that meet the specific needs of their customers Focused Differentiation Strategy A focused differentiation strategy concentrates on delivering unique and specialized products or services to a specific market segment Companies try to differentiate themselves in the targeted niche through superior quality, innovation, customization, customer experience, or unique features Integrated Strategy 10 Also known as a hybrid strategy or integrated cost leadership/differentiation strategy, it combines elements of both cost leadership and differentiation strategies Companies through unique and differentiated offerings while maintaining cost efficiency and operational effectiveness 2.1.3 Importance of business-level strategy and its impact on a business The significance of business strategies lies in their ability to provide a clear road map for organizations to achieve competitive advantage in their specific markets Here is why a properly defined strategy is important and what benefits it brings to companies Differentiation and Unique Value Proposition A crucial aspect of business-level strategy is differentiation It enables companies to distinguish themselves from competitors by offering unique value to customers Companies can tailor their products, services, and experiences to stand out in the marketplace by understanding customer needs and preferences Effective Resource Allocation Business-level strategies play a vital role in guiding resource distribution decisions They ensure that resources are effectively managed, optimizing their utilization and maximizing returns Whether it is investing in research and development, marketing campaigns, or operational improvements, a focused business-level strategy helps allocate resources to initiatives that align with the company’s competitive positioning Building Sustainability Business-level strategies contribute to long-term sustainability by creating barriers to entry for potential competitors By building a strong market position, reputation, and customer loyalty, companies can withstand competitive pressures and maintain profitability overtime This sustainability is achieved through a combination of differentiation, customer-centric strategies, and continuous innovation 11 2.2 Analysis of business-level strategy in Noir Dining in The Dark The business-level strategy of Noir Dining in the Dark can be analyzed using Porter's generic strategies framework Based on the information provided, Noir primarily employs a focused differentiation strategy, targeting a specific niche market with a unique dining experience Here's a closer analysis: Focus: Noir Restaurant focuses on a specific segment of customers seeking an unconventional dining experience By catering to this niche market, the restaurant aims to create a strong competitive advantage and build customer loyalty The focus allows Noir to meet the specific needs and preferences of its target customers more effectively than broader competitors Differentiation: The key element of Noir's strategy is differentiation By offering dining in complete darkness, the restaurant sets itself apart from traditional dining establishments This unique concept creates a memorable and immersive experience for customers, enhancing their perception of value The absence of visual cues amplifies the importance of other sensory elements, such as taste and aroma, making the dining experience truly distinct Customer Experience: Noir prioritizes customer experience by providing a sensory journey that engages multiple senses The concept of dining in the dark creates an atmosphere of mystery and surprise, stimulating curiosity and anticipation among customers The restaurant's trained staff guides customers through the experience, enhancing engagement and ensuring a seamless dining experience Branding and Positioning: Noir's brand is built around the concept of dining in the dark and the sensory exploration it offers The restaurant positions itself as a unique and exclusive destination, appealing to customers seeking novel experiences and willing to pay a premium for them The branding focuses on the emotional and experiential aspects of dining, emphasizing the heightened sensory experience and the social engagement it encourages 12 Pricing: As part of its focused differentiation strategy, Noir operates at a higher price point compared to traditional restaurants The unique and immersive dining experience justifies the premium pricing, as customers are willing to pay for the exclusivity and the sensory journey provided The pricing strategy supports the cost structure associated with delivering a specialized experience, including trained staff, specialized equipment, and the unique ambiance Market Expansion: While Noir focuses on a specific location in Vietnam, there may be opportunities for future geographic expansion The dining in the dark concept can be adapted to other markets, targeting similar niche segments globally However, careful consideration should be given to cultural factors, local preferences, and competition in new markets to maintain the uniqueness and relevance of the concept Continuous Innovation: To sustain its competitive advantage, Noir needs to focus on continuous innovation This can involve periodic updates to the menu, incorporating new flavors, and exploring collaborations with local chefs or artisans Additionally, the restaurant can introduce variations of the dining experience, such as themed nights or special events, to keep customers engaged and attract repeat visits In summary, Noir Dining in the Dark implements a focused differentiation strategy by targeting a niche market and offering a unique, immersive dining experience Through differentiation, customer experience, branding, and a premium pricing strategy, the restaurant positions itself as a distinctive and exclusive destination Continuous innovation and potential market expansion can contribute to the long-term success of the business-level strategy 13 CHAPTER 3: AN EVALUATION OF THE BUSINESS-LEVEL STRATEGY IN NOIR DINING THE DARK 3.1 Some factors resulting in the success of the business-level strategy applied in Noir Dining In The Dark 3.1.1 Differentiation In terms of differentiation strategy, noir restaurant has been successful in attracting the customers Noir has positioned itself as a distinct player in the highly competitive restaurant industry The concept of dining in complete darkness creates an alien “sensory experience” for the customers Normal restaurant chains make an effort to impress customers by masterful dish decoration under a comfortable lightning system By contrast, Noir tries to challenge customer’s sense of taste and make them curious about what they are eating This can be demonstrated by the fact that the absence of visual stimuli heightens the appreciation for the culinary creations and encourages customers to focus on the flavor and texture of the dishes What makes this experience more interesting is that after enjoying the meal, the staff will reveal the pictures and descriptions of the dishes that customers had for dinner This is a great way for them to compare the descriptions with the actual dishes Noir has successfully applied the differentiation strategy to attract several customer groups For instance, to satisfy young professionals seeking trendy dining experience, Noir can create a vibrant and trendy ambiance with stylish decor and modern music Moreover, the restaurant can offer a diverse range of small plates and craft cocktails that can be the preference of this group The concept of blind dating in the dark can be both unique, romantic and memorable for couples that meet each other for the first time Another customer segment that Noir targets at are food enthusiasts Noir can focus on creating a menu that showcases innovative culinary techniques and unique flavor combinations Additionally, offering a wine pairing menu and educational sessions on food can attract the customers who appreciate the art of fine dining 14 3.1.2 Social responsibility and Inclusivity Another critical contributing to the success of Noir is its strong social responsibility and commitment to inclusivity By providing employment opportunities for visual impaired people, Noir has created profound social impacts The restaurant actively promotes the talents and capabilities of visually impaired individuals, challenging the stigma and discrimination that they have to face Noir’s commitment to inclusivity extends beyond employment, as they cooperate with blind organizations to raise public awareness and support initiatives empowering visually impaired people As these campaigns receive positive response from the public, there will be more career opportunities for blind people in particular and for disabled individuals in general This socially responsible approach resonates with customers who appreciate Noir’s dedication to creating equal opportunities By choosing Noir, customers feel they are contributing to a larger cause, which strengthens their emotional connection to the restaurant Customers show enormous trust for all of the staff and service at the restaurant Noir’s commitment to inclusivity has gained support from various stakeholders, enhancing its brand reputation and customer’s loyalty 3.1.3 Marketing and promotion Effective marketing and promotion methods have contributed greatly to the success of business-level strategy applied in Noir The restaurant has adopted a multi- faceted approach to reach its target customers Through engaging social media campaigns, captivating visual content, and targeted online advertisements, Noir has effectively created brand awareness The restaurant has also collaborated with local influencers and food bloggers to leverage their reach and credibility to attract a wider customer base In addition, people are encouraged to share about their unique experience from Noir on their social media account such as Facebook, Instagram, which has a positive word-of-mouth effect Noir restaurant also implements the strategic partnerships The restaurant cooperates with complementary businesses and organizations, such as local theaters as well as culture venues to create bundled packages or cost- promotional opportunities For 15 example, Noir may offer a combined dining and theater experience, providing customers with a unique and memorable evening Noir’s differentiation lies in its immersive dining experience, and the restaurant capitalizes on this through experiential marketing Noir restaurant conducts this method by hosting special events, such as blindfolded tasting sessions or sensory workshops Thanks to these events, customers are provided the opportunity to personally engage with the brand, fostering a deeper connection and increase the likelihood of future bookings 3.2 Risks of the business-level strategy to Noir’s performance 3.2.1 Misunderstanding the core value of the restaurant Customers coming to your restaurant bases on the sympathy and empathy: As mentioned above, Noir is operated under Journey of the Sense – an organization holding a group of premium restaurants and creative services providing the unique experience of being served by and interacting with the team of different abilities, most of the part are the disabled On every marketing channel, social media, … they said that their staff are visually impaired, thus, we are afraid of the fact that their customers reach to their restaurant in order to help blind people indirectly to have better lives instead of enjoying unique experience and value brought via dishes and services 3.2.2 Rate of customers coming back is not high It is reasonable to say that the concept and the idea of Noir is interesting and worth looking forward to and dining in the dark definitely enables diners to develop their senses Their senses such as smell, taste, aroma are amplified to higher levels of sensitivity, therefore, customers coming to Noir look forward to enjoying their meal with more sensitive senses However, it is not difficult to realize that the rate of customers booking again is not as high as other restaurants This phenomenon can be explained through an array of studies in the world which state that 80% of the deliciousness of a dish often depends on visual perception We agree that the concept of dining in the dark creates an atmosphere of mystery and surprise, stimulating curiosity and anticipation among customers but nevertheless this experience will 16 gradually decline in value the next times Moreover, Noir is known as one of the most famous restaurants serving fine dining in Viet Nam Normally, the cost of fine dining for a couple in Noir ranges from 1.5 to million VND Hence, customers not always choose this type of service as the desirable or top choice when they want to eat out neither with their friends nor families 3.2.3 Difficult for firm to scale-up If the market is large, it is uncomplicated for firms to scale up However, as far as we concern, one of the key strategies of Noir is focused differentiation and they target a niche market in Viet Nam Although targeting niche market will bring about several benefits, this strategy has its own unfavorable points such as scale-up Customers reaching Noir once a month is not as usual as other restaurants, thus the possibility of scaling up is not high enough While Noir focuses on a specific location in Vietnam, there may be several chances for future geographic expansion The concept “Dining in the dark” can be adapted to other markets, targeting similar niche segments globally However, a volume of difficulties of overseeing may appear and they might result from the successful existing suppliers with the same idea such as BLACKOUT in Las Vegas, O Noir in Montreal (Canada), … 3.3 The failures the business-level strategy of Noir Dining in the Dark In 2019, Vietnam's food and beverage market garnered global attention, securing the 10th position among Asian nations, as reported by BMI The subsequent year, 2020, witnessed significant growth in this sector, with total food and beverage sales reaching an impressive $41.7 million, representing a noteworthy 3.8 percent year-on-year increase This burgeoning market attracted substantial investments from both domestic firms and for industry giants, with a particular focus on the restaurant service segment In this dynamic and competitive market landscape, Noir, a prominent player, adopted a unique approach by offering dining experiences in complete darkness This innovative concept quickly captured the curiosity of patrons and gained media coverage across various platforms, including television, YouTube, and Facebook 17 However, despite the initial surge in curiosity-driven patronage, Noir faced challenges in retaining customer interest and loyalty The primary issue revolved around the comparatively higher dining costs at Noir, which did not align with the income levels of the local population when compared to prevailing market prices Consequently, many customers who initially visited Noir's unconventional dining environment were hesitant to return, resulting in a noticeable difference in customer retention rates between Noir and its market competitors In fact, Noir's rate of customer returning consistently lagged behind, typically falling within the range of 10-15 percent Analysis of discussions within Facebook groups and on social media platforms revealed that the primary motivation for visiting Noir was driven by curiosity about this unique dining experience, rather than a strong preference for the culinary offerings Therefore, to ensure its continued success, Noir must consider revising its strategy to better align with customer expectations and economic realities Potential strategies might include reevaluating its pricing structure or diversifying its menu to cater to a broader range of tastes In the long term, such strategic adjustments will be crucial for Noir to maintain its competitiveness and secure its position in this dynamic and evolving market 18 CONCLUSION With hope to bring customers an exotic dining experience and provide the disabled with employment, Noir Dining in The Dark has restlessly been making efforts to bring the best value to the public through differentiation in the catering business As the leading business in the field of dark restaurants in Vietnam, Noir Dining in The Dark has attracted thousands of visitors over the last years of operating and has expanded its business with extra locations Until this moment, Noir Dining in The Dark is the only dark restaurant to ever be established in Vietnam despite being in such a niche market of fine dining On the other hand, Noir has failed to retain customers due to high costs Possible solutions for Noir to improve its business may include reconsidering pricing to better fit the general public’s budget and diversifying the menu to satisfy various customer demographics In conclusion, over the course of years in business, Noir Dining in The Dark has been making remarkable efforts to overcome hardship to become one of Vietnam’s most successful fine dining restaurants Noir has exceptionally established its reputation in the fine dining industry, created numerous values to customers and the physically unprivileged as well as made a strong social media presence to the public It is indisputable that Noir’s achievements are largely attributed to its business-level strategy 19