Group 4-Final Reseacrch Report - Highlands Coffee

GROUP ASSIGNMENT COVER SHEET
STUDENT DETAILS
Student name: Phạm Hoàng Bảo Ngọc Student ID number: 31201028720
Student name: Trương Mỹ Hạnh Student ID number: 31201029121
Student name: Phạm Nguyễn Khánh Vy Student ID number: 31201029217
Student name: Nguyễn Hồng Châu Student ID number: 31201028622
Student name: Lý Trần Bảo Minh Student ID number: 31201028707
Student name: Nguyễn Thanh Tùng Student ID number: 31181021206

UNIT AND TUTORIAL DETAILS
Unit name: Final research report Unit number: Study 3

Tutorial/Lecture: Marketing research Class day and time: Monday
Lecturer or Tutor name: Mr. Ho Trong Nghia
ASSIGNMENT DETAILS
Title: Factor affect customers’ buying decisions of Highlands coffee

Length: 51 pages Due date: 5/9/2021 Date submitted: 5/9/2021
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Student’s signature: Phạm Hoàng Bảo Ngọc

Student’s signature: Trương Mỹ Hạnh
Student’s signature: Phạm Nguyễn Khánh Vy
Student’s signature: Nguyễn Hồng Châu
Student’s signature: Lý Trần Bảo Minh
Student’s signature: Nguyễn Thanh Tùng
Note: An examiner or lecturer / tutor has the right to not mark this assignment if the above declaration has
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GROUP PROJECT - RESEARCH RESULT
FACTORS AFFECT CUSTOMERS’ BUYING DECISIONS OF

HIGHLANDS COFFEE
GROUP 4
Nguyễn Hồng Châu

Student ID: 31201028622
Trương Mỹ Hạnh
Student ID: 31201029121
Lý Trần Bảo Minh

Student ID: 31201028707
Phạm Hoàng Bảo Ngọc

Student ID: 31201028720
Phạm Nguyễn Khánh Vy

Student ID: 31201029217
Nguyễn Thanh Tùng

Student ID: 31181021206
September 5th, 2021

Marketing Research
Lecturer: Mr. Hồ Trọng Nghĩa
Class: MR-DH46ISB-1
Research proposal: Highlands Coffee
Table of contents
1. Executive summary………………………………………………………………………. 3
2. Background……………………………………………………………………………….. 3
2.1. Market overview…………………………………………………………………….. 3
2.2. Company overview………………………………………………………………….. 4
3. Problem definitions………………………………………………………………………. 5
3.1. Research questions…………………………………………………………………... 6
3.2. Research objectives………………………………………………………………….. 6
4. Approach the problem………………………………………………………………….... 7
4.1. Research background………………………………………………………………... 7
4.2. Research model……………………………………………………………………... 10
5. Research Design…………………………………………………………………………. 11
Research process……………………………………………………………………….... 11
5.1. Secondary data research……………………………………………………….... 12
5.2. Qualitative research…………………………………………………………….. 12
5.3. Quantitative research………………………………………………………….... 13
6. Data collection………………………………………………………………………….... 14
6.1. Qualitative research………………………………………………………………… 14
6.2. Quantitative research……………………………………………………………….. 14
7. Data analysis…………………………………………………………………………….. 15
8. Research result………………………………………………………………………….. 15
8.1. Qualitative result………………………………………………………………….... 15
8.2. Quantitative result………………………………………………………………….. 18
9. Recommendations and conclusion……………………………………………………... 23
10. References…………………………………………………………………………….... 24
11. Appendix……………………………………………………………………………….. 28
11.1. Discussion guide………………………………………………………………….. 28
11.2. Transcript Qualitative Focus Group……………………………………………… 32
11.3. TST Table……………………………………………………………………….... 32
11.4. Quantitative results……………………………………………………………….. 32
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1. Executive summary
Highlands is a well-known coffee brand among the Vietnamese community for truly
Vietnamese coffee with deliciously bold taste made from qualified ingredients and raw
materials. Este et al. stated that Highlands was born in 1999 by a young Vietnamese -
American entrepreneur David Thai.1 Carrying a mission of spreading the spirit of Viet pride
as well as interfering with tradition and modernity, Highlands won a considerable quantity of
Vietnamese consumers step by step. Nevertheless, their brands are facing some customer
service problems, which makes them undergo downward trends recently. Therefore, this
research proposal points out factors affecting the customers' buying decisions and the
difficulty that Highlands confronts nowadays. Throughout this study, there are four parts
analyzing deeply about the topic. Firstly, the background part will help you clearly
understand the market overview and the company overview. Secondly, we will move the
scope to the problem approach, which displays how we can approach the problem effectively
and logically with both internal and external factors. Then, the research design will
demonstrate all the methods and techniques that we offer for this topic. Finally, the fieldwork
and data collection will show how we gather the data and analyze them.
2. Background
As World Coffee Portal mentioned, Highlands was founded in Hanoi in 1999 and now
becomes the third-largest coffee chain with about 341 outlets throughout the country. In early
2012, Jollibee Food Corp. (JFC), a Filipino fast-food giant, completed the deal to buy a half
share of Highlands coffee chain from VTI.2 According to JFC’s Chief Finance Officer
Ysmael Baysa,3 Highlands Coffee is the fastest developing business in the Jollibee group
with high profitable new and current stores.
2.1. Market overview
According to Research and Market,4 the global coffee market reached $465.9 billion,
witnessing customers’ demand for qualified coffee products. Moreover, as they supposed,
Asia Pacific will be the most rapidly developing coffee market. That prediction results from
the rising disposable income, the developing coffee culture, the growth in the number of
coffee stores, etc.
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From the World Coffee Portal data, Vietnam takes fifth place in the coffee brand market in
East Asia, having 3,839 existing stores in 2020.3 Also, due to the global pandemic challenge,
Vietnam still retains the development momentum when opening 201 new stores. Therefore,
according to World Coffee Portal, Vietnam witnessed a growth of 5.5% in the number of
outlets during 2020.3 In the Vietnam market, Highlands has to deal with several big domestic
as well as international coffee brands such as The Coffee House, Phuc Long, and Starbucks.
As VnExpress collected data in 2019, Highlands is the market leader with VND 2.2 trillion of
revenue while two other local competitors, The Coffee House and Phuc Long, ranked at the
second and fourth place with VND 863 billion and VND 779 billion, respectively. Besides,
VnExpress’s data also shows that Starbucks is still a prominent competitor of Highlands, that
they ranked at third place with double-digit growth in 2019 (VND 783 billion). However, in
terms of gross margin, Highlands accounted for 60-70 percent over the market.
Table 1: Vietnamese tea and coffee chains’ revenue from 2017 to 2019 (Source: VnExpress)
2.2. Company overview
Ass we all know, Highlands Coffee had a goal of opening more than 70 stores in 2007, and as
of today, they have over 80 stores, most of which are in prime locations in the heart of major
cities. According to VnExpress, Highlands now has 336 outlets within Vietnam until 2019.
Highlands coffee shops are situated in scenic spots, such as buildings, workplaces, and
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supermarkets, as well as outdoors. Customers visiting Highlands Coffee will find free, fast,
and secure parking lots. Value is conveyed both visibly and invisibly, and Highlands Coffee
has demonstrated the difference, the elegance, and the security to their customers. The
average cost is approximately 50,000 VND (Highlands Coffee listed price). This price is
appropriate because it is based on the feelings of the customers. There are a lot of officers and
children, and young adults on these sites.
Officers, young people, and the middle - income are the primary targets of Highlands Coffee;
however, it is possible that serving solely these potential customers would be overburdening
during rush hour; thus, it is not recommended. It appears that boosting advertising is not
necessary. This is why they may grow steadily while avoiding formidable competitors until
they are ready.
"Highlands will now be a perfect spot for relaxation and modern customers at a fair price,
thanks to this improvement. The store is created to reflect Vietnamese culture's traditional
ideals of community, cohesion, and kindness", Mr. David Thai, VTI's General Director,
remarked. However, aside from the new aesthetic, the most noticeable change is Highlands
Coffee's "new" menu, which focuses on more traditional Vietnamese foods and drinks at
more affordable prices. Highlands is pursuing a bigger audience and distinguishing itself
from the Western-style Starbucks with the shift after more than a decade in the coffee
business in Vietnam.
"We are still a Vietnamese brand for Vietnamese people," David Thai stated, "but we will
attract foreign guests who adore coffee and traditional Vietnamese sandwiches."
3. Problem definitions
Recently, Vietnam is emerging to be one of the fastest-growing countries in South East Asia,
with an expected GDP of around 6.7% and 7% for the years 2021 and 20225 , respectively.
One of the most significant contributions is thanks to the F&B industry, which accounted for
15% of GDP in 2019.6 However, this also makes the industry highly competitive due to the
increasing number of competitors and free entrance. Therefore, Highlands Coffee, although
being roughly the biggest coffee chain in Vietnam, might even face adversity if it did not
continuously develop and do its best to serve customers. Nevertheless, the brand is currently
exposed to many negative comments on its service and even its products. For instance, in
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February 2020, Highlands received a complaint on disability discrimination towards a

physically impaired customer, which later turned to a boycott. The brand had to publish its
apology letter on the official website.7 Another significant and most recent scandal of
Highlands is one coffee shop of the chain chasing away a customer after one hour since she
bought only one bottle of water.8 After all these fusses, customers seem to start losing loyalty
and incentive to choose Highlands. In fact, research by Muhammad et al.20 proves negative
feedback, comments, and scandals on social platforms can actually yield adverse outcomes
for firms. For this reason, our group believes it is necessary for Highlands to have a deep
view into factors that promote customers’ intention to buy in order to adjust its offerings,
satisfy customers and stay on edge.
3.1. Research questions
- Regarding Highlands Coffee’s customers, does the products’ perceived value play a
dominant role? Or other aspects might be the reason for choosing the brand?
- How sensitive are the customers to Highlands’ price?
- What can Highlands improve to attract customers in-store, achieving a competitive

advantage in the coffee market? (Occasional-themed background, architecture,
parking lot, stores location, etc.)
- How does Highlands define whether customers are more satisfied to sit in a store and
consume their products or takeaway or order delivery?
- How will promotion strategies attract and make customers loyal compared to
competitors?
- Do demographic and cultural factors affect customers’ perception of purchasing or

using coffee and other drinks?
- What can Highlands do to differentiate between customer characteristics to modify its

strategies suitable for them?
3.2. Research objectives
This research aims to identify factors that affect customer buying decisions at Highland.
The following objectives are what we want to achieve:
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- To know in detail how many critical factors are as well as their effect level on
customers and their decisions.
- To understand the current attitude of customers towards the brand.
- To know what factors the brand still cannot adapt to and satisfy customers.
- To develop strategies for the brand to sustain the current issues, improve its business
performance toward customers.
4. Approach the problem
4.1. Research background
Internal factors: Internal factors have always been a good guideline when it comes to
analyzing, measuring the intrinsic value of a business, its strengths, and weaknesses. These
factors can be divided into Product, Price, Place, and Promotion.28 Regarding our group's
research on Highlands’ customer buying intention, this gridline would also be of great
importance to fully comprehend the firm’s internal reasons that create buying incentives. The
detailed analysis of each sector below will assist our lineup in building a set of valid
hypotheses for further investigation. We split the research aim into several research criteria
below, which make it easy to critically understand:10
PRO (Product): Research by Bahauddin Zakriya University11 claims that the product’s value
is highly likely to positively relate to the consumer’s intention to buy. In most marketing mix
analyses, the product usually comes first because of its significant impact on customers’
behavior, both pre-purchase and post-purchase.22 As a coffee chain, Highlands’ products do
include not only the physical value but also the tangible and augmented value:
PRO1. Tangible product
Product quality is often regarded as the combination of products’ characteristics and features,
making it one of the primary evaluative factors. When these attributes fulfill customer needs
and satisfy them, the perceived value will incentivize buying, revisit intention, and good word
of mouth.21 In the case of Highlands, its physical products are a bundle of the food and
beverage’s quality, variety, and packaging design. A crucial job of business participating in
the restaurant/service industry is to take product quality as a key for value creation for
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customers, increasing their loyalty and retention, even if they have to pay more non-monetary
costs such as time and effort to have their hands on favorite products.26 For Highlands, their
dominating revenue compared to other brands27 may be a good indicator of its competitive
advantage in products quality when the chain constantly innovates and release new products.
However, our group believes that tangible product quality, although being a critical research
objective, is not the only assessment for Highlands.
PRO2. Intangible product
The intangible product, or secondary product, in this case, is the services provided.22 It may
come in the form of customer service, credible brand name, or customers’ experience.
Although being invisible, the service dimension plays an essential and direct bridge to
customer satisfaction, in some cases, even with only a slight contribution from the product's
quality. A decent servicescape environment is highly likely to aid in building a reputation and
smooth the path to the success of a business.23 However, firms sometimes overlook this aspect
because of the difficulties in measurement or simply ignorance, creating poor service quality,
which has been scientifically proven to leave a stronger imprint on customers than a good
experience.24 The same thing seems to happen with Highlands due to recent customer service
scandals, making one of the main research objectives is to evaluate the weight of this
augmented value on the brand’s consumers’ intention to buy.
PRI (Price): Recent study12 indicates that price plays a vital part in anticipating the products’
quality, in which consumers usually perceive that a brand of high pricing would offer
high-quality service and goods. However, there will be an effect coming from other brands’
price levels since customers tend to compare different brands. If the price gap is perceived as
unfair or unreasonable, the demand will decrease in normal conditions. Still, an increase in
the purchase can also happen if the firm possesses great market power or strong brand
equity.25 In terms of the Highlands case, research is needed to exemplify whether its pricing
strategy restrains customers’ buying decisions or it actually provokes them to spend money
expecting to receive worthy products’ value.
H2.1: High price at Highlands coffee promotes buying incentives since it is an

indicator of high-quality products.
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H2.2: Customers are discouraged by the price setting of Highlands since the
perceived value is not worth their money.
PLA (Place): Highlands selects all of the "display" places in Vietnam's most luxurious center
because David Thai wants the Highlands trademark to correlate to the country's most
significant development.” I want to help maintain Vietnam's coffee heritage." That's what
David Thai said about the coffee distribution strategy in the city center, where the Vietnamese
people’s population density and living quality are both high. As the population of Viet Nam
grows, taking advantage of the available space and indulging in the pleasures of high-end
coffee is no longer a distant thing. In-store experience such as store displays, utilities,
location is a crucial factor that drives the customers’ decision.13 Especially, many businesses
of Highlands is in stores located in shopping centers, so it is vital for the brand to determine
and invest more effort in the store space, store features to attract the stable amount of
customers coming to store since most of the time, people go to shopping centers at weekend
or holiday and fairly weekday.
H3: Place and location are important factors that drive customers’ decisions.
PMT (Promotion): The findings show that monetary sales promotions can greatly moderate
the brand trust effect and heavily influence the customers’ behaviours14 . The promotion has
an influence on purchase decisions. Customers will be more interested in making purchase
selections if the company's promotional efforts are better. Companies must use the promotion
to advertise their products or services with the goal of informing, introducing, enticing, and
convincing potential customers or consumers to purchase the goods or services supplied31.
H4: Monetary sales promotions can greatly moderate the brand trust effect and
heavily influence the customers' behaviors.
External Factors:
DEM (Demographics): There is a link between customer demographic factors such as

education, age, gender, monthly income, occupation, and their frequency of purchases, in
which each factor will have different degrees of influence.15 Study about demographics helps
Highlands determine its target segment of customers, then apply the relative strategies for
them.
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According to Daneshvary and Schwer,29 buying decisions have a relationship with age.
However, in the research conducted by Khan et al.,31 there is nearly no difference in
customers’ purchasing decisions among different age groups. Similar to age, Khan et al.
showed that males and females share the same knowledge about buying decisions31. At the
same time, Jain and Sharma confirmed that purchasing decisions are significantly different
between genders.32 In terms of buying coffee, there is no difference by groups of age,
education, income, occupation, frequency of having coffee, and frequency of cups of coffee
per day about the buying decisions, according to Huang and Dang.30
H5.1: Buying decisions have a relationship with age.
H5.2: There is no difference in purchasing decisions of customers among different

age groups.
H5.3: Both genders share the same knowledge about purchase decisions.
H5.4: Buying decisions are significantly different between genders.
H5.5: When purchasing coffee, there is no difference in demographic characteristics

about their buying preferences.
SCU (Socio-cultural): There is a strong relationship between buyers' behavior and

socio-cultural factors. Operating stores in different parts of the country will lead to diversity.
Highlands should identify and adapt quickly to the problems.
H6: There is a strong relationship between buyers' behavior and socio-cultural factors
4.2. Research model
To sum up, which approach we are aiming for, our group establishes the below model in
which the buying incentives are divided into two main sectors, internal and external. Each
industry contains more details in order to clearly identify what factors make customers
choose Highlands.9
10
Figure 1: Research Model of factors affecting purchase intention of Highlands

customers
5. Research Design
Research process
After defining the problem and narrowing down various factors into internal and external
groups, we can determine the requirements for data collection and analysis related to Product,
Price, Place, Promotion, Demographic, and Socio/culture environment. The process of
collecting information will occur in 2 stages: Secondary data research and Focus group
research.
5.1. Secondary data research
Secondary research can clarify a client company's problems and opportunities with a small
number of sources. Therefore, we can take full advantage of data mining to uncover customer
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segments and product features that meet customer needs.16 Through secondary data collected
mainly from Google, we can gain general insights and understanding of customer perception
and loyalty as well as gather factors that can affect their buying decisions for Highlands
products, which are provided in the research background and problem approach sections. In
the process of analyzing secondary data, it is necessary to evaluate the relevance of data to
our project and the credibility of sources.
5.2. Qualitative research
We will apply focus group interviews for the research. The main benefit of a focus group is
the in-depth understanding of the participants, which enables researchers to uncover
customers’ attitudes and beliefs that would not be found on the Internet. Moreover, a focus
group provides more relevant and credible information to the research problem.17
As qualitative research is open-ended research, the data collected from interviewees will be
flexible and complicated. Therefore, the data would be reviewed and analyzed carefully so
that we can collect necessary and relevant information for our project.18
Method of administering the questionnaire
About Interviewer-administered questionnaires, we use this method for collecting qualitative

information by face-to-face interviewing or using focus groups through digital devices. This
will help us exploit more data by asking open-ended questions to get the insights of the
interviewees.
Nature of questionnaires
With the interview questionnaires, we will prior open-ended questions like TST methods to
get as much information from the respondents as possible. There will be around 15-20
structured and unstructured questions. Consequently, the average time needed to spend on it
is nearly 1.5 hours.
Sampling plan
We chose our sample as a group of undergraduates and postgraduates from 18-26 years old.
This group used to use Highlands’ products and services at least once and already used other
competitors’ products such as Phuc Long, The Coffee House, Starbucks.
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Sample size
About qualitative research, the focus group of our interview was conducted with 10 people
who were successfully invited to get the insights of these consumers.
5.3. Quantitative research
We aim to reach more straightforward opinions upon our hypothesis that has been found
through focus groups. Through quantitative research, we could estimate the percentage of the
occurrence of the population's behavior, their interest, perception of Highlands Coffee’s
products and services, and what drives their buying decision. The information obtained helps
us to get the appropriate answer to the research problem and develop a strategy for it.
Furthermore, quantitative research is also a way for us to ensure the information gained from
focus groups is generalizable to the whole population.
Scaling methods
Non-comparative scaling technique
In our survey, we will use the Likert scale because this technique is easy for the respondents
to answer. Additionally, it also helps us to approach and analyze the data easier and more
efficiently.
Method of administering the questionnaire
With self-administered questionnaires, they will save us lots of time and resources to get the
result from the surveys through Google Forms. Moreover, interviewees will have leisure time
for their careful responses.19 At the same time, we can gather as many answers as possible to
serve our quantitative data. Google will automatically collect and analyze the data for us.
Nature of questionnaires
Our survey will include all of the elements in the given model. In each element, we will add
some key closed-ended questions. The approximate number of questions will be about 40
questions. The time for answering the survey is predicted to be 10 minutes.
Sampling plan
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Since Highlands Coffee is a popular coffee chain in Vietnam, many people usually go there.
This leads to the fact that our target population is enormous. However, due to the COVID-19
pandemic, we cannot reach that huge number of respondents offline or face-to-face. In order
to solve that problem, we will try to conduct surveys with our relatives, friends, and our
networks to get our convenience sample. We will conduct surveys with our connections or
convenience sampling.
Sample size
For quantitative research, the ideal number of respondents should be around 120 people.
However, depending on the limited time and unexpected hurdles, we will consider
approximately 100 people for this survey. As a result, we finally got 105 responses in total.
6. Data collection
6.1. Qualitative research
This qualitative research aims to gain insights from participants about Highlands Coffee in 4
factors: Product, Price, Promotion, and Place. Questions used in this interview are
unstructured questions, which aim to gain insights of participants in what they expect at
service and price of a cup of coffee, what an effective promotion campaign would be like, or
the affection of the coffee shop. Participants are chosen randomly (which would be
considered convenience sampling) among university students at UEH-ISB, other university
students, and millennials between 22 – 35 years old who usually choose coffee shops to meet
up, study or work.
6.2. Quantitative research
Quantitative research’s objective is to understand the market characteristics and analyze the
factors that affect customers' buying decisions and make Highlands Coffee a successful
coffee chain in Vietnam today. This research is conducted using an online survey. Likert scale
questions will be mainly used in the research since they can measure and be convenient for
participants to do as well as easy for us to analyze the data and make interpretations.
Quetheyions are surrounding customers' decision to choose a coffee shop, their perspectives
about the product, price, and service and promotion of Highlands. In addition, demographic
questions (Age, Gender, Occupation, Income) will be involved in the survey.
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7. Data analysis
In the case of Quantitative research, we will use SPSS software to evaluate our data when we
have collected enough. We will start by converting all non-metric data to metric data, then
apply charts and frequency tables to understand the overview and the general trend within
factors. To be more specific, we will analyze the data using descriptive statistics and combine
certain variables into crosstabulation. Finally, we will compute the mean of five factors we
have, including product, price, promotion, and place, and compare them together in order to
determine which factors in the model are not appropriate, as well as which factors are the
most and least significant in influencing consumers' purchase decisions at Highland. We also
rank the elements in descending order of importance.
About Qualitative research, when we finish the interview, the answers will be collected into
Microsoft word or excel. Then, all of them will sum up the whole picture of the consumers
and their insights, defining what they think about Highlands.
8. Research result
8.1. Qualitative result
8.1.1 Sample Characteristics
In general, the participants of the interview are undergraduates. A few of them already have
jobs with an average salary between 2-5 million dong. Some people come from some cities in
the West of Vietnam, the others are from Ho Chi Minh city. Moreover, all of them are
studying in the UEH belonging to Ho Chi Minh city. They all agreed that having coffee is one
of their hobbies in life. They tended to choose coffee shops to meet friends or study. As a
result, Highlands has reasonable prices that can satisfy most of the customers. Moreover,
Highlands are beneficial with a wide range of customers as well.
8.1.2. Product
Tangible product
Almost all the interviewees agreed that the drinks and food in the Highlands are delicious,
particularly its coffee. Highlands Coffee has succeeded in building signature products, Tea
with Lotus Seed and Coffee, when most people think of them when mentioning the
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Highlands brand. In addition, a few people mentioned satisfaction with drinks safety and
packaging design. However, many interviewees are not satisfied with the packaging materials
of Highlands because it is not environmentally friendly. From the above, it can be concluded
that environmental friendliness is more important for customers nowadays than the beauty of
the packaging.
Intangible product
From normal to quite good is the assessment of all interviewees about the service quality at
Highlands Coffee. The reason for this evaluation is because of the service speed and attitude
of the staff when the shop is crowded, some people received the wrong drink, others had to
wait too long. Moreover, when talking about bad experiences at Highlands, they think about
the poor service quality of the staff, specifically: "I once called the staff to clean the table 4-5
times, they came and their attitude at that time was very unpleasant." or "The first time I went
to Highlands Coffee, I was not happy because when I didn't know how to order a drink, the
staff was not enthusiastic and friendly to help a new customer like me." In conclusion, the
service quality of Highlands Coffee has not really satisfied customers, causing bad
impressions in customers' thoughts about Highlands.
8.1.3. Price
Most of the participants agreed that Highlands Coffee offers a various price list for them to
choose from. However, most of them tended to choose the drink which is no more than
50,000 VND, a small number chose between 50,000 to 60,000 VND. They both think that the
price spending on the drinks is suitable and worth the quality and service they received.
Someone stated that “For the same amount of money, Highlands drink's quality is better than
many other coffee shops, Highlands has more drink options as well.” However, in the store’s
menu, if the majority agree to purchase drinks within 50,000 VND, they will only get the
options of black/ milk coffee, tea, and other fancier drinks but in small size cups. With the
above information, we may infer that our participants are pleased with the various price lists
at Highlands but are skeptical of it (since they need to pay higher to get the larger cups or
better drinks).
8.1.4. Place
Many participants are satisfied with the decorations in the Highlands. Most of them agree that
Highland is an ideal place to hang out with friends because Highlands offers a spacious place
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to sit down for a cup of coffee and chat with friends. 65.7% of participants think that tables
and chairs in Highlands are comfortable, and their arrangement of tables and chairs also
makes the space feel larger and more open. It is also argued that Highlands is a place to
study; one implied that “ I would rate 10/10 if the atmosphere is appropriate for me to go with
my girlfriend to study.” But another says that if he goes to study, he will opt to choose a
quieter place compared to the Highlands. And in our research survey, most of the participants
agree that Highlands is a suitable place to study. Most of the participants find that there are
many Highlands stores within their place, and they also appreciate them because they are
always kept clean.
8.1.5. Promotion
Less than half of the participants experienced a promotion campaign from Highlands. The
majority of them know about the coffee chain due to its widespread and high brand
recognition. However, some marketing campaigns were mentioned. One implied: “I knew it
from a campaign collaboration with CGV when I was little, I got a pack of combo vouchers
then I came to Highlands, it created a great customer journey, I am impressed by the
campaign.” Only a small fraction of participants shared that word of mouth, and occasional
meetings took them to Highlands in the first place. Overall, all interviewees knew about
Highlands through one means or another, and at least one time have tried its products.
8.1.6. Socio/culture
Almost all the interviewees agreed that the lifelong factor does not affect their purchase
decisions. Besides, as their thoughts, buying a cup of coffee from a famous brand does not
make their lifestyle. They concurred that they buy Highlands products based on two main
reasons: the quality of product and the place of studying and relaxing. Moreover, as
customers, they do not pay much attention to the commercial affair of Jollibee in 2012.
Nevertheless, as the view of customers, they felt that Highlands is not a great brand in being
on-trend. Their mission is to preserve the value of tradition so that they are not as trendy as
other coffee brands nowadays. In the part of the recommendation for Highlands' menu, which
should have more Vietnamese cuisines, there are some considerable and creative ideas such
as adding some kinds of milk tea, creating more types of healthy Vietnamese juice, and
making new drinks based on minor Vietnamese peoples’ tradition.
17
8.2. Quantitative result
8.2.1 Sample Characteristics
Generally, most people participating in the survey are females from 18 to 35, with about 77%
relatively (chart 8.2.1.e). Otherwise, there are approximately over 20% of males from 18 to
35 taking the survey (chart 8.2.1.e). Besides, there are minor participants from those aged
below 18 and over 35, which is about 10% and 7% respectively. About the statement of
monthly outlay, we can see that most of the aged groups usually spend from 2 - 5 million
dong per month (table 8.2.1.d). Moreover, people who are over 35 often spend more than 5
million VND monthly (table 8.2.1.d). From this statement, we can easily understand their
purchasing frequency. As you can see from the bar chart 8.2.1.f, the frequency of using
Highlands’ products, especially those aged from 18 to 35, is more than once a month.
Otherwise, it can be seen that there is a slight portion of those aged below 18 and over 35 also
consuming Highlands’ products.
8.2.2 Product
Tangible product
After analyzing, the mean for evaluation of tangible products is in the range of 3.24 and 4.18,
and the mode is 3 and 4 (table 8.2.2.a), which means most of the answers are neutral to agree
with the statements we gave.
Table 8.2.2.b illustrates that customers of Highlands Coffee satisfy with the quality of its
ingredients most, as PRO1.1 has the highest mean of 4.18, in that 42.6% of customers choose
Agree (option 4) and 38.9% choose Strongly agree (option 5) (table 8.2.2.c) Moreover,
PRO1.1 received the most Strongly agree answers out of the 8 questions we gave in Tangible
product section. Besides, customers are also happy with the statement that food and drinks in
Highlands are delicious (PRO1.2), accounting for 4.15/5 (83%) of the level of agreement.
The opinion that received the lowest level of satisfaction was PRO1.6, with the level of
agreement of 3.24/5 and a total of 26.9% of customers choosing Strongly disagree (option 1)
and Disagree (option 2) about Highlands's products being environmentally friendly (table
8.2.2.d). In addition, in terms of the opinion that had the most Strongly disagree responses,
PRO1.6 received the most, accounting for 10.2% of the 5 options.
18
There is no customer holding Strongly disagree about satisfaction when consuming

Highlands’ products (PRO1.5) and only 2.8% choose Disagree (table 8.2.2.e), leading to the
conclusion that Highlands products are not too controversial and succeeds to leave good
impressions on customers' minds. In detail, in the group of people under 18 years old, the
majority of participants chose Strongly agree (57.1%), 46.4% of people aged 18-35 years
chose Agree, while the group of people over 35 years old shared the same opinion about
Strongly agree and Agree for PRO1.5 (table 8.2.2.f). Therefore, for customers of different
age groups, the satisfaction level of Highlands products is also different.
Intangible product
The mean of agreement level of customers about services in Highlands Coffee ranges from
3.80 to 4.17, and the mean is 4 and 5, all of which show that most participants agree with the
statement (table 8.2.2.g).
In this section, our group prepared a general question to state that customer service is the
main reason for retention (PRO2.5), and it received the most agreement with a mean of 4.17
(table 8.2.2.h), of which 45.4% of participants answered Strongly Agree (table 8.2.2.i).
However, the least agreed statement is that customer services of Highlands meet your
expectations (3.8/5.0) (PRO2.4). According to customers in this era, customer service is a
very important factor, but Highlands has not been really successful in creating a sense of
satisfaction for customers in this aspect.
Simultaneously, the level of customer service satisfaction also varies across age groups. Most
of the participants in the under 18 age group just kept a Neutral (option 3) attitude, while the
other two groups of people aged 18 and over chose Agree the most for PRO2.4 (table 8.2.2.j)
8.2.3 Price
According to the metric data, the mean ranges from 3.44 to 3.88 (table 8.2.3.a), but it still
cannot reach the satisfaction rate of 4. Customers in Highlands are concerned about the
pricing and are not completely satisfied.
In Highlands, the most satisfying factor among those we provide to participants is PRI3, with
the highest mean of 3.88. In addition, 50% of PRI3 participants agreed (choose option 4) that
the price in Highlands is worth the entire product quality, including food and drinks.
19
However, when we ask further, the most significant pricing concern for them is the food
quality that comes with the price tag (PRI2). PRI2’s mean is the lowest (3.44) among other
pricing factors (table 8.2.3.a), indicating consumers feel not entirely happy that Highlands'
food is affordable. This is also the only factor in which both option 3 (neutral) and option 4
(agree) have the same proportion of 33.3% (table 8.2.3.b). The other 5 pricing factors, on the
other hand, have the highest percentage choice at option 4 (table 8.2.3c).
Because PRI6 is the only variable for which no one picks 1 (strongly disagree) (table 8.2.3.a),
we may infer that neither participant has a strong defense on the coffee product at Highlands,
with only 9.3% of disagreement, caffeine products at Highlands may have a moderate price
and fit with the current coffee market.
All genders shared the same trend of selection throughout the survey, with the exception of
the Highlands price variation (PRI5). While most males strongly agree that the store has a
wide range of prices, the majority of women simply agree and pick option 4 (table 8.2.3.d).
When compared to the qualitative study results, customers' points of view on price are similar
in both methods. They both believe in general that the cost of products in the Highlands
varies, yet it is fairly pricey since they are mainly willing to pay approximately 50,000VND
for a cup of drink on average, and with that amount of money, they seldom enjoy the store's
delicious, signature products. However, they are only able to do so in small cups, or they will
have to spend more money.
8.2.4 Place
According to metric data, in general (Table 8.2.4.a), the mean for 7 questions ranges from 3
to 4.18. The mode is 4 for almost every question, which means that many people are satisfied
with the factors related to the place of Highlands coffee shops.
It shows that 80.5% of people are satisfied with the decorations in Highlands, with a mean of
4.06/5 scale of agreement (Table 8.2.4.b). 83.3% of participants agree that Highlands stores
are always kept clean and cleaned regularly, which is also the most satisfying factor that the
participants claim on Highlands stores. (Table 8.2.4.c)
In terms of the coffee shops, there are 69.4% of people agree that Highlands shops are big
enough for them to hang out with friends (Table 8.2.4.d). In addition, they also highly
appreciate the arrangement of tables and chairs at Highlands stores because it makes space
20
bigger, 65.7% of the participants feel that it is comfortable when sitting down and chatting
with friends. (Table 8.2.4.e)
However, there is a significant argument in question PLA4 that whether the arrangement of
tables and chairs is far enough not to hear the conversations of others. The mean of PLA4 is
the lowest, which is exactly 3, and 15.7% of the participants strongly think that Highlands
stores are too noisy (Table 8.2.4.f). Because of that reasons, many people do not believe that
Highlands stores are a suitable place to study or work, the mean of this question (PLA5) is
also second-lowest (3.31) (Table 8.2.4.a), (Table 8.2.4.g), with 33 participants disagree to
study or work at Highlands, 32 of them are older than 18 which means they are in the labor
force and they might suffer from a bad experience of going to Highlands stores for studying
or working before (Table 8.2.4.h). In terms of coverage, 76.9% of participants think that it is
easy for them to find a Highlands store in their place, making Highlands a recognizable brand
(Table 8.2.4.i).
8.2.5 Promotion
After analyzing the metric data, it can be drawn out that approximately 70% (table 8.2.5.a) of
the participants agree that Highlands has many of its advertisements online (PMT2), with the
mean of 4.28/5 scale of concurrence (table 8.2.5.b). This result is partially contradicted with
the outcome of our qualitative research, where most interviewees barely noticed any
advertising coming from the brand. However, this might be explained by the variances in
sampling since some focus group interviewees did mention some marketing campaign of the
brand.
Additionally, the majority of people seem to fairly agree and strongly agree that the coffee
brand offers good deliveries (PMT3), with many coupons and discounts (PMT1), which will
encourage them to buy more if new ones are available (PMT4) (table 8.2.5.b). It is observable
from the data that those who think Highlands’ prices are not so affordable tend to have higher
levels of agreement on products’ purchase when new coupons are released, since the central
tendency of PRI1 and PMT4 both lie at the mode of 4, and the mean of above 3.5 (table
8.2.5.c).
Regarding Highlands’ marketing campaign, while many participants are fond of seasonal
promotions (PMT5) such as newly-released products in Christmas, or New Year (overall
metric score of 3.52), a slight polarization between different age groups can be observed.
21
Those aged below 18 are more interested in seasonal promotions, with approximately 71% of
this age group. Nevertheless, around 49% of participants aged from 18 hold neutral opinions
or strongly disagree with the idea that the brand has good seasonal marketing campaigns
(table 8.5.2.d).
8.2.6 Socio/Culture
Based on the metric data, the mode of all questions is 4 and 5, which displays that most of the
participants agree with the given factors except one aspect. It can be seen that about 34%
(table 8.2.6.a) of the participants choose Highlands because of its history with the mean of
4.23/5 scale of concurrence (table 8.2.6.j). On the contrary, in the qualitative results, all the
interviewees showed their disagreement with the fact that the lifelong effect on their buying
decisions (8.1.6). However, 30.6% of participants choose option 3 (neutral), which means
that they barely care about this statement so far.
Besides, 34.3% of people, especially from 18 to 35, agree with the fact that they are on-trend
when using Highlands' products (table 8.2.6.b). Otherwise, in the group of 18 to 35, there are
some conflicts among their choices which is about 12% of them disagree with this point of
view.
Additionally, strong disagreement or disagreement (the mean of 2.71/5 scale of concurrence,

table 8.2.6.k) can be observed the most in adding traditional food/drinks into Highlands’
menu, with the most contradiction from the 18-35 aged group (chart 8.2.6.g). It is
demonstrated from metric data that about 27.8% of participants strongly disagree with this
statement, while 17.6% of them strongly agree with that.
On the other hand, two other kinds of drinks witnessed the concurrence from participants.
There is uniformity within most of the participants about adding more healthy juice or
smoothie into Highlands’ menu, with approximately 82% of people concurring with (table
8.2.6.d). From that result, we can predict that a healthy lifestyle is the tendency of people in
the future. As the result of metric data, it is also shown that most participants slightly agree
with adding kinds of milk tea into the menu, which has the mean of 3.71/5 scale of
concurrence, table 8.2.6.k). From the bar chart 8.2.6.j, those aged from 18 to 35, 38%
22
relatively, have strong agreement with this idea; however, there is approximately 16%
disagreement from all participants.
9. Recommendations and conclusion
From both qualitative and quantitative results, we can conclude that: There is a small
variance between these two results, but it is not significant; nevertheless, some negative
comments like the interior arrangement and the cultural factor are exact with the quantitative
results. Furthermore, Table 9. a shows that Product and Promotion have significant positive
effects on customers' decision to purchase since they have the highest means among the other
three factors, whereas Socio/culture directly contradicts, revealing that consumers do not put
as much focus on this factor. Highlands should consider this as well in order to provide the
best service to their customers.
There are some suggestions for Highlands in improving the satisfaction and redefining the
factors which affect their customers’ intention to buy.
Overall, customers define Highlands as a coffee chain that follows a traditional-oriented style
with delicious drinks and food, but the menu is not diverse. The price of Highlands is
affordable for nearly half of respondents, the others feel that the price there does not fit their
willingness to pay based on the responses.
Moreover, although the decoration of the Highlands is good-looking, the arrangements of the
interior are not appropriate. 35% of customers do not feel comfortable because of the
too-close distance between tables. Some said that the tables and chairs are too small and 50%
of them said it is not suitable for studying individually or in groups. In order to improve
customers' experience, Highlands should consider the arrangement of the interior with wider
tables and distance between them.
Highlands should also have more juicy drinks or milk tea on the menu so as to diversify it
and give customers more selections. However, about 60% of people who answered the survey
do not want or are not sure if Highlands add more traditional Vietnamese food to their menu,
so Highlands should not add more traditional food or drinks in the menu.
In addition, one of the most important reasons why customers choose to stay with that
business is the service with 77% acceptances. While the quantitative shows two-third of the
23
respondents feel Highlands serve them as their expectations, most respondents complained
that the staffs’ attitude does express the hospitality in the qualitative interview. As a result,
Highlands is doing good in providing acceptable service to their customers, but if they want
to retain customers and make them become loyal customers, they need to improve more on
the staff training.
Additionally, in order to attract more customers, they should advertise or promote their brand
or products heavier on social media. The case, like the collaboration with actor Huynh Lap, is
too little, and the responses did not show any significant awareness about their digital
activity.
Another issue that Highlands should notice is the ambient, sound, and smell of their store.
Several people said that the overall sound is too noisy for them to work or study and because
of allowing them to eat in the cafe, the smell is quite annoying for some customers. They can
reduce it by having different rooms for functions or purposes, for example, rooms for
working and studying, another room for customers who want to chat with their friends.
Finally, Highlands could make the smell better by applying the same way as above or using
essential oil or only using the food provided by the stores.
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11. Appendix
11.1. Discussion guide
I. Introduction:
Say thank you to the participants, introduce yourself.
Asking personal questions to close the gap between the interviewer and interviewee:
- What is your current job?
- How is your day at work?
- What are your hobbies?
II. General Behavioural Questions:
1. Can you please tell me the best thing you have ever experienced in Highlands
coffee?
2. Can you please tell me the worst thing you have ever experienced in
Highlands coffee?
3. What attributes do you consider when you buy drinks or especially coffee?
● What attributes do you consider when you buy drinks?
● Why do you think that factor is important?
● How about (other factors existing in our model but they do not
mention) ….?
● Can you further explain …?
● Why do you choose drinks at Highlands but no other Vietnamese street

vendor drinks?
4. Do you really want to go to the Highlands when you want to work, study or
hang out with friends? Why/Why not?
5. Do you think of Highlands as affordable or luxury? Why?
29
6. When the phrase “drinks, coffee, milkshake” is mentioned, which brand(s) do

you think of first?
7. TST: Write down 20 things you think about “Highlands”`
III. Coffee Consumption Questions:
1. On average, how many times do you drink coffee, milkshake, or similar drinks
in 1 month? How many times of which are Highlands?
2. What is your most frequently ordered drink? What is your most frequently
ordered drink from the Highlands?
3. If you could make ONE change to any aspects of Highlands, what would you
change?
IV. Questions about Highlands’s Price impacts on buying decision:
1. On average, how much do you spend on a drink?
2. Do you think the price of Highlands is worth your experience? Why/ Why
not?
3. Do you think Highlands is expensive, affordable, or cheap? Why?
4. How much are you willing to spend in the Highlands?
V. Questions about Highlands’s Products and Service Quality impacts on buying

decision:
1. Do you prefer to buy Highlands in combo with a drink and food or in

individual, with or without promotion? Why/ Why not?
2. What is your favorite coffee chain brand? What makes you choose it over
Highlands?
3. What differences in the drink do you think there are between Highlands and
other brands such as Phuc Long or The Coffee House or Trung Nguyen?
4. Which brand(s) fit your taste the most? Why?
5. What are your favorite products in Highlands? Why?
30
6. What product comes first in your mind when the name “Highlands” is
mentioned?
7. Does the quantity of a drink satisfy you?
8. Before you experience Highlands, what do you think about this brand?
9. Does the Highlands service match your perceived expectation (in terms of
waiting time, drinks’ quality (at the place and take home), employees’
attitude)?
10. Do you think the Highlands packaging is attractive, hygienic, and

environmentally sustainable? Why/ Why not?
VI. Questions about Highlands Place impacts on buying decision:
1. Does distance from your place to the coffee affect your drinks purchasing
decision? Why/ Why not?
2. Do you think the store’s atmosphere, interior, vibe, decoration, etc., affect your
buying decision? Why/ Why not?
3. How important do you think about the sanitary factors?
4. Does the parking problem affect your buying decision at Highlands?
VII. Questions about Highlands Communication impacts on buying decision:
1. How do you first know about the brand Highlands (through friends,
promotion, word of mouth, or …)?
2. Do you know of any social activities from the coffee brands? If yes, which is
your favorite? Why?
3. Do you know how Highlands advertise and promote their new product or their
brands? Does it affect your intention to buy?
VIII. Questions about Social and Cultural impacts on Highlands’s buying decision:
1. Do you consume Highlands because it’s trendy and has a long-lasting history?
31
2. Do you think dining at Highlands can make you feel more up-to-date and
modernized?
3. Do you think Highlands should have more drinks or foods to match with
Vietnamese culture? (adding more Vietnamese food or traditional drinks like
sugarcane or chè)
11.2. Transcript Qualitative Focus Group
https://docs.google.com/spreadsheets/d/1OQUhqGUa6pl1CZ8SlF-ngXwE77fIoc25cATA4fS
UuBE/edit?usp=sharing
11.3. TST Table
Top 10 things respondents mentioned the most when they first think about Highlands
32
11.4. Quantitative results
Table 8.2.1.a
Table 8.2.1.b
Table 8.2.1.c
Table 8.2.1.d
33
Chart 8.2.1.e
Chart 8.2.1.f
34
Chart 8.2.1.g
Table 8.2.2.a
Table 8.2.2.b
35
Table 8.2.2.c
Table 8.2.2.d
36
Table 8.2.2.e
Table 8.2.2.f
37
Table 8.2.2.g
Table 8.2.2.h
Table 8.2.2.i
38
Table 8.2.2.j
Table 8.2.3.a
39
Table 8.2.3.b
Table 8.2.3.c
40
Table 8.2.3.d
Table 8.2.4.a
41
Table 8.2.4.b
Table 8.2.4.c
Table 8.2.4.d
42
Table 8.2.4.e
Table 8.2.4.f
Table 8.2.4.g
43
Table 8.2.4.h
Table 8.2.4.i
44
Table 8.2.5.a
Table 8.2.5.b
45
Table 8.2.5.c
Table 8.2.5.d
Table 8.2.6.a
46
Table 8.2.6.b
Table 8.2.6.c
Table 8.2.6.d
47
Table 8.2.6.e
Table 8.2.6.f
48
Table 8.2.6.g
Table 8.2.6.h
Table 8.2.6.i
49
Table 8.2.6.j
Table 8.2.6.k
50
Table 9.a
51

Group 4-Final Reseacrch Report - Highlands Coffee

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GROUP ASSIGNMENT COVER SHEET

Student name: Phạm Hoàng Bảo Ngọc Student ID number: 31201028720

Student name: Trương Mỹ Hạnh Student ID number: 31201029121

Student name: Phạm Nguyễn Khánh Vy Student ID number: 31201029217

Student name: Nguyễn Hồng Châu Student ID number: 31201028622

Student name: Lý Trần Bảo Minh Student ID number: 31201028707

Student name: Nguyễn Thanh Tùng Student ID number: 31181021206

Unit name: Final research report Unit number: Study 3

Title: Factor affect customers’ buying decisions of Highlands coffee

Student’s signature: Phạm Hoàng Bảo Ngọc

FACTORS AFFECT CUSTOMERS’ BUYING DECISIONS OF

Nguyễn Hồng Châu

Lý Trần Bảo Minh

Phạm Hoàng Bảo Ngọc

Phạm Nguyễn Khánh Vy

Nguyễn Thanh Tùng

September 5th, 2021

2.1. Market overview

2.2. Company overview

February 2020, Highlands received a complaint on disability discrimination towards a

3.1. Research questions

- How sensitive are the customers to Highlands’ price?

- What can Highlands improve to attract customers in-store, achieving a competitive

- Do demographic and cultural factors affect customers’ perception of purchasing or

- What can Highlands do to differentiate between customer characteristics to modify its

3.2. Research objectives

The following objectives are what we want to achieve:

- To understand the current attitude of customers towards the brand.

4. Approach the problem

4.1. Research background

PRO1. Tangible product

PRO2. Intangible product

H2.1: High price at Highlands coffee promotes buying incentives since it is an

DEM (Demographics): There is a link between customer demographic factors such as

H5.1: Buying decisions have a relationship with age.

H5.2: There is no difference in purchasing decisions of customers among different

H5.4: Buying decisions are significantly different between genders.

H5.5: When purchasing coffee, there is no difference in demographic characteristics

SCU (Socio-cultural): There is a strong relationship between buyers' behavior and

4.2. Research model

Figure 1: Research Model of factors affecting purchase intention of Highlands

5.1. Secondary data research

5.2. Qualitative research

Method of administering the questionnaire

About Interviewer-administered questionnaires, we use this method for collecting qualitative

5.3. Quantitative research

Non-comparative scaling technique

Method of administering the questionnaire

6.1. Qualitative research

6.2. Quantitative research

8.1. Qualitative result

8.1.1 Sample Characteristics

8.2. Quantitative result

8.2.1 Sample Characteristics

There is no customer holding Strongly disagree about satisfaction when consuming

Additionally, strong disagreement or disagreement (the mean of 2.71/5 scale of concurrence,

9. Recommendations and conclusion

5. VnExpress. Vietnam to lead Southeast Asia in growth: ADB - VnExpress International

6. BritCham Vietnam. FOOD & BEVERAGES RETAIL REPORT [Internet]. BritCham