PART II: APPLYING THE 4 PS OF MARKETING TO SERVICES
The 7PS OF HIGHLAND COFFEE
Highlands Coffee's 7Ps marketing mix strategy is analyzed based on seven important factors in
marketing: Product, Price, Place, Promotion, People, Physical, Environment and Process.
1. PRODUCT
1.1 Product brand
Brand logo - one of the important factors in implementing the new business strategy of Highland
coffee. Before 2013, the meaning of Highland was full of coffee with the image of a parallel coffee
powder. After 2013, Highland Coffee decided to renew its logo, this time the logo reflected the image
of mountains, land and the flow of water; talk about the origin as well as the quality of coffee in the
highland sunny and windy. At the same time, the main color is highlighted to attract people.
1.2 Packaging Products
Highlands is a large coffee company that started business in Hanoi in 2002, accompanying the
Vietnamese coffee culture for the past 20 years. To create such great success, packaging is one of the
important factors that contribute greatly to brand development. Although the product packaging is
simple, it shows the luxury, and thanks to the loyalty to the red - black color, it has created a
distinctive feature in Highlands Coffee that many people love.
1.3 Raw material supply
Highlands Coffee uses 100% coffee from the
fertile highlands of Vietnam. This is the brand's
commitment to contribute to maintaining the
sustainability of Vietnam's coffee growing
industry through the purchase of clean
ingredients, grown on Vietnamese land, with
both human effort and will. Vietnamese.
Ingredients at Highlands Coffee are purchased
from coffee farms of farmers in Gia Lai, Dak
Dak, Buon Ma Thuot and Lam Dong.
1.4 Types and categories of products
Regarding the product development strategy of Highlands, it can be clearly seen that this brand divides
the menu into 2 distinct parts: Drinks and food. First of all, drinks, it can be seen that Highlands' drink
line is divided into 3 main groups:
● Group 1: Café (Café, Phindeli, Cafe Espresso) with Phin Sua Ice as the main product.
The perfect combination of premium Robusta and Arabica coffee beans grown in the
fertile highlands of Vietnam, along with the unique art of roasting and the traditional
Vietnamese “Phin” filtration method. Highlands coffee helps drinkers stay awake for work
or simply enjoy relaxation in a gentle, slow way.
Illustration for coffee products of Highland coffee
● Group 2: Tea (Lotus tea, fruit tea & green tea) with Golden Lotus Tea as the main product.
Tea is made from rich and readily available Vietnamese tea ingredients with fresh fruit,
and topping or milk. Highlands Coffee's tea products are for customers who can't drink
coffee or want to experience the fresh taste of traditional tea.
Illustration for tea products of Highland coffee
● Group 3: Freeze with Freeze Green tea as the main product. Freeze is a Vietnamese-style
iced drink made from pure Vietnamese ingredients with crushed ice and jelly. Freeze is a cold
drink that helps drinkers stay awake while still helping to relax stress.
Illustration for freeze products of Highland coffee
The 3 main products representing each group are always branded Highland Coffee
In addition to these three groups, the company also serves a number of other drinks, but these are not the
main products, so they will not be discussed. We can easily see that 3 key products representing each
group are always favored by this brand, and appear in most advertising campaigns.
Next is food, in this group Highlands is divided into 2 main lines: Bread and cakes. In addition to the
popular choice in modern cafes for cakes, the chain also adds bread to its menu as a leading product. It
can be seen that banh mi is considered the "national spirit" of Vietnam, it is also the most popular street
food in this country. Bread can be eaten at any time (morning, noon, late afternoon or evening). This is
also a wise strategy of the Highlands, when bread is a dry food and easily causes thirst. Therefore, every
time a customer orders bread, the company also sells water.
Illustration for bread and cake products of Highland coffee
Highlands also launched packaged products such as canned coffee or roasted coffee, making it accessible
to customers far away. Moreover, this brand also launches fashionable water bottles and cups that attract
young people. At the same time, encourage customers to bring water cups to reduce waste into the
environment.
2. PRICE
2.1 The basic price of Highlands Coffee
The price of Highlands Coffee is currently ranging from 30,000 to 70,000 VND. Specifically the
following lures:
● Coffee: prices range from 29,000VND to 75,000VND.
● Tea: prices range from 39,000 VND to 55,000 VND.
● Freeze: prices range from 49,000 VND to 65,000 VND.
● Breads or cakes cost about 29,000 VND.
Highland Coffee's menu can clearly show the price for each product
This is a price that is not considered appropriate in the Vietnamese market, where the world's fifth
largest exporter of coffee. Compared to the common ground, this price is not low, however, for the
target customers who are middle-class people who have a stable income, namely coffee for business
men/women, this is an acceptable price. On the other hand, for a big brand like Highlands, the cost to
make a cup of coffee is not only input materials, but also many other costs such as premises,
promotional activities, etc.
2.2 Compare prices with competitors
Compared to the price of competitors, the price of Highlands Coffee is lower, specifically as follows:
2.3 Price adjustment strategies
♥ Package pricing
♥ Promotion pricing
♥ Geographical pricing
3. PLACE
3.1 Distribution channel
3.2 Distributing nationwide
Currently, Highlands has more than 300 stores
spread across 24 provinces in Vietnam. This
brand's chain of stores is located in the most prime
locations in the city center, making it easy for
everyone to access.
Highlands Coffee distributes by selling directly at
the store. Highlands Coffee shops are found
around major streets or historical sites such as
Hanoi Flagpole, Opera House... or around commercial centers such as Vincom Ba Trieu, Bitexco,
Saigon center, etc. Shark Vault… and under many office buildings. Highland Coffee wants to reach
out to more employees working in office buildings as well as Tourists…
In addition, with the expansion strategy through franchising, the
brand can reduce the cost to open an exclusive store, on the other
hand, it also has a stable source of income from franchise fees.
Through franchising, Highlands can scale up its presence quickly
with low risk.
Not only selling directly at the store, Highlands also brings its
packaged products to supermarkets or convenience stores. At the
same time, the company also cooperates with food delivery units such
as Shopee Food, Baemin, GoFood, Grab... to help customers place
orders at home without going to the store. Especially in the context
that the Covid-19 pandemic is still breaking out and there is a
potential risk of infection, it is also a solution to help Highlands sell goods during the epidemic
season.
3.1 Franchise
The secret to the success of Highlands is to build a great Highland
Coffee franchise system while providing customers with excellent
products with attentive service and the most appropriate prices.
Although not the number one in terms of quality, Highlands Coffee is
currently the most successful brand of the chain-based business
model - a franchise-oriented business model.
4. PROMOTION
As a big brand, Highlands does not appear to be an outsider in promotions. Despite having a strong
foothold in the beverage industry, this does not mean that this brand is indifferent to promotions, on
the contrary, this is also the brand that launches many of the best promotions. Notable programs such
as Highlands Coffee have many promotions such as collecting three stamps, giving one ice milk filter,
or free upsize for women on the occasion of October 20 or March 8, combo tea and cakes for the
afternoon… In addition, to maintain customer loyalty, Highlands Coffee also prepares a membership
card system, such as a VIP card with benefits such as discounts, gifts attached ... or loyalty card with
promotional campaigns on the price of drinks.
After a period of social distancing due to the impact of the Covid-19 pandemic, Highland Coffee has
implemented many discount and promotion programs. Especially in the past December, there were
many attractive offers for customers when coming to Highland Coffee.
5. PHYSICAL ENVIRONMENT
Highlands is always in the top brands investing in space rental as well as store decoration. Most of the
stores are divided into two types: indoor and outdoor. The space in the house is luxurious and cozy,
which is suitable for customers who prefer privacy and quiet. At the same time, soft music is also a
suitable choice for this space. On the contrary, the outdoor space feels close to nature, suitable for
those who like dynamism and bustle.
Highlands Coffee with brown, red and white as the main color. In the early stage, Highlands Coffee's
logo was only red to distinguish it from other coffee brands, with brown as the main color. However,
the company later combined the two sepia colors, with the brand name written in white. Highlands
Coffee's logo has a brown hill at its center, representing a sunny and windy highland that grows
coffee. And this hill is surrounded by the words "Highlands Coffee" in an oval symbol for coffee
beans. If brown is the color of the earth, the oval is the shape of a coffee bean, then the white text on a
red background shows the sophistication and enthusiasm for the spirit of Vietnamese coffee.
The chairs in Highlands Coffee's coffee shops are made of many different materials such as wood,
sofa, cushions, rattan... The interior of Highlands Coffee always comes with the natural landscape to
create a relaxing space. And a very Westernized style through a system of wooden tables and chairs,
as well as white umbrellas for outdoor coffee tables. This is a symbol commonly seen in coffee shops
in Italy or France. In addition, the bartender in Highlands is also located in the center of the store,
from which customers can see each beverage preparation process and feel more secure about product
quality.
Not only that, the Vietnamese spirit is also reflected in the yellow decorative lights made from
bamboo and rattan, creating a familiar and cozy feeling for customers when entering the store. In
modern commercial centers such as Vincom, Parkson, Highlands Coffee shop becomes even more
prominent with wooden floors, different from the rest of the stores next door.
6. PEOPLE
Highlands Coffee's staff is rated
as always friendly to customers
and serving in the best condition.
Along with that, the staff is also
selected and trained through a
rigorous process.
To become an employee at this
coffee chain, whether it is a part-
time or full-time position or any
position, one must meet high
requirements for working style as
well as service style in order to
be able to work. bring the best
quality to customers. In addition,
Highlands also regularly recruits
young, dynamic and enthusiastic
staff to help customers always
feel new when entering the store.
Before starting work, each
employee is trained for 3 days on
the basics of coffee and service
style, then works under the
guidance of the management
team.
7. PROCESS
The processes at Highlands are very simple to help customers save time and facilitate purchases. When
coming here, right after ordering, customers will receive a pick-up device.
In addition, Highlands also added many payment methods other than cash such as cards, or e-wallets to
help customers have more choices as well as optimize the payment process.
THE FLOWER OF SERVICE
1. CORE PRODUCT
To optimize benefits for customers, Highland Coffee tries to diversify its core products as much as
possible, they not only provide beverage products such as coffee, tea, freeze,… and food products such as
bread, cakes, ... but also sold with products about mugs, instant coffee...
2. SUPPLEMENTARY
SERVICES
♥ Information: In order to meet the needs of searching for customer information, Highland Coffee
builds its own website, fanpage and even mobile app to provide customers with all detailed
information about the Highland Coffee brand (introduction, vision, core values,…) and their
services (prices of each product of food, drink and accompanying products, preferential packages,
product reviews...). Even through the website or app, customers also know the location of each
Highland Coffee branch, which branch is closest to them for their convenience in moving.
♥ Consultation: Highland Coffee offer training and inspirations to their employees regarding the
service they need to offer, this include coffee knowledge, how the beverages should be prepared
and how the customer intimacy is needed to fulfill the Highland Coffee culture. Highland Coffee
staff always ask and give suggestions to customers first, to meet the needs of customers.
♥ Order-taking: Highland Coffee offers a membership card so that customers can accumulate
points after their purchase and receive extra products. They also offer a broad menu with a wide
variety towards food and beverage, their order wait delivery consists in writing your name and
within 5 mint your order will be ready. At the same time, customers can order products online
through apps, which helps customers to be more proactive in terms of time.
♥ Hospitality: Highland Coffee does this very well in that they design the space of the shop and the
waiting space for customers to be very clean and beautiful, the interior is modern to create a
feeling of relaxation and enjoyment for customers even when they use it. service and when they
wait to receive their drinks. Even Highland Coffee offers security systems with cameras, free wifi
in their shops.
♥ Safekeeping: The maintenance of Starbucks is very good, they keep their cafes clean, the counter
is always organized, there is a self.cleaning system where usually customers clean their tables, but
if some customers don't clean there is always someone keeping the service quality. At the same
time, Highland Coffee provides free parking for customers.
♥ Exceptions: Highland Coffee offer in their web site a part for complaints and suggestions,
complaints usually are made presencialy in their shops, which have a quicker response, they also
provide information about ingredients and food allergies that customers must be aware of.
♥ Billing: Bill is the element that shows the sophistication of Highland Coffee's service model. To
create the most convenience for customers, Highland Coffee issues an invoice right before the
customer completes the order, the invoice contains information about the combo that they ordered,
the staff will capture the information themselves and do not need to ask the customer again.
♥ Payment: Starbucks manage their billing process quite standard, they have digital terminals that
connect directly with the financial transaction, invoice are generated after the payment. Highland
Coffee also provides a variety of payment services for customers including cash, swipe cards,
vouchers or e-wallets such as VNPAY, Grab Moca, etc.
