ITM - Competitive Analysis - Sparkling Dream - 1
ITM - Competitive Analysis - Sparkling Dream - 1
COMPETITIVE ANALYSIS
Da Nang, 2024
Table of Contents
I. Competitors.............................................................................................................................................. 3
References .................................................................................................................................................. 17
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I. Competitors
Trung Nguyen Legend, born in the famous coffee hills of Vietnam, is a journey of constant creativity and
discovery. Founded in 1996 in Buon Ma Thuot, Vietnam, Trung Nguyen carries the mission of building a
unified human community, bringing true success and happiness. Not just a drink, Trung Nguyen Legend is
also a symbol of strength, and resilience, representing the spirit of entrepreneurship and endless conquest.
With a system of stores spread across Vietnam and internationally, they are not only a place to enjoy coffee
but also a destination for enthusiasts, a place to connect like-minded souls.
In the current market, Trung Nguyen has many competitors, especially two: Highlands Coffee and Phuc
Long.
• Highlands Coffee
From the love for Vietnam and passion for coffee, in 1999, the Highlands Coffee brand was born with the
desire to elevate Vietnam's long-standing coffee heritage and spread the spirit of pride, harmoniously
connecting tradition with modernity. By using clean, pure Vietnamese ingredients combined with a unique
filter brewing formula, Highlands Coffee quickly conquers the most demanding customers with its rich,
"standard" flavor according to the true Vietnamese coffee quality.
• Phuc Long
Phuc Long is a famous beverage chain in recent years in Vietnam. Not only does it attract customers because
of its delicious drinks, Phuc Long is also popular because of its diverse menu, prime location. After more than
10 years of nurturing from the famous tea plateau of Bao Loc, in 1968 Mr. Lam Boi Minh established Phuc
Long with the expectation of bringing customers quality tea and coffee products.
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II. Assess Competitors
1. Market share
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After the high-profile merger of Phúc Long and Masan Group (2021 – 2022), the revenue of this brand
recorded a 3.5-fold increase but stagnated at 1,500 billion VND in 2023, with market share decreasing
compared to 2022 to 4.52%. Although Phuc Long's revenue skyrocketed after the merger, profits continuously
declined over the two years, falling below 30 billion VND in 2023.
2. Brand Positions
Highlands Coffee
Highlands Coffee positions itself as a premium coffee brand, with a luxurious space, top-quality products,
and outstanding service. The goal is to become the preferred choice for those seeking an ideal relaxing space
with delicious coffee.
Phuc Long
Positioning about quality and experience: Phuc Long affirms its quality through products with rich, natural
flavors that suit the Vietnamese palate. The store's space is modern and luxurious yet still friendly, creating a
comfortable atmosphere for customers to relax and meet.
Positioned as a symbol of Vietnamese culture in the beverage industry: Phuc Long is one of the brands closely
associated with Vietnamese tea culture, yet it continuously innovates to align with modern trends, allowing
customers to take pride in and support domestic products.
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Highland has been wise in choosing the location for its stores. To cater to its target customers, who are
businesspeople, the stores are always located at intersections, crossroads, or gathering spots at the foot of
office buildings in major cities. This helps the store maintain a consistent brand image that always targets
wealthy entrepreneurs and intellectuals.
Understanding customer preferences
What gives Highland an advantage over foreign stores in Vietnam is the customers. Vietnamese customers
particularly enjoy strong coffee, while many European and American countries prefer a lighter brew. In
addition, the brewing method and type of coffee are also considered by the store to align with the Vietnamese
coffee-drinking culture.
• Weaknesses
Highlands Coffee's products still often use quantities served in hard-to-recycle plastic cups
This used to be one of the reasons that caused some trouble for Highland. Highland has invested in and
advertised its environmental protection campaigns on social media multiple times, but they still serve plastic
items and nylon bags. Considering the total of 300 stores nationwide, they have to serve millions of customers
each day, resulting in a significant amount of plastic waste being released into the environment.
In addition, currently, serving plastic items at large and long-established stores is considered unprofessional
by many people. Customers are looking to use paper products or more environmentally friendly items.
Phuc Long
• Strengths and Competitive Advantages
Directly targeting high-potential segments and markets
The F&B market has Starbucks and The Coffee Bean & Tea Leaf positioning themselves as premium brands
targeting office workers, high-income customers, and foreigners who prefer foreign coffee flavors, while
Trung Nguyên positions itself in the mid-range segment, primarily serving customers who enjoy traditional
coffee flavors. Not directly competing with those brands, Phúc Long Coffee & Tea chose a fresh and trend-
appropriate direction – targeting the middle class with stable incomes, office workers who are discerning about
tea and coffee.
It can be said that Phuc Long was very smart in choosing a highly potential market segment because this is
a customer base with a very high demand and frequency of tea and coffee consumption. Moreover, office
workers or young businesspeople with decent incomes often have quite "generous" spending habits; they are
willing to "open their wallets" to buy their favorite drinks daily.
Breaking the mold thanks to a unique and distinctive business USP
Creating the success of Phuc Long cannot overlook the unique USP (Unique Selling Point) that no other
brand possesses, which is that the flavor of Phúc Long must be singular, unique, distinctive, and different.
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Phuc Long is on the path to becoming the number one symbol in Vietnam for rich, pure, and delicious tea
flavors, thereby building a beverage brand that is "valuable and worth it." The tea flavor must be both
traditional and modern, meeting the discerning and fastidious taste of Vietnamese tea drinkers. Owning many
tea hills in Thai Nguyen, Phuc Long can proactively compete in flavor, appearance, and the most authentic
Thai tea quality.
Although there are more and more competitors, Phuc Long still maintains a strong performance that few
brands can "surpass." Not following the beaten path, this brand leaves a strong impression in the minds of
consumers by clearly defining its direction. With the motto "Quality ignites passion," Phúc Long has been and
is writing a story about a Vietnamese brand rich in tradition, quality, and class.
Focusing on product quality to create sustainable competitive advantages
To capitalize on the sophisticated taste for tea and coffee among Vietnamese people, Phuc Long has
leveraged its tea advantage to introduce signature drinks that are characteristic of the brand. Phuc Long milk
tea, Hong tea milk, lychee tea, peach tea,... with their impressive strong tea flavor, are the core products that
have made Phuc Long's name. If other types of milk tea and fruit tea on the market mainly have the sharp
sweetness of milk, sugar, and syrup, Phuc Long's tea is evaluated to lean towards the "astringency" of tea. This
flavor is very much to the taste of many tea connoisseurs, so it has been received with great enthusiasm.
Not only does Phuc Long elevate the quality of important products to attract customers, but it also expands
its menu to create a diverse and rich variety of flavors to offer customers more choices. The most notable ones
include Caramel Coffee, Vanilla Coffee, Iced Blended Coffee, Iced Blended Caramel, Iced Blended Matcha,
etc. Phuc Long's packaged products have good quality with eye-catching packaging, and they sell very well in
stores during festive occasions.
Distributing and reaching customers everywhere
After "returning home" to Masan, Phuc Long has expanded its network of standalone stores and kiosks
within the WinMart supermarket system. In terms of the number of points of sale, as of the end of 2022, Phuc
Long Heritage operated 78 flagship stores, 760 kiosks, and 13 small stores. Phuc Long has risen to the top of
the beverage chain in terms of extensive coverage in Vietnam. Besides traditional offline stores, Phuc Long
also focuses on expanding sales channels, notably through food delivery apps like ShopeeFood, GrabFood,
Baemin,…
• Weaknesses
One limitation of Phuc Long is that the tea brewing process takes a lot of time, resulting in a lengthy
preparation time, which often makes customers wait. Moreover, during weekends or holidays, the number of
customers at the stores is quite high, resulting in a lack of seating inside the shop and parking spaces. A recent
weakness of Phuc Long is that the rapid integration of kiosks into the WinMart+ chain has not been well
managed, leading to inconsistent product quality across all locations.
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4. Marketing Mix (7Ps)
TRUNG NGUYEN
7Ps HIGHLANDS COFFEE PHUC LONG
LEGEND
Products a. Offering a variety of a. Offering a variety of a. Offering a variety of
products suitable for all products suitable for all products suitable for all
customer segments. customer segments customer segments.
- Focuses on 4 main groups: - Beverage Group: Coffee, - Beverage Group: Tea &
High-class Trung Nguyen Tea, Iced Blended. Coffee, Milk Tea, Juice &
coffee, Trung Nguyen roasted - Food Group: with 2 main: Smothies, Cold Blended.
coffee, G7 instant coffee, bread and cakes. - Food Group: Snacks and
Trung Nguyen coffee beans. Bakery.
b. Focus on producing
healthy products.
- Produces products with low
caffeine content to help
supplement collagen, anti-
aging substances and diet
sugar specifically for women.
Price Trung Nguyen Legend Highlands Coffee focuses on Phuc Long focuses on
focuses on target customers target customers who have target customers who have
who have high income and are high income and are willing to high income and are
willing to spend money on spend money on quality willing to spend money on
quality products. products quality products.
a. Drinks a. Drinks a. Drinks
- The product price is only Drink prices at Highlands - Products range from
from 7,000 - 140,000 VND, so Coffee range from 29,000 35,000 - 75,000 (VND).
everyone can enjoy a delicious VND - 65,000 VND.
cup of Trung Nguyen coffee.
b. Foods b. Foods b. Foods
- Trung Nguyen Legend food Food prices at Highlands - Food prices at Phuc Long
prices range from 25,000 Coffee range from 29,000 range from 19,000 VND -
VND - 59,000 VND. VND - 35,000 VND. 35,000 VND
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Place a. Traditional distribution a. Traditional distribution a. Traditional distribution
channel channel channel
- Wholesalers; Retailers such - A total of 823 stores spread - Phuc Long Coffee & Tea
as grocery stores and stores. across the provinces of owns 84 stores across the
- 4 coffee roasting factories, 2 Vietnam. country.
instant coffee processing
factories along with 600
coffee shops and 121
exclusive distributors.
b. Modern distribution b. Modern distribution b. Modern distribution
channel channel channel
- The brand has built the G7 - Cooperate with beverage - Cooperating with popular
Mart system. delivery units such as delivery platforms such as
- In addition, the products ShopeeFood, Baemin, Grab,.. GrabFood and Shopee
available on: Shopee, Lazada, - Distribute and deliver Food helps the brand easily
Amazon, ... and technology packaged products to many meet the increasing needs
delivery applications such as convenience stores and of customers who prefer
Grab, Now, Loship… supermarkets nationwide convenience.
c. Franchise system c. Franchise system
- There are about 3,000 coffee Highlands Coffee also has a
shops in 63 provinces and 8 franchise system
franchise stores abroad in a
short time.
Promotions a. Social media a. Social media a. Social media
- TVC advertising and the - Youtube (TVC distribution) - Youtube (phát hành
advertisements of this brand - Facebook TVC)
often appear in prime time on - Instagram - Facebook
national channels such as - Instagram
VTV1, VTV3, etc.,
b. Promotions b. Promotions b. Promotions
- Implement promotional - Buy 3 get 1 free - Different promotions on
campaigns suitable for each - Save the combination. special occasions such as
holiday.
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- Receive incentives when - Free upgrade Tet, Mid-Autumn Festival
paying with online apps. -Seasonal discount plan. and Christmas.
People - Manager - Manager - Manager
- Staff - Staff - Staff
- Bartender - Bartender - Barista
-> They are trained to have -> Well-trained in coffee -> Phuc Long prioritizes
knowledge about the origin, knowledge, brewing skills developing a young and
types, roasting and brewing and attentive customer service dynamic workforce to
methods of coffee. Always methods and they need to deliver exceptional
show joy and enthusiasm meet high requirements in customer service. The
while serving. Create a working style and company focuses on
friendly and close atmosphere communication style to comprehensive staff
for customers. ensure bringing the most training, ensuring
perfect quality to customers. employees are skilled in
both coffee and tea
preparation while
maintaining a friendly,
approachable service style.
Process a. Delivery and service a. Delivery and Service a. Delivery and Service
process process process
- Cooperates with reputable - Order online (through - Order online (information
and reliable delivery units: delivery apps): via delivery apps):
• Grab • Grab • Grab
• ViettelPost • Baemin • Shopeefood
• Internal delivery • Shopeefood
teams
- Order directly: After - Order directly: Self-service - Order directly at the
ordering, customers will wait culture, after ordering and cashier:Self-service
for the waiter to bring the food paying, customers will receive culture, after ordering and
directly to the table and do not a signal device when the drink paying, customers will
need to go get it themselves. is ready at the counter to pick receive a signal device
it up themselves. when the goods are
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available in the spirit of
automatic retrieval.
b. Payment methods b. Payment methods b. Payment methods
• Momo • Cash • Cash
• Zalopay • Zalopay (only applied • Zalopay
• Bank accounts in some places) • Vnpay
• Payment by bank cards • Banking
• E-wallet • Momo
• Smart Banking
Physical a. Store decoration and a. Store decoration and a. Store decoration and
Evidence design design design
- Black and white tones - Red and dark brown tones - Green and white brown
- Bring a unique, elegant and - Creating a classic, warm tones
dynamic beauty. feeling for customers. - The coffee’s space is
modernly decorated, cozy
and spacious
b. Logo b. Logo b. Logo:
- The brand's logo shows a - Eye-catching design with 2 - The colors of Phuc Long
modern style, with a 3D space main tones of red and brown logo are carefully chosen,
embossed with sharp colors. representing a sunny and with dark green. It is
- The logo of Trung Nguyen windy highland where coffee known that green
Coffee Company is an arrow is grown. symbolizes life and white
pointing straight up to the sky, - If brown is the color of the symbolizes prosperity.
clearly showing the brand's soil and the oval is the shape Therefore, the colors of the
desire to rise and the will to of a coffee tree, then the white Phuc Long logo carry the
conquer the top. letters on a red background meaning of connecting life
represent the vitality and and prosperity. They are a
sophistication that is suitable harmonious, parallel
for the Vietnamese coffee connection.
consciousness. - The font "Phuc Long"
was chosen with a modern,
strong stroke design, and a
bit of a subtle curve to
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make the font friendly and
not too stiff. This shows
that the Phuc Long logo is
always strong, adaptable
and becomes a brand that
accompanies consumers.
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III. SWOT
Based on all the above analysis, we have analyzed the SWOT of Trung Nguyen Legned
Strengths
• Huge advantage in raw materials for coffee production.
• The G7 coffee brand has high quality and unique flavor.
• Wide distribution network with more than 1,000 stores nationwide.
Weaknesses
• Not much experience in foreign cooperation.
• Franchising is rushed and inconsistent.
• Constantly changing the system with signs, colors, and packaging.
• Having many projects and ambitions at the same time.
Opportunities
• Vietnam has joined the WTO. This led to a market explosion in Viet Nam.
• Instant coffee has grown popular as coffee drinking becomes a widespread habit.
Threats
• Many products that can replace instant coffee such as canned coffee or coffee at coffee shops.
• Vietnam’s economy is quite unstable and economic growth often goes hand in hand with
inflation.
• The development of foreign beverage brands has continuously threatened to affect Trung
Nguyen's market share.
• Many counterfeit products of the company cause loss of reputation.
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IV. Objectives
1. Increase awareness of new cake products for Trung Nguyen Legend.
• Specific: Increase awareness of new cake products for Trung Nguyen Legend.
• Measurable: Increase the rate of customers knowing about the store's new cake by 20% after 1 month
of launch.
• Attainable: Put the product on social networking sites, and launch eye-catching posters to attract
consumers' tastes. Grasp customer consumption trends and give search suggestions on the company's
website and put them in the top product search. And currently, they prefer products that bring health
benefits to themselves.
• Relevant: The company has enough resources and a good marketing department. As well as being
present on e-commerce platforms and having its own website, as well as cooperating with many
shipping units, it can easily reach a large number of customers and increase revenue, creating loyalty.
• Timebound: Within 1 month from the time the product is launched on the market.
2. Increase the sales of Trung Nguyen Legend's new cake product by 25% within 10 months from the
launch date.
• Specific: Increase the sales of Trung Nguyen Legend's new cake product by 25% within 2 months
from the launch date.
• Measurable: Achieve the goal of selling 5,000 new cake products through online sales channels, direct
sales at stores, and distribution partners.
• Attainable: Use social media platforms like Facebook, Instagram, and TikTok to build product
recognition through creative advertising and engaging content, including short videos, live streams,
and reviews from KOLs or influencers. At the same time, integrate promotional programs such as
discounts when ordering through e-commerce channels (Shopee, Lazada) or the company's website to
attract attention and encourage customers to make immediate purchases. In addition, collaborate with
partner restaurants and cafes to include cakes on their menus, pairing them with coffee products to
create a complete tasting experience for customers. Each order at these partners can include promotions
or small gifts to increase value and encourage customers to return.
• Relevant: The goal of increasing sales aligns with Trung Nguyen Legend's overall business strategy,
as the new bakery products perfectly complement the existing coffee products, adding value for
customers when enjoying both simultaneously.
• Timebound: Achieve the sales target within 2 months from the product launch date, with weekly
reports to assess progress and adjust the strategy if necessary.
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V. Marketing Strategy
1. Target Segment
The target is office workers over 25 years old. They are stable in their jobs and have high incomes. Office
workers often have to work overtime and their workload is quite large, so they tend to drink a cup of coffee
every morning. Coffee is a part of life. They pay attention to health and a healthy lifestyle. They tend to be
loyal to the brand. They care about customer service. They care more about quality and origin than price. They
are willing to spend money on coffee from famous brands or coffee that offers a unique experience. They care
about the time it takes to make coffee because they are very busy, or the long-distance transportation but still
keep the coffee hot or cold. Office workers often go to work early, so they won't have time to eat breakfast, so
when they go to a cafe, they will want to buy a food product to help them have a complete breakfast. This
helps them have more energy for a whole day's work.They often buy quickly from the sidewalk stall to take
away, or go to a coffee shop or order coffee on apps, or buy in groups. Offering products to go with coffee
helps them feel more comfortable.
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