Brand Value Measurement - Starbuck Vietnam Coffee

Table of Contents

Executive summary        

I.        Introduction        

1.        Rationale, scope and theoretical framework        

2.        Research Objectives and Research Questions        

3.        Structure of the study        

II.        Literature review        

1.        Brand and Branding        

2.        Brand value and measuring brand value        

3.        Related studies on Starbuck brand value        

III.        Research methodology        

1.        Research instrument        

2.        Sampling and data collection        

3.        Survey construction and development        

4.        Data analysis method        

IV.        Findings and Analysis        

1.        Respondents’ demographic profile        

2.        Comparison of brand value between Starbuck Vietnam Coffee and other major coffee brands in Vietnam        

3.        Brand status of Starbuck Vietnam Coffee in Vietnam Coffee shop market        

4.        Relationship between gender and perceived brand value of Starbuck Coffee Vietnam        

5.        Relationship between age groups and perceived brand value of Starbuck Vietnam Coffee        

V.        Discussion, Conclusion and Recommendations        

1.        Discussion        

2.        Conclusions and Recommendations        

Appendix        

Appendix 1- Survey        

Reference list        

Executive summary

The project mainly aims to measure brand value of Starbuck Vietnam Coffee upon customers’ perspectives using the Brand Asset Valuator  Model proposed by an advertising agency named Young & Rubicam  and address its brand status in Vietnam coffee shop market employing the Power Grid developed by the same author. Accordingly, four dimensions of brand value which are differentiation, relevance, esteem and knowledge are measured upon Vietnamese customers’ perceptions and evaluation to analyze Starbuck Vietnam Coffee’s brand strength and brand stature in comparison with major coffee shop brands in Vietnam . To collect quantitative data which support the analysis, the research uses survey method with a final sample size of 258 Vietnamese customers, both male and female belonging to age groups of 20-25, 26-32, 33-40 and more than 40 years old.  The findings has shown that in comparison with major coffee shops brands in Vietnam such as Highland Coffee, Trung Nguyen Coffee, Me Trang Coffee and “Street Coffee”, Starbuck Vietnam Coffee is perceived as quite differentiated , however, such differentiation is not very relevant or appropriate to Vietnamese customers as the whole. In addition, Starbuck’s brand stature which is represented by perceived quality and popularity (i.e. esteem) and knowledge that Vietnamese customers has towards the brand  is still very low. As a result, Starbuck Vietnam Coffee is just considered as a new brand that is coming closer to an aspiring brand with potential differentiation. The study also discuss further to find out the reasons of Starbuck Vietnam Coffee brand value in Vietnam coffee shop market in spite of its popular global brand name as well as draw some helpful strategic recommendations so as to become a power brand in the market.

1. Introduction

1. Rationale, scope and theoretical framework

Nowadays, to be successful in such a competitive business world requires a firm to differentiate its self from competitors. In which, differentiation can be made upon various ways such as superior products or services, exclusive promotional offers, shocking advertising campaigns, etc. Branding is the strategy that combines many marketing techniques and policies adopted by a firm to differentiate its offerings from that of competitors (Handlin,n.d). However, branding does go beyond just putting a unique name or logo on the product. In fact, brand is the way customers perceive a product or service and differentiate it from other similar ones that result from interaction between the customers and the products or services and other marketing activities of a firm (Williams, n.d). In other words, a brand is defined by customers in their own mind, not by firms or the market (Neumeier, 2006). As a result, upon a list of similar product or service choices, each person will base partly or wholly on what they perceive towards each brand so as to make purchasing decisions.  That is the reason why brand has long been recognized as a powerful influencing factor to customer’s purchasing behaviors in which customers, as human beings with perceptions and emotions, have the tendency of being more committed to the products/ services that they are familiar to and connected with. A strong brand not only strengthens the loyalty of customers toward an organization but also enhances customers’ willingness to pay an extra price to buy the product upon that brand. Since  

Starbucks is an American coffee company which is honored as the largest coffeehouse chain in the world and the second most valuable fast food brand worldwide in 2014 (Statista, 2014), therefore, the role of brand in marketing is undeniable, measuring brand dimensions is a must-do or every marketers. There has been much research on measuring brand awareness, brand recognition or customer-based brand equity. However, there is another important brand dimension which is brand value. Due to different definition of what brand value is and the purposes of measurement, there are various brand value evaluation and measurement models. Many researchers and marketers define brand value as the ‘financial value” of a brand by putting a price tag on the brand value. This idea is mostly adopted when brand is valued for mergers and acquisitions, calculating costs for brand licensing or raising investment funds. As a result, brand value upon this perspective is measured in monetary terms to answer the question of how much a brand is worth or costs. On another side, as brand is perceived in customers ’mind, there is another idea that we should measure brand value upon customer perspectives so as to understand how customers perceive about the brand. Upon which brand value is viewed as the customer’s perceived value toward a brand. In this study, the author will support the idea of measuring brand value where it is created – customers’ mind by adopting the Brand Asset Valuator Model which is proposed by an advertising agency named Young & Rubicam and widely used as a brand management instrument which measures brand value upon four key components which are differentiation (i.e. how a brand is different from competitors), relevance (i.e. how appropriate the brand is to consumers), esteem (i.e. how consumers perceive towards the brand in terms of quality and popularity ), knowledge (i.e. how well consumers know or understand the brand). The Brand Asset Model requires data collected from consumers’ survey to scoring the four factors of brand value and evaluate the brand status upon consumers’ perspective. Thereby, the study does not aim at calculating the specific figure on how much a brand is in terms of financial figures but investigate how customers perceive about each element of brand value featured in the brand value model  upon the case study of Starbucks Coffee Vietnam.

Starbucks which has presented with about 21,000 stores in more than 60 countries and territories all over the world has entered into Vietnam since February, 2013. According to John Culver, president for China and Asia Pacific, Starbucks aims to “showing up in a way that doesn’t currently exist in the market in terms of the premium products and the experience”. Thereby, However, Starbucks has not experienced “hot” growth as it did in other countries although according to Mr. Luong Van Tu, chairman of the Vietnam Coffee and Cocoa Association  Vietnamese coffee consumption has continuously increased by 7 to 10% in recent years. The  challenge of Starbucks is Vietnamese deep-rooted coffee culture in which Vietnamese people is quite loyal to strong coffee sweetened with condensed milk and one or several familiar coffee shops whether branded ones such as Highland Coffee, Trung Nguyen Coffee or just a small coffee shop on the streets. Another challenge is that Starbucks set prices for its offerings at the highest in the market since it is deemed to target the high-end customers. However, whether customers think it is worth to pay an extra price to enjoy not only ‘the premium product and the experience” but also the Western lifestyle and the world brand name and more is still questionable. There may be a gap between what Starbucks Vietnam managers believe and what customers perceive about Starbucks’ brand value. Therefore, this research will adopt the Brand Asset Valuator model to evaluate brand value of Starbucks in Vietnamese consumers’ mind in terms of four key elements of brand value which are differentiation, relevance, esteem and knowledge. Customer surveys will be designed and distributed to 150 Starbucks Vietnam customers who are Vietnamese and living in Vietnam randomly so as to get customer insights and collect data for scoring and comparing the four factors. The findings will be analyzed to evaluate Starbucks brand value upon each of the four dimensions, the current status of Starbucks brand in Vietnamese consumers’ mind and forecast the trend of the brand’s status. This research will contribute to academic subjects about branding and measuring brand value as well as draw helpful practical implications for Starbucks Coffee Vietnam in evaluating and improving its marketing strategy and better understanding their consumers