group assignment principles of marketing mkt101 phuc long coffee tea

In 2007, Phuc Long invested in building a tea processing factory in Thai Nguyenprovince and a tea & coffee processing factory in Binh Duong province Phuc Long, 2020.All are equipped with

GROUP ASSIGNMENT

Lecturer: Do Vu Thien Nhan COURSE: PRINCIPLES OF MARKETING - MKT101

Group members: 4

1 Nguyen Thi Phuong Thao - SS180029

2 Nguyen Le Ngoc Linh - SS180119

3 Bui Ngoc Thanh Tuyen - SS180071

4 Doan Thi Thanh Hang - SS171170

A Introduction……… 3

B Body……….3

I Marketing environment analysis……… 3

1 Micro-environment analysis……… 4

2 Macro-environment analysis……… 5

II Target customers and Positioning……….6

III Analysis of the marketing mix……….7

IV Marketing plan for the next year……… 8

C Conclusion……….9

D References ………10

E Appendices………11

A Introduction

Phuc Long Coffee & Tea was established in Bao Loc tea plateau, Lam Dong Province by

Mr Lam Boi Minh in 1968 In 200, Phuc Long Trading Production Co., Ltd was officially established In 2007, Phuc Long invested in building a tea processing factory in Thai Nguyen province and a tea & coffee processing factory in Binh Duong province (Phuc Long, 2020) All are equipped with modern equipment and machinery and have HACCP certification Thereby, bringing quality products for domestic services and meeting export demand (Phuc Long, 2020) Also from here, Phuc Long tea has conquered fastidious markets such as the US, Japan, Indonesia,…

In 2012, Phuc Long continued to expand its F&B business with a self-service store and a modern space In 2018, the second tea & coffee processing factory was built in Binh Duong Along with that, there are more than 40 new stores built and opened by Phuc Long In 2019, Phuc Long continued to develop 70 new stores and expanded the system stretching from South to North (Phuc Long, 2020)

After more than 50 years of development, Phuc Long constantly refines the quintessence to create excellent products At the same time, the desire to bring customers the most valuable experience Phuc Long continuously pioneers many leading innovative ideas in the tea and coffee industry This Vietnamese brand, rich in tradition, quintessences, and strong changes,

is increasingly being accepted by generations of customers

(Source: Phuc Long, 2020)

B Body

1 Micro-environment analysis.

1.1 Industry Competitors

Talking about the main competitors of Phuc Long, we can mention some competitors such

as Starbucks, Highlands Coffee, Trung Nguyen, The Coffee House,…

Phuc Long’s competitors all make a difference They stand firmly in the Vietnamese market and are constantly competing

Competitive price of products: Starbucks (45.000-110.000 VND), Highlands Coffee (30.000-85.000 VND), Trung Nguyen (50.000-100.000 VND),…

` From there, we can see that Phuc Long has a relatively cheap price, only 50-70% compared

to the price of Trung Nguyen, 30-50% compared to Starbucks With a reasonable price, it is easy to bring many different customers such as students, office workers, etc

1.2 Alternative products

On the menu of Phuc Long, customers will find tea, milk tea, juice, and coffee Phuc Long’s menu is also very rich with 63 different milk tea flavours With coffee-flavored drinks, outstanding drinks can be mentioned such as caramel coffee, rick milk, cappuccino, vanilla coffee, and iced mint coffee (drinks, 2020) In addition, the following tea dishes are also popular with young people's favourites such as peach milk tea, and pink milk tea Diverse choices for customers from young to elderly customers

In addition to favorite drinks, Phuc Long also includes snacks such as moon cake, bread,… All products such as coffee, tea, and food,… are provided by Phuc Long as substitute products Among them, there are many substitute products with lower prices than Phuc Long’s products This makes the threat of substitute products to this brand high

1.3 Suppliers

In 2007, Phuc Long owned a tea hill in Thai Nguyen and built a tea processing factory there

In the same year, Phuc Long invested in a processing factory in Binh Duong (Phuc Long, 2020), equipped with many modern machines, certified to ensure food safety and hygiene standards, with the goal of ensuring the supply of quality products, serving the domestic market and meat export demand Because of that, suppliers can only exert low to moderate pressure on Phuc Long

1.4 Customers

With a mission to become a pioneer of the times with innovative ideas at the forefront of the coffee and tea industry The brand also develops more youth-oriented drinks with “softer” prices than competitors

Phuc Long focuses on customer groups from working people to students Phuc Long wants to reach out to the public more, attract a large number of customers, and have many choices However, Phuc Long has the advantage of space, store location, and a special pure

1.5 Potential rivals

There are certain barriers when entering this industry, setting up a chain of stores like Phuc Long requires a huge investment as well as a lot of time to develop the brand and gain brand loyalty Phuc Long has positioned its products in the hearts of customers, which is pure Vietnamese flavour In fact, there are plenty of similar stores at the local level that has been successful in growing the customer base in their area, but the threat from new entrants to Phuc Long is moderate

2 Macro-environment analysis

2.1 International market

With the current trend of globalization, businesses not only develop domestically but also want to reach out to the world, so competition becomes stronger For the domestic coffee market, competitors are not cheaper coffee shops in the country anymore, but also high-end brands in the world that are approaching the Vietnamese market such as Starbucks, Coffee Beans,…

- Opportunity: Domestic coffee chains are winning over foreign coffee, so the domestic coffee chain market still has many opportunities for domestic business to rise up

- Challenge: With the trend of globalization, the penetration into the coffee chain market of the world’s giants makes the competition in this market more fierce In addition, the pandemic situation is complicated, it seriously affects the economy, customers’ income, and store consumption

2.2 Economic factor

When the economy develops, income increases and demand also rises, creating conditions for production and business to develop According to the General Statistics Office, in 2023, Vietnam is growing economically at around 8-9% and this could strengthen Phuc Long’s position in the market

- Opportunity: The coffee market in Vietnam is a big market, our economy has grown over the years, which is an opportunity for businesses to develop more Resident’s income also rises, so the demand for entertainment spirit rises, making the coffee business more opportunities

- Challenge: residents’ income is still low, and the demand for a cup of coffee high-end is not high, so to compete with cheap street cafes

2.3 Politics

The Vietnamese government is focusing on promoting investment and economic

development over the next decade Along with a stable political background, policies, and decrees support businesses to develop and protect their legitimate rights and interests

- Opportunity: Our country’s legal system has created great conditions for domestic enterprises to develop

- Challenge: Negative effects on laws and institutions, especially taxes

2.4 Technology

Phuc Long applies many scientific achievements (machines for dispensing, serving,

the Internet and smart robots are increasingly being applied to life, penetrating many fields to replace humans

- Opportunity: Technological development, the process of serving or dispensing all become convenient, fast, and save effort In addition, the promotion and sales on electronic channels make the coverage stronger,

- Challenge: If businesses do not catch up with technology, they will soon be priced out of the fiercely competitive market today

2.5 Culture-Society

Vietnamese culture is very oriental Targeted at office workers, young people, students, etc Because they spend a lot of time at the shop to work, study or entertain themselves

- Opportunity: With a large population and habit of drinking coffee as much as Vietnam, this

is a potential market

- Challenge: Street coffee culture in Vietnam is hard to change, psychology and culture are obstacles for high-end coffee chains

2.6 Natural environment factors

In our country, each region has its own distinct climate characteristics and climate characteristics are factors that Phuc Long needs to pay attention to in order to have the best service Besides, weather, climate, and soil also affect the quality of coffee beans and tea Environmental protection is always a challenge in business activities, and for coffee chains, the issue of environmental protection is quite closely associated with coffee cups and coffee straws

II Target customers and Positioning

2.1 Target customers

While big brands like Starbucks or The Coffee Bean & Tea Leaf position themselves as a high-end brand when targeting office workers, high-income customers, and foreign guests foreign coffee Or Trung Nguyen coffee brand positioning as a mid-range brand but clearly identifying the mid-range segment as customers who love traditional coffee flavors Then Phuc Long Coffee & Tea determined its market segment based on Demographics and Psychology when targeting the market segment of the middle class with stable income, office people "connoisseurs" of tea and coffee

It can be said that in order to compete with the big boys in the coffee industry, Phuc Long was very smart when choosing this market segment with a large number of customers This precise choice has helped Phuc Long gain a target market with diverse customers from middle- to high-income workers to tourists and students

2.2 Positioning

Phuc Long gives customers great experiences when they come to enjoy delicious tea and coffee products, imbued with Vietnamese essence

Conclusion: Phuc Long builds a position in the hearts of customers as a delicious tea with a pure Vietnamese taste “Expensive and worth it” (business strategy, 2019)

III Analysis of the marketing mix

3.1 Marketing strategy for Phuc Long's product

The product is seen as being the most crucial element in determining a brand's success A quality product not only draws in customers but also fosters loyalty and trust, encouraging recurrent use As a company, Phuc Long is aware of this and continually focuses on creating items of the greatest caliber Finding its Unique Selling Proposition (USP), which

differentiates it from competing brands, has been a priority for Phuc Long The flavor of Phuc Long's products, which must be distinctive, distinctive, and different from other brands, is its USP This quality is reflected in the development of tea products with strong flavors that appeal to consumers with discriminating palates

3.2 Phuc Long's pricing marketing strategy

The "Good-value Pricing" technique has been used to design a pricing strategy by Phuc Long Coffee & Tea Additionally, they have put into practice appropriate and effective pricing techniques including "Product line Pricing," "Promotional Pricing," and "Combo Pricing." Phuc Long Coffee & Tea has established a fair pricing strategy, focusing on its strengths in offering premium tea and coffee Their rates are in the middle range, making them ideal for

students, and visitors.

Beverage costs at Phuc Long continue to range from 35,000 to 75,000 VND Comparing this pricing range to rivals like Trung Nguyen and well-known brands like Starbucks and The Coffee House, it is only approximately 50–70% lower (business strategy, 2019)

3.3 Marketing strategy for distribution of Phuc Long

A well-known coffee and tea brand in Vietnam, Phuc Long Coffee & Tea has an extensive distribution network of 84 locations nationally (Phuc Long, 2022) Large cities including Ho Chi Minh City, Hanoi, Binh Duong, Dong Nai, Khanh Hoa, Da Nang, Lam Dong, Can Tho, and Nghe An are where you'll find most of Phuc Long's stores These stores, in particular, are situated in excellent development-friendly sites

Products from Phuc Long are not just on display and for sale in the businesses mentioned above, but also in supermarkets, shopping malls, and a few other convenience stores The growth and expansion of Phuc Long's internet sales channel have been a priority Through the official website of Phuc Long, customers can place direct orders Additionally, they can utilize food delivery services like Shopeefood, Grabfood, Baemin, and Foody to order from Phuc Long ( Phuc Long’s services, 2021)

3.4 Marketing strategy for the promotion of Phuc Long

Both "push" and "pull" marketing methods are used by Phuc Long To draw in a huge number

of passersby, they purposefully place their chain of stores in prominent areas like Bitexco, Landmark 81, Vincom, and well-known streets like Le Loi, Cong Hoa, and Ngo Duc Ke Additionally, Phuc Long promotes its brand image on social media sites including Facebook, Instagram, and Youtube With more than 400,000 fans on Phuc Long's Facebook fanpage, this strategy has been effective Despite not relying on distribution channels substantially, Phuc Long successfully pushes their items into supermarkets, shopping malls, and convenience stores, enabling a targeted and effective approach to this strategy

IV Marketing plan for next year

- The prices of Phuc Long's products remain the same as last year In addition, there is an idea

to launch a new product for Phuc Long, such as plum tea, and introduce it to customers by attracting them through promotional programs, reasonable trial prices, or Combo Pricing (ordering any 2 Phuc Long products will allow customers to try the new product, buy 3 get a new product, etc)

- Apart from F&B business activities, Phuc Long also sells its tea products directly to consumers With the idea of developing the marketing plan for Phuc Long next year, the products will be prominently displayed and sold in Phuc Long stores currently operating in the market, supermarkets, shopping centers, convenience stores, and specialty tea shops Additionally, Phuc Long will strengthen its product position on e-commerce platforms such

as Shopee, Lazada, Sendo, etc to reach consumers more effectively

- Enhance the use of modern equipment and tools in the process of preparation or service (coffee and tea brewing equipment, beverage preparation) to facilitate and improve operational efficiency

Extend the reach of the store chain to provinces and cities where Phuc Long is currently not operating

* Services of Phuc Long

- Quality Products: Phuc Long focuses on high-quality coffee and tea sourced from special plantations This ensures excellent-tasting products for customers

- Variety: Phuc Long offers a range of beverages such as coffee, tea, milk tea, and other specialty drinks This caters to the diverse needs and preferences of customers

- Space and Design: Phuc Long stores are designed with a modern and sophisticated aesthetic, creating a comfortable and relaxing space for customers to enjoy their drinks The layout is thoughtfully planned to create a welcoming and friendly environment

- Delivery Service: Phuc Long provides delivery services, allowing customers to conveniently shop and receive their products at their desired location in a prompt manner

- Customization Service: Phuc Long offers corporate gifting services, enabling companies to customize and imprint their own logos on coffee and tea products This creates unique and memorable gifts for corporate customers

C Conclusion

In conclusion, Phuc Long is a brand that stands out for its commitment to quality, authenticity, and innovation in the tea and coffee industry With its focus on responsibly sourced ingredients, diverse beverage offerings, and inviting cafes, Phuc Long continues to delight and satisfy customers Whether you are a tea enthusiast or a coffee lover, Phuc Long provides

a delightful experience that blends tradition with contemporary flavors

Kotler, P & Armstrong, G 2020: Principles of Marketing

Phuc Long Coffee & Tea, 2020 Available at:https://phuclong.com.vn/ (Accessed 15 June 2023)

Drinks, 2020 Available at:https://phuclong.com.vn/category/thuc-uong (Accessed 17 June 2023)

Analysis of the micro-environment of Phuc Long brand, 2021 Available at:

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Business Strategy Phuc Long, 2019 Available at: https://123docz.net/document/5717933-business-strategy-phuc-long.htm(Accessed 20 June 2023)

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https://igenz.net/phuc-long-coffee-tea-hanh-trinh-cua-thuong-hieu-tra-va-ca-phe-viet/ (Accessed 20 June 2023)

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https://123docz.net/document/11499352-phan-tich-moi-truong-marketing-highlands-coffee.htm (Accessed 2 July 2023)

Phuc Long's business strategy and services: Slow but quality transformation, 2021 Available at:https://www.cukcuk.vn/8594/chuoi-tra-cafe-phuc-long-va-chien-luoc-kinh-doanh/ (Accessed 2 July 2023)

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