Marketing Principles

1. Lecturer: Nguyen Hữu Hảo
Khổng Mạnh Cường
Huỳnh Đào Anh Thư
Nguyễn Hoàng Anh Thư
HCMC, July 2016

2. Introduction
-------------------------------------------------
Market Analysis
- PEST
- SWOT
- Customer Segmentation
-------------------------------------------------
Marketing Plan
- 4 Ps
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Conclusion
- Recommendation
- Future Plan
-------------------------------------------------
Q & A
CONTENT

3. INTRODUCTION

4. ABOUT US
• Highlands Coffee is a Vietnamese brand under
profession:
– Coffee shop chain
– Producer and distributor of coffee products
• Known since 1998, owned by Việt kiều David Thai
under Viet Thai International Joint Stock Company.
• Highlands Coffee first opens in Metropolitan tower
in 2000, quickly, brings a fresh style to Vietnam
coffee shop business.

5. SUMMARY
• Until 2009, the company operated 80 coffee
shops in six cities and provinces across VN
– Hanoi, Hai Phong, Saigon, Danang, Vung Tau, Dong
Nai.
• At present, Saigon has 53 brands in every district
• Seeing the strengths and potentials of coffee
consummation, VTI decide to launch a brand
new Highlands Coffee on 220 Cao Thang that
600m away from cross Ba Thang Hai.

6. BASED ON RESEARCH

7. BASED ON RESEARCH

8. BASED ON RESEARCH

9. NEW BRANCH
LOCATION

10. MARKET
ANALYSIS

11. Industry PEST Analysis
• Political stability
mostly in agriculture
• However in
merchandising and
enterprise industry
still fixing
• Government
encouragement for
foreign investments
• Tax policy for
investors
POLITICAL ECONOMICAL SOCIAL/CULTURE
• Development of FTA
(free trade agree) in
Vietnam
• High inflation 4.1%
(2014 est.) and
change in VN Dong
value every year
• GDP growth of 6.0%
(2014 est.)
• Positive economic
reforms since 2012
• Coffee centered
culture
• Coffee takeaway
culture only
popular in main
cities
• Young people
quickly absorbing
modern trends
Western
standards

12. Industry PEST Analysis
• Use of Internet and
Smartphone industry
(Around 5 million in
2014)
• Increasing use if
Social media
networks
TECHNOLOGY ENVIRONMENT LEGAL
• Tropical rainy climate
with varying
temperatures
• Having a heavy
polluted
environment that
affectedly harm to
the material supply
• Medium labor
policies
• Food safety
regulations
• Advertising
regulations
• Bribery and
Corruption

13. SWOT
• Strong brand equity
• Quick service
• Use material coffee in Vietnam
• Good location with beautiful view
• New style of mixed culture between the West and the East
• Consistency in Western identical decoration and delivery service
• Highlands Coffee shops located at central of city or trade centers
• It looks so premium that many customers seem reluctant to
enter while they can afford
• Western style need time to be suitable for Vietnamese lifestyle
• Highlands coffee is rather expensive due to high cost in materials
and operating system.
• Highlands café does not focus much on promotion campaign.

14. SWOT
• There are not many cafe stores professional in style and
service
• Vietnamese people habit is to go to cafeteria for their
business
• Coffee market is now matured and fiercely competitive
• Most buildings in cities have already had at least one
cafeteria inside, it’s difficult for Highlands to jump in and
replace
• It’s difficult for outdoor cafe store like Highlands to attract
customers in cold winter
• There are many competitors with Highlands Coffee, such
as: The Coffee House, Paris Baguette, and other
competitors

15. Competitors

16. Perception Mapping
Low Price High Price
High Quality
Low Quality
Highlands Coffee
The Coffee House
Local Coffee shop
Paris Baguette

17. MARKETING
PLAN

18. TARGET CUSTOMER
Customer
segment
Middle-class
consumers
Youth and
offices
Foreigners in
VN

19. We highly
provide
Eating,
Drinking
Entertaining
Self
Expressing
CUSTOMER NEEDS

20. BASED ON RESEARCH

21. 1. Traditional coffee 2. Espresso coffee
PRODUCT

22. 2. Other espresso coffee
Vanilla latte
Caramel Macchiato
Drip Special
PRODUCT

23. 3. “Freeze” coffee slushie
• Caramel Phin Freeze
Elegant combine between
traditional coffee and jelly with a
little bit caramel on top.
• Freeze Green tea
Green milk tea added with espresso
drop and jelly.
PRODUCT

24. 4. Tea, fruit juice
• Lists of tea: lotus roasted tea,
light peach tea, peach jelly,
rose jelly, mango tea.
5. Banh mi, cake
PRODUCT

25. 6. Beverages & Consumable
Highlands Coffee now
introduces express coffee
(can), also roasted coffee
(package) sell at retailer
PRODUCT

26. PRODUCT & SERVICE
Service process:
- dynamic & willing
Booking & order:
- website, phone call, takeaway

27. PRODUCT & SERVICE

28. BASED ON RESEARCH

29. PRICE
Why high price positioning?
Based on customer’s feeling, brand positioning
Business environment, high quality = high price

30. PLACE
Overview of the distribution strategy of the Highlands Coffee
2002
2006
2011
2015
2016
100 stores
on 6 cities,
provinces
75 stores
50 stores
25 stores
First ever
store in
HCM city.
1 week
later in
Hanoi

31. PLACE
The Store system is set at prime locations such as:
• Concentration of targeted customers of Highlands
• Brand-oriented always races with country’s latest
development and investment
• Navigate to central location of big cities: population density,
rising living-standards
• Franchising

32. PLACE/ DISTRIBUTION

33. PLACE
Distribution Strategy
• Location at a corner of intersection, convenient for business
• Nice view, high population, office accommodation
Disadvantages
 Compete with numbers of café and catering shop
 Small, cramped parking lot

34. POTENTIAL AREA
Apartment No. 5
136 Cao Thang

35. POTENTIAL AREA
Tower 19
145 Cao
Thang

36. POTENTIAL AREA
Nahi Building
110 Cao Thang

38. BASED ON RESEARCH

39. PLACE

40. TYPES OF PROMOTION
Advertising Above The Line (ATL)
• Website banners

41. PROMOTION
• “Đánh thức ngày mới!” – Buy a combo of Banh mi and coffee with only
39.000 VND. Event estimated sell out 3 million cups of traditional coffee
across the country in 2 months.
• Combo Freeze: Caramel Phin and Green Tea are applied at 49.000 VND

42. PROMOTION
WELCOME
• First 50 customers come to
grand opening day will receive
any drink for FREE.
• Next 100 will buy traditional
coffee for 20% off when
purchase along with any Banh
mi type (19,000 VND.)
*Require: Check-in on FB*

43. PROMOTION
Buy 1 get 1 Free
• Buy 1 medium Caramel Phin
Freeze get 1 small size for free
of the same type
• Buy 1 medium Freeze Green
Tea get 1 small size for free of
any drink you choose
• Available with voucher

44. PROMOTION
Mini Game
“Mê Cung Bí Ẩn”
• Create funny mini game on
Facebook, that attract customer to
win small prize or award.
• Receive voucher and discount
for new product

45. PROMOTION
Campaign
“Mỗi Tuần Cuốn Sách”
• Perceive card and start
stamping your point off every time
you buy drink.
• Enough stamp receive voucher
and discount on purchasing book
at certain bookstores.

46. ADVERTISING CALENDAR

47. TYPES OF PROMOTION
Advertising Below The Line (BTL)
• Ambient
• Standee

48. (PEOPLE)
Store Manager 1
District Manager
(Highlands Coffee Shop)
Store Manager 2 Store Manager 3
Store Manager
Assistant
WaiterBarista Cashier Shipper Security
Organizational Structure

49. (PEOPLE)
Recruitment and Training
– 2 days training employers, 3-7 day training manager (high school degree, higher)
– Sponsor, support entry to several contests in exchange skilled preparation

50. Compensation
– Wages increased in every 3 months (depends on experience and dedication)
– Received tip from the customers
(PEOPLE)

51. FINANCE
No. Items Year
0 1 2 3
I TOTAL REVENUE 3,456,000,000 5,184,000,000 6,336,000,000
Expected Operating Capacity 30% 45% 55%
Consumption rate 86,400 129,600 158,400
Price of product and service 40,000 40,000 40,000
II TOTAL COST 2,142,480,000 2,380,080,000 2,538,480,000
1 Variable cost 475,200,000 712,800,000 871,200,000
Raw material 475,200,000 712,800,000 871,200,000
Insurance 0 0 0
Management 0 0 0
Cost of sales 0 0 0
Expenditure 0 0 0
Interest of Working Capital 0 0 0
2 Fixed cost 1,667,280,000 1,667,280,000 1,667,280,000
Electricity 36,000,000 36,000,000 36,000,000
Water & Internet 36,000,000 36,000,000 36,000,000
Wages 335,280,000 335,280,000 335,280,000
Management 270,000,000 270,000,000 270,000,000
Costs of sales 0 0 0
Leasing 960,000,000 960,000,000 960,000,000
Others 30,000,000 30,000,000 30,000,000
Capital Depreciation 0 0 0
III Profit before Tax 1,788,720,000 3,516,720,000 4,668,720,000
Long-term Interest 75,369,002 50,246,002 25,123,001
Income Tax 500,841,600 984,681,600 1,307,241,600
IV Profit after Tax 1,212,509,398 2,481,792,398 3,336,355,399

52. FINANCE
Target Year 1 Year 2 Year 3
Total table in store 20 tables 20 tables 20 tables
Total drink on table/ day 4 cups per table/ day 4 cups per table/ day 4 cups per table/ day
Total time daily operation 10 hours/ day 10 hours/ day 10 hours/ day
Total time usage for 1 table 1 hour 1 hour 1 hour
Total drink sold on 1 day 800 cups/ day 800 cups/ day 800 cups/ day
Capacity avaragely a day 30% 45% 55%
Average drink sold a day 240 cups/ day 360 cups/ day 440 cups/ day
Average price per drink 40.000 VND/ drink 40.000 VND/ drink 40.000 VND/ drink
Total income/ day 9.600.000 VND/ day 14.400.000 VND/ day 17.600.000 VND/ day
TOTAL REVENUE = 288.000.000/ MONTH
TOTAL COST = 178.540.000/MONTH
TOTAL INCOME =

53. CONCLUSION

54. RECOMMENDATION
Beside positive feedbacks from the customer,
negativities exist:
– 41% complaint feedback come from inexperienced services
– 9% unsatisfied with lack of privacy and space for business talks
– 24% think our promotion is less creative and not very attracting
– 5% hate to wait for the delivery come on time
– The rest want an upgrade in wireless service provided in shop

55. VOUCHER
Office workers like go for coffee but they are afraid of sun outside

56. Exclusively for
companies surround
the store. Period from
11:30 – 14:00 and
06:00 – 08:00 pm
HAPPY HOUR

57. CUSTOM NEW SAMPLES

58. EXAM SERVICES
Increase from 1 cashier to 2 cashiers, double the waiter, barista in rush
hours 17:00 – 22:00 Friday, Saturday, Sunday

59. BOOSTING TAKEAWAY
Morning from 6:00 – 8:00, every Monday to Friday, lack of customers

60. NOT ENOUGH SPACES

61. TOP OF MIND

62. LETTER FROM TEAM
Highlands Coffee always look forward to
bring their customers the feel of a traditional
and modern values ​​. As a famous brand, we
put trust in bringing customers the most
sophisticated experience of coffee.

63. THANK YOU FOR SUPPORTING
HIGHLANDS FAMILY