Khóa luận tốt nghiệp: Analyzing customer loyalty among Hanoi students for Viettel’s telecommunications services

Loyalty measurement results of student customers using Viettel's mobile telecommunications service: .73 Chapter 5: Conclusions and suggestions .... Figure 1.1: The brand loyalty pyramid

GRADUATION THESIS

Instructor : Le Minh Quang, Ph D

Student : Dang Thu Phuong

Faculty : Political Economy

Class : QH - 2020 - E Kinh te CLC 3

Ha Noi, 10/2023

GRADUATION THESIS

Analyzing customer loyalty among Hanoi students

for Viettel’s telecommunications services

Instructor : Le Minh Quang, Ph DStudent : Dang Thu Phuong

Faculty : Political Economy

Class : QH - 2020 - E Kinh te CLC 3

Ha Noi, 10/2023

leadership, staff and experts of the Faculty of Political Economy, University ofEconomics and Business, Vietnam National University, Ha Noi for creating favorable

conditions for facilities, information and guidance during the research process

Also, the completion of this study could not have been possible without Dr Le

Minh Quang His guidance and advice carried me through all the stages of writing this

project

Last but not least, I would like to express my heartfelt gratitude to my family,

friends and classmates for constantly motivating me and providing me with invaluablesupport while I completed the challenging task of finishing the paper

Reference information from the study is fully and carefully cited.

If not true, I would like to take full responsibility for the content of our research

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4.3 Loyalty measurement results of student customers using Viettel's mobile

telecommunications service: 73

Chapter 5: Conclusions and suggestions 5-5 Stttrkekekerrkerree 76

5.1 Conclusion 765.2 Propose some solutions for Viettel to maintain and increase customer loyalty

77

REFERENCES

EFA Exploratory Factor Analysis

KMO Kaiser-Meyer-Olkin

SPSS Statistical Package for Social Science

AMA American Marketing Association

Figure 1.1: The brand loyalty pyramid 15Figure 1.2: Measuring customer loyalty to mobile information services - 18

Research in Ho Chi Minh City market

Figure 1.3: Proposed research model 21

Figure 2.1: Viettel’s global presence 27

| Figure 2.2: Vietnam Telecom Market Leaders 28Figure 2.3: Revenue top telecom companies in Vietnam from 2019 to 29

sectors, largely attributable to the substantial contributions made by the

telecommunications service industry Over the past few years, this industry haswitnessed remarkable growth, evolving into a fundamental component of our

infrastructure and effectively facilitating progress in digital transformation, as well asthe development of a digital economy and society The market for telecommunicationsservices has become increasingly dynamic with the presence of prominent brands such

as Mobiphone, Vinaphone, and Viettel The intensifying competition among theseproviders offers customers a wide range of options, enabling them to select the products

and services that best cater to their needs and yield optimal benefits Notably, oncetelecommunications businesses have established a customer base, it becomes crucial forthem to continually enhance customer satisfaction in order to achieve success, foster

customer loyalty, improve competitiveness, and expand their market share Howerver,telecommunications service providers face challenging tasks, as they not only need to

attract new customers, but also grapple with the dilemma of maintaining and cultivatingcustomer loyalty

Researching customer satisfaction when using mobile telecommunications services

is one of the keys to the success of any providing companies Increasing customer

satisfaction with the services provided is an important factor in retaining customers,while improving the competitiveness of the business contributes to attracting more newcustomers to use the service In the past few years, the customer segment with a good

income has tended to slow down Recognizing that problem, mobile telecommunicationscompanies have shifted their target to a potential segment - people with low incomes,

limited ability to access and use mobile telecommunications services, including

customer group For this purpose, this study has focused on studying the loyalty of

student customer groups in the Hanoi area, through investigating, synthesizing data,identifying and analyzing the impact of factors on student customer loyalty

2 Research objectives

¢ General objective:

The study aims to understand factors affecting the loyalty of student customers inHanoi and evaluate the level of loyalty of those customers to telecommunicationsservices From there, evaluate and propose solutions to improve customer loyalty to

Viettel's telecommunications services

e Specific objectives:

- Systematize the theoretical basis of factors affecting loyalty and evaluate the level

of loyalty of telecommunications services

- Identify factors that influence the loyalty of student customers in Hanoi to

Viettel's telecommunications services

- Evaluate the level of loyalty of student customers in Hanoi with Viettel's

telecommunications services

- Propose solutions to improve customer loyalty regarding to the quality of Viettel'stelecommunications services

w Research object and scope of the study

e Research object: Loyalty of student customers in Hanoi to Viettel'stelecommunications services

e The scope of the study:

- Time range: from 09/29/2023 to 10/11/2023

Chapter 1: Literature review

Chapter 2: Current situation of ViettelChapter 3: Materials and methodologyChapter 4: Results and discussions

Chapter 5: Conclusions and suggestions

The works below all do in-depth research on the effects, especially loyalty or

technological improvements, to be able to retain and expand the customer base in thetelecommunications technology industry in Ha Noi specific

1.1.1 Domestic research

(1) Research "Factors affecting customer satisfaction with Vinaphone mobile

services in Tra Vinh province" by Tran The Nhan - 2020 The results show that thevariables affect in the same direction as The level of influence on the dependent variable

in descending order is as follows: Price structure, Creative value, Functional value,

Promotional value, Corporate image, Social value, and the lowest impact is Customer

Service The model explains 70.9% of the variation in customer satisfaction withVinaphone Tra Vinh mobile service

(2) Research by Nguyen Minh Loi and Duong Ba Vu Thi, 2020

This study was conducted to understand the impact of factors on customer satisfactionwith Viettel Quang Tri's mobile telecommunications services This research results show

that there are 6 factors that affect Viettel Quang Tri customer satisfaction

(3) "Factors affecting customer loyalty in the Vietnamese telecommunicationsindustry" - Tran Hong Nguyen and Nguyen Thi Ngoc Tram — 2018 Research results

indicate that service quality, price, after-sales support and prompt supplier response are

important factors in building customer loyalty

(4) "Determinants of customer loyalty in the Vietnamese mobiletelecommunications market" Nguyen Thi Thanh Ngan and Tran Huu Nguyen - 2016

This essay researched on factors that shape customer loyalty in the telecommunicationsmarket mobile in Vietnam

social responsibility, and service recovery They highlight the importance ofunderstanding customer perceptions, satisfaction, trust, and commitment in building and

maintaining loyal customer relationships in the telecommunications sector

(1) Kamiru's doctoral thesis (2015) explored various aspects of competition theory,

development orientation, marketing orientation, Porter's strategic management, and theassessment of resource-based development capabilities within the telecommunications

services industry The thesis specifically focused on the impact of marketing strategies

in creating a competitive advantage among mobile service providers in Kenya It also

drew parallels with research conducted in Vietnam, indicating consistency in the thesis'scontent The theoretical framework presented in the thesis was well-organized and

comprehensive The article addressed three primary questions: Which types ofinequalities are relevant to the concept of the digital divide?; How does inequality inaccess and use of information and communication technologies differ from other scarce

and non-material resources? And does the information society give rise to new forms ofinequality or exacerbate existing ones? The research findings on the digital divide were

classified into four distinct approaches: motivational, physical, skills, and usage There

was a noticeable shift in focus from physical access to skills and usage as key factors in

understanding and addressing the digital divide

(2) Research by Lai et al (2009)

"How quality, value, image and satisfaction create loyalty in the Chinese

telecommunications market" by Lai et al (2009) was conducted to propose and test of amodel integrated to examine the relationship among service quality, value, brand image,

satisfaction and loyalty in the Chinese mobile telecoms market Lai et al (2009) built a

customer loyalty Satisfaction has a significant intervention effect on the relationship

from perceived value, company image to loyalty Value plays a mediating role in therelationship between service quality and loyalty, corporate image and loyalty At the

same time, value has a great influence on customer loyalty Service quality directlyaffects both perceived value and company image Higher service quality significantly

enhances a company's image thereby improving customer satisfaction and perceivedvalue Image also has an indirect impact on satisfaction through value; and does notdirectly impact customer loyalty but it also plays an important role in enhancing

customer value and satisfaction

(3) Research by Ocloo, C E., & Tsetse, E K (2013)

Quality service has become very important in retaining customers in the mobile phoneindustry With the rise of multiple mobile network providers, customers are becoming

more and more sophisticated in making decisions regarding which services or products

to consume Research has been conducted to find out whether service quality has arelationship with customer retention and whether there is an interaction betweencustomer satisfaction and retention Result shows that there is a relationship betweenservice quality and satisfaction while customer satisfaction greatly influences customer

retention These findings have implications for industry executives on key areas thatneed attention to improve customer satisfaction to ensure customer retention

(4) "Determinants of customer loyalty in the mobile telecommunications market: across-cultural analysis" by A O Ayaburi and M Asare-Bediako (2015): This study

investigates factors influencing customer loyalty in the mobile telecommunicationsmarket across different cultural contexts This research suggests that telecom companies

between service quality and customer loyalty in the Korean mobile telecommunication

services" by C Kang and S J Park (2010): This research emphasized the mediatingeffect of customer satisfaction and switching barriers on the relationship between service

quality and customer loyalty Telecom companies should focus on enhancing customersatisfaction and reducing switching barriers to foster loyalty

(6) In Avila's (2017) research, the author examined the diffusion and competitivedynamics of mobile phone services in Guatemala The study was published in the

esteemed Journal of Telecommunications Policy The analysis primarily focused onvarious external factors such as the country's GDP per capita, population, demographics,

as well as market-related aspects including investment, number of operators, tariffs, and

telecommunications regulations Additionally, the research considered technologicalfactors like the introduction of digital technology and the number of phone lines The

article delved into the internal telecommunications issues within organizations and

emphasized the advantages of implementing telecommunications services for business

development It identified the objectives and presented factors that influenced the

development of telecommunications services in the study The article also providedguidelines for conducting research when formulating a telecommunications services

business strategy Avila's article encompassed different research areas that werecarefully chosen during the planning and execution of the strategic assumptions outlined

in the study Furthermore, the article discussed limitations that could impede the

effective implementation of telecommunications service business development

strategies

policies in the books or topics mentioned above will not be suitable for current conditions

in our country With the above research projects, the questions raised by the topic havenot yet been solved, especially the comprehensive and assessments after a number of

years of implementing telecommunications service development policies in the context

of Vietnam's increasingly deep international integration Many existing studies may still

have methodological limitations such as small sample sizes, convenience sampling, or

reliance on self-reported data

There may also be a lack of studies specifically focusing on the customer loyalty

of Hanoi students towards Viettel's telecommunications services Further research in thiscontext would contribute to a better understanding of the unique factors influencing

loyalty among this particular demographic With the increasing prevalence of digitalplatforms and services in the telecommunications industry, exploring how these

technological advancements affect customer loyalty among Hanoi students could be an

important research gap This could include examining the influence of mobile apps,online customer support, or personalized digital experiences on loyalty outcomes

Investigating the factors that create switching barriers and influence customerretention among Hanoi students could be a relevant research gap This could include

exploring contractual obligations, pricing strategies, network coverage, or customerservice experiences that deter students from switching to competitors Another research

gap could involve examining the impact of competitors’ telecommunications services on

customer loyalty among Hanoi students Investigating factors such as competitivepricing, service quality, promotional activities, or brand reputation of rival companieswould contribute to a comprehensive understanding of loyalty in a competitive marketcontext.

1.3 Definition and concepts

According to Michael Levine: “Brand loyalty is unchanging shopping habits

Customer satisfaction is the central factor affecting brand loyalty, they tend to find other

brands to replace On the contrary, if a brand can exceed customer expectations, they

will feel loyal to that brand

According to Dick and Basu (1994), brand loyalty can be defined as the state where

a consumer possesses a positive attitude towards this brand and consistently chooses to

purchase products from this brand However, this type of loyalty may be superficial and

susceptible to change

Besides, Oliver (1999, 33) describes loyalty as a deep commitment to continue

patronizing and repurchasing a preferred product or service in the face of situational

influences and marketing efforts that could potentially lead to switching behaviors Thislevel of loyalty is characterized by enduring behavioral patterns and a profound

psychological connection, making it resistant to change

When studying customer loyalty, researchers typically adopt three primaryapproaches: the behavioral approach, the attitudinal approach, and a general researchmethod (Oh, 1995) However, the authors argue that an integrated approach that

considers both attitudes and behaviors is the most powerful and suitable method for

research, as it encompasses the two major influences on consumer decision-making This

integrated approach allows for a more comprehensive understanding of customer loyalty.(Rujrutana & Yaowalak, 2011)

1.3.2 The role of customer loyalty

1.3.2.1 Competitive advantage

Frederick Reichheld is a customer loyalty researcher and author of the best-selling

book series “Influence and the Rules of Loyalty.” He believes that loyalty is acompetitive advantage to create profits and long-term standing of a company, the optimalindicator in the direction of the company's efforts to create value for customers Indeed,loyal customers are customers who have had a long-term, traditional relationship with a

company, they will always be with the company even in difficult times Furthermore,loyalty comes from customer satisfaction and trust, so it will be very beneficial for

businesses in dealing with competition from new products on the market In addition, as

analyzed above, loyalty is also associated with the actions of "repeat shopping" and

“recommending to others" of customers about the products and services they are using,

which is invaluable, it also generally becomes a competitive tool for the company whennew faces appear on the market

1.3.2.2 Reduce costs

Philip Kolter - world-famous marketing expert, commented: "It will not be too

difficult for you to fully understand the important and necessary role of buildingcustomer loyalty to the brand." Because, some studies have shown that the cost to attract

a new customer is usually 6 times as much as the cost to retain an existing customer He

also said that the cost of offensive marketing campaigns is often much more expensivethan the cost of defensive marketing “Today, companies are looking for ways to keeptheir customer base.” According to him, many companies discover that the cost of

maintaining an old customer is much smaller than the cost of developing a new customer

and even smaller than the cost of restoring an old customer who has left For that reason,

maintaining and making the most of existing customers, creating close relationships,

sharing with them, and developing them into loyal customers is a top priority for

businesses

1.3.2.3 Increase revenue

The key to success in modern business is maintaining a stable number of customers

Many statistics show that 80% of a company's profits come from 20% of its loyalcustomers Many businesses make the mistake of ignoring loyal customers to pursue new

customers in the market And with such a business orientation, it will be difficult forthem to have a chance to squeeze into the already narrow business market with countlesscompetitors It can be said that loyal customers are a company's greatest asset

1.3.3 Customer satisfaction

Customer satisfaction has many different definitions, researcher Philip Koter

suggests that satisfaction is the degree to which a person's feeling state originates fromcomparing the results obtained from consuming products or services with those theirown expectations As for Hansemark and Albinsson (2004), “ Customer satisfaction is

an overall attitude of a customer towards a supplier service, or an emotional response to

the difference between what the customer expected anticipate and what they receive, inorder to meet some needs, goals"

In Vietnam, research on customer satisfaction mainly takes a tissue approach

Servqual model to measure the relationship between service quality factors andperformance customer satisfaction (Vo, 2017) According to the Servperf model,customer satisfaction are evaluated through their actual perception of service quality, or

In other words the customer's perceived level of enterprises’ service performance is the

best reflection criterion (Nguyen, 2020)

1.3.4 Telecommunication service concept

The telecommunications industry is a key driver behind Vietnam’s digital

transformation Telecommunications, or telecom, is the term used to describe theelectrical transfer of information over very long distances, including voice, data, and

video This general term refers to a wide range of information-transmitting devices andcommunication systems, including telegraphs, wired and wireless phones, satellites,microwave communications, fiber optics, radio and television transmissions, and mobile

phones In accordance with the United States Communications Act of 1934 and theTelecommunications Act of 1996, the Federal Communications Commission definestelecommunications service for regulatory purposes as "The provision of

telecommunications service for a direct fee." This service is offered to the public or tospecific user groups that have a direct impact on the public, regardless of the medium

employed

Telecommunications, on the other hand, is defined as "the transmission of

information selected by the user, without any alteration in the form or content of theinformation, between specified points designated by the user." Telecommunications

services encompass the provision of voice and data services by telecommunicationscompanies over a wide geographical area The most prevalent form of

telecommunications service is telephone service, which can be delivered via wired orwireless standards Other services may include internet access, television services, andnetworking solutions for both residential and commercial purposes However, the

availability of these services may vary across different locations and service providers.Pricing structures for various telecommunications services can vary significantly and

may differ for residential and commercial customers

1.4 Types of brand loyalty

Brand loyalty is classified in two typical ways:

e Classification according to loyalty level:

- Behavioral loyalty group

Customers in this group demonstrate loyalty through consistent repeat purchasebehavior They consistently choose a specific brand over others, indicating a higher level

of commitment and habitual buying patterns

- Satisfied group

The satisfied group consists of customers who display loyalty to a brand owing to their

overall satisfaction with the product or service They have positive experiences andperceive value in their interactions with the brand

- Brand liking group

This group of customers exhibits loyalty based on an emotional attachment and positive

attitude towards the brand They genuinely hold a favorable opinion of the brand andmay actively engage with it, recommend it to others, or defend it against criticism

- Group Committed to the Brand

Customers in this group demonstrate the highest level of loyalty They possess a deepcommitment and strong bond with the brand, often identifying themselves as loyal brandadvocates They are likely to remain loyal even when confronted with competitive

offerings

© Classified by expression:

- Loyalty in attitude

This classification pertains to customers who display loyalty through their positive

attitudes and beliefs about the brand They exhibit a strong emotional connection, trust,and favorable perceptions towards the brand

- Rejection of competing products

This category encompasses customers who actively reject or avoid alternative brands orproducts in favor of a specific brand They consciously resist switching or considering

alternatives due to their unwavering loyalty towards the preferred brand

- Loyalty tendency

Customers in this category consistently exhibit a preference for a particular brand butmay still entertain the possibility of exploring alternative options They possess a higherlikelihood of choosing the preferred brand, but they remain open to considering other

alternatives

- Complaining behavior

This classification refers to loyal customers who engage in expressing dissatisfaction orvoicing complaints about specific aspects of the brand's products, services, or

experiences Despite their loyalty, they hold high expectations and desire continuous

improvement from the brand

1.5 Levels of brand loyalty

There are five steps, with prospects or customers “entering” at the base and

progressing upwards as they become more and more loyal to a product or service, or to

a brand as a whole From bottom to top, the types of brand loyalty on the pyramid looklike this:

Committed Buyers

Brand Likers

- Satisfied Buyers with Switching Costs

- Satisfied or Habitual Buyers

Switchers

Figure 1.1: The brand loyalty pyramid

Source: David A AakerThe more effective a business’ branding strategy and execution are (and the better

the product or service, of course), the more customers will be found in the upper echelons

of the pyramid In a little more detail, we have:

e At the bottom of the tower — Buyers passing by

No loyalty whatsoever to a brand Customers who buy products and services simplybecause they match their needs and price When they find a better supplier, these

customers will immediately leave They have no problem at all switching brands (hencethe name)

e At the 2nd level of loyalty - Regular buyers

This person tends to buy one brand, but isn’t passionate about it As the namesuggests, they buy the brand out of habit—they’re reasonably satisfied and don’t see anyreason to switch, but if they have issues finding their typical brand they’re happy to

simply buy from a different brand rather than making an unusual effort to seek out theirtypical brand.

e At the 3rd level of loyalty - Buyers with switching costs

Customers who are satisfied with products and services and want to stick with the

business for a long time At this level, customers have placed their trust in the business,they find it unnecessary to switch to another brand To attract these customers, otherbrands must compensate for the costs of switching brands for these customers

e At the 4th level of loyalty - Loyal customers

This level is the transition point at which the buyer is passionate about the brand, atrue brand enthusiast Their affinity for the brand is based primarily in emotion and they

not only shop but also speak well of the business to relatives and friends

e At the highest level of loyalty — Wholehearted customers

At this level the brand plays an active role in the buyer’s day-to-day life, and thebuyer is proud of their association with the brand The brand identity of the product fits

closely with the buyer’s personal values, and a smart brand will reward this buyer withloyalty perks to ensure it’s a two-way relationship And those customers not onlyintroduce the business's products and services to others but are also willing to speak up

to defend the business against criticism This level is very difficult to achieve but not

impossible For example, Apple and Starbucks already have this class of customers

1.6 The role of brand loyalty

Customer loyalty plays a crucial role in the success of a brand Here are the key

aspects of its importance:

e Enhancing brand awareness and reputation

Loyal customers engage in positive word-of-mouth, write reviews, and offer

valuable compliments to the business This generates recognition and fosters trust among

new customers.

e Strengthening brand power

Loyal customers remain committed to the brand, take pride in it, and even become

brand advocates They make repeat purchases on a larger scale, contributing to thegrowth and resilience of the business Additionally, loyal customers serve as effective

brand ambassadors by introducing the brand to others in their social circle

© Reinforcing brand association

Loyalty is an integral part of brand equity and closely interlinked with other brand

elements When brand loyalty strengthens, it positively impacts other brand components.Moreover, loyalty fosters a strong connection between the brand and its customers

e Increasing competitiveness

A brand with a larger base of loyal customers, who exhibit unwavering loyalty,

creates a barrier that safeguards the brand against existing and potential competitors

Loyal customers contribute to the brand's strength, revenue, and profitability, while alsoprotecting the brand in a competitive market

e Developing valuable assets

Loyalty helps businesses develop tangible and intangible assets Tangible assets

include increased revenue, profits, and higher customer spending Loyal customers notonly return for more purchases but also spend more, opt for premium or upgradedproducts, and purchase accompanying items Intangible assets encompass intellectual

property, brand assets, and more, which are created and strengthened through customerloyalty

1.7 Loyalty research models from previous studies

1.7.1 Research models that influence loyalty

Nguyen Duc Ky and Bui Nguyen Hung (2007) built a theoretical model and testedhypotheses about factors affecting customer loyalty in mobile information services in

Vietnam

OOODOONK

“Chất lượng địch vụ )\ ci piety at

© ©

Figure 1.2: Measuring customer loyalty to mobile information services - Research in

Ho Chi Minh City marketSource: Nguyen Duc Ky and Bui Nguyen Hung (2007)

1.7.2 Research models evaluate the level of customer loyalty

1.7.2.1 From a behavioral point of view

According to the AMA, loyalty is defined as "a situation in which customers tend

to repeatedly purchase products from the same manufacturer within a certain period of

time"

Based on Oliver (1999), customer loyalty is defined as a deep and lasting

commitment to repurchase a product or return to a preferred service in the future, despiteemotional effects, situations or marketing efforts that have the potential to shift behavior

According to Chaudhuri (1999), customers are considered brand loyal when they

tend to buy many products from that brand and make repeat purchases

Furthermore, Pong and Yee (2001) define loyalty in the service sector as “a customer's

willingness to consistently continue to be a customer of a particular service provider and

that is their first choice Among many suppliers, in which there is compatibility betweenbehavioral outcomes, attitudes and preferences, regardless of situational influences and

marketing efforts made to change behavior"

While according to Caruana (2002), loyal customers can be understood as

customers who repeatedly purchase from a supplier According to this definition, a loyalcustomer is someone who (a) regularly uses a service provider, (b) really likes the

provider and speaks highly of it, and (c) never thinks twice about the service provider

to use another service provider for this service

From Bandyopadhyay and Martel (2007), the definition of loyalty is often

expressed in future repurchase behavior, quantity and frequency of repurchases; andbrand change in each acquisition Similar to Lombard (2011), loyalty refers to customers’

repeat purchasing behavior, showing their preference for a certain brand or service

Typical behavioral scales of loyalty include purchase rate, purchase sequence, purchaselikelihood

1.7.2.2 From an attitudinal point of view

As reported by Beerli and colleagues (2004), loyalty is a variable that in addition

to the behavioral aspect is also related to the attitudinal aspect According to Baldinger

and Robinson (1996), behavioral loyalty is influenced by attitudinal loyalty, whichmakes it possible to link loyalty according to customers’ behavioral patterns with theirattitudes as in basic level

According to several other authors, attitudinal loyalty refers to the customer'sintention to repurchase and recommend, a feeling of attachment, psychologically linked

to a supplier and always choosing that supplier at level that as preference Thus,

attitudinal loyalty is an attitudinal approach, a perspective that emphasizes the role ofexperience and emotional aspects in loyalty and reflects customer actions; refers to acustomer's past purchasing limitation over a particular brand or group that are likely to

purchase again in the future

Futhermore, research on customer loyalty has many different approaches:

behavioral approaches (Seiders & colleagues 2005) and attitudes, perspectives (Jacoby

& Chestnut 1978) Behavioral loyalty is often expressed in a behavioral approach based

on future repurchase behavior; number and frequency of repurchases from(Bandyopadhyay and Martel 2007); (Liang et al 2009) Attitudinal loyalty is an

attitudinal approach that emphasizes the role of experience and emotional aspects inloyalty and reflects customer actions; related to a customer's past purchasing limits and

a particular brand or group of brands' likely future purchases based on past purchasing

behavior (Evanschitzky et al 2006) To study customer loyalty, there are 3 mainapproaches, specifically: behavioral approach, attitudinal approach, and general research

method (Oh, 1995) The authors believe that an integrated approach involving both

attitudes and behavior is the most powerful and appropriate approach for research

because it captures the two biggest influences of users’ decisions ( Rujrutana &

'Yaowalak 2011)

1.8 Proposed research model

1.8.1 Proposed research model

Previous theories and research have shown that customer satisfaction and servicequality are one of the factors that go hand in hand and have an important impact oncustomer loyalty However, some other studies have also shown that loyalty comes notonly from service quality but also from the "switching barrier" factor In addition, the

factors of trust and marketing communication activities have also been shown by many

studies, to have a significant impact on customer loyalty The hypothesis to be tested is

proposed as follows:

H1: The higher the customer satisfaction, the higher the customer loyalty

H2: The higher the service quality, the higher the customer loyalty

H3: The greater the switching barrier, the higher the customer loyalty

H44: The higher the customer's trust in the brand, the higher the customer loyalty

H5: The more attractive the marketing communication activities, the higher the customer

Customer's trust in the brand

The marketing communication

activities

Figure 1.3: Proposed research model

1.8.2 Viettel's services contribute to increasing customer loyalty

When Vietnamese consumers are considering a specific product or service, they

tend to rely on the internet and seek opinions from friends and family Particularly, theexperiences and recommendations of individuals who have used or are currently using

the service hold significant weight in their decision-making process Such personalrecommendations are considered more valuable than extensive advertising campaigns

Based on a NielsenIQ survey conducted between June and September 2021, it

was found that among over 510 customers using Viettel's mobile telecommunicationsservices, and 490 customers using services from other carriers, 85% of them were willing

to recommend the service to their relatives and friends This percentage is 10% higher

than the regional standard in Asia, which is 75% Additionally, Viettel ranked highest incustomer satisfaction for fixed internet services, with a customer satisfaction index of

78%

According to NielsenIQ, there are several factors that influence customer

satisfaction with Viettels telecommunications products and services However, twofactors stand out as having the most impact on the customer satisfaction index (NPS):

service quality and price These factors play a crucial role in shaping the overallsatisfaction levels of customers

Viettel's signal quality and coverage are attributes that customers perceive asexceptional in both mobile telecommunications and fixed bandwidth services.Specifically, mobile telecommunications services extend beyond regular communication

functions, as smartphones and mobile data have become indispensable in the era oftechnology 4.0 Notably, 90% of Viettel's mobile subscribers utilize mobile data, which

is an impressive statistic compared to other network operators in Vietnam

Moreover, Viettel's customer service staff receive high praise for their service

quality Customers regard them as professional and dedicated across varioustouchpoints, including customer service hotlines, stores, and technical support personnel

Additionally, Viettel's extensive store network covers a wide range of areas throughoutthe country, enabling prompt responses to customer inquiries and requests.

Service pricing is also a crucial factor in customers’ decision-making process, andViettel's rates are deemed appropriate and competitively priced This affordability factor

contributes to customers choosing Viettel as their preferred service provider

Viettel, along with other carriers, faces the challenge of attracting young customers who

are starting to use mobile services and possess a certain level of technologicalunderstanding The speed of internet access and reasonable pricing are crucial factors

that influence customers’ decision to choose Viettel's services According to a NielsenIQsurvey, Viettel achieved a satisfaction level of 8.4 among customers aged 18 to 45 years

old This high satisfaction level presents an opportunity for Viettel to expand its marketshare among young customers However, it also poses a challenge that requirescontinuous investment in technology, expansion of value-added services, and

improvements in the stability and quality of telecommunications services

The NPS (Net Promoter Score) customer satisfaction index is considered an

important factor contributing to a business's success With 85% of customers willing to

recommend Viettel's service to others, the company solidifies its position and brand in

Vietnam's mobile telecommunications market

With the introduction of 5G services and a range of e-wallet and e-bankingapplications, many people believe that Viettel will become an integral part of shaping

the daily lives of Vietnamese individuals, contributing to their overall well-being

Chapter 2: Current situation of Viettel

2.1 Introduction to Viettel

Viettel Military Industry and Telecoms Group, commonly known by the trading

name Viettel or Viettel Group, is a Vietnamese telecommunications and technologycorporation established on June 1, 1989 With the motto "Creativity for people", ViettelGroup thrives at home and abroad

2.1.1 History of formation and development of Viettel

June 1, 1989, Viettel Group was established with the name Electronics andInformation Equipment Corporation (Sigelco) with about 40 employees, who were

soldiers from units of the Communications Corps The main industry is construction andinstallation of telecommunications projects

In 1995, the name of Information Electronics and Equipment Company waschanged to Military Electronics and Telecommunications Company (transaction name

Viettel) and officially became the second telecommunication service provider in

Vietnam

In 2000, Viettel launched 178 the VoIP service platforms, marking a transformation

of Vietnam's telecommunications industry

By 2005, Viettel's Internet network was expanded nationwide In September 2003,

Viettel began providing fixed telephone services in Hanoi and Ho Chi Minh City, thenexpanded to other provinces and cities across the country

Viettel excelled in becoming the telecommunications enterprise with the largest

market share in Vietnam in 2008

In 2009, this network tried to go international with business activities in Laos and

Cambodia This has brought great success to Viettel Also in 2009, Viettel created a bigboom when building the largest 3G network infrastructure in Vietnam at that time

From 2009 to 2018, Viettel continuously expanded international markets by

deploying operations from Asia to Africa and Latin America There were 10 companiesbearing Viettels brand are operating on 3 continents Among them, in 5 markets,Viettel's subsidiaries were in the leading position in terms of subscriber market share,

revenue, and profit: Cambodia, Laos, Burundi, East Timor, Mozambique

In 2019, Viettel was among the first 50 network operators in the world to deploy

BNB-IoT internet connection technology With the term 5G being very famous abroad,Viettel successfully tested Vietnam's first 5G call in 2019

In 2020, despite being affected by the global Covid-19 pandemic, Viettel stillcompleted its production and business plan, achieving total revenue of more than 264

trillion VND, an increase of 4.4% compared to 2019 and reached 102.4% of the year's

plan

2.1.2 Field of activity

The group operates in various industries, which encompass the telecommunicationsand information technology services industry, electronics and telecommunicationsequipment research and production industry, defense industry, cyber security industry,and digital service provision industry Among its diverse portfolio, Viettel Mobile stands

out as the company's flagship product, representing the leading network operator in theVietnamese telecommunications services market Although Viettel initially focused on

telecommunications construction and installation, it has expanded its operations to

include five additional industries: telecommunications and IT services, research andproduction of telecommunications electronics equipment, international operations, cybersecurity, and digital service provision Specifically, Viettel's business areas are asfollows:

- Information and communication activities

- E-commerce, postal and delivery activities

Providing financial services, payment services, payment intermediaries, andmonetary intermediaries

Providing video game services, electronic news sites, and social networks

Management consulting, surveys, designs, investment projects

Construction and operation of projects, equipment, telecommunications, IT, andtelevision network infrastructure

Research, develop, and sell military technical equipment and support tools fornational defense and security

Research, development, and sales of dual-use products

Scientific research and development activities

Research, development, and sales of machinery and equipment fortelecommunications, IT, television and multimedia

Research, develop, and sell products and services of civil cryptography and

network information security

Advertising, market research

Consulting activities on management of trade introduction and promotion

organizations

Sport

CA electronic signature

Bankplus (Money transfer service, fee payment on mobile phones)

Automated entertainment switchboard: 1060

Consulting on labor information and job introduction: 1066

Economic and social information consulting hotline: 1068

Providing products and services in the fields of telecommunications, IT, radio,

television and multimedia;

2.1.3 Accomplishments and Achievements

In 2021, after over three decades of development, Viettel emerged as the leading

telecommunications enterprise in Vietnam, boasting approximately 67 millionsubscribers nationwide The subsequent rankings are held by Vinaphone, MobiFone,Vietnamobile, and Gtel, in that order Viettel's beautiful sim numbers have gained

significant popularity and are considered best-sellers in the beautiful sim number market

In terms of brand value recently, Viettel's worth has surged to nearly $9 billion in

2023, marking a $144 million increase compared to 2022 This group standed at the 9th

most valuable brand in Asia and the 17th globally Notably, Viettel has experienced eightconsecutive years of growth in the rankings of the world's 500 most valuable brands

Furthermore, Viettel has expanded its operations and investments to 10 foreignmarkets across Asia, Latin America, and Africa In 2019, it was recognized as one of thefastest-growing telecommunications companies worldwide Viettel has also establisheditself as one of the top 15 largest telecommunications companies globally in terms of

subscriber count and among the top 40 companies in terms of revenue

VIETTEL'S GLOBAL PRESENCE

BEA wmv GRE) con ee nen 24

Mãi số BEED cen eee eet ve 175 milion 13 ilion 12BHỦƠn I8800BIS 90800Km

Figure 2.1: Viettel’s global presenceSources: Viettel global report 2023

2.1.4 Viettel’s performance overview

2.1.4.1 Vietnam Telecom Market Scenario

Vietnam telecom market has witnessed strong growth in recent years and isexpected to attain stronger growth over the forecast period to 2025 It is also estimated

to reach USD 29.6 billion by 2032 with a CAGR of 4.4%

The growth in the industry is mainly driven by increasing population,communication service, and rising adoption of smartphone services The major part of

the market growth in Vietnam is attained by premium connectivity and content services

in the country However, consumers enjoy robust and forward-looking regulatory

regimes for these services Although Telecom service revenues were increased as usersare mainly adopting work-from-home practises and are spending more time streaming

video, games and other forms of entertainment being at home during this pandemic era

Vietnam Telecom Market Leaders

Based on the service type, Vietnam telecom market has experienced major growth

from Value-added services The growth in Value-added services is mainly due toincreasing subscribers in the emerging economies and growing demand from networkoperators to offer efficient mobile services Based on the transmission type, still, wireline

is accounted for the major market across the world and is expected to have continuedgrowth over the forecast period, the growth in wireline is mainly due to increased

demand for wired communication services

Leaders continue to enjoy significant market share at high competition and racing

for innovation ranging from mass-market entertainment to high-end businessconnectivity The key strategies adopted in the industry are introducing new and

affordable products and services, mergers, acquisitions, expansion of services or networkand bandwidth Most of the market share of terrestrial mobile telecommunicationsservices in Vietnam are held by three giants including Viettel (54.1%), MobiFone

(25.6%), and VNPT (18.4%)

45 Unit: Billion USD

+3

|Viettel VNPT Vinaphone

REVENUE OF TOP TELECOMMUNICATIONS

Figure 2.3: Revenue top telecom companies in Vietnam from 2019 to 2021

Sources: Vietnamcredit

$3 Vietnam Unit: Billion USD

Figure 2.4: Profit of top telecom companies in Vietnam from 2019 to 2021

Sources: VietnamcreditFurthermore, during the first half of 2023, the Military Industry andTelecommunications Group maintained its leading position in the telecommunicationsindustry, generating a revenue of 81,000 billion VND and a profit of 24,100 billion VND

These figures represent 46.4% and 53.4% completion of the yearly plan, respectively.Vietnam Posts and Telecommunications Group (VNPT) ranked second, with a total

revenue of 26,323 billion VND The parent company alone contributed 18,600 billionVND, achieving 47.1% of the annual plan In the first six months of 2023, VNPT'sconsolidated pre-tax profit reached 2,196 billion VND, and the parent company's pre-tax

profit amounted to 1,386 billion VND, both of which achieved 49.7% of the annual plan.Mobifone Telecommunications Corporation (Mobifone) secured the third position with

an estimated revenue of 13,482 billion VND for the parent company However, the tax profit experienced a decline of 10.7% and 30.5% compared to the same period in2022

pre-In other words, Viettel remained the top network operator, capturing 53.8% of the

mobile subscriber market share Notably, 4G subscribers accounted for 78% of the totalsubscriber base, and 5G services were being tested in 55 out of 63 provinces and citiesacross the country In the foreign telecommunications market, Viettel observed a growth

rate of over 20% during the first half of 2023 The company maintained its leadingposition in five countries: Laos, Cambodia, Myanmar, East Timor, and Burundi

Vettel Construction Joint Stock Corporation | Stock Cade: CTR Ut billon YN.

Figure 2.5: Viettel’s performance by business segment between 2022 and 2023

Sources: ViettelAfter nearly 20 years of foreign investment, Viettel is currently in the top 20 of

the world's leading enterprises in telecommunications investment, on par with developedcountries To achieve this achievement, Viettel has launched an investment strategy

abroad very early with the desire to expand the market and create new development

space Viettel has done business in 10 foreign markets, spanning 3 continents (Asia,Africa, America) There are 7/10 foreign markets of Viettel ranked in the top in terms of

mobile market share in the host countries