group assignment mkt202 topic highlands coffee

Today, with hundreds of stores at home and abroad, Highlands not only serves a lot of coffee but also serves tea and other dishes Brandsvietnam.com, 2019.Highlands is famous for its dive

FPT UNIVERSITY- CAMPUS CAN THO «««««

Group Assignment [MKT202] TOPIC: Highlands Coffee

Name of group member Contribution (%) 1 Tran Thi Ngoc Thuy 100% 2 Nguyen Vuong Thuy 100% 3 Nguyen Quynh Nhu 100%4 Ton Diem Quynh 100%5 Quang Thi Ngan Binh 100%

Cần Thơ, 11/2023

TABLE OF CONTENTS

I Introduction 3

II Company Overview 3

2.1 Company situation and service business activities 3

2.2 SWOT analysis 4

2.3 Market positioning strategy 5

III Consumer Research 7

3.1 Primary Research of the consumer 7

3.2 Consumer Insights 9

IV Analysis and Evaluation 10

4.1 4Ps Strategy in service marketing and Customer Interface strategy (7Ps) 10

4.2 Customer Relationship strategy 19

V Recommendation and Conclusion 24

VI References 24

I Introduction

Vietnam is a country that is considered to have an increasingly developing economy With a population of more than 99 million people (danso.org, 2023), Vietnam's consumer market is extremely potential and diverse Vietnamese consumers today not only care about product quality but also focus on service experiences To please customers requires organizations and businesses to have a marketing plan for products or services that suit consumer tastes and win their trust This is also an important issue for Highlands when facing many famous domestic and foreign coffee brands on the market, especially in Vietnam

This report aims to analyze Highlands' 4P strategy in service marketing, customer interface and customer relationship strategy, then evaluate to provide specific solutions to help Highlands build and further develop its brand

II Company Overview

2.1 Company situation and service business activities Highlands Coffee was established in 1999 in Vietnam From the beginning, Highlands' goal has been to serve and enhance society by enriching human connections and social cohesion Today, with hundreds of stores at home and abroad, Highlands not only serves a lot of coffee but also serves tea and other dishes (Brandsvietnam.com, 2019).

Highlands is famous for its diversity of coffee products including traditional Vietnamese coffee, espresso, filter coffee, iced coffee, and many other innovative coffee drinks This allows them to serve a range of consumers with different coffee preferences With the traditional coffee shop and take-away coffee

shop models, they help them reach both customers who want to enjoy the shop space and those who want to buy take-away coffee Highlands Coffee has a network of cafes covering the whole country, from cities to rural areas with nearly 300 coffee shops in 24 provinces (Brandsvietnam.com, 2022) Not only focusing on product quality, Highlands also puts service quality first All the smallest details in choosing raw materials and in decoration are paid attention to by Highlands Coffee, to enhance Vietnamese values, so that Highlands Coffee becomes the most popular brand in terms of taste and style Modern style of Vietnamese coffee and tea, but still keeping reasonable prices, friendly and ready to serve all customers, anytime, anywhere (Highlandscoffee.com, 2018)

www.brandsvietnam.com

2.2 SWOT analysis Strengths

• Strong brand identity, with more than 20 years of experience in the coffee field, the Highlands Coffee brand has been extremely popular in the market and has created solid trust in the hearts of customers

• High quality products and services, Highlands focuses on coffee quality and creates many products with unique characteristics of their brand Highlands stores are uniquely decorated and their staff is professionally trained in mixing and serving knowledge to provide the most dedicated and friendly service to customers • With a diverse menu, Highlands offers many types of coffee, drinks and other dishes

to serve the needs and attract many customers

• Extensive store network, there are nearly 300 coffee shops in 24 provinces and cities in Vietnam (Brandsvietnam.com, 2022) and a number of stores scattered in other countries

Weaknesses

• High prices, compared to other types of coffee on the market, Highlands is considered a store with relatively high prices but still lower than two major competitors in the same industry, Phuc Long and The Coffee House

• Strong competitiveness, developing in a country with a strong coffee industry, Highlands must compete fiercely from large and small coffee brands both domestically and internationally

• Changes in consumer behavior and psychology, customer needs and preferences are increasingly changing and this also greatly affects the development of Highlands if it does not adapt to customer needs

2.3 Market positioning strategy

Opening is about the company's complete focus, they have focused entirely on coffee and paid a lot of attention to this issue Highlands Coffee ensures the quality of its coffee by selecting high-quality coffee beans and a professional roasting process They put their focus on creating delicious cups of coffee and meeting customer needs for taste and quality The perfect combination of premium Robusta & Arabica coffee beans grown in the fertile highlands of Vietnam, through unique roasting secrets, Highlands Coffee is proud to introduce flavorful Coffee product lines rich and sophisticated (Highlandscoffee, 2018) About focusing on the market, Highlands Coffee places emphasis on understanding the needs and tastes of customers By researching the market, they learn about the preferences, trends and needs of customers in the target area From there, they develop suitable products and services that meet exactly what customers expect Next, Highlands Coffee builds loyal relationships with customers They create a friendly and professional environment where customers feel comfortable and receive dedicated care And Highlands Coffee also focuses on providing good service and quality Thanks to focusing on the above factors, Highlands Coffee has built a successful brand and attracted a large number of loyal customers Highlands Coffee focuses on its service by ensuring product quality, training professional staff and creating a customer-friendly environment Coffee quality is a top priority for them,

using premium ingredients and professional roasting processes to create great tasting coffee Staff are thoroughly trained in mixing techniques and service, ensuring that each customer experiences professional and dedicated service The environment in the coffee shop is designed to be cozy and elegant, creating an ideal space to relax and enjoy coffee Customers are always greeted with enthusiasm and joy, creating a positive communication experience In addition, Highlands Coffee offers a diverse menu with many types of coffee and special drinks, meeting a variety of customers' culinary needs All of these factors together create an excellent and reliable service at Highlands Coffee, attracting and maintaining a large base of loyal customers (Cooked F&B School, 2022)

With the above comments, Highlands' incomplete focus strategy is also shown Highlands Coffee has adopted an unfocused strategy to develop and expand its brand They have expanded their scale and locations by opening more stores in different locations, from cities to regions and even internationally This helps Highlands Coffee reach a wider customer base and build a strong presence in the coffee market Highlands Coffee has diversified its menu Instead of focusing solely on coffee, they have expanded their product portfolio to include teas, juices, and smoothies They have also added snacks and pastries to the menu to give customers a rich and diverse culinary experience Additionally, Highlands Coffee has cleverly incorporated local culture into the experience mine In addition, Highlands Coffee has expanded its distribution channels Besides opening more brick-and mortar stores, they -have also developed a franchising model and opened cafes in shopping malls, airports and other commercial areas This helps Highlands Coffee reach more potential customers and attract customers from many different segments, while creating diversity and richness for customers' coffee experience (Hong Nhung, 2022)

The Coffee House and Highlands Coffee has the same taste, according to thecoffeehouse.com and highlandscoffee.com.vn, both brands use Arabica and Robusta coffee beans but the quality of Highlands Coffee is more appreciated, leads to Highlands' profit were eight times higher than The Coffee House and about three times higher than Starbucks (Cafef.vn, 2018) Starbuck Coffee has a high price but the quality of cafe is not good Vietnamese people favor traditional coffee taste than Starbucks taste Maintaining the traditional taste is the key to remain the most loyal and dedicated customer (Soha.vn, 2014) Also according to Mr Le Nguyen Vu, General Director of Trung Nguyen Joint Stock Company, who is considered "coffee king" of Vietnam implied that: "Whatever Starbucks is doing, is not right They do not sell coffee but, they sell coffee flavored with sugar” (Cafebiz.vn, 2013)

III Consumer Research

3.1 Primary Research of the consumer

According to a survey of 100 people, Highlands Coffee does not focus on a specific gender but targets both men and women Both genders can find spaces and experiences that suit their interests

Highlands Coffee can attract many ages, from teenagers and older Looking at the survey, 62% are aged 18 25 And those under the age of 18 account for 11% Besides, the age group -26-35 accounts for 25% In addition, the percentage over 35 years old is insignificant.

Students account for 63%: Highlands Coffee is often a popular destination for students, as a place for them to study, work in groups or relax after class.

Office workers account for 14%: Many people working in an office environment like to go to Highlands Coffee to meet colleagues, hold small meetings or work individually.Trade and small business account for 7%: Highlands Coffee provides a comfortable and luxurious environment, an ideal place for business meetings, meeting partners or relaxing after a stressful day of work.

Freelancers account for 7%: Highlands Coffee provides a quiet workspace with Wi Fi and amenities for freelancers, such as graphic designers, writers, critics, and other freelance jobs

-The proportion of customers who regularly use the product accounts for 50% Besides, the rate occasionally accountsfor 44% The remaining 4% are customers whoregularly use HighlandsCoffee products So it can beseenthat the number of customers using HighlandsCoffee products is not too many

With a rate of 92%, people are very interested in product brands

More than 80% of customers care about product quality when coming to Highlands Customers care about service quality more than 80%

More than 25% of customers choose reasonable prices

This shows that customers highly perceive the brand and service quality

Through the survey, we can see: The number of satisfied customers accounts for the highest percentage followed by normal experiences, not rated too highly Besides, customer satisfaction is also very high In addition, the percentage of dissatisfaction is very small.3.2 Consumer Insights

KEY INSIGHT

• Variety of Products and Choices: Customers highly value the range of products available to them They appreciate having many options to choose from, indicating a desire for diverse flavors, types of beverages, and accompanying food items This

suggests that offering a wide selection of products can attract and retain customers (Highlandscoffee.com.vn, 2021)

• Service Quality and Staff Attitude: Customers place significant importance on the quality of service they receive This includes factors such as the friendliness and helpfulness of the staff, as well as their overall attitude towards customers Ensuring that staff members are well-trained, courteous, and attentive to customers' needs can enhance the overall customer experience

• Product Quality: Customers pay special attention to the quality of Highlands Coffee products This indicates that the taste, freshness, and overall quality of the beverages and food items served by Highlands Coffee are crucial factors in customers' decision-making process Maintaining high product standards and consistently delivering excellent quality can help meet customer expectations and build brand loyalty (MegaStory, 2021)

CHALLENGES

• Customer base size and target customer development: One challenge is managing the size of the customer base With a diverse customer base, serving each segment's specific preferences and needs effectively can be challenging

• Affordable and price: The price of Highlands Coffee products can be a challenge as it may not be affordable or suitable for all classes of customers

• Limited presence in rural areas: The absence of Highlands Coffee stores in rural areas, far from city centers, is a challenge This limits the brand's reach and ability to reach potential customers

• Lack of a Customer Feedback Corner: Not having a dedicated customer feedback corner can hinder a brand's ability to gather valuable insights and address customer concerns effectively

• Fierce competition: Highlands Coffee faces strong competition from other standing coffee chains such as Trung Nguyen, Starbucks and The Coffee House Competing with these well-known brands requires continuous efforts to differentiate products, deliver exceptional customer experiences, and execute effective marketing strategies (Vietnam Briefing, 2023)

long-IV Analysis and Evaluation

4.1 4Ps Strategy in service marketing and Customer Interface strategy (7Ps)4.1.1 Product Strategy

Drinks and food comprise the two primary product categories of Highlands Coffee The beverage group, specifically, consists of the following primary groups:

• The first group, coffee is a popular beverage in Vietnam Only around 0.7 kilogram of coffee are consumed annually per person on average 65% of Vietnamese coffee drinkers, with a preference for males (59%), consume coffee seven times a week, according to IAM's research on the subject (Nguyen et al, 2020) Highlands Coffee offers a range of coffee products, including Phin Sua Da, PhinDi, Cafe, and Espresso Cafe.

• The second category is the good tea group, which is also a crucial group of Highland products Golden Lotus Tea is the group's emblematic product, along with fruit tea, lotus tea, and green tea.

• The Freeze group, symbolized by Freeze Green Tea, is the last group The corporation offers a few more drink varieties in addition to the three categories that were just described, but they are not essential items that don't need discussion The representative beverage items provide significant revenue for Highlands by meeting the varied demands of clients Highlands Coffee receives a significant amount of money from three primary product segments annually Customers now have a wide range of options thanks to the introduction of three product categories.

www.highlandscoffee.com.vn

Cakes and bread are included in the food group at Highlands Coffee The brand doesn't think much about earnings when it comes to these items In an effort to draw consumers, bread was introduced to Highlands' menu as a link product.

The company has also introduced new product lines, including water bottles, canned coffee, roasters, and designer mugs, which have drawn interest from young consumers and collectors alike new items, while also encouraging consumers to preserve the environment with these multipurpose products, thereby broadening Highlands Coffee's product marketing approach In addition to its basic products, Highlands Coffee offers space service as its primary customer service Highlands Coffee frequently creates welcoming environments in their establishments that are ideal for gathering, working, or unwinding with loved ones With a welcoming environment that provides an excellent user experience, the business has drawn in and kept a sizable clientele

Highlands Coffee created its own website, page, and phone app to satisfy the need for customer information by giving consumers comprehensive access to all brand details (introduction, vision, fundamental values, etc) Customers may also find out the location of any Highlands Coffee branch, whether it is open or closed, which branch is nearest to them, and other details via the website or app This information is helpful for moving Highlands Coffee understands this as well, which is why they offer free parking so that patrons may enjoy their coffee in peace Good other tasking is available at Highlands Coffee Water may be ordered and delivered in a matter of minutes, without requiring clients to wait an excessive amount of time One component of Highlands Coffee's sophisticated service approach is Bill Producing a bill that includes detailed pricing information for every item the consumer has bought demonstrates the professionalism of the business Employees at Highlands Coffee get focused, efficient training Customers will receive recommendations on the company's items from employees Employees will provide goods that meet clients' requirements and preferences Highlands Coffee accepts a variety of payment methods, including cash, e-wallets, credit card swipes, and voucher applications Employee attitudes toward clients are valued by Highlands Coffee, where staff members are meticulously trained and exhibit a soft, kind demeanor that aligns well with service standards Customer service that is enthusiastic and extends a warm welcome will make clients desire to utilize the business repeatedly Highlands Coffee also handles exceptions with professionalism During the servicing process, promptly address and fix any issues that come up The management and employees of the store will be the ones to provide the best customer comfort by promptly and effectively resolving issues

To put it succinctly, Highlands Coffee is nearly finished with its service process, which pays close attention to every little aspect of all services, including extra ones By providing comprehensive customer service, Highlands Coffee has established a competitive edge over its rivals

4.1.2 Pricing Strategy

Price is the amount a consumer must pay to get a product, or the product's cost to the consumer Cost is thought to have the most influence on a consumer's decision (Armstrong, Saunders, Wong, & Kotler P., 1999) The pricing range for Highlands Coffee products is now between 30,000 and 75,000 VND When compared to the general level, this pricing is not cheap However, this pricing is totally appropriate and realistic given that middle class -consumers with steady incomes are the brand's target market

The goal of Highlands Coffee is to draw in and grow a diverse clientele As a result, the pricing differences between product lines are evident This is a crucial component of Highlands Coffee's aggressive price plan Vietnam is one of the world's top 5 coffee exporters, thus its affordable pricing makes sense for traditional coffee products, which will be offered for less than other drinks Customers who wish to consume coffee and also have a positive experience with the shop's environment and staff can be drawn in and kept by Highlands Coffee Certain drink categories are priced much more and are marketed towards affluent consumers and younger consumers who like a wide variety of drinks with easily consumed flavors.

4.1.3 Place Strategy

Highlands Coffee has also had great success with their distribution location marketing approach Over 300 outlets for the brand may be found in 24 provinces and towns throughout Vietnam The majority of stores are located in core districts, which are large cities with dense populations and easy access to transportation (Brandsvietnam.com, 2022)

www.cooked.vn