Subject Services Marketing Management Hailidao.pdf

This research will cover the state of Haidilao services, including a SWOT and PESTLEanalysis as well as the background of the F&B market in Vietnam.. As a sizable, internationally operat

GROUP ASSIGNMENT

Subject : Services Marketing Management

Lecturer: Pham Khanh Huyen

Class: MKT1722 Group 2

Table of Content:

1 Executive Summary

2 Service Organization’s Introduction

2.1 Introduction

2.2 Mission

2.3 Products

3 Service Organization’s Situation Analysis

3.1 Business/ Company Context

3.2 SWOT Analysis

3.3 Analyze Competitors

3.4 PESTLE Analysis

4 Consumer Research

4.1 Primary Research of Consumer and Customer Profile

4.2 Key Insight

4.3 Challenges and Problems

5 Analysis and Evaluation of Current 7Ps Marketing Strategy

5.1 Product strategy = Core product + Supplementary services

5.1.1 Core product

5.1.2 Supplementary services

5.2 Pricing strategies

5.3 Placement strategy

5.4 Promotion strategy

5.5 Physical evidence strategy

5.6 Process

5.7 People

6 Recommendations and Conclusion

7 References

1 Executive summary

China's Haidilao is a well-known hot pot brand Group 2 will look at Haidilao's service model in Vietnam

in this report This research will cover the state of Haidilao services, including a SWOT and PESTLEanalysis as well as the background of the F&B market in Vietnam Furthermore, our team conductedprimary research on Haidilao's customers in order to identify important issues, difficulties, and problemsthat the company is dealing with Using the service flower model, it's also crucial to analyze and assessthe 7PS strategy Lastly, suggestions are offered for Haidilao

2 Service organization’s Introduction

2.1 Introduction

Haidilao is a hot pot restaurant chain founded in 1994 in Jianyang City, Sichuan Province, China, by Mr.Zhang Yong Initially, the company was called Dia Thuong Nhan and started as a small roadside hot potrestaurant In 1999, Haidilao opened the first Haidilao Xian Yanta Store, specializing in selling hot potproducts and spices of this brand Then, in 2012, Haidilao opened its first branch outside of China inSingapore, and since then, it has opened many other branches domestically and internationally Haidilaohas grown into a famous name in the culinary service industry worldwide, with more than 935 restaurantchains in many countries such as China, Singapore, USA, Korea, Japan, Canada, UK , Malaysia,Vietnam, Indonesia and Australia

The name "Haidilao" is derived from the Sichuan mahjong game term, meaning "Fishing at the bottom ofthe ocean," and represents the founder's passion, perseverance and confidence This name was chosen tobring luck to businesses and customers

2.2 Mission

Brand philosophy: Through carefully chosen products and innovative services, Haidilao is constantly

dedicated to the goal of fostering enjoyable moments while savoring hot pot and introducing gourmetsworldwide to the health benefits of hot pot culture As a sizable, internationally operating restaurant chainthat upholds the value of ethical business practices, Haidilao aims to provide customers with more

attentive service, better, safer, and healthier meals, as well as increased nutrition and stability in the foodquality.

Brand vision: Building trust amongst individuals requires communication, and Chinese hot pot is a great

way to improve social networking over dinner Haidilao is dedicated to fostering a table culture thatappeals to young people worldwide and getting more people to converse and eat together at the table

Characteristic service: Putting the needs of its clients first, Haidilao consistently offers creative and

enjoyable services The crew of Haidilao's restaurants comes up with all of the unique services that theyoffer These hospitable and customized services make every meal a memorable one

● Dips: Haidilao offers a variety of dips, including beef, pork, chicken, seafood, vegetables, andmore Haidilao is famous for its Haidilao beef, marinated and thinly sliced according to Cantoneseflavors

● Side dishes: In addition to hot pot and dip, Haidilao also offers side dishes such as salad, noodles,rice, etc Haidilao is famous for its free side dishes, such as egg noodles, rice, vegetables, and more

3 Service Organization’s Situation Analysis

3.1 Business/company Context

- F&B market in Vietnam:

• In 2019, Vietnam will be in the top 10 most attractive destinations in Asia when talking about F&B,according to IBM's assessment In 2020, despite the Covid-19 pandemic, Vietnam's total revenue of foodand beverage products reached 975.867 billion USD, an increase of 3.8% over the same period andaccounting for 15.8% of total GDP

• According to market research company BMI, Vietnam has become one of the most attractive F&Bmarkets globally According to statistics, the F&B industry has contributed 15.8% to the total nationalGDP (2021) Total spending on food and beverages accounts for the highest proportion at about 35% ofspending.

• In 2022, Vietnam's F&B market is experiencing a significant recovery after the Covid-19 pandemic.The scale of F&B industry revenue in 2022 will reach nearly 610 trillion VND, an increase of 139% Theeating out market alone recorded a revenue of 333.69 trillion VND, recovering close to the milestonebefore the Covid-19 pandemic broke out

- International Development: Haidilao has expanded internationally and sought marketopportunities in many other countries, especially in developed markets They have grown rapidly andbecome one of the world's leading hot pot restaurant chains, with stores in markets such as the US, UK,Australia and many more

- Competition and business model: The hot food and culinary service industry is growing rapidlyand competing fiercely Haidilao needs to stay competitive by continuously improving customerexperience and maintaining competitive prices

3.2.1 Strength

Product quality:

● Haidilao is a famous restaurant that serves 6 typical hot pots, including Thai hot pot, spicy oil hotpot, bone hot pot, mushroom hot pot, sour cabbage hot pot and herbal hot pot The highlight is the spicyoil hotpot, with a spicy and Sichuan flavor

● In addition, Haidilao is famous for its Haidilao beef, marinated and sliced according to Cantoneseflavors The menu is diverse with many types of meat, vegetables and mushrooms for diners to choosefrom

● Haidilao also makes an impression with unique noodle dance performances, creating a uniquevisual experience for diners

● The restaurant provides a separate dipping sauce counter, allowing customers to choose thedipping sauce flavor according to their personal preferences In addition to the available dipping saucerecipes, customers can also create their own sauce flavors to their own liking

Selective distribution activities:

● In Vietnam, Haidilao currently has 14 facilities, concentrated in two major cities: Ho Chi Minhand Hanoi It can be seen that most of Haidilao's restaurants are located in shopping centers or luxurybuildings in the central area

Outstanding service quality:

● In the service industry, it is certainly impossible not to mention employee training, and moreimportantly, how to train them proficiently and make customers satisfied Haidilao always puts customerexperience first, so when customers encounter any problems, or even when customers have no need, thestaff provides support beyond expectations

● Haidilao has a human resources organization with an employee turnover rate of 10%, while themanagement turnover rate here is 0%

● At Haidilao, there are support areas to help make the customer experience more complete such asthe customer waiting area, nail salon area, and children's play area.

● Haidilao has arranged a waiting area with a standard and comfortable number of tables and chairs,along with a beauty area for women

Application of modern technology:

● Haidilao's staff is fully equipped from headsets to handheld devices, supporting operations andensuring all arising issues are handled promptly Besides, at each table, customers will be able to orderfood according to their needs through a tablet

3.2.2 Weakness

Business expansion speed is too fast:

● Since 2016, Haidilao has expanded rapidly from 100 stores to more than 1,000 stores worldwide.This has led to a number of problems, including: Inappropriate store locations, lack of management staff,failure to build corporate culture, and "illusion" about business profits

High operating costs:

● Personalized service, entertainment, and extensive menu options can lead to high operating costs.This may limit profits in some markets

Dependence on the Chinese market:

● Although Haidilao has expanded globally, its main source of revenue still comes from the Chinesemarket, making the company vulnerable to economic and regulatory changes in China

Fierce competition:

● The hot pot market is increasingly competitive, with the emergence of new brands from China andother countries such as Manwah, Hutong, and Hotpot Story This may make it difficult for Haidilao tomaintain market share and competitive advantage

3.2.3 Opportunities

● According to experts' forecasts, by 2023, the F&B industry's revenue could double, reaching 408billion USD and continue to grow further as the middle class in Vietnamese society increases.

● It's easy to see that the F&B business potential in Vietnam is extremely huge The clearestevidence is that more and more restaurants and eateries are opening, meeting the large dining needs ofcustomers

Trends aimed at young people:

● Young people's need to eat at restaurants is constantly increasing, especially in big cities.According to assessments, young people from 15 to 25 years old are the potential customers that F&Bbusinesses need to pay the most attention to

Electronic payment trends:

● In the era of digital transformation, the application of technology in payment for purchases hasgradually become popular Nowadays, young people are familiar with paying via QR codes, e-wallets onsmartphones or cards instead of using cash

● That is also the reason why consumers can easily choose the modern payment methods mentionedabove when making purchases in big cities

3.2.4 Threats

Difficulty of customers when using the service:

● The M&A trend in businesses brings huge development opportunities for businesses However,this is also a big challenge for the F&B industry in Vietnam Service quality will become the measure;Decide whether a business can win the hearts of customers or not

"Noise" from e-commerce activities:

● With the strong development of information technology and e-commerce, consumers are

"disturbed" in identifying and choosing necessary information

● To face this challenge, F&B industry operators need to capture and build core, correct informationand target the right customers

● Strengths: Manwah has a similar Sichuan hot pot style and menu to Haidilao, they offer a variety

of broths and ingredients to create a diverse hot pot experience

● Weaknesses: Manwah is present mainly in Vietnam and some Southeast Asian countries, whileHaidilao has expanded internationally

● Opportunity: Manwah has the potential to scale and develop international markets, similar toHaidilao

● Threats: Competing with Haidilao on brand and cycle services is a big challenge

● Economic: Consumer buying patterns might be impacted by economic volatility When theeconomy is doing well, people might be more likely to go out to eat, but during a recession, they couldspend less on discretionary items Changes in exchange rates might have an impact on the price ofimported raw materials and the translation of money into foreign earnings as Haidilao grows worldwide

● Sociocultural: Haidilao caters to upper-class patrons because it is a hot pot restaurant with ratherpricey food Social influences have a variety of effects on Haidilao and should be properly taken intoaccount In order to accommodate local cultural preferences in other nations, Haidilao must also modifyits menu and service methodology Haidilao's business strategy may be impacted by shifts in societaltrends, such as a preference for online ordering or meal delivery.

● Technological: While many Vietnamese food businesses connect with internet delivery services in

an effort to boost sales, Haidilao doesn't appear to be following this route Due to the nature of itsoperations, Haidilao cannot transition to a meal delivery service The dine-in options at Haidilao arehighly recommended The described unique experiences at Haidilao restaurant will be of little use if theyare only available "on the app" You will lose your competitive edge if you sell takeout or pair it withapplications that deliver meals invisibly

● Legal: Government laws pertaining to food safety and health must be complied with by Haidilao

in the nations in which it conducts business The operations and expenses of a corporation may beimpacted by changes to these rules Because Haidilao is renowned for providing customer-focusedservices, it is imperative to abide by labor laws and regulations pertaining to working conditions andemployee benefits

● Environment: Since environmental elements have a direct impact on consumers' health, Haidilao'sactivities are heavily influenced by them Modern consumers are more conscious of environmental issuesand have a preference for locally and sustainably sourced food The sustainability initiatives of Haidilaomight follow this pattern On the other hand, issues like outbreaks or unstable food supplies may seriouslyharm Haidilao

4 Consumer Research

4.1 Primary Research of the consumer and customer profile

4.1.1 Primary Research of the consumer

a) Demographic factors:

● Gender:

According to the survey, female gender accounts for 58.2%, the remaining gender is male with41.8% This shows that Haidilao's services receive attention from both genders, but femalecustomers will be slightly more than male customers.

● Age:

Besides, the age group from 18 to 25 accounts for 58.2%, followed by the age group under 18 with20.6%, the remaining are the age group from 26 to 35, accounting for 12.9% and over 35 years oldwith 8.2% It can be seen that customers interested in Haidilao's services span different ages, butmostly young people, especially young people between the ages of 18 and 25

● Jobs:

From age, it can be seen that student age is the age group most interested in Haidilao's services.That's right, according to the survey, the number of customers are students accounting for 66.5%,the rest are teachers and office workers.

● Average monthly income:

According to the survey, customers' income is divided equally into different ranges Income from 5million to 10 million accounts for the highest percentage with 26.5%, followed by customers withincome under 2 million with 24.7% and 22.9% have no income, the remaining is about 2 to 5million and over 10 million This shows that the average income of customers is at an averagelevel

- People from 18-30 : Mainly students, income mainly comes from family allowances orpart-time jobs.

- People over 30 : Mainly working and financially independent people

c) Identifying characteristics:

● Target group 1:

- Behavior:

+ Food preferences: They will want to be able to enjoy and experience the dining and variety

of services offered at Haidilao

+ Budget conscious: With limited income, they may be price sensitive when choosing diningoptions

+ Social dining: Young people often like to experience social dining with friends, so foodchoices are often made in groups or more

- Interest: The quality and taste of the food are important factors for them Additionally, theywill likely appreciate attentive and friendly customer service

- Special needs:

+ Affordability: They require budget-friendly dining options that fit their limited income.+ Flexible meal hours: Since they may be busy with studies and part-time jobs, restaurantswith flexible opening hours will be very convenient

+ Group dining options: With young people's tendency to socialize, they will preferrestaurants with services suitable for groups or gatherings

+ Convenience: Young people often like convenience, so being able to book online or takeaway also meets their needs

- Aspiration: They always want to ensure that they have access to affordable, nutritious meals,given their limited income sources Providing cost-effective dining options can help addressthis concern

● Target group 2:

- Behavior: