Vietmac fast food - marketing research and recommendations = Nghiên cứu marketing và đề xuất cho sản phẩm fast food Vietmac

VIETNAM NATIONAL UNIVERSITY, HANOI
SCHOOL OF BUSINESS

NGUYEN MINH DUC

VIETMAC FAST FOOD – MARKETING RESEARCH
AND RECOMMENDATIONS
Major: Business Administration
Code: 60 34 05

MASTER OF BUSINESS ADMINISTRATION THESIS

Supervisor: Dr. Tran Doan Kim

Hanoi – 2011


TABLE OF CONTENTS
ACKNOWLEDGMENT ..........................................................................................i
ABSTRACT ............................................................................................................ii
TÓM TẮT .............................................................................................................. iv
TABLE OF CONTENTS ....................................................................................... vi
LIST OF CHARTS ................................................................................................. ix
LIST OF FINGURES ............................................................................................. xi
LIST OF TABLES ................................................................................................xii
INTRODUCTION ................................................................................................... 1
CHAPTER 1: LITERATURE REVIEW.................................................................. 9
1.1.

Marketing research ..................................................................................... 9

1.2.

Research methodology theory and implication .......................................... 13

1.2.3. Sample selection ....................................................................................... 18
1.2.4. Data collection methods ............................................................................ 19
1.2.5. Data processing analysis ........................................................................... 19
1.3.

The marketing analysis ............................................................................. 20

1.3.1. Fast food marketing .................................................................................. 20
1.3.2. Market segmentation, target market and positioning. ................................ 23
1.3.3. Marketing mix .......................................................................................... 23
1.4.

Franchising ............................................................................................... 25

vi


CHAPTER

2:

VIETNAM

FAST

FOOD

MARKET

AND

VIETMAC

MARKETING REVIEW ....................................................................................... 27
2.1.

Vietnam fast food market review .............................................................. 27

2.1.1. Overview .................................................................................................. 28
2.1.2. Market development ................................................................................. 33
2.1.3. Consumer data .......................................................................................... 34
2.1.4. Competitor information............................................................................. 35
2.1.5. Vietnam Fast food Industry models analysis ............................................. 38
2.2.

Vietmac marketing review ........................................................................ 44

2.2.1. About Vietmac .......................................................................................... 44
2.2.2. Comparative advantages and marketing strategies..................................... 50
2.2.3. Initial target market & customer ................................................................ 51
2.2.4. Performances ............................................................................................ 52
CHAPTER 3: SURVEYS CONDUCTING AND FINDINGS ............................... 54
3.1.

Surveys conducting ................................................................................... 54

3.1.1. Questionnaire design ................................................................................. 54
3.1.2. Target respondents and sampling .............................................................. 56
3.1.3. Questionnaires delivery............................................................................. 56
3.1.4. Data processing and analysing .................................................................. 56
3.2.

Vietnam fast food market findings ............................................................ 57

3.2.1. About competitors ..................................................................................... 57
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3.2.2. Customers’ need, habit and satisfaction measurement ............................... 59
3.2.3. Behavior of people about fast food products. ............................................ 66
3.2.4. Behavior of people about price.................................................................. 67
3.2.5. Behavior of people about advertising channel ........................................... 68
3.2.6. Behavior of people about distribution channel. ......................................... 69
3.2.7. Market structure and opportunity .............................................................. 70
3.2.8. Recognition of Vietmac and comments ..................................................... 72
3.2.9. Respondents information .......................................................................... 74
3.3.

Vietmac satisfaction measurement ............................................................ 76

3.3.1. Satisfaction measurement comperation between Vietmac and KFC .......... 76
3.3.2. Respondents summary .............................................................................. 84
3.4.

Other findings ........................................................................................... 86

3.5.

Answering the research question ............................................................... 88

CHAPTER 4: SOME MARKETING RECOMMENDATIONS FOR VIETMAC . 92
4.1.

Recommendations..................................................................................... 92

4.2.

Action plans.............................................................................................. 97

4.3.

Conclusion ................................................................................................ 97

REFFERENCES.................................................................................................... 99
APPENDIXES .................................................................................................... 101

viii


LIST OF CHARTS
Chart 1. Most wanted fast food brand name .................................................................................... 57
Chart 2. Factors measurement influences on chosing a brand ......................................................... 58
Chart 3. Brand changing habit ......................................................................................................... 59
Chart 4. Brand satisfaction measurement ......................................................................................... 60
Chart 5. Nutrition, health and safety satisfaction measurement ....................................................... 60
Chart 6. Tasty and flavor satisfaction measurement ........................................................................ 61

Chart 7. Convenience satisfaction measurement.............................................................................. 62
Chart 8. Menu flexible satisfaction .................................................................................................. 62
Chart 9. Price satisfaction measurement .......................................................................................... 63
Chart 10. Point of sale decoration satisfaction measurement........................................................... 63
Chart 11. Service and staff behaviour satisfaction ........................................................................... 64
Chart 12. Satisfaction compare within KFC, Jollibee and Vietmac ................................................. 64
Chart 13. Important factors .............................................................................................................. 67
Chart 14. Behaviour of people about price ...................................................................................... 67
Chart 15. Price sensitive ................................................................................................................... 68
Chart 16. Ads channels .................................................................................................................... 69
Chart 17. Distribution channels........................................................................................................ 70
Chart 18. Frequency of eating fast food in last month ..................................................................... 71
Chart 19. Times of eating fast food in last three months ................................................................ 72
Chart 20. Recognition of Vietmac Rice burger ................................................................................ 72
Chart 21. Brand satisfaction Vietmac V.s KFC ............................................................................... 77

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Chart 22. Nutrition satisfaction Vietmac V.s KFC .......................................................................... 78
Chart 23. Tasty & flavor Vietmac V.s KFC..................................................................................... 78
Chart 24. Convenience measurement Vietmac V.s KFC ................................................................. 79
Chart 25. Menu satisfaction Vietmac V.s KFC ................................................................................ 80
Chart 26. Price satisfaction Vietmac V.s KFC ................................................................................. 81
Chart 27. P.O.S decor Vietmac V.s KFC ......................................................................................... 81
Chart 28. Service and staff behaviour Vietmac V.s KFC ................................................................ 82
Chart 29. Vietmac satisfaction by factors ........................................................................................ 83

x

LIST OF FINGURES
Figure 1. Phases of the research process ............................................................................................ 6
Figure 2. Organization of the research ............................................................................................... 8
Figure 3. Follow chart of the research process................................................................................. 11
Figure 4. Factors influence to Vietnam fast food marketing application ......................................... 22
Figure 5. The four Ps components of marketing mix ....................................................................... 24
Figure 6. Market analysis steps ....................................................................................................... 28
Figure 7. Porter five force ................................................................................................................ 44
Figure 8. Vietmac Rice burger product ............................................................................................ 46
Figure 9. Vietmac's strengths and weaknesses ................................................................................. 84

xi


LIST OF TABLES
Table 1. Forecast sales in fast food by subsector: units/outlets 2011-1014 (quoted from 2009 2014) ................................................................................................................................................ 33
Table 2. Forecast sales in fast food by subsector: foodservice value 2011 – 2014 (quoted from
2009-2014) ....................................................................................................................................... 33
Table 3. Global Brand Owner Shares of Chained Fast Food 2005-2009 ......................................... 38
Table 4. Brand Shares of Chained Fast Food 2006-2009 ................................................................ 38
Table 5. Hanoi fast food market sales forecast - lunch time meal ................................................... 49
Table 6. Vietmac performances ....................................................................................................... 52
Table 7. Factors measurement influences on chosing a brand ......................................................... 58
Table 8. Time of meal ...................................................................................................................... 65
Table 9. Place of meal ...................................................................................................................... 65
Table 10. Group of people ............................................................................................................... 66
Table 11. Willing measurement to sellect fast food. ........................................................................ 66
Table 12. Treatment of people with fast food .................................................................................. 70
Table 13. Fast food potential measurement ..................................................................................... 70

Table 14. Respondents by genders ................................................................................................... 74
Table 15. Respondents by ages ........................................................................................................ 75
Table 16. Respondents by careers .................................................................................................... 75
Table 17. Respondents by location .................................................................................................. 76
Table 18. Respondents by income ................................................................................................... 76
Table 19. Vietmac Satisfaction by factors ....................................................................................... 82
Table 20. Descriptive statistics ........................................................................................................ 84

xii


Table 21. Gender .............................................................................................................................. 85
Table 22. Careers ............................................................................................................................. 85
Table 23. Place of work ................................................................................................................... 86
Table 24. Decision right ................................................................................................................... 86

xiii


INTRODUCTION
1. Back ground
Global economic with the daily changing of business environment, as the human
needs are continuously developing and changing, according to those changes,
opportunities are constantly appearing. Marketing research plays an important role
in searching for new opportunities and determining the objectivities, valuation of
those new opportunities. It is also used to know more about existing market like
customer, competitor, business environment, marketing trend and prospect…
Fast food is an example of changing and developing market over the past years.
Living and working environment and food culture have been changing, people
quickly accept Western style fast food and this is a great opportunity for investors in

this area.
In a short time, the leading brands of fast food worldwide have been quickly
penetrating and growing strongly in Vietnam, for example, KFC, Lolteria, Jollibee,
BBQ, Pizza Hut...
Sales volume of fast food chain stores in five years from 2004 to 2009 had grown
55%, and forecasted to grow 18.9% / year from now to 2014. Sales of fast food
industry in Vietnam in 2009 reached 6.296,6 billion, expected to reach 9.204, 4
billion USD in 2014 (according to Eromonitor international). Fast food for lunch
time that serving officer is one of the major markets that competitors are focusing
on.
Vietnam currently has some brands participating in fast food industry and also
found the objective signs e.g. Pho 24, Ga 99 ... and most recently, in early July,
2011, Vietmac Rice burger brand was officially introduced in Hanoi after six month
of researching and developing.

1


2. Definition of Problem
Vietmac is trying to launch a new product – Vietmac rice burger to a rich potential
market but risk. It stared business with limited information about fast food market,
it did business when the founder saw the opportunity with his intuition.
Vietmac managers need to know both about market landspace and behaviour of
customer about Vietmac product.
Who are serving this market? What are customer’s needs, habit and satisfaction?
What is the most important characteric of fast food products?
Why some people choose FKC, others choose Jollibee, and some like Vietmac?
What differentiates Vietmac product from its competitors' products? Do we need to
enhance our current product or service?
What specific marketing strategies are currently using? How do competitors market

their products? Should marketing strategy need be revised?
After six months of testing new product Vietmac rice burger to Hanoi market, the
company has achieved initial goals, but this time the company needs to look back
for any adjustments in marketing strategy and marketing plan to choose a right way
of developing.
3. Objectives of the research
Vietmac had started its business with very limited information in fast food industry.
So that the first objective is to have an overview of Vietnam fast food market. It is
very important, once understanding about market, Vietmac managers will know
how to deal with it. Information about market the thesis will cover is: competitor,
customer need, habit, and satisfaction, product, price place and promotion, market
structure and opportinuty, awareness of Vietmac product.

2


The second objective is to measure the satisfaction of costomers with Vietmac rice
burger product after few months of testing and developing the products. Satisfaction
about brand/origin, nutrition/health, tasty/flavor, time consumming, menu flexible,
price, place, service and staff will be presented.
The author will focus on fast food products that serve for officer in lunch time in
Hanoi city.
Finally, is to provide Vietmac manager some recommedations in marketing strategy
and marketing activity.
4. Research question
To fullfill the objectives of the research, the study should answer the following
questions:
• Is there a need for Vietmac's product or service?
•

What is the target market?

• Who are the customers?
•

What do customers expect from this type of product or service?

•

What are customers willing to pay for this type of product or service?

•

What specific companies are servicing this market?

•

Is the market saturated or wide open? If so, why?

•

What is the size of the market? Is it a growing market? Is the industry stable,
volatile, growing or trendy?

• How can Vietmac reach this market? How do competitors reach the market?
What are the business models of competitors?
•

What core competencies must the product or service have?
3

•

What is Vietmac competitive advantage?

These questions will be answered after this marketing research is completed.
5. The necessary of the research
Marketing research covers a wide range of phenomena. In essence it fulfills the
marketing manager’s need for knowledge of the market. The marketing manager of
Vietmac may ask “How we can expand Vietmac brand and gather customer from
other competitors?” or “How is customer satisfying with the products?” Or “If need
to refine the product or price?...” Each of these marketing questions, as well as
questions concerning most other marketing decisions, requires some information
about how customers, distributors, and competitors will respond to the executive’s
marketing decisions. Marketing research is one of the principal tools used for
answering these questions.
Beside that, after discovered, the author found that, there are few reports,
documents, researches mentioned about Vietnam fast food market. While, Vietmac
had tested it products for few months, so that it needs more and more information
about fast food market and its testing results. This research may supply more
knowledge for readers, investors, marketers, and especially, it is meaningful for
Vietmac managers.
6. Scope of the research
First, in this research the author presents an overview of Vietnam fast food market
and some major analysises about it such as market trends, market prospect,
consumer market data, competitor information, model analysis.
Second, Vietmac customer satisfaction measurment will be conducted in the
research.
The author also compare Vietmac rice burger with the market leader, may be KFC,

Jollibee or Lotteria to find out the strong and weakness of each sides.
4


The research will conduct two questionnaire surveys, one for Vietnam fast food
market, and the other for Vietmac satisfaction measure.
Food for lunch time market is diversified to kinds of foods. Take the main market
share is traditional foods such as “ordinary sidewalk meals” (In Vietnamese is said
“Cơm bụi”), “home delivery rice meals” (In Vietnamese is said “Cơm hộp”), and
“canteen service”. However, Vietmac rice burger is defined as fast food, so the
author will not mention and analyse non-fast food products, or if yes, it is just point
of views of the author, professors, or information gathering from second data
sources. The fact that, definition of fast food is too wide, it includes any foods that
can be served fast, such as bakery product fast food, burger fast food, chicken fast
food, pizza fast food, Vietnam noodle fast food or it may be classified to chained
fast food and independent fast food, convenience store fast food… in this research
the author mainly focus on chained fast food with range of products that serve for
lunch time meal such as burger fast food, chicken fast food and Vietnam noodle.
And the research focuses mainly on officers working in Hanoi.
7. Research methodology
The data and information may be collected from primary source where data can be
measured in numerical or secondary source where information is just as point of
views. In this research the outhor uses both approach method of qualitative and
quantitative.
Data and information from secondary sources and surveys are both gathered.
This research will use descriptive research method to describe and demonstrate the
answers of the problems.
8. Research design
In general, the process of the research usually involves six phases described as
Figure 1. Phases of the research process:

5


Figure 1. Phases of the research process1
This research will follow this design.
9. Organization of the research
This thesis includes four chapters.
Chapter one: Literature review. In this chapter, we will scan through the literature
about marketing research, research methodology, marketing management, and the
theory of franchising. By understanding this literature chapter, readers will have a
better understanding the other chapters.
1

William G.Zikmund, Exploring marketing research, 2nd edition, 1986, p.40

6


Chapter two: Vietnam fast food market review and Vietmac marketing review.
First, this chapter will take an overview of Vietnam fast food market. It gives
readers an understanding about history, market trend, market prospect, consumer
market data, competitor and some industry model analysis. This chapter also helps
the researcher to do next chapters more fluently, accurately. It is also help
researcher to have more information for other analysis.
Sencond, the situation analysis is main concept of this chapter. General information,
idea, products, comparative advantages of Vietmac are mentioned in this chapter.
Chapter three: Surveys conducting and findings. In this chapter, the author will
describe the conducting of two questionnaires such as generating needed
information and questions, designing questions, respondents and sampling,

questions delivery, data process and analysis, and finally, the findings of the
research will be presented in this chapter.
Chapter four: Some Marketing recommendations for Vietmac. After discovering
theory, market review, conducting surveys, and the findings are presented in above
chapters. The author will make some recommendations for Vietmac. Future actions
should be suggested. Finally, in this chapter, any condensations will be summarized
in conclusion section.

7


Figure 2. Organization of the research

8


CHAPTER 1: LITERATURE REVIEW
By understanding the literature, readers can approach the research easily,
accurately. This chapter will mention about basis theories such as marketing
research, research methodology theory and implication for this research, marketing
management, and franchise theory.
1.1.

Marketing research

We now will scan for some theories about task and definition of marketing research,
marketing information system, and marketing research process.
Market research will provide specific market information that will permit the firm to select
the target market segment and optimally position the offering within that segment.

1.1.1. Task and Definition
The task of marketing research is to make the information used in decision making
more accurate. The emphasis of marketing research is to shift decision makers from
intuitive information gathering to a systematic and objective investigation.
As American marketing association: Marketing research is defined as the systematic
and objective process of gathering, recording, and analyzing data for aid in making
marketing decisions2.
After that, it expanded as: Marketing research is the function that links the
consumer, customer, and public to the marketer through information - information
used to identify and define marketing opportunities and problems; generate, refine,
and evaluate marketing actions; monitor marketing performance; and improve
understanding of marketing as a process. Marketing research specifies the
information required to address these issues, designs the methods for collecting

2

American marketing association (1960) Marketing definitions: a Glossary of marketing terms , page 17

9


information, manages and implements the data collection process, analyzes, and
communicates the findings and their implications.3
1.1.2. Marketing information system (MIS)
One of the most essential tasks of marketing research is to provide information for
making decision. Has many alternative sources and type of information. It may be
available or gathered from a survey. Managers usually complain of a lack of right
information, they were also overburdened with too much irrelevant information.
Resolution for this trouble, information should be managed systematically. Further,
as marketing research grew in importance during the 1950s and early 1960s,

managers realized that unsystematic handling of isolated problems as they occurred
was not the most effective means for gathering information. This more effective
type of thinking, along with the widespread use of computers, led to the
development of the marketing information system (MIS) concept.
A marketing information system is a continuing and interacting structure of people,
equipment, and procedures design to gather, sort, analyze, evaluate, and distribute
pertinent, timely, and accurate information for use by marketing decision makers to
improve their marketing planning, execution, and control.4
1.1.3. Marketing research process
In introduction, six phases of research had been listed. Now, Figure 3. Follow chart
of the research processshows the decisions that researchers must make in each
phase.

3

American Marketing Association (AMA) - Official Definition of Marketing Research

4

Philip Kotler, Principles of Marketing (1980, page 136)

10


Figure 3. Follow chart of the research process5
The process begins with problem discovery. Indentifying the problem is the first
step toward its solution.
Correctly defining the problem is the crucial first step in the marketing research
process. If the research problem is defined incorrectly, the research objectives will
also be wrong, and the entire marketing research process will be a waste of time and

money.
Exploratory research is often conducted during the initial stage of the research
process. The preliminary activities undertaken to refine the problem into a
5

William G.Zikmund, Exploring marketing research, 2nd edition, 1986, p.42

11


researchable one need not be formal or precise. The purpose of exploratory research
is a progressive narrowing of the scope of the research topic and a transformation of
the discovered problems into defined one incorporating specific research objectives.
Researchers have three basic techniques for discovering insights and gaining a
clearer idea of the problem: secondary data, experience survey, and pilot studies.
Statement of research objectives. After defining the problems, with or without
exploratory research, the researcher should make a formal statement of the problem
and research objectives. It points out the type of information that should be
collected and provides a framework for the scope of the study.
Research design. After the researcher has formulated the research problem, the
research design must be developed. A research design is a master plan specifying
the methods and procedures for collecting and analyzing the needed information, it
is a framework for the research plan of action.
Selection of the basic research method takes an important role. In general, there are
four basic design techniques for descriptive and causal research: survey techniques,
experiments, observations and secondary data studies. Which techniques should be
utilized depend on available data sources, the urgency of the decision, and the cost
of obtaining the data.
Once the proper design has been determined, the researcher moves on the next
phase: sampling.

Sampling involves any procedure that uses a small number of items or that uses
parts of the population to make a conclusion regarding the whole population.
The next sampling issue concerns sample size. Sample size means that how big
should the sample be?
Gathering or collecting information should be conducted after all above phases.
Correlative with research techniques, there are many methods of data gathering
12


such as: secondary methods, observation, mail interview, telephone interview,
personal interview, focus group.
Once data gathering has been completed, the data must be converted into a format
that will answer the research question. Data processing generally begins with the
editing and coding of data. Editing involves checking the data collection forms for
omissions, legibility, and consistency.
Before data can be tabulated, meaningful categories must be established for groups
of responses. The rules for interpreting, categorizing, recording, and transferring the
data to data storage media are called codes.
Finally, conclusions and reports are made for managerial decision.
1.2.

Research methodology theory and implication

This section discusses more about the research design and methodology. The first
concept that the author mentions is research purposes? After that, which method
approach should be used, in method approach theory, the author mentions about
types of research, research approaches, and choosing a basic method of research.
Which types of research should be applied, Exploratory research, Descriptive
research, Analytical research, Predictive research and why they are chosen? Which
method approach should be used, qualitative or quantitative? Which basic methods

of research should be applied, survey research or secondary data study?
To answer those questions, research design is first dealt with. Marketing research
design includes six phases (as in introduction mentioned, see Figure 1. Phases of
the research process). To discover research methodology, the phases will be
interpreted once again, see again at Figure 3. Follow chart of the research process
for analyzing.
After that, Sample selection, Data collection methods, Data processing analysis
will be discussed to help readers know more about how the surveys is conducted.

13


This section will detail the theory of above section – marketing research.
1.2.1. Research purpose
Market research is the process of systematic gathering, recording and analyzing
data about customers, competitors and the market. This research can help create a
business plan, launch a new product or service, fine tune existing products and
services, expand into new markets etc. It can be used to determine which portion of
the population will purchase the product/service, based on variables like age,
gender, location and income level. It can be found out what market characteristics
your target market has. With market research companies can learn more about
current and potential customers.
The purpose of this research is to help company make better business decisions
about the development and marketing of new products and fine tune the product –
Vietmac rice burger after few months of testing in market. It also has a review and
synthesis existing knowledge about marketing research and fast food market in
Vietnam.
1.2.2. Research approach
This research need information about fast food market, gathering information is one
of the most important tasks. So that, after definition of the problem and

identification objectives and questions of research, now the types of research,
research approach and research methodologies are needed to define and employed.
1.2.2.1.

Types of research:

Exploratory research is undertaken when few or no previous studies exist. The
aim is to look for patterns, hypotheses or ideas that can be tested and will form the
basic for further research. Typical research techniques would include case studies,
observation and reviews of previous related studies and data.

14


Descriptive research can be used to identify and classify the elements or
characteristics of the subject. Quantitative techniques are most often used to collect,
analyze and summarize data.
Descriptive studies are conducted to answer who, what, when, where, and how
questions. Implicit in descriptive research is the fact that management already
knows or understands the underlying relationships among the variables in the
problem. A variable is simply a symbol or concept that can assume any one of a set
of values.
A descriptive study used in thesis might include demographic and lifestyle
characteristics of customers, their habit and satisfaction. Other questions might
determine how frequency, or to whom they go with when using fast food. It is used
to explore competitor field and factors concerned to fast food.
Analytical research often extends the Descriptive research to suggest or explain
why or how something is happening. An important feature of this type of research is
in locating and identifying the different factors.
Predictive research: The aim of this research type is to speculate intelligently on

future possibilities, based on close analysis of available evidence of cause and
effect.
It is quite blur of edge within these above types of research, but as described, the
Descriptive method is almost used in this research.
1.2.2.2.

Research approaches

This research uses both data and information that gathered by previous authors and
by the author. To understand about fast food market, the author may synthesize
information from secondary sources or/and from primary data; to those data and
information, the author used both qualitative and quantitative approach method. To
understand about customer needs, habit, satisfaction… the author may conduct a

15


survey by questionnaire; to measure the information, the author should apply the
quantitative approach.
Quantitative approach is on collecting and analyzing numerical data, it
concentrates on measuring the scale, range, frequency etc. of phenomena.
Quantitative approach is one in which the researcher uses positivistic methodology
to develop knowledge (e.g. cause and effect, test a hypothesis or a theory).
Quantitative research involves analysis of numerical data. For this research, a
quantitative survey will be conducted. Followings are some features of a
quantitative research:
-

The aim is to classify features, count them, and construct statistical models in
an attempt to explain what is observed.

-

Researcher knows clearly in advance what he/she is looking for.

-

Recommended during latter phases of research projects.

-

All aspects of the study are carefully designed before data is collected.

-

Researcher uses tools, such as questionnaires or equipment to collect
numerical data.

-

Data is in the form of numbers and statistics.

-

Objective seeks precise measurement & analysis of target concepts, e.g.,
uses surveys, questionnaires etc.

-

Quantitative data is more efficient, able to test hypotheses, but may miss

contextual detail.

-

Researcher tends to remain objectively separated from the subject matter.

Qualitative approach is more subjective in nature than quantitative approach and
involves examining and reflecting on the less tangible aspect of a research subject,
16