ii
ACKNOWLEDGEMENTS
ACKNOWLEDGEMENTS
I owe the greatest debt to my tutor, Prof. Dr. Nguyen Ngoc Hoa, his intellectual
support and advice, continuous guidance, full of patience and enthusiasm, has kept me
carrying out my thesis and writing up my thesis. In spite of being very busy with his
plentiful plans, Prof. Dr. Nguyen Ngoc Hoa has been very generous with his time,
comments, suggestions and corrections on the draft of my thesis. Without such
guidance and assistance, I could not have finished my research and writing up this
thesis on time.
My utmost thanks go to my study group in MBMM4 class, who gave me endless
experienced and mental support. Also to my family, other colleagues and friends, who
listened to my ideas and encouraged me in completing this thesis.
I am ever more indebted to all Professors of Solvay Business School, my school,
who gave me very interesting and great lectures. This course gives me a lot useful and
interesting knowledge that helps me much in my future career path. Especially thanks
to Prof Bayern, chairman of the program, for his enthusiasm, support, and
professionalism.
iii
TUTOR’S COMMENTS
Ms. Nguyen Thi
Thi Thi
Thien Huong tries her best to conducted the thesis on the topic
“Exploring Customers Demands and Habits of Drinking Fruit Juice In Hochiminh City”
The author has had a lot of efforts to gather information as well as to conduct a
research to understand the demand and habit of consumers in drinking fruit juice. The
results and conclusions of the thesis with applicable recomendations are useful
information for the people who want to enter the fruit juice shop business in Ho Chi
Minh City
The thesis meets requirements of MBA thesis. I suggest the committee should allow
the author to present it to your kind perusal and consideration.
Hochiminh city, Vietnam, December 10, 2010
Regards,
Dr. Nguyen Ngoc Hoa
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TABLE OF CONTENTS
Declaration
Acknowledgment
Tutor’s comment
1. Executive Summary
2. Introduction
3. Overall Background
3.1. Scientific Research on Use of Fruit Juice
3.2. Business potential of Fruit Juice market
3.2. Overall Background about Fruit Juice Market in Vietnam
4. Literature Review
4.1. Defining Problems
4.2. Hypothesis Statements
4.3. Objective
5. Research Design and Methodology
6. Data Analysis & Result
6.1. Demands of Fruit Juice
6.2. Frequency of Buying / Using Fruit Juice
6.3. Types of Using Fruit Juice
6.4. Customer feeling about price
6.5. Promotion
6.5.1. Kind of Fruit Juice Shop
6.5.2.Key Factors Concerned for a Produces
6.5.3Added Value for a Fruit Juice Shop
6.5.Conclusion on data analysis
7. Recommendation
7.1 Product
7.2. Price
7.3. Place (Distribution)
7.4. Promotion
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2
4
4
5
7
10
12
13
13
14
16
19
20
21
24
26
26
28
30
30
34
34
34
35
35
v
8. Conclusion
References
Appendix
1. In-depth interview
2. Questionnaire
2. Data Report
37
38
39
39
41
49
vi
LIST OF TABLES
1. Figure of Off-trade Sales of Fruit/Vegetable Juice by Subsector:
Value 2004 – 2009
p.8
2. Figure of Company Share of Fruit Juice in by Off-trade
volume 2005 – 2009
p.9
3. Graph of Stimulus Response Model of Buyer Behaviors
p.11
4. Chart of level of research method process
p.16
5. Chart of level of education
p.17
6. Chart of level of professional
p.18
7. Chart of Things doing at Leisure Time
p.19
8. Chart of Purpose for Using Fruit Juice
p.20
9. Chart of Frequency of Drinking Fruit Juice
p.21
10. Chart of Attitude of Drinking Fruit Juice
p.22
11. Chart of Time of Drinking Fruit Juice
p.22
12. Chart of Attitude for accompanies to go with
p.23
13. Chart of Where to Drink Fruit Juice
p.24
14. Chart of Customer Feeling about price of Fruit Juice
p.25
15. Chart of Kind of Fruit Shop to enjoy
p.26
16. Chart of Buying Fruit to process at home in field of leisure activities
p.26
17. Chart of Buying at Takeaway shop in fields of gender
p.27
18. Chart of Buying at Takeaway shop in fields of professional
19. Chart of Key factors concerned for a takeaway shop
p.27
p.29
20. Chart of Key factors concerned for a shop
p.30
21. Chart of decoration for a products of a fruit juice shop
p.31
22. Chart of Added value for a products of a fruit juice shop
p.32
23. Chart that summary the data analysis process
p.33
1
1.
EXECUTIVE SUMMARY:
Despite fruit juice has been available for some time; it has never been as
popular as other soft drinks, such as carbonates. And despite fruit juice shop
has been appeared several years ago, it also haven’t created interest to
customers as other shops like restaurants, coffee shop, etc. This study was
concluded to find out if there is a demand of fruit juice shop in Hochiminh
City and the drinking habits of customer. This thesis is limited to Hochiminh
City only because of some geographical, climate reasons that may affect to
the demand of drinking fruit juice more than other locations.
Conceptual frameworks was built in researches about usage of fruit juice all
over the worlds, then develop to their economic value together with Stimuli –
Response Model of Customer Behavior from Sandhusen, Richard L. .
Therefore defining problems and create hypothesis for the demand and habit
of drinking fruit juice in Hochiminh City. The research samples method is the
mix of qualitative and quantitative with 200 to be delivered out and filled in
by 200 respondents which get 112 positive feedbacks with using fruit juice.
Descriptive and frequency analysis are used to analyze data.
The result was found out that demands of fruit juice in Hochiminh City are
obvious and customer’s drinking habit is very multiform. Two kinds of shops
are preferred by respondents and follow those are factors that customers
require to the products. Base on these readers will get recommendations for
those who want to invest in this area.
2
2.
INTRODUCTION:
We live in Hochiminh City, the largest city in Vietnam, where provide lots of
work and attract many young people. Ho Chi Minh City is the most important
economic center in Vietnam as it accounts for a high proportion of Vietnam's
economy. With a population now 7,162,864 (as of Census 2009 on April 1, 2009) Ho
Chi Minh City is in need of vast increase in public infrastructure. Transportation
here is extremely crowded and the environment is polluted with lots of vehicle. The
city has a tropical climate, specifically a tropical wet and dry climate. The weather is
usually hot can lead people to using of drink to refresh.
These days our bodies need more vitamins and minerals than ever before.
This is because we work longer hours, are exposed to more toxic fumes from
pollution and are under more stress than we used to be. Eating fruit every day is a
simple way of providing your body with these nutrients to ensure you are well
equipped to deal with the stresses of daily life, and possibly protect you from
illnesses in the future.
It is no secret that eating fruit is good for you and has plenty of health
benefits. Generally, people who eat more fruit as part of a healthy diet are less
likely to develop diseases such as diabetes, heart disease, Alzheimer’s and cancer,
and they provide your body with all the nutrients it needs to fight other infections
and repair cells, too.
A diet involving regular amounts of fruit will provide your body with
antioxidants to help prevent free radicals from attacking the body.
There are some products from fruit, one of them is fruit juice. 100% fruit
juices are a smart addition to any well-balanced diet, providing vitamins and
3
minerals like potassium, vitamin C and foliate. Fruit juice is also a convenient way
for adults and children to help reach the recommended number of daily servings of
fruits and vegetables.
Despite fruit juice having been available for some time, it has never been as
popular as other soft drinks, such as carbonates. In 2009, with increasing awareness
of local consumers over health problems and attempts to control their calorie intake
by cutting down on carbonated drinks, this is a very good chance for other healthier
drinks to step up. Fruit juice is said to contain a lot of vitamins and added minerals
which are very good for the heart and the skin.
The demand and consumption of fruit juice in Hochiminh City is real. There
are many people, esp. female using fruit juice in coffee shop, juice booth in
shopping mall or even vendors in the streets. Beside, % of people using fruit juice
bottle like Minute Maid Teppy, Dr. Thanh ….. are also increase. The success of fruit
juice brand such as Tan Hiep Phat, VFresh from Vinamilk is the evidence for that
need.
However, juicy juice shops where provide fresh juices are not too much and
play no important role in consumer’s mind. When talking about drinking shop, even
with a fruit juice lovers they mostly remember coffee shops, bubble tea chains,
street vendors or juicy bottles brands…. but not a fruit juice shop.
Knowing that situation, we start a project about Exploring Customers’
demands and habits of drinking fruit juice in Hochiminh City – Vietnam. This project
has ambitious to find demands and fruit juice drinking habit of customers in HCMC,
which factors affect them most. Therefore we can help enterprise who wants to
invest in this area to find the best segmentation and plan for their business.
4
3.
OVERALL BACKGROUND:
BACKGROUND:
3.1 Scientific Research on Use of Fruit Juice:
If you enjoy a glass of 100% juice as part of your daily routine, chances are
you also have fewer risk factors for several chronic diseases when compared to your
non juice-drinking peers. New research presented today at the Experimental
Biology (EB) 2009 meeting highlights this association among adult men and women,
with evidence showing that 100% juice drinkers were leaner, had better insulin
sensitivity and had lower risk for obesity and metabolic syndrome - a cluster of
conditions that increases risk for stroke, heart disease and diabetes. From the
National Health and Nutrition Examination Survey (NHANES) 1999-2004 - an
ongoing data collection initiative through the Centers for Disease Control and
Promotion
We all know how fruit mean good to us. Fruit juices, as another step, are the
development of drinking habit, from eating fruit to drinking fruit juice. There are
many studies about the uses of fruit juices overseas, from a French scientist who
declares that fruit juice may have benefits over whole fruit, according to their
research in the April 2008 issue of Molecular Nutrition and Food Research.
The researcher hypothesized that juicing might affect the content of phenolic
compounds, which are powerful antioxidants contained in fruits. To test their theory,
along with a control group, hamsters were fed either grapes, grape juice, apples,
apple juice or water, along with a high fat diet known to promote atherosclerosis in
these animals. (Atherosclerosis is the buildup of fatty plaque deposits in the arteries
that can lead to heart attacks or strokes).
5
About the research, Decorde's team writes that it, "provide encouragement
that fruit and fruit juices may have a significant clinical and public health
relevance."
The researchers also note that their findings suggest that the phenols
contained in foods have a direct effect on its antioxidant properties, along with other
antioxidant compounds such as vitamin C and carotenoids.
There are other studies in cancer research, which found that eating fruit and
drinking fruit juice help to defense cancer according to the nutritional components of
fruit. Cancer is proving to be a disease of lifestyle, environment, and culture, and not
a condition caused by a genetic factor, microbe or germ.
A research by Joanna Verdan said that At least 70% or more of your nutrition
should come from fresh fruits and vegetables eaten in their RAW state. Juicing is a
great way to easily add more vegetables to your diet - especially the green leafy
vegetables, such as spinach, kale, lettuce, cabbage, parsley, celery, and other that
are essential to our well being. We must also limit consumption of acid-forming
foods like cooked proteins, heated oils, fried foods, processed foods. We cannot
expect to be healthy and cancer-free if we regularly consume unhealthy foods, even
if we also eat large quantities of fruit and greens. We all can achieve many health
benefits of juicing by drinking green juices and smoothies.
3.2 Business potential of Fruit Juice Market:
We are finding potential of fruit juice market, a report from MINTEL, a
worldwide leader of competitive media, product and consumer intelligence,
compare fruit juice market as an appealing squeeze. This research based in Britain
market, which shows a new era for fruit juices, as Britain's increasing demand for
high quality, natural and healthy produce revolutionizes the market. Fruit juice
6
market is more and more developing in Britain: “Trends towards healthier eating as
well as an increasing interest in more natural, organic products are key reasons for
the phenomenal growth we have seen in this market. What is more, British
consumers are now demanding more top quality, premium products and produce
with added vitamins, minerals, and functional ingredients such as soy or omega-3.
Healthy living is a growing trend and people just can't get enough of these kinds of
products," comments James McCoy, senior market analyst at MINTEL.
They also mentioned about Juice Bar can considered as The New Coffee
Shop Revolution. The off-trade (supermarkets etc.) still dominates sales of fruit juice
and juice drinks, with 80% of the market, but the on-trade (pubs and restaurants) has
experienced the stronger growth, having grown by over 30% between 2002 and
2004. The on-trade has benefited from increasing health concerns among consumers
in particular binge drinking. There is also a greater awareness of the dangers of
drink-driving (and of the stringent penalties for doing so), which have both
contributed to the occasional drinking of fruit juices or juice drinks in preference to
an alcoholic beverage. Juices are also often drunk as a mixer in alcoholic drinks.
As these are research overseas and to apply for their country but we could use these
theories for the model of Vietnam in general and Hochiminh City in specific, as HCMC is the
most developed city and the most rapidly integrated with international trends in Vietnam.
3.3 Overall Background about Fruit Juice Market in Vietnam:
Hot weather immediately drives away the gloomy market of soft drink. The
Number-1-position of carbonated drink is currently shaking, on the way being
replaced by natural original drink.
However, as a report by Vietnam Business Forum. Fruit juice soft drink
manufacturer just supplied 18% demand of the market; the rest is for other fruit juice
7
supplier. With the low price advantages, fruit juice from street vendors are accepted
by consumers although they won’t have guarantee from any quality assurance
organization.
As one of the top 5 fastest developing market of non alcoholic drink in the
world, each Vietnamese person use 3 liters of non alcoholic soft drink per year,
whereas this number in Philippines is 50 liters per year. According to the new
research of Department of Research and Development of Chuong Duong Company,
each year, Vietnamese consume more than 500 millions lit of soft drink
Fruit drink market at Vietnam increase a lot, meet nearly 30% / year. The
sales report from Bidrico Company show that, nearly 50% HCMC consumers are
changing to fruit juice, vitamin with less sugar and natural flavors.
According to TNS, demand of consume fruit juice with bring nutrition and
healthy to customers are increasing in Vietnam. This market has huge potential for
investors to exploit and develop.
The need of fruit juice in Vietnam is obvious. A report from
www.foodbycountry.com provides that climate influence in cuisine and also drinking
habit of citizen. What people eat / drink is influenced a lot by environment and
climate. According to that website, we found that: “The south, where the climate is
conducive to a long growing season and where more ingredients are available, the
typical diet contains a wide variety of fruits and vegetables. In the south, sugar and
sugarcane are used more often than in the north.” The website also shows that
Lemon Soda is one of the typical drinks of Vietnam besides Vietnamese coffee.
Then the researcher also come to study about trends of using fruit juice in
Vietnam in general and HCMC in specific, as HCMC is the most developing city
and there are many manufacturers, business enterprises located here. The most
8
imposing project considered from Euromonitor which help us to have the overview
of Fruit / Vegetable Juice Market in Vietnam. This report is cover all the fruit
products include: 100 juice, nectars, juice drinks, and fruit flavored drinks. There are
some blue chips on bottled fruit juice mentioned such as: Tan Hiep Phat, Vinamilk,
Tribeco, to prove that fruit juice play more and more important role in recently
market.
Figure of Off-trade Sales of Fruit/Vegetable Juice by Subsector: Value 2004 – 2009
Euromonitor, May 2010
9
Figure of Company Share of Fruit Juice in by Off-trade volume 2005 – 2009 – Euromonitor, May 2010
Smaller projects are thesis of oversea master program from Vietnamese
students. Ms. Do Thanh Huong, University of Zwickau, Gernany had a research
about fruit juice in Vietnam. The research base in ages, monthly income and
relaxing habit to find customer’s frequency of buying fruit juice. The research has
more coverage in juice drink when focus in brands of fruit like VFresh, Number 1,
Le Fruit, Wonderfarm. This research also indicates that Vietnamese people are
more and more interested in nutrition juice which is natural and helps to have good
health1
In retails fields, the market is very crowded. An article from Vietnamet
showed the new trend of market which the rising of non carbonated soft drink. The
report showed quotes from some big brands in Vietnam such as Coca Cola, Pepsi,
10
Tribeco, Tan Hiep Phat, provided that juicy market have developed recently. In the
past few years most of our soft drink is carbonated. Nowadays, aware that market
tendency move to fruit juice, because of its benefit to health and beauty, enterprises
are investigating in this field. Coca Cola has Minute Maid Teppy, Tribeco has Canxi
Somilk, Vinamilk has VFresh, Tan Hiep Phat has Dr. Thanh, O2, C2 …. With the
change of market’s demand, local soft drink manufacturers immediately change a
produce structures. The big players like Vinamilk, Tribeco, Wonderfarm have
launched to market many kinds of fruit juice: apple, mango, grapes, etc … to meet
customers’ need. Currently, soft drink enterprises already increased production to
20% in comparison with last years. Vinamilk increase 30% production of VFresh,
Pepsi also up to 30% production for non-carbonated soft drink. The importers also
diversify products with mass of brands like Ligo, Welch’s, Regain, Berri, Dwritt …
Other companies also promised to invest in fruit juice products, esp. ones which
have refresh use like artichoke, dwarf sugarcane, ginseng, waky pumpkin.
Many of them are very successful which means the market are accepting that
kinds of products. This is a huge and blooming market these years.
4.
LITERATURE REVIEW:
REVIEW:
Exploring demands of customer needs to find customer buying behavior.
Consumer behavior is the study of when, why, how, and where people do or do not
buy a product. It blends elements from psychology, sociology, social anthropology
and economics. It attempts to understand the buyer decision making process, both
individually and in groups. It studies characteristics of individual consumers such as
demographics and behavioral variables in an attempt to understand people's wants.
It also tries to assess influences on the consumer from groups such as family, friends,
reference groups, and society in general. As you might guess, factors affecting how
customers make decisions are extremely complex. Buyer behavior is deeply rooted
11
in psychology with dashes of sociology thrown in just to make things more
interesting. Since every person in the world is different, it is impossible to have
simple rules that explain how buying decisions are made. But those who have spent
many years analyzing customer activity have presented us with useful “guidelines”
in how someone decides whether or not to make a purchase.
Below is the Model of Customer Behavior from Sandhusen, Richard L.:
Marketing (2000, S. 218)
With this kind of products, we don’t need much technology and political is
also not a problem, then we will analyze customer buying attitude through 4Ps and
Economic, Social Factors.
12
4.1. DEFINING PROBLEMS:
Although the market is huge, fruit juice drink seem not to have much market
share in HCMC. First of all, as state above: “In the south, sugar and sugarcane are
used more”, people usually like vitamin juice, that called “sinh tố”, a kind of fruit
juice but added some milk and sugar. Leaving the healthy aspect behind, some
customers stated the natural juice isn’t delicious like others products made by juice.
Then the recipe of 100% natural food drink have problem also.
Furthermore, consumers seem to intend buying fruit juice to enjoy at home.
They can buy bottled fruit drink to put in frig, or buy fruit to make at home. They
might don’t like to gather in a shop just for enjoying fruit juice. There are not much
fruit juice shops in HCMC. Besides, most of the juicy drinks are integrated in menu
of coffee shop or restaurant, some spend time in vendors. As a drink, juicy fruit shop
can have direct competitors from other fruit juice, or an indirect competitors like
coffee shop, vendor in the market and natural soft water / drink like 02 green tea.
Furthermore, as state above: “In the south, sugar and sugarcane are used
more”, people usually like vitamin juice, that called “sinh tố”, a kind of fruit juice
but added some milk and sugar. Leaving the healthy aspect behind, some customers
stated the natural juice isn’t delicious like others products made by juice. Then the
recipe of 100% natural food drink have problem also.
In summary, the potential of fruit juice shop market in HCMC will bear the
following problem: “Is the consumers want to have fruit drink at home and don’t
want to join at a shop or just because the internal of products such as product is not
delicious or these current shops don’t have much marketing plan to promote
themselves.” This project is to solve the below hypothesis:
13
4.2. HYPOTHESIS STATEMENTS:
1.
Is there any demand of fruit juice in HCMC and what size of that
market?
2.
Reason why consumers use fruit juice as they know it’s good for their
health, or because it’s delicious, or just for refresh purposes.
3.
Is it possible to gather people and enjoy fruit juice at a fruit juice shop
like what coffee shops are doing nowadays?
4.
Is a fruit juice chain with high price positioning is acceptable in
HCMC?
5.
Does customer prefer a takeaway model for a fruit juice chain of shop?
6.
Do we need to focus in the delicious aspects of products by adding
more ingredients to fruit juice, wine, milk, sugar, etc.
7.
Are there any other benefits / added value to a fruit juice shop to make
the project possible?
4.3. OBJECTIVES:
1.
To analyze level of demands of fruit juice in HCMC.
2.
To find fruit juice’s customer drinking habits.
3.
This document provides an overview and basic suggestions to those
who want to invest for a fruit juice shop
14
5.
RESEARCH DESIGN
DESIGN & METHODOLOGY
Base on hypothesis statement, a questionnaire with 20 questions is designed
base on the following variables: Age, Knowledge, Professionals, Lifestyle, … and
independent variables: price, services, ways of drinking, etc…..
5.1
. In-depth interview allows person to person discussion, these person
are those who selected as they loves drinking fruit juice. This interview leads to
increased insight into people's thoughts, feelings, and behavior on this product. This
type of interview is often unstructured and therefore permits the interviewer to
encourage an informant (respondent) to talk at length about the topic of interest. We
use this interview to find factors concern to the products, then insert to the
questionnaire for an email and telephone surveys with a bigger quantities of
respondents.
5.2.
A quantitative research is conducted from 200 samples in HCMC. The
respondents will fill in the questionnaires sheet by themselves.
Convenience method of sampling is used in this quantitative research because
this is the exploratory one where the researcher is interested in getting an
inexpensive approximation of the truth. As the name implies, the sample is selected
because they are convenient. This nonprobability method is often used during
preliminary research efforts to get a gross estimate of the results, without incurring
the cost or time required to select a random sample. Then we will define exactly
who the one in our target respondents are. Samples are 70% female and 30% male.
All of them are from 15 – 35 years old.
200 sheets of questionnaires will be delivered to:
a.
Students from high schools, universities: 30%
15
b.
Executives from companies: 30%
c.
Random interview in stylish coffee shops, drink corners at shopping
malls, supermarket, vendor: 30%
d.
Others: residential area, industrial park: 10%
As theory of customer buying habit, social factors affected in customer habit,
then the samples are well-selected from the above categories of professional to
define the need of products in these groups of customers.
Fieldwork is conducted in one day of each categories of samples in order to
avoid the overlap of respondents.
With quantitative research, we just focus on demand of fruit juice, frequency
of using it and their knowledge about nutrition.
5.3.
A qualitative research continue after information have been collected
for people interested in juicy fruit drinking to gain a better understanding aspects
influence in their habit of drinking juice. These samples are those who join the
quantitative research and have positive feedback with the product. The research is to
define what is top of mind fruit shop brand in HCMC, what are the key factors in
choosing a fruit juice shop and what are the add valued to compete with other
drinking.
Samples can be delivered through mail and telephone surveys. Participants
returned completed form to the researcher by replying email or answer to the
interviewer
through
telephone.
Survey
is
also
uploaded
into
this
link
https://spreadsheets.google.com/viewform?formkey=dG5uUUdUQV9WV2Jydm4xd
FRtRUtGcFE6MA and submits to researcher.
Research method process can be summary in chart below
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