MINISTRY OF EDUCATION & TRAINING

C COLLEGE OF BUSINESS
SCHOOL OF INTERNATIONAL BUSINESS- MARKETING
----

FINAL-TERM PROJECT
MAJOR: MARKETING

TO SELECT THE MARKET AND THE

ENTERPRISE
TO DO SEGMENTATION OF THE MARKET,
SELECT MARKET THAT IS RELEVANT TO
THE ENTERPRISE AND IDENTIFY KEY
CONSUMER PROFILE

Student name: Trần Hồng Nguyên

Student ID: 31231024659
Class: MRF001
Lecturer: Professor Trần Mai Đông
Course code: BUS503070
Batch: 49
Table of Contents
COFFE INDUSTRY AS A MARKET ……………………………………...
1
.The need to evolve to meet customers’ new demand from the coffee
industry……………………………………………………………………….
2. Coffee industry in
Vietnam……………………………………………….
2.1 Overview…………………………………………………………………
2.2 Consumer’s behavior in Vietnam and the disadvantage for
international coffee brands………………………………………………….
STARBUCKS AS THE STUDIED
ENTERPRIZE ……………………….
1. Starbucks history………………………………………………………….
2. Challenge in the Vietnam coffee
market…………………………………
TARGET MARKET ANALYSIS FOR
STARBUCKS……………………
1. Market segmentations…………………………………………………….
1.1. Demographics…………………………………………………………...
1.2. Geographics……………………………………………………………..
1.3. Psychographics………………………………………………………….
1.4. Behavioral……………………………………………………………….
2. Key market target………………………………………………………...
3. Consumer profiles………………………………………………………...
3.1. The Coffee Aficionado………………………………………………….
3.2. The Healthy Seeker……………………………………………………..
3.3. The Social Media Influencer…………………………………………...
3.4. The Night Owl students………………………………………………...
3.5 The Nostalgic Boomers……………………………………………….....
APPENDIX…………………………………………………………………..
REFERENCES……………………………………………………………....

COFFEE INDUSTRY AS A MARKET

The quality of life has improved continuously, and people's product requirements
become stricter. Apart from necessities, their demand varies in specific aspects of
things. They want to eat well-seasoned and beautifully presented food, not just
something random to fill their stomachs. They want to wear unique and elegant
clothes with various styles to their liking, not just a piece of cloth to cover themselves.
 Overall, people seek a pleasurable experience from the products they choose
to use. As a result, products and services have witnessed drastic change alongside
the improvement of technology. New ideas, trends, and business models have
emerged in markets, leading to nonstop development in industries and things they
provide with advanced quality as well as new marketing tactics.
1. The need to evolve to meet customers’ new demand from the coffee
industry
The coffee industry witnesses evolution alongside the development of
consumerism. Coffee has been one of the most popular types of drink for people,
especially for workers and students who need to stay conscious and productive to
execute their work for a long time, as caffeine in coffee can help boost people's
energy. However, consumers no longer want to come to the café only for a single type
of coffee with average or low quality; they also want the coffee shops to expand the
types of coffees they serve with various origins and recipes at various price ranges for
a broader range of selection. They consider coffee a comfort drink, which is their
reward after a busy day. In order to keep up with customers' constant new needs,
coffee shop owners have to find suitable and logical directions to raise their branch's
awareness and reach potential customers to stand their ground in the marketplace.
2. Coffee industry in Vietnam
2.1. Overview
Vietnam is the second largest coffee exporter and ranks first in coffee cultivation
yields. These yields were made up of domestic brands such as Trung Nguyên, The
Coffee House, and Highlands Coffee, and international coffee brands like Arabica,
Café Amazon, Starbucks, and so on. Since the coffee business thrives with hundreds
of coffee shops from distinctive brands nationwide, its market experiences heated
competition.
2.2. Consumer’s behavior in Vietnam and the disadvantage for international
coffee brands
Domestic coffee brands have the upper hand as they have existed for quite a
long time in Vietnam, thus making them memorable and associated with
Vietnamese daily life, which directly impacts their decision to purchase coffee
from these local brands. This brings challenges for international coffee brands
even though they have gained brand awareness in different nations, and in this
case, it is Starbucks.
STARBUCKS AS THE STUDIED ENTERPRIZE
1. Starbucks history
Though the brand offers more than just coffee, Starbucks's primary drink is
coffee. It has been well known for its service and products, for Starbucks is the
world's most famous grocery brand.
As for the business's history, initially, it was a small store specializing in selling
premium coffee and coffee grinding equipment. The history of this small coffee shop
turned to a new page when Howard Schultz - the famous CEO of Starbucks until now
- realized the potential of serving coffee in Italy to America. This world's largest
coffee chain had successfully overcome the global economic crisis, with the first
quarter of 2009 revenue reaching up to 2.7 billion USD and net profit at about 242
million USD, increased by 300% in the same period in 2008, which is the year when
Starbucks Coffee's business situation encountered hardships. After 50 years of
construction and development, Starbucks has not only limited itself to Seattle or the
US but has even spread out of the continent, introducing modern Italian coffee
enjoyment technology to other countries such as Japan, Hong Kong, South Africa…
and Vietnam is one of those new markets that they wanted to conquer.
2. Challenge in the Vietnam coffee market
The coffee consumption behavior of Vietnamese customers has noticeable
differences compared to Starbucks' previous markets. When the brand first entered
the market, Vietnamese people only preferred using their local coffee brands since
they had gotten used to the taste and the affordable prices, while Starbucks'
coffee's taste was new and the price was rather costly. This reduced Vietnamese
customers' willingness to pay as they hoped it would be worth the money.
TARGET MARKET ANALYSIS FOR STARBUCKS
Behind a successful business is a well-structured marketing strategy, and the
same can be said in the case of Starbucks company. Therefore, they strive for new
marketing methods to increase business profit, yet grabbing customers' attention can
be challenging. To change the situation, Starbucks could research and analyze the
collected data to determine its market segmentation. After the first step, they can
divide the general market segments into critical market targets to create detailed
consumer profiles with distinctive characteristics from the suggested segmentations.
Once Starbucks owners finish determining their prioritized customers, they can
develop a differentiated marketing strategy and focus on these specific groups of
consumers to achieve desirable efficiency in advertising.
1. Market segmentations
Starbucks' market segmentation can be divided into four criteria: demographic,
geographic, psychographic, and behavioral. Starbucks is a worldwide brand. However,
this essay mainly focuses on the coffee business in Vietnam so that the criteria will be
given based on this specific research scope. Demographics will focus on the target
market's biological gender, age, occupation, and income level. Geographics will
consider areas where the coffee shops are located. Psychographics, on the other hand,
includes customers' social status and analyzes their coffee tastes and types preferences
to provide Starbucks data about products for diverse customer needs. The behavioral
elements in Starbucks' market segmentation can explain consumers' purchasing
behaviors and loyalty toward this coffee brand.
1.1. Demographics
For demographics, Starbucks focuses on males and females, white-collar
workers and students, mainly those pursuing university. Therefore, the targets are
those with ages ranging from 18-60. Single people, those with lovers, and married
couples with or without children are also included. Rich kids between the ages of
15-17 can also be included as potential customers. Often, these customers will
have an income of more than 6,000,000 VND/month.
1.2. Geographics
For geographics, Starbucks has more than 87 small branches across Vietnam,
with facilities mostly located in Ho Chi Minh City and Ha Noi, the two central areas
of Vietnam with a dense population. Placing the facilities in these places will easily
hold targets' attention, thus making approaching targets more effective.
1.3. Psychographics
The Psychographic criteria of Starbucks mainly focus on the targets' social status
and their different lifestyles. Starbucks' consumer targets are mostly the middle and
high classes, and they are interested in coffee culture. These people are willing to pay
for luxurious coffee drinks provided that the quality they receive is worth the money.
1.4. Behavioral
Behavioral segmentation observes customers' behavior in Starbucks, how often
they visit, and what they order. Through observation, the company can gain insights
into the customers' behavior, preferences, and attitudes toward the brand.
2. Key market target
After analyzing the market segmentations, it can be inferred that Starbucks' key
target markets are usually urban, have good academic knowledge, and are affluent.
Their occupations typically include professionals, students, and other individuals with
high incomes who are coffee enthusiasts and have an interest in coffee culture. These
people have been searching for a luxurious coffee experience with high-quality
service and a comfortable space to relax that can meet their expectations. In addition,
Starbucks also targets consumers who prioritize convenience and quality over cost and
attracts those who want to express their love for coffee by allowing customers to
customize flavors and ingredients to create a cup of coffee that suits their liking.
3. Consumer profiles
Consumer profiles are created for Starbucks to better understand its target
audience and preferences so the company can generate more targeted and effective
marketing campaigns that use customized marketing materials, promotions, and
events to attract specific groups of customers. Besides that, consumer profiles help
Starbucks see risks in their plans and help adjust them into more complete and suitable
ones to bring higher customer satisfaction. In addition, consumer profiles provide
Starbucks with detailed information about their customers. The company can use that
data to maximize the effectiveness of its operations. The data can include information
on customer demographics, purchase histories, and customer feedback, all of which
play a part in helping with Starbucks' strategic decisions about their product offerings,
pricing strategies in different provinces all across Vietnam, where to build new coffee
shops and what to decorate to attract more potential customers.
Below are five possible consumer profiles suggested by the author:
3.1. The Coffee Aficionado
A coffee aficionado is a person who has a wide range of knowledge about things
relating to coffee. Their age range is usually 22-60, and their income is at least
5.000.000 VND/month. They are experts when it comes to exporting coffee quality
since, with just one smell or taste, they can tell which coffee bean was used, how the
drink was brewed, and how long it was made. They love combining different
ingredients and using various methods to create unique flavored coffee drinks with
pleasant aromas. They are also quick to update the latest coffee trends. This consumer
chooses Starbucks because they want to drink premium coffee from experts with
enough knowledge to handle the high-class ingredients. This type of consumer's
frequency of coming to Starbucks coffee shops tends to be occasional, and they are
willing to pay for coffee at high prices as long as the quality meets their expectations.
Starbucks can give them a Starbucks card with special discounts to make them feel
appreciated and become loyal customers.
3.2. The Healthy Seeker
This type of consumer is a health enthusiast interested in healthy lifestyles. They
are usually women who have been married and have families to take care of; their age
range is from 20-60, and their income is estimated to be over 7.000.000 VND/month.
This consumer seeks coffee with healthy components or contains organic compounds
that are beneficial for the human body, such as antioxidants, vitamins, or minerals.
They love consuming organic coffee beans from trees that are grown without the
usage of pesticides or any chemical substance. They may also be interested in coffee
with a low percentage of caffeine or added supplements, such as omega-3 or
probiotics. Another reason they chose Starbucks is its well-known reputation, so food
safety and hygiene can be guaranteed. Starbucks can give a more detailed description
and emphasize how fresh and healthy the coffee products are to encourage this
consumer to buy more products.
3.3. The Social Media Influencer
This consumer is interested in using famous coffee drinks and sharing their
thoughts on social media platforms through review clips. They are likely to be
teenagers or young adults with the age range from 16-25. They tend to have interests
in fashion, daily lifestyle, and social media trends. They can be considered rich kids or
successful people at an early age with an average income of at least 7.000.000
VND/month. This consumer will likely try out every coffee drink to make more
content for viewers. They are the ones who have a direct impact on viewers' intention
to try out the coffee products themselves. They can gain money from reviewing
products if they get booked by the Starbucks company. This is a relationship where
both parties gain profits. However, the company should be independent of KOLs, for
the primary purpose is to improve the quality of the brand's product. A good coffee
drink will be recognized and welcomed for a long time for its high quality.
3.4. The Night Owl students
This type of consumer is often a student who is pursuing university. Their age
range is 18-22; their income is at least 4.000.000 VND/month. They tend to stay up
late studying or working on projects. Since this is a long process, they need coffee that
is high in caffeine and has a solid flavor to keep them focused and energized for a
long time. Since this type of consumer has the habit of camping in the café for a long
duration, it would be reasonable for Starbucks to prepare bean bags to help them rest
more comfortably, bringing satisfaction to them and creating a good and caring image
of the company in the eyes of this type of consumer.
3.5 The Nostalgic Boomers
This consumer is interested in coffee that reminds them of their youth. They are
usually the elderly who have retired and want to enjoy their time in slow motion or
baby boomers who are interested in nostalgia and traditional values. Their age range is
above 55 years old, and their income is estimated at least 4.000.000 VND/month.
They may be interested in classic coffee drinks such as Americano, cappuccino, or
espresso. They may also be interested in coffee shops with a nostalgic, old-fashioned
aesthetic. Starbucks can occasionally consider decorating coffee shops with vintage
themes and colors to create a visual impact. They can also make a playlist with
classical musical instruments or old songs back in the 90s to further give this type of
consumer the calm atmosphere they are looking for in the fast pace of life.
APPENDIX

(Picture source: https://vietnamtop10.net/starbucks-coffee/)

 (Picture source: https://vincom.com.vn/brand/starbucks)

REFERENCES
1. (“The Love and Hate Relationship of International Brands in Vietnam’s Coffee
Market.”)
2. Nguyen, Pham. “Vietnam Coffee Market: Consumers, Challenges, and Prospects.”
Vietnam Briefing News, 15 Sept. 2023
3. (Starbucks)
4. Edrawmind. “Starbucks Market Segmentation, Targeting, and
Positioning.” Edrawsoft, 2022.