Phân tích chiến lược MARKETING MIX 7P của THE COFFEE HOUSE và STARBUCK Việt Nam, Phân tích SWOT, PESTLE của Starbuck

TRƯỜNG ĐẠI HỌC KINH TẾ QUỐC DÂN
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TOPIC: MARKETING MIX 7P OF THE COFFEE
HOUSE & STARBUCK; SWOT AND PESTLE ANALYSIS
NEW MARKETING PLAN FOR STARBUCK

THE COFFEE HOUSE


Contents
I. INTRODUCTION..........................................................................................................3
II. MAJOR FINDING........................................................................................................4
2.1 MARKETING MIX 7Ps..........................................................................................4
III - Develop and evaluate a basic marketing plan...........................................................16
3.1 Company Overview...............................................................................................16
3.2 SWOT Analysis for Starbucks..............................................................................18
3.3 Marketing Objective.............................................................................................20
3.4 Segmentation, Targeting and Positioning (STP).....................................................21
3.5 Tactics and Actions................................................................................................23
3.6 Evaluating and Monitoring marketing plans..........................................................24
IV. PESTLE Analysis for Starbucks................................................................................25
4.1. POLITICAL..........................................................................................................25
4.2 ECONOMIC.........................................................................................................25
4.3 SOCIAL-CULTURAL...........................................................................................26
4.4 TECHNOLOGICAL..............................................................................................26
4.5 ENVIRONMENT..................................................................................................27
V. Conclusion...................................................................................................................27
VI. References:................................................................................................................. 27

I. INTRODUCTION

This assignment is reviewing all the 7Ps of The Coffee House's marketing mix and
compare to Starbuck Coffee writing up a marketing plan( new service, existing market)
Right off the bat, Started propelling in 2014 however with the name The café and the
improvement of the brand is something that numerous new companies merit,
particularly in the F&B ( food and drink) industry. The café said it would turn into the
second Starbucks in Vietnam, while referencing The café is alluding to a Vietnamese
espresso brand. At present, The Coffee House has arrived at 80 stores, serving in
excess of 40,000 clients per day and it expended around 300 tons of espresso in 2018.
Secondly, Starbucks is a well-known global coffee brand and is currently the world's
largest coffee company, established in 1971 in the USA. Starbucks now has more than
17,000 stores in more than 50 countries around the world. In 2013 starbucks opened its
first store in Ho Chi Minh City. Nowadays in Vietnam, Starbucks coffee brand has
been present and become one of the familiar destinations of many coffee lovers.


II. MAJOR FINDING

2.1 MARKETING MIX 7Ps
Marketing Mix is a combination of marketing tools used by businesses to achieve
marketing goals in the market, 7P is a marketing model with 7 elements: Product,
Price, Promotion, Place, People, Process, Physical evidence ( Kotler and Philip
(2012)..

7Ps
Product

The Coffee house
+ Core product/ service

-Initially,

TCH

supplied

Starbuck

Evaluation

+ Core product/ service

Basically, the type of

-Initially, SB provided its main products of both TCH

mainly coffee.

product as coffee.

The formula of roasting and

There are 4 types of coffee (business to consumer).

blending Tica's Arabica and

based on 4 different criteria: In terms of product

Robusta

roasted

beans

creates

a

coffee;medium

and

SB

roast decisions:

are

All

overall balance of bitterness,

and dark roast; Normal coffee products

sweetness, sourness and it

(with caffeine), etc

makes

Currently, coffee, tea, cakes, conformance).

aromatic

coffee

stronger,

are

quality

Frappuccino drinks, smoothies products

B2C

SB
high

(quality
are

SB
so


are

all

main

products

of consistent that they are

Starbucks.

willing to give up their
products

+Additional services/products
+Additional
services/products

or

product

lines if those products

Fruit tea (Teavana iced tea- for have a major impact on
Apart

people

who

do

not

drink their key products. For

from popular cafe items,

coffee),

seasonal expamle,

TCH also develops many

products(Christmas

other products such as tea,

Espresso Roast), limited edition line

macchiato, fruit drinks and

products, products for festive influenced the flavor of

side dishes like cake, bread

seasons

and snack.

Valentine ( Starbucks cup).

such

as

SB

once

Blend discarded its sandwich
because

it

Christmas, the coffee they sold.

+Product/ service support

About

style

and

design

of

TCH

products.

For

+ Product / service support

SB Vietnam launched cards and drinking

water

Payment by card, momo, etc

mobile application instead of products: TCH starts

if customers do not use cash

cash payment.

from ordinary plastic

SB Vietnam will also introduce paper cups, or glass
(The Coffee House, 2020)

limited designs of each season.

cups shared for all
products and next is
the

cup

insulation,

with
.

The

most recent design
of TCH coffee beans
is wrapped in paper
material
environmentally
friendly.

-


+Pricing approach:
Price

+Pricing approach:

The prices of SB products are TCH

At the beginning when entering
the market, TCH did not pay

higher

than

usual

(

applies

VND right

80,000- VND 180,000)

the

market

penetration strategy.

much attention to profit, which

When

Vietnamese

helped to attract many potential

people

are

customers.

accustomed

After

fully

to

penetrating the market, TCH

drinking coffee at

gradually won over customers'

quite

hearts and profits began to

prices from brands

increase.

such as Starbucks,
+Pricing stategy:

expensive

Coffee Bean, etc, the

+Pricing strategy:

-Multiple products: SB also price

The average price of Urban

offers savings combo products 30,000-60,000 with

station, Passio ranges from VND

and ancillary services like a Western style is still

15,000 to VND 40,000, while

VND 80,000 savings breakfast. being ignored. It is

Trung Nguyen and Starbuck

These combos are aimed at this reason that TCH

Coffee are from VND 40,000 to

customers who care about price.

has

VND 90,000. The gap of VND

-Psychological pricing strategy:

researched

30,000 to VND 60,000 is TCH's

SB applies

market. TCH has solved the

Starbucks products come in 3 Conversely, SB does

problem: customers can sit to

sizes: Short, Tall and Grande. not aim at prices but

enjoy coffee in a peaceful,

After that, SB added 2 large focuses on product

luxurious space like the "big"

sizes:

foreign

as

Immediately, Grande became media message that

Starbucks or The Coffee Bean at

the "most reasonable" choice in they provide high

a reasonable price.

the eyes of customers.

countries

such

Venti

of

VND

carefully
and

middle price: entered the market.

and

Trenta. value, by giving the

value

products

customers.

+Factors influencing pricing

to


+ Factors influencing pricing

Infation,

Infation,

comes from competitors and

Further more, due to

lunch new products

fierce

Price

competition

comes from competitors

Price

competition
competition

from the Vietnamese
brand

group,

SB

started

running

events

or

discounting products
to keep customers in
order to keep the
growth pace.

+ Offline:
Place

+ Offline:
TCH

uses

TCH
direct

a

direct

sales

sales

distribution channel (direct to Basically, TCH and

distribution channel (direct to

end users). The store system is SB are quite similar

end users).In addition to the fact

built on the central roads. There in

that it makes an impression

are currently 64 stores across distribution.

through the thick appearance in

Vietnam

significant urban communities,

In addition, SB also cooperates the downtown areas.

the

with hotels, airports and coffee However, The coffee

brand

a

uses

likewise

acquires

focuses by picking the correct

shops in the office area

terms

of
The

shops are located in

house

diversifies

area for the intended interest

than SB in online

group. The Coffee House stores

distribution

are constantly situated in simple
to-discover

areas,

simple


stopping, the front of the focal
point of the locale, where the
eye-getting road see . TCH has
reached 160 stores covering 14
provinces and cities which are
usually big cities, of which the
highest concentration in Ho Chi
Minh City, the rest scattered in
the remaining city such as
Hanoi, Nha Trang, etc
+ Online:
+ Online:

Adapting to the development of

TCH operates its own delivery

technology, Starbucks develops

team from operator to delivery

an ordering application through

staff. Specifically, the delivery

the Starbucks App, allowing

service in the inner city through

customers

the coffeehouse.com website and

anytime, anywhere.

to

place

orders

the mobile phone app The
Coffee House, in cooperation
with food delivery applications

such as Lala.vn, Grab Food and
Now

+ Advertising
Promotion
+ Advertising ( Mainly Digital

-Facebook

The way of conveying

Marketing)

Starbuck's fanpage has 512,000 the message of TCH is


-Facebook: TCH's fanpage has
512,000

followers

"strange"

contrasted

followers

with

with the shared belief of

interesting

posts

about

brands in F&B industry,

promotions,

new

product

not just concentrating on

launches or special occasion

advancing items on the

wishes, posted on golden hours

media channels. From

frames suitable for young people

the good 'ol days, the

-Youtube:

3.5

benefit of mindful and

the

the obligation to make

creative change video has won

-Website: Starbucks has an eye- the living condition of

the hearts of customers

catching website with all the everybody quite solid

-Website: TCH has a beautifully

necessary information

thousand

designed,

With

nearly

subscribers,

very

attractive

top need of TCH.

website. moreover, using tools
like Google AdWords makes it

-Facebook hashtags are not very

easier to reach customers.

reliable to everyone, but with

-->In October 2019 ,the straw

Starbucks, they have shown a

reduction

quick effect for the discount

campaign

at

The

Coffee House - "Thank you for
refusing to use straws" was
posted on facebook, youtube and
TCH's website and caught the
attention of many people.
+ Public Relation:
- After a few weeks, the straw
reduction campaign: TCH began
reducing the disposable plastic
straws at the entire system

has consistently been the

campaign through hashtags.


+ Sale Promotion
A new Starbucks discount
+Sale Promotion:

campaign for customers is that

TCH discounts 20% all drinks

they will get a discount in the

to encourage people to support

afternoon if they buy Starbucks

after the launch of the campaign

and

have

the

hashtag

#TreatReceipt on Facebook that
morning.

+Process serving
Process

A greeting by a Starbucks
+Process serving

employee

Starbucks is frequently

Greet and invite customer to

an

exceptionally

order

bustling

spot,

Customers

order

and

their employees need to serve


drink/food
Confirm order

clients as effectively as
could be expected under
the circumstances while

Make the payment
Print the invoice and invite

Staff delivery the drink (food)
to the customer.

Staff delivery the drink (food) to
the customer.
+ Customer process

Order, payment at the counter

Get the bill

Choose a table

Receive the drinks and
enjoy

People

have

abundant staff

customer to choose the table

Transfer the order to the bar

TCH

+Recruiment and selection

more


+Recruiment

and

determination

-SB is always looking for

Serving clients in only

people

who

3

about

coffee

are

passionate

and

good

at

minutes,

serving drinks for over

- Prioritize experienced staff,

mixing techniques

30

great correspondence in both

-meticulous

English and Vietnamese

program: send an experienced

Starbucks

management team and barista.

With

recruitment

minutes

just

create

complete

the

the

effective.

receptionists

in

is

distinction that makes

- Love the activity and want to
themselves

never

2
and

1

staff,

administration business. .

+Attitudes and behaviour of

Starbucks

-Recruitment

staff:

220

employee screening monthly

-Customers were welcomed

terms

+ Attitudes and behaviour of

with

employee,

staff:

special cup of coffee and were

centered

listening to the

small things but has

-Friendly,

and

training,

enthusiastic

and

goodwill,

served

a

extensive

can

serve

clients/hour.
of

In

TCH's
Person-

”from

the

always take care of customers,

knowledge about coffee and

brought

(from

firsthand

effect. Every decision

service,

cashier

to

to

see

the

tremendous

security). For example, the

preparation technique. This

and

glass of purified water you

contributes

Coffee House begins

drink will always be filled,

always eager to come back

with

your vehicle will be taken to

next time

"Deliver Happiness".

to

customers

action
the

at

The

mission

your place.

From

- Do not wait until being

staff

reminded

employees

satisfaction. This has

always meticulously observe

made them wild fans

the activities and wishes of

of TCH in a very

customers to support at all

natural way

times

that

pleasure
to

to

customer


Physical
Evidence
Each new and renovated store

State

-TCH's space is intended to

uses one of the four design

Starbucks

make the "home" feeling as

mattress concepts (Starbucks

anyway not obliged to

could be expected under the

Corporation, 2020).

its store structures,

circumstances:

yellow-tone

-Heritage Cafe with wooden

logo, coffee cups, and

light to expand the comfortable

floors, stained concrete floors

napkins.

inclination, skyscraper design

or flower-tiled floors, metal

offers customers an

consolidating the utilization of

chairs

alluring

many glass, windows, making

lighting. Large and long tables,

It has gotten another

an open and open space, tables

club chairs and wooden blinds

approach to manage

and seats arranged by zone,

evoke a sense of the turn of the

store structures. The

TCH likewise has a long table

century

new

technique

in the style of "Cooperating

-The

requires

Starbucks

space" - an open workspace, .

simple

as

makers to look at

Most of the tables here are

exposed steel beams, brick

each store solely to

equipped with sockets to serve

walls,

glass

ensure that it looks

customers.

windows of the factory and

especially close by.

hand-polished

As far as TCH, they

-Classic

architecture

intermingled

Artisan

factory-style

Store

materials

honors

such

two-winged

wood

being

of

fuses

Starbucks
atmosphere.

modern,

constructions at an innovative

continually

creative

gathering place for cultural

clients another space

paintings, trees opened a cool

activities. and art.

experience

and clean space. Futher more,

-Regional Modern uses bright

natural.

recently released The Coffee

space, with lighting systems to

House Signature, this highlight

create a quiet and modern

is

getaway

decorated

the

with

and

of

with

thing

that

attracts

after

the

noisy,

visitors. TCH Signature has

bustling world.

extremely wide glass space;

-The Concept Store is a unique

bring
however


highlighted with 2 luxurious

environment created by our

orange - black colors. Lots of

designers

green trees also make this

innovations within the cafe.

space a truly relaxing place in
the heart of Hanoi.

to

explore

the


Overall Objective
The common goal of both TCH and SB is to increase market share and increase sales. The 7 elements
of a marketing mix strategy play a very important role in achieving overall objective.
An appropriate pricing strategy helps the company to attract more customers. Futher more, IMC
(Integrated marketing communication) makes a substantial contribution to approach more customers
by attractive promotions.

Besides, product quality as well as good service process won more

sympathy from customers. The above factors will help gradually gain the trust from customers as well
as gain market share and increase revenue
Infact, in 2018, TCH applied a better marketing mix strategy than CB. 2018 is the rise of TCH,
usurping SB to occupy the second position in revenue. The second position in the ranking has had a
big change when TCH, with a growth rate of nearly 100%, has knocked Starbucks off. The TCH's

revenue in 2018 reached nearly 670 billion VND, while SB only reached less than 600 billion VND,
although before that in 2017, SB's revenue was higher than TCH by more than 100 billion VND
(Tuyet Lan, 2019).


III - Develop and evaluate a basic marketing plan

In this part, I would like to write up a marketing plan for a new service to an
existing market.

3.1 Company Overview
+ Brief Starbucks history
According to Starbucks coffee company (2020)
 The first Starbucks store was opened in Seattle, Washington, on March 30, 1971
 1982, Howard Schultz joins Starbucks as executive of retail tasks and
marketing. Starbucks starts giving espresso to fine cafés and coffee bars.
 1998, Starbucks had more than 1,500 stores in North America and the Pacific
Rim
 February 2013, Starbucks officially launched in Vietnam with the first store
opening in Ho Chi Minh City.
+ Mision
 Inspire and nurture the human spirit - one person, one cup of coffee and one
neighborhood at a time (Starbucks coffee company, 2019)
 Besides, Starbucks also made statements about environmental mission (Strive to
buy, sell and use eco-friendly products; Develop innovative and flexible


solutions to bring about change, etc)
+ Vision

 Embrace local and global markets, inspiring a new cup of premium coffee
everyday

+ Core values
 Starbucks is returning to its core values - luxury cafes
 The space of Starbucks cafes both brings the taste of modern life and gives
customers the classic beauty.


3.2 SWOT Analysis for Starbucks
From the analysis of external environment, inside Starbucks when entering Vietnam
market as above, we can create a SWOT model to analyze its strengths, weaknesses,
opportunities and threats as follows:
STRENGTH
-As a famous global brand, having

WEEKNESSES
-High price ( compared to other coffee

successful experience in Asian market

brands in Vietnam)

and known by many Vietnamese
people

-Products can be imitated and lack of

-Good product quality, professional

products too unique

service
-Business approach towards people and
the environment

-The problem of raw materials, while
Starbucks mainly imports coffee from
the outside

OPPORTUNITIES
-Expanding markets outside the US,

THREATS
-Compete with some famous coffee

especially potential as Viet Nam-

brands in Vietnam ( Trung Nguyen, The

young and open market.

Coffee House, etc) and companies that
sell cheap coffee

-Concerns about food safety and

-Coffee drinking habit with strong and

hygiene in Vietnam. This is the

bitter taste of Vietnamese people

motivation for consumers to find new
options
-The average income of Vietnamese
people is increasing
As a matter of first importance, Starbucks is the most celebrated and amazing brand in
the food and refreshment industry. Its size, volume and number of steadfast clients has


expanded after some time and that has a solid fascination for Vietnam advertise.
Starbucks items are astounding quality, appear to be earth cordial and generally
appropriate across areas. Therefore, they can bear to charge clients at a significant
expense, which a great many people are eager to pay. In addition to the fact that this
means incredible benefits, however it is additionally all around perceived as a standout
amongst other bistro chains. Further more, regarding quality, flavor and normalization
- because of its high mix of and delectable espresso, Starbucks has extended all around.
It offers fantastic quality and steady standard items at all areas.

Starbucks offers a high offering cost to amplify benefits, yet this makes it harder to
sell. This interior vital factor is a shortcoming since it confines the organization's piece
of the pie, particularly to generally low-pay buyers. While Starbucks might be known
for its smoothies, pumpkin zest nets and huge chocolate bread rolls, they don't
generally have the most one of a kind market. Loads of cafés, chains or something else,
offer comparable items and are simply behind the enormous names of Starbucks.
Besides, Starbucks items are anything but difficult to duplicate. For instance, littler
nearby contenders can create drinks that are not actually the equivalent yet are
fundamentally the same as the organization's items. Indeed, even the inside plan and
space at Starbucks stores are anything but difficult to reproduce. This business

condition has reinforced the opposition.

Extending in creating markets - Starbucks has a bistro essentially in the US.
Worldwide development in certain territories of Vietnam can give an extraordinary
chance to the organization.


Concerns about food safety and hygiene in Vietnam. This is the motivation for
consumers to find new options like Starbucks products. Additionally, the average
income of Vietnamese people is increasing, the more demands.
In terms of threat, Starbucks has to compete with some famous coffee brands in
Vietnam ( Trung Nguyen, The Coffee House, etc) and companies that sell cheap coffee.
Further more, coffee drinking habit with strong and bitter taste of Vietnamese people is
an unfavourable for Starbucks

3.3 Marketing Objective

A good marketing objective is beneficial to accomplish what a business wants from its
marketing activities and it is significant that marketing objectives and marketing plans
support the general destinations of the business (Jim, 2017).
In terms of Starbuck, there are 2 main marketing objectives for a new product
( existing market)
1st MO : Raise awareness of targeted customers about new products
With new product, Starbucks wants 90% of its targeted customers to know the product
within 3 months, 65% of which love the product and 75% of which use the product.
2nd MO : Increase market share and sale after launching new products.
Starbucks needs to release a new product into the market to add at least 7% to overall
market share and increase sales of new products 5% over each month.

3.4 Segmentation, Targeting and Positioning (STP)

+ Segmentation
According to Mike (2018), market segmentation helps businesses save time and
money. Moreover, it helps businesses identify strengths, weaknesses and opportunities
for their brands.
Starbucks classifies based on 3 criteria: Geographic, Demographic and Psychographic
-Geographic:
Starbucks focuses only on two big cities, Hanoi and Ho Chi Minh.
Hanoi and Ho Chi Minh defined as a national central cities to become potential places
for selling new products. Especially, HCM city is the largest city in Vietnam in terms
of population and economy
- Demographic
Starbucks' new products are aimed at young people with middle-income.
-Psychographic
Starbucks' new products are aimed at young people with healthy lifestyles who prefer
healthy drinks.

+ Targeting
Starbucks applies focus strategy :
Targeted clients of Starbucks go from the age of 18 to 22 in the two females and guys
however female clients represent most of deals customets. Starbucks centers around
understudies who need to appreciate the beverages with free-associated wifi in
loosening up climate, visit with companions


Following The Central Intelligence Agency (CIA, 2018), the population of Vietnam
from the age of 18 to 22 is:
Age
18-22

Hanoi

Ho Chi Minh

Total

0,8 million

city
0,6 million

1,4 million

This is a decent number for Starbucks to approach. Futher more, this section likewise
has diverse tastes and interests and they are very much aware of their needs

.

Quality

Price


Based on perceptual maps, we can see the position of 3 products : Starbucks, Lofia
and Fresh Saigon . All 3 companies sell healthy drinks.
The reason why customers buy products based on price and quality is that targeted
customers who care about their health will naturally demand high quality products.
Moreover, the right price is always one of the top priorities for consumers in any
product. In tems of Starbuck, they have a competitive advantage that is the famous

brand available. The launch of new products will make many consumers curious and
want to experience. Starbuck's new products are priced and quality between Fresh
Saigon and Lofita.

3.5 Tactics and Actions
In this situation, I would like to change 3 elements of marketing mix of Starbucks:
Product, Price and Promotion.
+ Product:
Core products are juice and Detox with no sugar
+ Price startegies
Starbucks applies new product pricing stategies
-Market penestration strategy : Low price at first (35-45 VND) and encouraging trials
After gaining market share, pushing prices up to the most reasonable.
+ Promotion
Starbucks will apply IMC strategy


-Advertising: Attractive articles and promotions about new products are posted on
social networking sites such as Facebook, Youtube and Website during golden hours
- Direct marketing
Starbuck will applies couponing: use printed media to get feedback from readers with
cut-out coupons in exchange for a discount
+Sales promotion
Providing discount, voucher to encourage potential customers to use the new product

3.6 Evaluating and Monitoring marketing plans

Starbuck applies the strategy of giving 20% discount vouchers for each customer when
buying the next product on the condition that: Invite 2 new users of Starbucks
products.

Therefore, Starbucks will monitor the progress of the marketing plan through the
number of vouchers that customers give them when they buy new products.


IV. PESTLE Analysis for Starbucks
According to Will (2020), PEST analysis studies the effects of factors in the macro
environment, including political, economic, social, environment, technological and
legal factors.These factors are external factors of the business and industry
4.1. POLITICAL
First of all, political factors unequivocally influence the misuse of business openings
and the accomplishment of the business objectives (Julian and Campisi, 2016).
Vietnam is one of the countries with the most stable politics in Southeast Asia. The
Government issued Resolution No. 13 / NQ-CP of May 10, 2012 on a number of
solutions to remove difficulties for production and business, supporting the market.
Restructuring of state-owned corporations and enterprises so that manufacturing
enterprises have competitiveness, advanced technology and skilled labor - this is a
long-term solution that the State is particularly interested in.
4.2 ECONOMIC
Economic factors affecting purchasing power, changing consumer demand or the
development trend of industries (Swan and Trevor, 2014).
Vietnam is one of the Southest Asia's quickest developing economies and has a plan to
be a created nation in 2020. As per the Word Bank, the gross dosmetic produtct (GDP)
in Vietnam is expanding. In addition, per capita pay additionally increments. Likewise,
Vietnam consumer pricce Index (CPI) additionally ascends as of late. As indicated by
the report of General Statistics Office of Vietnam, just in 2016, CPI expanded from
100.17 Index focuses in January to 103.31 Index focuses in September

From these information, it is protected to state that Vietnam is a likely market for any
business. The economy is developing which is a perfect pattern that makes Vietnam
turns into a decent goal for Starbucks to broaden their business.