Analysis of The Coffee House’s marketing strategy according to the 7Ps model

Among countless names, including famous brands, The Coffee House still managed to grab a lucrative market share for itself. And to do this, The Coffee House’s marketing strategy plays a very important role. Specifically, what actions has this brand taken? Let’s analyze with MarkKnow below

Overview of The Coffee House Brand

Owned by Seedcom Joint Stock Company, The Coffee House coffee chain was officially established in 2014 with the first store located at 86 – 88 Cao Thang, Ho Chi Minh City. After 10 years of formation and development, The Coffee House has shown its strength and “quickness”, affirming its capacity through continuous growth.

At present, The Coffee House covers almost all residential areas and bustling commercial centers in the city. Of which, the total number of The Coffee House stores nationwide is currently 117, with 57 stores in Ho Chi Minh City, 32 in Hanoi and many other stores in Da Nang, Hai Phong, Tay Ninh, Binh Duong, Hung Yen, Tien Giang,….

The success of this brand is not only built by an excellent business plan, but also lies in The Coffee House’s marketing strategy – a bright spot for other competitors to learn from. Among countless big names in the country and internationally, The Coffee House has its own position, building a strong brand with a deep impression in the hearts of many customers.

Analysis of The Coffee House’s marketing strategy

Overall, The Coffee House’s marketing strategy is implemented systematically in every aspect based on the 7Ps in Marketing :

The Coffee House’s product strategy

Pursuing a specific field such as the beverage industry, The Coffee House focuses a lot on product development. The products of this brand not only meet the taste factor, but also have to be beautiful in form. Above all, there must be diversity to meet the needs of each customer group.

Specifically, The Coffee House’s product marketing strategy is implemented in the following ways:

Product diversification

The Coffee House focuses on 3 main parts: food, drinks and gift products. In which, drinks are divided into 3 main groups, including:

• Group 1 – Coffee : Includes: black coffee, black coffee, latte,….
• Group 2 – Fruit, milk tea : Peach tea, oolong milk tea, black milk tea,…
• Group 3 – Crushed ice : Crushed chocolate, crushed cookie,….

Although owning a diverse menu of many types of drinks, The Coffee House’s main product is always Peach Orange Lemongrass Tea – a drink with a sweet, slightly sour taste, suitable for Vietnamese taste. The proof is that the brand has invested in many promotional campaigns for this product such as eye-catching advertising images in the menu, creating a feeling of thirst; building interesting stories around a cup of Peach Orange Lemongrass Tea, linking with daily life experiences, organizing contests or minigames on social networks related to the Peach Orange Lemongrass Tea product to increase interaction with customers,…

With food, The Coffee House offers two main lines:  Cakes and Snacks.

Not only boosting revenue, the two product lines of cakes and snacks help The Coffee House diversify its menu, attracting more customers with different needs, especially those who like to snack. The brand aims at a place to enjoy coffee and meet friends, so cakes and snacks will contribute to enhancing the experience, attracting customers to return to the shop. At the same time, The Coffee House often combines combo drinks and cakes/snacks at preferential prices, which is an effective way to increase the value of each bill at the store.

In addition, The Coffee House also offers seasonal gift sets such as Tet gift sets and Mid-Autumn gifts. These include iconic products such as precious oolong tea, traditional filter coffee, etc.

Continuous product innovation

Along with preserving and developing traditional beverage products, served at the shop, The Coffee House also expands its product portfolio by providing instant coffee, tea bags, etc. This helps businesses increase revenue strongly, meeting customers’ beverage needs at all times and in different spaces.

Focus more on “experiential” value instead of just stopping at the product

True to its positioning strategy, The Coffee House’s marketing strategy focuses more on enhancing the value of customer experience. Not only simply creating quality products, The Coffee House wants to bring customers perfect service, professional service, airy and inspiring space,…

The Coffee House’s Pricing Strategy

The Coffee House has used a market penetration pricing strategy by applying common, reasonable and “moderate” price ranges with the financial spending power of Vietnamese people. And only when it has a loyal customer base and gradually becomes famous, will this brand officially take steps to adjust prices based on new fluctuations from the market.

The average price of drinks at The Coffee House ranges from $1 – $3. Compared to many big names in the industry such as Starbucks or Highlands, the price of drinks at The Coffee House can be considered relatively reasonable. This meets the needs of most users who want to enjoy high-quality coffee and drinks, which is not having to pay too much but still enjoying delicious drinks with good service quality.

In addition, The Coffee House also implements a price hierarchy strategy based on different drink sizes such as small, medium and large. At the same time, it also applies a psychological price strategy – package price with combos of 1 cake and 1 drink to stimulate customer demand. This is really a smart move for a brand operating in the F&B field , with a diversity of customer groups and consumer behavior.

The Coffee House’s distribution strategy

The Coffee House fully exploits different distribution systems to achieve the best sales. The Coffee House’s business strategy focuses on 2 main sales channels:

• Direct sales at stores: To achieve direct access to the target customer group, The Coffee House arranges its stores in prime locations such as near shopping centers, office buildings, busy neighborhoods, etc. These are the places where the most customers are concentrated, customers with high consumption needs.
• Online sales: The Coffee House deploys online sales channels on many different protocols, including apps and websites. Customers can easily order food and drinks at The Coffee House through the company’s official website, and can also order through food delivery applications associated with The Coffee House such as Grab, Gojek, Shopee Food,…

The Coffee House’s Promotion Strategy

The Coffee House’s marketing strategy has implemented an effective multi-channel promotion strategy, building a widely recognized image, associated with a modern, youthful style:

Take Advantage of Social Media Channels

The Coffee House makes the most of the most popular social media platforms such as Facebook and Instagram to reach and interact with a variety of customers, especially young people, by creating viral campaigns to increase brand awareness.

Build a Big Community Project

Projects such as The Coffee House X The Library, The Coffee House X Vulcan,… all bring positive values, demonstrating social responsibility to the community. Specifically, The Coffee House X The Library is a project to build bookcases for children in disadvantaged areas, aiming to contribute to improving the quality of education, creating a better learning environment and increasing interaction between customers and the project through the activity of placing donation boxes at The Coffee House stores.

In addition, the cooperation with The Library Project also helps The Coffee House take advantage of the resources of a professional organization in the field of education, bringing books to children who still face many difficulties. In 2019, The Coffee House’s free electric arm production and installation project in collaboration with Vulcan supported a group of people with disabilities to integrate into the community. After being trained in basic skills, the “iron-armed warriors” will have the opportunity to work at The Coffee House stores nationwide. This project has spread and inspired thousands of people with disabilities in Vietnam.

TVC advertising with creative messages

The Coffee House has always been known for its creative and unique marketing campaigns, especially during the holidays. Inspired by a familiar fairy tale, The Coffee House has created a new, humorous and young-friendly story through the Mid-Autumn Festival campaign “The Tale of Cuội”.

In 2020, The Coffee House launched a campaign emphasizing the quality of raw materials and the coffee production process, with the message “Make a difference from the original quality”. In which, the TVC content revolves around the coffee production process, starting from the selection of raw materials to the brewing process. Combined with that, the brand’s social networking pages will share knowledge about coffee, new brewing recipes, coffee workshops, etc. Through these campaigns, The Coffee House has built the image of a high-quality, high-end coffee brand, increasing brand awareness and differentiation from competitors, while boosting sales during the holidays.

Loyalty Program

Regular customers of The Coffee House will have a membership card and receive accompanying promotional programs on every holiday and Tet. This brand also builds a community of loyal customers on social networking platforms. In order to boost sales, The Coffee House always builds attractive promotional policies such as discounts from 20% – 30% on the total bill for loyal customers, buy 1 get 1 free applicable during holidays and Tet, combining cake and drink combos with a price of 99K to hit the consumer psychology,…

In particular, The Coffee House customers will receive a free drink or cake on their birthday and can be accompanied by special discounts throughout the birthday month, thereby personalizing the experience according to the needs, preferences and characteristics of each customer.

Event Organization

Activities such as workshops and art exhibitions are created to increase new experiences for customers, encouraging customers to regularly interact and shop at the event. In addition, The Coffee House often builds a number of Minigames on social networks to create interactive games to award prizes and increase accessibility to many customer groups.

The human element in The Coffee House’s marketing strategy

The Coffee House’s marketing strategy is not only about building customer care services, but also focuses on training a team of professional staff.

About the customer

The Coffee House’s target customers are young people, students and middle-income workers who are looking for a place to meet friends, or to study and work. Therefore, The Coffee House’s store space is often warm and cozy, creating a quiet feeling. In addition to the main product of coffee, customers can enjoy drinks, cakes or other snacks to suit their needs and personal preferences. On each birthday, customers will receive congratulations and special promotions from the brand.

About the staff

The Coffee House brand focuses on personalizing the customer experience by training its staff to remember customer preferences to make appropriate suggestions. In addition, staff are also thoroughly trained in product knowledge, communication skills and how to serve customers professionally.

Process Elements in The Coffee House’s Marketing Strategy

To achieve its current position, The Coffee House has built a tight and effective marketing process system.

• Market research and product development: The Coffee House regularly surveys consumer tastes and trends to find new drinks that suit customers’ tastes. The barista team is responsible for researching and developing new recipes, combining unique and creative ingredients. New products will be tested with a small group of customers to collect feedback before being released to the market. Once the product is completed, The Coffee House will plan to launch the new product, often accompanied by special marketing campaigns.
• Building a marketing campaign: Each campaign has a clear goal, including increasing sales, raising brand awareness, or attracting new customers. First, the brand will clearly identify the target audience that the campaign wants to target in order to deliver appropriate messages. Depending on the goal and audience, The Coffee House will choose communication channels such as social networks, television, newspapers, events, etc. The Coffee House’s marketing content is often very creative, close to life and focuses on telling stories about coffee. After each marketing campaign, the most important thing is to evaluate the effectiveness based on indicators such as interactions, sales, and make necessary adjustments.
• Customer care process: Through membership cards, surveys, or mobile applications, The Coffee House collects information about customers to better understand their shopping behavior. Loyalty programs will be created to connect the community of loyal users and increase interaction with the brand. The Coffee House staff always serves customers professionally, enthusiastically and is ready to resolve all customer inquiries.

Facilities of The Coffee House

Physical Evidence plays an important role in building the image and increasing brand recognition of The Coffee House, thereby creating experiences and differences to attract customers.

• Shop space: Each store of The Coffee House is designed in a modern, open space, with many virtual living corners, creating a comfortable feeling for customers. The Coffee House uses natural light and yellow lights to create a warm, close feeling. At the same time, the music played at the shop always has a gentle rhythm, suitable for the space to chat, work and study. The combination of green trees also makes the shop space green and close to nature.

• Product design: The Coffee House uses uniquely designed paper cups, eye-catching colors, and environmentally friendly paper straws. The packaging is highly aesthetic, demonstrating the sophistication of the brand.

• Brand publications: The menu has clear, easy-to-read information, helping customers easily choose products. In particular, gifts such as cloth bags and notebooks often have beautiful designs, bearing the brand of The Coffee House.

• Staff uniform : Uniforms have youthful colors, simple and dynamic designs, suitable for brand image.

The Difference in Marketing Strategy of The Coffee House compared to Highlands

Operating in the same beverage and coffee business, The Coffee House’s marketing strategy is always compared with another major competitor in the industry, Highlands Coffee.

Brand Positioning

Compared to Highlands Coffee’s marketing strategy, The Coffee House has many similarities, both in terms of positioning and shop setup. However, looking more closely, both have very unique features, clearly showing their “personality” in terms of building and development orientation.

With Highlands, this brand always aims to spread coffee culture, at the same time build a connection with people, becoming a destination for the community. Sticking to this orientation, Highlands Coffee defines itself by simplicity, modernity but preserving Vietnamese identity, reaching international level but aiming at the community.

This has many similarities with The Coffee House’s marketing strategy. The Coffee House positions itself as a “factory” that produces and distributes quality coffee, with excellent service and reasonable prices. The Coffee House is likened to a “home”, a relaxing destination where people can relax, chat and work comfortably. The brand also has ambitions to expand to the Asian market, and even more broadly, the world. Like any Vietnamese coffee brand, The Coffee House wants to introduce and affirm the value of Vietnamese coffee on a larger scale.

Product

In terms of products, both Highlands and The Coffee House are following a multi-dimensional development direction, including both vertical and horizontal. Still focusing on coffee, these two brands have not forgotten to expand their beverage menu with more products. In particular, the recipes are gradually being perfected to better suit the taste of Vietnamese consumers.

In addition, the two units also expanded their beverage and food portfolio with cakes, snacks, etc. At the same time, they developed other specialized product lines such as instant coffee, roasted and ground coffee, canned coffee, etc. This helps create huge competitive advantages for both brands, responding to changes in the lifestyle and behavior of modern consumers.

Store Space

True to its positioning, Highlands Coffee’s space is a blend of old and new, both modern and traditional. Highland’s store design bears a strong impression of the past with hot red tones combined with brown wood and characteristic yellow lights. Meanwhile, The Coffee House has a much more youthful feel. The Coffee House’s store space is designed with brighter tones, with many similarities to coworking spaces, professional and tidy.

However, both Highlands and The Coffee House invest heavily in store space. Most of the stores of the two brands are located in prime locations, usually shopping malls and major streets with wide frontages and lots of traffic,..

Conclude

The above analysis of MarkKnow has helped you understand more about The Coffee House’s marketing strategy, thereby explaining why this brand has grown so quickly despite having only recently entered the market. It can be seen that The Coffee House has utilized most of its existing strengths, continuously deepening and developing new values ​​to meet the requirements from customers. This has helped the brand affirm its strong position in the highly competitive beverage market, even surpassing many big competitors to win on its home turf.