Enhancing banquet program performance a case of heineken vietnam brewery

UNIVERSITY OF ECONOMICS HO CHI MINH CITY International School of Business --- TRAN BA KHOI ENHANCING BANQUET PROGRAM PERFORMANCE A CASE OF: HEINEKEN VIETNAM BREWERY MASTER OF BUSINES

UNIVERSITY OF ECONOMICS HO CHI MINH CITY

International School of Business

-

TRAN BA KHOI

ENHANCING BANQUET PROGRAM PERFORMANCE

A CASE OF: HEINEKEN VIETNAM BREWERY

MASTER OF BUSINESS

Ho Chi Minh City – Year 2019

UNIVERSITY OF ECONOMICS HO CHI MINH CITY

International School of Business

-

TRAN BA KHOI

ENHANCING BANQUET PROGRAM PERFORMANCE

A CASE OF: HEINEKEN VIETNAM BREWERY

MASTER OF BUSINESS SUPERVISOR: NGUYEN THI MAI TRANG

Ho Chi Minh City – Year 2019

EXECUTIVE SUMMARY

According to the development plan until 2020, the Vietnamese beer industry will reach an output about 4.1 billion liters by 2025 to 4.6 billion liters and 5.5 billion liters by 2035 However, beer consumption already reached more than 4 billion liters by the end of 2018 Vietnamese beer industry has been maintaining a growth rate of over 5% per year while many other markets have moved sideways or negative growth in recent years Vietnam is becoming an attractive beer market that makes both domestic and international beverage businesses stand to fight

Winning in the beer industry mainly depends on marketing technique secrets more than finance and product recipe Businesses seize market share by unique marketing strategy from advertising, communication to promotion in all channel such as on premise, off premise, modern on premise, modern off premise and brand building right at the initial customer level

Mention about the communication and promotion in beer market Many customers and consumers always save an affection for many activations of Heineken Vietnam Brewery such as Heineken formula 1, Tiger street football, Trade loyalty, Fridge, Banquet ect From 2016, HVB discorvered that Banquet catering is a popular segment and had strongly impact to beer market share but HVB have not much focused on this channel before That

is the main reason Banquet promotion program was piloted from 2016 With the successful

of the first year ran promotion in small scope only two provinces, HVB continued to expand program with more than 30 provinces (in P3.2018) When expand the program so quick in the short time like that, it led to there was many problems and issuses that effected

to performance of program and not adapt to the management’s expectation

The research will explore the cause’s Banquet P3.2019 had not meet KPI The finding of study revealed that lack of RTMK to manage, deploy, push, check and support ST which played the most important role on poor performance of Banquet P3.2018 which compaired

to other factors Moreover, some reasonable solutions would be recommended to improve performance of Banquet in the future

With out the extremely enthusiastic encouragement, guidance and support of Associate Professor Nguyen Thi Mai Trang and orther teachers in ISB (International School of Business), the entire master-level project would not be completed with the highest qualified research I would like to say thank and appreciate to my advisors It has been a pleasure working with you on this project

I also would like to thank my family, colleagues, classmates who have supported me while

I have been studying in ISB and working on my research Your patience, understanding and respecting greatly appreciated

CONTENTS EXECUTIVE SUMMARY

ACKNOWLEDGEMENT

LIST OF TABLES 1

LIST OF FIGURES 1

ABBREVIATION 2

1 INTRODUCTION 3

1.1 Overview 3

1.2 Heineken performance in 2018 5

1.3 Competitors of Heineken Vietnam Brewery in 2019 6

1.4 Objectives and targets for Heineken Vietnam Brewery portfolio brands in 2019 7

1.5 Trade marketing plan in 2019 11

1.6 Commercial department structure 12

2 PROBLEM CONTEXT 14

2.1 Introduction about Banquet program in traditional off trade marketing 14

2.2 History of Banquet program 18

2.2.1 The Banquet program performance pilot phase in 2016 18

2.2.2 The Banquet program performance in 2017 19

2.2.3 The Banquet program performance phase 1.2018 20

2.2.4 The Banquet program performance phase 2.2018 21

2.2.5 The Banquet program performance phase 3.2018 21

3 PROBLEM INDENTIFICATION 25

3.1 Symptoms 25

3.2 Potential problems 28

3.2.1 Distraction of sales team to Banquet program 28

3.2.2 Unqualified agency service 31

3.2.3 Unattractive mechanism Banquet program 33

3.2.4 Unpredictable market factors 36

3.3 Problem validation 38

3.3.2 Illuminating distraction of sales team to Banquet program as the main problem

39

3.4 Potential cause’s distraction of sales team to Banquet program 43

3.4.1 Lack of regional trade marketing to manage, deploy, push, check and support sales team 43

3.4.2 Sales team overloads with many activations 45

3.4.3 Sales team only focuses on sales volume and excellent outlet execution 46

3.4.4 Sales team misunderstands the role of related parties in Banquet program 48

3.4.5 Causes validation 49

3.4.6 Cause - effect tree 51

4 ALTERNATIVE SOLUTIONS AND JUSTIFICATION 53

4.1 Recruite regional trade marketing for regions 54

4.2 Develop the application management for Banquet program 57

5 ORGANIZATION ACTION 60

6 CONCLUSION 62

7 SUPPORTING INFORMATION 64

APPENDIX 97

Appendix 1: Roles and responsibilities of related departments in Banquet program 97

Appendix 2: Communication material Banquet program phase 3.2018 99

Appendix 3: Regional trade marketing – Job description 100

Appendix 4: Proposal the application management for Banquet program 102

REFERENCES 122

LIST OF TABLES

Table 1: The BP performance pilot phase in 2016

Table 2: The BP performance in 2017

Table 3: The BP performance phase 1.2018

Table 4: The BP performance phase 2.2018

Table 5: The proposal budget for BP phase 3.2018

Table 6: The BP performance phase 3.2018

Table 7: Satistics performance per region in BP phase 3.2018

Table 8: Estimating the expense for five RTMK per year

Table 9: Estimating the cost of application for Banquet per project

Table 10: Action plan

LIST OF FIGURES

Figure 1: Organization HVB

Figure 2: Commercial department structure

Figure 3: Trade marketing roles in HVB

Figure 4: The interaction structure between TMK and ST

Figure 5: Sales department structure

Figure 6: Banquet promotion program process

Figure 7: The interaction of related parties in Banquet program

Figure 8 : Satistics performance per region in BP P3.2018

Figure 9: Satistics percentage of outlet types and party by outlet types in BP P3.2018 Figure 10: The initial cause - effect map

Figure 11: Updated cause - effect map

Figure 12: Workflows for related parties in Banquet program

Figure 13: The final cause - effect map

Figure 14: Cause - effect tree

Figure 15: The recommended effectively structure with RTMK roles

PO: Party Owner

RTMK: Regional Trade Marketing

ST: Sales Team

SV: Sales Volume

ToffT: Traditional Off Premise Trade Channel

TMK: Trade Marketing

in Vietnam get over 4 billion liters in 2018, and is forecasted get over 4.6 billion liters in

2019 (Internal report HVB 2018)

HVB product portfolio

HVB own many favorite brands beer in Vietnam such as: Heineken, Heineken Silver, Tiger, Tiger Crystal, Strongbow, Desperados, Amstel, Afligem, Larue, Larue Special, Bivina, and Bivina Export

HVB also has planned to release unique strategic actions to recover the SV of Heineken brand as well as increase the innovation with Heineken Silver for new targeting young, dynamic, high-income consumers who mainly live and works in big cities in 2019

About the implementation, two strategic plans recommended is upgrading Heineken brand (Heineken Silver) and creating a new brand (Amstel) for economy beer segment To implementing strategic actions, HVB will face to some potential challenges, as the attack from rivals, losing profits by increasing investment cost for new products, cannot gain the expected SV, or the higher tax from government

HVB target customers

Target customer: people aged from 20-50 with medium or high income, potential

customers mainly live in urban or city They may be a professionals, employers, senior managers and employees

Customer relationships: engagement by brand awareness, advertising, innovation

HVB value proposition

Key resources: Heineken have more than 165 breweries in more 65 contries, distribution

networks, intellectual property

Value proposition: HVB strategy concentrates on to achieve determined objectives

Win in premium price led by Heineken

Shape the cider category

Lead in marketing and innovation

Be commercially assertive

Improve the productivity

Maintain a better brewing in a world

Channel activation: modern On, modern Off, traditional On, traditional Off

Cost structure: raw material, production, distribution, quality control and assurance, tax

Revenue streams: sales of products, distribution agreements, Heineken experience

Key partners: investors, raw materials suppliers, distribution networks, technology

Vision, mission and core value of HVB

Target: a better Vietnam by creating good value for peole, planet and prospery

Vision and Values: HVB’s vision is to be the leading, proud and responsible brewer in

Vietnam, guided by values: “Respect for People & Planet, Enjoyment, Quality and Passion for Winning”

Missions: HVB delight consumers, day in day out, with perfect cider and beer brand experiences

Slogan in 2019: Winning, Faster, Together With new way of working: (1) Effective workflow, (2) Assigning rights for each region, (3) Focus in efficiency

The standard behavior: (1) Safety first, (2) Act as an entrepreneur, (3) Corporate with trust, (4) Keep in simple, (5) Always learning to development

Ambition to 2021: Become the number one in terms market share, profit and sustainable developments With priority:

Become a market share leader in both Urban and Rural

Be a beer leader in both premium and mainstream segmentation

Continue keep moment growth of Heineken and Tiger

Develop Apple Cider brand

Increase revenue and manage efficiency expense

Attract develop and significant advantage talents

Lead sustainable development strategy

Drink responsible policy in 2019: (1) Responsibly in consumption and behave, (2) To be

an ambassador to drink responsibly, (3) Do not drink in working hour, (4) Drink do not drive

1.2 Heineken performance in 2018

Heineken Global performance in 2018

Generally, Heineken Global had one very successful year in 2018 with all good indicators (SV, net revenue, and profit) Leo Evers (HVB Managing Director) reported in national commercial conference in Da Nang on 21 March 2019

Consolidated SV in 2018 increased +4.2% compare to 2017 With Heineken brand, SV significantly grew +7.7% It is the strongest performance in more than a decade Net revenue (β) also increased +6.1% organic growth and it led to the increasing on operating profit (β) went up +6.4% versus 2017 performance

Net profit (β) was so good with the absolute number €2.424 billion, increased approximately 12.5% from 2017 So, the distributed earning (β) per share €4.25, increased 7.9%

Heineken Vietnam performance in 2018

Mr Alexander Koch (HVB Commercial Director) also shared the performance of HVB

in 2018 with over 1,800 employees in commercial meeting

HVB had a very successful year in winning about SV with total HVB SV in 2018 achieved 15 million hectl liters, increase 13.9% compared to 2017 In detail: sold out 14.1 million hectl liters (increased 13.8% compared to 2017) by HVB sold out and 0.9 million-hectl liters (increased 24.2%) by Heineken Hanoi

Regional sales performance:

Regions had fast growth versus last year (>14%): most of region of HVB in the North, Central (Da Nang, Quang Nam), South East (Binh Duong, Binh Phuoc), Mekong 1 (Tay Ninh, Long An, Tien Giang, Ben Tre, Vinh Long, Dong Thap, Tra Vinh), Mekong 2 (Can Tho, Hau Giang, Soc Trang, Ca Mau, Ba Lieu, An Giang, Kien Giang)

Regions had stable growth versus last year (7%-14%): Central South (Quang Ngai, Binh Dinh, Phu Yen, and Daklak), North East (Dac Nong, Lam Dong) and HCM City

Regions had little growth versus last year (0% - 6%): market share under high pressure: East South (Ba Ria-Vung Tau, Dong Nai)

Region had negative growth versus last year (lost in SV and market share): Central North (Hue, Quang Binh, and Quang Tri), Central South (Gia Lai, Kon Tum), East North (Khanh Hoa), East South (Ninh Thuan, Binh Thuan)

1.3 Competitors of Heineken Vietnam Brewery in 2019

Moreover, beer market becomes the fierce competition These current famous brands such

as Sabeco, Heineken, Habeco, Carlsberg, Budweiser’s and Sapporo ect., take advantage to gain market share and other new foreign brands want to enter this attractive market with the participations from most of investors Shares of Sabeco - a firm with the biggest market share (42.9%) belongs to Thai billionaire and then this firm is changed almost the human resources in top managers There is potential change in strategy of this company, too Besides that, Heineken - the second market share leader (34%) take actions try to maintain the growth and extend beer brands Habeco is very closely with the third market share (14.5%) Beside that Carlsberg (Hue + South East Asia Beverage), account for 5.3% in

total beer market The world’s biggest ABInBev brewery with Budweiser’s brand - also appear in Vietnam since 2015 However, there had many brands, which used to be popular

as BGI, San Miguel, Foster, Zorok, Gambrinus, Laser ect., are not spectacular or even silently retreat

The Vietnamese beer market are very competitive, especially in the North and North Central Coast where is the place Sabeco increase market share day by day Sabeco continue

to deploy many activations to increase market share in the North In 2018, Sabeco-ThaiBev concentrates for all portfolio in many key cities to compete with all other brand beer One more strongly competitor is Habeco also increase to sale out share to private section that make them more dynamic and competitive in North Central Coast

In the North where the total SV beer in market is approximately 9 million hectl liters with the biggest 67% market share in Habeco (6 million hectl liters) Sabeco has 26% market share (2.3 million hectl liters) HVB only sell out 0.6 hectl liters and has 7% market share

in here

In North Central Coast where the total SV beer only 6 million hectl liters: Carlsberg account for above 50% (from 2 to 3 million hectl liters), Sabeco is closely with 30% market share (from 1 to 2 hectl liters), and Habeco only has 10% market share in here (0.5 million-hectl liters)

In the South where the biggest beer market in Vietnam with total SV on the market 26 million hectl liters, with mainly competitor are Sabeco-ThaiBev account for 50% market share (13 millions hectl liters), other 48% market share belong to HVB In the South there are a lot of strongly international competitors such as Sapporo, ABinBev, Singha but the

SV are too small

1.4 Objectives and targets for Heineken Vietnam Brewery portfolio brands in 2019 Ambition with successful year 2019, Mr Leo Ever announced on the national commercial

meeting in Da Nang on 21 March 2019:

Target SV: 17 million hectl liters (increase +12.9% versus 2018)

Market Share 2019: 36,5% (increase 2.5% versus 2018)

Strategy, activation and detail target for portfolio brands in 2019:

Heineken brand (Heineken, Heineken Silver): recovery in growing with target 1.666

million hectl liters Heineken is the brand that brings the highest profit per case for HVB

Mr Reinoud Ottervanger (Heineken Brand Marketing Manager) shared the Heineken strategy

Heineken brand had impressive SV in Tet 2019 increased 2% compared to Tet 2018 and got over target in Jan and Feb 2019 was +57% In 2019, Heineken sleek can (250ml) increased in SV (+74% versus last year), Heineken sleek can (330ml) (+29% versus last year), Heineken Aluminum (+1.091% versus last year) Besides that, The World of Heineken also welcomed 150,000 visited guests

New campaign in 2019: new in communication messages, new in activation at outlets Orientation campaign 2019: innovation products (new visual, packaging, new product

- Heineken Silverect.), unique communication campaign, win in activation at outlets Heineken: Formula 1 Vietnam Grand Prix in My Dinh stadium on April 2019

New type package for Tet 2020

Strongbow brand becomes a leader Cider segmentation in Vietnam with target 0.11

million hectl liters (+100.2% versus 2018) with three main strategy: brand identity, accelerate market, and expand distribution

Miss Nguyen Thi Ngoc Tram (Strongbow Brand Marketing Manager) also shared the planning for innovation Strongbow

Many activations would be active in 2019 such as promoting and sampling (restaurants, traditional restaurants, and modern trade channel), displaying, branding and promotion (traditional on trade, modern on trade, traditional off trade, modern off trade channel) Media campaign: social media, digital, social network, Facebook, cinema, building office ect

New flavor Cider: dark fruit, carton with ten cans, festive carton

Tiger brand (Tiger, Tiger Crystal): continuing to maintain and develop in new area with

target 12.226 million hectl liters (+12.3% versus 2018)

Folow the sharing from Mr Nguyen Phuong Hoang (Tiger Brand Maketing Manager) Developing strategy for Tiger brand in 2019:

In the market with the fast growth versus last year (>14%) (* detail provinces as mention above) - In these provinces, Tiger account for 44% versus Tiger SV (core market) which strategy in here is reward

In the market have stable growth versus last year (7%-14%) (* detail provinces as mention above) - In these provinces, Tiger account for 51% total Tiger SV Tiger also

have many marketing strategies to appeal the drinkers which switching from mainly competitors such as: Red Saigon, 333, Saigon Larger, Saigon Special, Hanoi beer etc

In the market have negative growth versus last year: Tiger will compete directly with Huda, Saigon Larger, Saigon Special to gain growth SV

Target 2019: continue to be the most favorite beer brand across Vietnam with the

Expand distribution in rural market to gain more SV for Tiger

There are alot of campain and events for Tiger in 2019:

- Tet/Tiger remix (January 2019) with many key cities such as: Ha Long, Hai Phong,

Ha Noi, Da Nang, Nha Trang, HCM City, Can Tho

- Tiger street football (April 2019): Thai Nguyen, Hai Duong, Hai Phong, Quang Ninh,

Ha Noi, Nghe An, Hue, Da Nang, Quang Nam, Buon Me Thuoc, Khanh Hoa, Ba Ria Vung Tau, Dong Nai, Tay Ninh, CM City, Tien Giang, Can Tho, Kien Giang

- Tiger Crystal imprints 1 million hectl liter with slogan “ Khat khao vuon xa, that san khoai” in Bac Ninh, Ha Noi, Ha Long, Hai Phong, Hue, Da Nang, Quang Ngai, Binh Dinh (147%), Dak Lak (152%), Binh Thuan (141%), Nha Trang (129%), Ba Ria Vung Tau, Binh Duong, HCM City, Long An, Tien Giang, Dong Thap, Can Tho, Hau Giang, An Giang, Tra Vinh (147%), Vinh Long (133%), Soc Trang (132%), Ca Mau and Kien Giang (151%)

- 88 years Tiger with Jackpot with the big win 550.000.000 VND, this is the first time Tiger brand bring the Jackpot in to promotion in Vietnam

Amstel brand premium positioning with reasonable price with target for 2019 is only 0.1

million-hectl liters Vietnam is one of the first country in South Asia where sell Amstel with impressive design, appear the first time in Holand in 1870 with many international campaign (with Mohammad Ali mighty, companion with Eropia League from 2015) Mr Nguyen Le Manh Linh talked about the strategy of Amstel

Wingman strategy and always fly beside on Tiger: Amstel is strategic weapons that compete with other competitors with the main purpose to reduce depend on Tiger brand Expand distribution in 2019 in Phu Yen, Binh Dinh, Quang Ngai, Quang Nam, and Da Nang

Continue the media campaign “Vi em huyen thoai”: increase outlets visibility, activation and sampling

Strategy for Amstel in 2019

Sell in the multi brand outlets where, have a lot of Saigon Special

Put more sell in outlets, where market share Tiger in there lower than 50%-70% Maintain the Amstel competitive price in the affordable and premium segmentation

Larue brand (Larue, Larue Special): develop in mainstream segmentation with target

2.632 million hectl liters (+ 21.5% versus 2018) with campain flashing victory with slogan

“Song yeu doi, moi Larue” with many marketing campaigns which disclosured by Mr Nguyen Tam Hoang (Larue Brand Marketing Manager) as details

Golden Mic (Karaoke Larue) will be activate on internet, mobile ect

Open the cap, big win (first prize Karaoke portable speaker & 5 million VND, second prize one million VND, third prize 10.000 VND

Larue festive campaign Tet 2020: Facebook media 2020, event activation, promotion for consumers

Bivina brand continue expanding distribution and increase SV in mainstream

segmentation with target 0.2 million-hectl liter (+23% versus 2018) Mr Tran Tuan Kiet very happy to annouced about the slogan of Bivina “Tu hao bia dao ngoc” with a lot of marketing campain 2019 such as

Open the cap of Bivina gets the scratch card: “Khui Bivina san qua dao ngoc” (10 the first prize 1 Pearl, the second prize is hundreds Polo T-shirt, the third prize hundred thousand mobile card ect.)

In 2019 Bivina brand expand more Bivina Export in increase opportunities SV

Managing director HVB expectation for 2019

Focus on premium beer and cider brand and continue leading industry beer in Vietnam Revenue management: Concentrate on margin profit and expense Improve effective operation in cost, innovation, investment and sales execution

Quickly develop in the North market

Quickly accelerate for premium brand (Heineken, Tiger, Amstel, Strongbow ect.) in urban area and mainstream (Larue, Larue Special, Bivina ect.) in rural

Sustainable competitive with rivals and delivers HVB’s value to stakeholders through

“Brewing a Better World”

Grow with customers and partners, to be successful with integrity and fairness

1.5 Trade marketing plan in 2019

Accelerate coverage expansion: quickly to expand the coverage market

Build many TMK programs, events according to regional characteristics to have many quickly actions to support for ST

Picture of success (PICOS): deploy the standard outlets for each region

To become a quicker winner in market with accelerate more 25,000 outlets:

In the North will recruit more than +10,800 new outlets in 2019: expand coverage in small outlets instead concentrate in the big outlets with high SV

In the Central will recruit more than +7,900 new outlets in 2019: concentrate on distribution the North Central Coast

In the South will recruit more than +6,300 new outlets in 2019: concentrate on rural area

Recruite more 200 people in sales team and distributor salesmans in 2019 to take care outlets

Support more tools and activation to become a winner at outlets

Traditional Off Premise Trade (ToffT) Channel

BP: Continue to make sure for HVB products is always the first choosing in most of party at home Moreover, TMK and ST have to improve the performance program achieve the target expanding more 30 provinces, 45,000 parties, and SV 1,500,000 cases

Trade Loyalty Program: build a long-term relationship with 14,000 loyalty customers,

SV 15,900,000 cases

Fridge Program: strengthening the present of 9,520 fridges in 30 provinces - create believers and profits for customers

Traditional and Modern On Premise Trade Channel - key priorities in 2019

Win with Cold Availability

Win with loyal customers

Accelerate sell out activities under brand campaigns

Modern Off Trade Channel - key focus in 2019

Understand shopper’s behavior in store in order to respond fully to their needs and immediately through category management

Enhance shoppers experience through shopper based category presentation, fixture Pack six cans, carton units which, will be focus on 2019

Incremental volume comes from how to increase frequency and volume per trip

Drive basket size for Strongbow in HCMC and sampling activities for province

1.6 Commercial department structure

Figure 2: Commercial department structure

Commercial department is considered the heart of HVB, there are three main functions such as Brand marketing, TMK and ST TMK and ST are operated by channel but brand marketing is managed dedicated by seperately per brand as the above structure

advertising materials, and forecasting products, budget management ect These activities are merely to support sales and retail outlets more effectively

Figure 3: Trade marketing roles in HVB

Source: internal structuce HVB, 2018 HVB TMK plans by channel, focuses on categories, drives portfolio and brands in channel, and executes with customers

HVB TMK develops and delivers activation strategies, platforms and plans for prioritized

channels or outlets

Figure 4: The interaction structure between TMK and ST

Source: internal structure HVB, 2018

As the chart above, RTMK has the important roles as the bridge to get all information from TMK to work with ST and deploy all trade activations in market and receive all feedbacks from ST

Figure 5: Sales department structure

Source: internal structure HVB, 2018 Actually, RTMK for ToffT only had in MK1, MK2 In other regions, ASM had to cover the RTMK It will effect to the TMK activations on these market Lack of RTMK in region will effect to BP performance is a typical case for example that TMK already determized via the real analysis performance BP P3.2018

2 PROBLEM CONTEXT

2.1 Introduction about Banquet program in traditional off trade marketing

Party at home is a big opportunity in beer industry in ToffT In the past year, HVB has been deploying many trade promotion programs for this segment because of tree main reasons such as (1) BP leverages and exploits this opportunity to increase HVB market share, (2) BP is a new weapon to compete to gain more SV from competitors, (3) BP is a tool to support ST achieve sales target in whole year

Mr Mateusz Sikora – ToffT manager has shared about the ToffT straregy in 2019

Three mainly activations of ToffT for 2019 such as BP, Trade loyalty and Fridge program, which BP can be seen as one of the survival factor of ToffT Therefore, TMK have to concentrate all resources to improve the performance of BP in 2019 and future

The contribution of BP to the HVB’s performance is evaluated very effective about the image, brand, distribution, trial, convert custommers, buyers Caterers who are selling the competitors will be switching to push out HVB products to end comsumers because of having more profit via promotion program Consumers have no choice their favorite beer

in party because it depends on the receptions from party owners The effectiveness is very clearly and all of HVB’s management team reconized that BP is very effective to contribute for HVB’s performance TMK will continue to evaluate the impact of BP to end consumers after the program in future which is very important aspects to prove the essential of BP in ToffT in particularly and HVB in generally

One more thing to prove the effective and contributed BP to SV that is many competitors also see the strongly impact of BP Therefore, most of them such as Sabeco, Huda, Budweiser, Sagota…, also have had similarly tactical promotion in this segmentation

Mr Le Thai Hung – Project owner evaluated the BP contribution for HVB performance

BP will increase awareness for ST, customers, and end consumers about HVB porfolio

brands BP is additional tool to increase availability HVB product portfolio at outlets, retailers, consumers …, expand trial from many guests of parties, who used to drink competitor’s products such as Sabeco, Budweiser, Sapporo, Huda… which have a compulsory chance to try HVB’s products This is a tool to support ST in daily sell in, sell out and stock products at outlets Beside that Banquet also has a lot of contribution for HVB’s performance in 2018, especially in penetration (from HVB to retailers and from retailers to consumers) Banquet is a new channel, which TMK need to expand and reach out new drinkers

For an example to see the impacts of BP such as one party can consumme 30 - 40 cases (especially in rural area, mainly dominated by competitors such as Sabeco, Su Tu Trang, Huda….) with average 200 people will drink HVB products at party where as occation for them to trial HVB brands, that a big oppotunities to spread HVB portfolio to mass consumers with the lowest cost It will lead to “Halo effects”, “Words of mounth” that are clearly very inportant program Assumption that only 10%-20% of people who used to drink HVB products at party which will buy back the HVB brands in future that will be huge of contribution HVB SV

HVB also evaluated carefully the effectiveness of program Therefore, HVB already put a lot of budget for the BP which more than 50 billion vnd per year (2019)

Mr Tran Ngo Vinh Phuc – RTMK added more opinion about BP contribution to HVB performance

The full meaning of the BP is that HVB want to switch the competitor’s consumption to HVB products It was estimated that there have 40%-50% NoP, which were switched from key compertitors such as Sagota, Sabeco, Su Tu Trang, Huda ect., from last phase

Program objectives

Banquet catering is a popular segment in Vietnam, that especially in rural and sub-urban area In recently, TMK HVB has been deploying many promotion programs for this segment to promote, motivate Banquet Caterers and increase SV BP also help HVB to expand market share at Banquet in both party at home and wedding venue segment that focus on rural area where many strong competitors such as Sabeco, Su Tu Trang, Sagota, Huda… are concentrating on that channel Besides that, BP not only will support ST to achieve sales target in monthly, quarterly, yearly but also provide a tool to lure PO who organize party at home both in urban and rural areas BP is trongly weapon to compete and gain more SV from competitors such as Sabeco, Habeco, Carslberg, Sagota, Su Tu Trang, Huda…

Figure 6: Banquet promotion program process

Source: approved proposal Banquet program P3.2018

Step 1: PO (who hold wedding, birthday, dead anniversary, grand opening, reunion,

memory party … ) will buy beer and get promotion information from Caterers

Step 2: Caterers who are outlet owners of: Sub distributor, Beverage retail shop, Grocery

shop plus, Grocery shop, Banquet cartering, Wedding venue ect., that signed agreements with HVB and appointed to join the BP that will call to hotline and supply the party information for hotline such as full name of PO, telephone, party location, type of beer, quality beer, type of party, date partyect., Caterers must to confirm ID code and notice full information of party as requirement to hotline

Step 3: Hotline will call back to the PO to reconfirm all information which supplied by

Caterers is correct or not and confirm again party schedule

Step 4: Hotline will confirm the promotion package to agency supervisor (who deliver

voucher, beer, gift ect.)

Step 5: Supervisor will call and inform to PO the date and time to deliver voucher

Step 6: Supervisor will notice to sales representative ST about the party information Step 7: Supervisor deliver voucher to PO and get proof to prove by: take picture, get party

owner signature on HVB form

Step 8: Hotline will call back to PO again to reconfirm that they already received voucher

on time

The interation chart in BP

Figure 7: The interaction of related parties in Banquet program

Source: approved proposal Banquet program P3.2018 The chart clearly show the process how interaction of many related parties in BP RTMK has very important role in the chart as the bridge to connect TMK, ST and agency ect., RTMK is also the key clutch in deploying, managing, checking, supporting to make sure

that ST will deploy the sucessful BP on market In some regions lack of RTMK that ASM have to cover RTMK tasks such as central north, central south, east north, east south and HCM

2.2 History of Banquet program

In 2016, TMK and ST reconigzed that HVB had an big oppotunity to increase SV in party

at home segmentation in ToffT which had not focused on before After a lot of meetings, discussion, alignment which got information from market and analized data from many related departments such as: TMK, ST, business controller, revenue management, process and control improvement ect., the first BP was piloted on the 5th September at the same year

The BP has been continued to develop, expand and improve year by year, from only one province and one district (Tien Giang, Cu Chi) in 2016 with 2,000 parties (SV 52,740 cases) which expand to five provinces in 2017 with served 7,417 parties (SV contribution 268,432 cases) In remarkable year 2018, BP continued to expand to 30 provinces and served total 51,320 parties (total SV 1,717,753 cases) In 2018, BP had three separately phases: the main reason TMKT had not run the whole program in one year because TMKT would like to review and improve the program gradually, step by step Generally, the performance of BP in 2018 did not meet the requirement because of the poor performance

in NoP achieved 77.1% (actual 51,320 parties/target 66,577 parties) but SV met the target 101% (actual 1,717,753 cases/target 1,701,633 cases) But deep down the performance BP P3.2018 are very low in both KPI that are NoP only achieved 68% and SV only 86.1% compare to target of program Therefore, the TMK crucial mission must to find out the solution to improve and increase both indicators NoP and SV for BP in 2019

2.2.1 The Banquet program performance pilot phase in 2016

The first time pilot BP on Tien Giang province and Cu Chi district with very simple mechanism: The party registered by Caterers which buy from 15 cases Heineken or 20 cases or Tiger, Larue will be received 2 cartons Heineken or free Karaoke service at party and Caterers will be received 200,000 VND for introducing each successful party

Both indicators are the NoP achieved 100% and the SV achieved 132% versus KPI One more thing, the NoP chosed the Karaoke prize quite low approximately 5% of the 2,000 total party It was the remarkable number to get experience for future

Table 1: The BP performance pilot phase in 2016

(From 05 September 2016 to 20 January 2017)

Source: internal report from Agency G.Solution With the successful pilot phase, HVB decided continue the program in next year and determized that Banquet is one of the key activation of ToffT for future

2.2.2 The Banquet program performance in 2017

Table 2: The BP performance in 2017

Included three phases

Phase 01 (From 01 April to 30 June 2017)

Phase 02 (From 01 September to 31 October 2017)

Phase 03 (From 15 October to 31 December 2017)

Source: internal report from Agency G.Solution After the pilot phase in Tien Giang and Cu Chi, HVB evaluated performance of program

as well as got many positive feedbacks from ST that, suggested to continuing and

expanding the program Therefore, in 2017, TMK decided to deploy program with bigger scope include five provinces such as Tien Giang, HCM, Dong Thap, An Giang, and Hau Giang with the same mechanism of 2016 Both the NoP and SV did not meet the expectation only 70% performance for party and 94% for SV One more learning from this phase was Karaoke mechanism was not attractive PO Therefore, TMK had to reconsider the other prize promotion for closely with consumer’s expectation in next phase to enhance both NoP and SV more

2.2.3 The Banquet program performance phase 1.2018

Table 3: The performance of BP phase 1.2018

(From 05 January to 28 February 2018)

Source: internal report from Agency G.Solution and TVE After got a lot of experience from BP 2017: TMK continued program in Phase 1.2018 with

a lot of improvement in both mechanism and management in 14 selected provinces, had taken out the poor performance Hau Giang (only had 172 parties in 2017), added in new potential provinces and stoppped Karaoke prize compared to 2017

Mechanism of program: the party registered by Caterers which buy from 15 cases HVB will be received 1 carton by brand and Caterers will be received 100,000 VND In case, they buy from 30 cases HVB will be received two cartons by brand and Caterers will be received 200,000 VND for introducing each successful party The performance in P1.2019 was good with NoP achieved 100% and SV was 124% versus target Beside that TMK also received many positive feedbacks from ST for improvement in this phase

2.2.4 The Banquet program performance phase 2.2018

Table 4: The performance of BP phase 2.2018

(From 16 April to 31 July 2019)

Source: internal report from Agency Trio and TMAR

In phase 2.2018, BP remained 14 provinces as previous phase TMK continued to take out some poor perfomance provinces such as Dong Nai, Binh Duong, Vung Tau, Soc Trang and added new potential provinces which suggested by ST as Quang Nam, Phu Yen, Ninh Thuan, Binh Thuan Merchanic was not big change compared to previous phase - only having the small change was designed more suitable and detail by the province It led to improvement in performance of actual NoP increase 182% from 8,920 parties in P1.2018 parties to 16,272 parties and actual SV also went up 191.5% from 306,464 cases to 587,180 cases But the total NoP in P2.2018 had not hit target, only achieved 84% (actual 16,272/target 19,329 parties), although the SV was quite good in performance is 118% (actual 587,180/496,816 cases) These change had an effect that the TMK cannot control

in executing program on market

2.2.5 The Banquet program performance phase 3.2018

Scope in: Hue, Đa Nang, Quang Nam, Quang Ngai, Binh Đinh, Phu Yen, Gia Lai, Kon

Tum, Dak Lak, Khanh Hoa, Ninh Thuan, Binh Thuan, Binh Duong, Đong Nai, Vung Tau, HCM, Long An, Tien Giang, Ben Tre, Vinh Long, Đong Thap, Tra Vinh, Tay Ninh, Can Tho, Hau Giang, Soc Trăng, Ca Mau, An Giang, Kien Giang, Bac Lieu

Mechanism of BP P3.2018

The party registered by participated Caterers in list (Sub-distributor, Beverage retail shop, Grocery shop, Banquet cartering) which buy from 15 cases HVB (Heineken, Tiger, Tiger Crystal, Strongbow, Larue, Larue Special, Bivina), will be received voucher (1 carton) by brand and Caterers will be received 200,000 VND bonus for a successful party

The party registered by participated Caterers in list (only be applied to wedding venue) from 40 cases (HVB porfolio) will be received voucher (02 cartons) by brand and Caterers will be received 100,000 VND bonus for a successful party Heineken Trolley added as special gifts for party owner in peak season (December 2018 and January 2019) to push more SV

BP P3.2018 Budget:

Table 5: The proposal budget for BP phase 3.2018

(From 01 October 2018 to 31 January 2019)

Source: approved proposal Banquet P3.2018

In P3.2018, TMKT put in there a lot of expectation about successful pictures with over bilion vnd budget POS items and beer promotion accounted for 70% (approximately 29 billion vnd) and the agency fee accounted for 30% (approximately 14 billion vnd) of the total budget of program Agency fee is very important aspects, which TMKT had to notice for future

43-Table 6: The performance of BP phase 3.2018

(From 01 October 2018 to 31 January 2019)

Source: internal report from Agency Trio With the successful performance of BP P1.2018 and acceptable performance of BP P2.2018 that TMK and ST decided to expand to double scope with 30 provinces in nationwide The target of NoP also went up from 19,329 in P2.2018 to 38,305 in P3.2018,

SV increased from 496,816 to 957,625 cases

Unfortunately both target for P3.2018 could be not achieved such as NoP only got 68% (actual 26,038 parties/target 38,305 parties) and the SV was 86.1% (actual 824,109 cases/target 957,625 cases) There also appeared many complicated problems need to be solved when the scope was quickly expanded in short time like that

In case a Banquet program did not achieve the target like that it would lead to not only negative impact in return on investment (ROI) of the program but also lost market share and not protect market from many competitors Especially, Banquet is one of the key activation of ToffT which management team HVB put a lot of expectation

Figure 8: Statistics percentage of party by brands in BP P3.2018

Source: internal report from Agency Trio Statistics performance NoP BP P3.2018 by brands such as Tiger brand is the largest with 61% of the total served NoP (26,038 parties), Larue brand is the second with 30% of the total party, Heineken brand only account for 7%, and other brands (Tiger Crystal, Larue Special, Strongbow, Bivina …) are very limited in 2% in contribution to program

Figure 9: Statistics percentage of outlet types and party by outlet types in BP P3.2018

Source: report from Agency Trio

In Figure 2 shows, that in 2,090 activated Caterers that contributed in by outlet types to total 26,038 parties BP P3.2018 The biggest percentage take part in program is Grocery shop plus (30%) which contribute 26% NoP in performance Secondly, there is Sub distributors (27%) which contribute 35% in total NoP Thirdly, there is Beverage retail shops (20%) which contribute only 15% to the performance, Wedding venue (10%) contribute 14%, Grocery shops (8%) contribute 4%, and BP Catering (5%) contribute 5%

in the performance

Heineken 7%

Tiger 61%

TigerCrystal 0%

Larue 30%

Larue Special 2%

Bivina 0%

Strongbow 0%

% PARTY BY BRAND

Banquet Catering 5%

Beverage Retail Shop 20%

Grocery Shop 8%

Grocery Shop Plus 30%

Sub Distributor

27%

Wedding Venue 10%

% OUTLET TYPE

Banquet Catering 6% Beverage Retail Shop

15%

Grocery Shop 4%

Grocery Shop Plus 26%

Sub Distributor 35%

Wedding Venue 14%

% PARTY BY OUTLET TYPE

3 PROBLEM INDENTIFICATION

3.1 Symptoms

Symptom of BP P3.2018 did not achieve KPI As the performance of BP P3.2018 on table

7 presented both indicators, NoP only achieved 68% and SV achieved 86% versus the target, which did not meet the management’s expectation about program Besides that, the participated Caterers who proposed from ST, also had very low percentage in activated outlets that directly reason led to poor BP P3.2018 performance The Caterers introduced

at least one party (calculated by whole program within 4 months), which called active Caterers only 38% (2,090 active Caterers/5,521 participated Caterers) From three indicators: NoP, SV and active Caterers that the NoP is the most important indicator need

to be improved performance because it will effect to SV particularly and ROI of program

in generally

Table 7: Statistic performance per region in BP phase 3.2018

Source: internal report from Agency Trio Lunenburg (1) shared on his paper that reasonable KPIs (target setting) will have a pervasive influence on employee behaviors, company performance and management practice Most of modern organization has some specific form of goal setting in business Actually, KPI Banquet P3.2018 was set reasonable and could reach the target Most interviews confirmed that Banquet P3.2018 had poor performance not because of target setting Mr Le Thai Hung – Project owner shared his opinions about BP P3.2018 performance that could not be acceptable

Actually, I am not sastisfy with the performance BP P3.2018 both indicators the NoP only achieved 68% and the SV achieved 86% (compared to target) However, compared

to previous phase that program also receieved more positive feedbacks from stakeholders in improvement process Therefore, TMK need continue these good things

Active Total % Active Actual Target Performance Actual Target Performance

CN 462 1,004 46% 7,220 8,085 89% 224,869 202,125 111%

CS 262 801 33% 4,092 7,065 58% 134,664 176,625 76%

EN 173 575 30% 1,597 2,920 55% 76,266 73,000 104%

ES 159 488 33% 4,278 2,590 165% 151,129 64,750 233% HCM 185 493 38% 3,138 7,600 41% 71,760 190,000 38% MK1 340 1,122 30% 1,587 4,955 32% 46,533 123,875 38% MK2 509 1,038 49% 4,126 5,090 81% 118,888 127,250 93%

Total 2,090 5,521 38% 26,038 38,305 68% 824,109 957,625 86%

Region

and find out the solution to solve currently problems to increase Banquet performance

in next phase

Parmenter (2) said that key performance indicators (KPI) will let managers know how the organization is performing in their necessary success factors Via supervising, managing and monitoring these KPI: the managers are able to improve performance company or program dramatically Most of stakeholders strongly said that the poor performance of BP P3.2018 was not because of the target setting in unreasonable There were many opportunities to achieve KPIs (or even though easily get over the target) if project manager had more efforts in execution and improved in management Agree with those viewpoints:

Mr Nguyen Khanh Vu – Project manager (agency Trio) confirmed that BP P3.2018 performance did not meet the expectation

The NoP only achieved 68% and SV only achieved 86% is quite low compare to HVB’s expectation As the project manager, I felt unhappy with the performance like that Actually, all of us also tried the best to improve it while we were deploying program on market I think that in next phase we will have a lot of experience in repairation and improvement Banquet performance

One more things, the indicator which project owner worried about which was the activated Caterers were very low (2,029/5,221 = 38%) It means that 62% Caterers in the list did not introduce any party in whole promotion program Many unqualified Caterers would effect

to performance BP P3.2019 In case, project owner could increase qualified Caterers that would lead to improve NoP Mention about this point, Mr Nguyen Phi Cong – Sales representative in HCM also added one more the critical factor, which he concerned

The percentage of active Caterers (HCM only had 185/493 Caterers (38%) that introduced at least 01 party) was not good in performance, so TMK had to reconsider these problems in next phase If the Caterers are unqualified like that will directly negative effects to Banquet performance

Shahin et al (3) stated that KPI must to SMART in goal setting (Specific, Measurable, Attainable, Realistic, Time-sensitive) and integrate with AHP (analytical hierarchy process) technique for sure that both quantitative and qualitative factors are put into consideration in target setting

Set up KPI for both NoP and SV of BP P3.2018 base on

The performance of previous phase and also referenced the historical data

The KPI were aligned and confirmed by related managers such as HoT, HoS, RCM, ASM, Project owner, Project leader and Controller

Actual and real information from market and also estimated in future such as competitors, seasonal, market trends, consumer behaviour, regional custom ect

In some new provinces are the first time join to program, which are benchmarked with the other provinces that have similarly condition, standard

Generally, KPI of BP P3.2018 was evaluated reasonable (not too high or too low) compare

to the ability bussines of HVB by most stakeholders There were many sharing opinions to prove that KPIs is reasonable which BP lost many oppotunities to improve performance Banquet by small innovation in mechanism such as agency service, communication with Caterers, branding at outlets ect Mr Tran Ngo Vinh Phuc – RTMK shared some opinion about time service of agency

If agency could improve their better service such as serving all party call to hotline before 24h, the number of party could increase more than 30%

Román (4) also shared in his report that role that sales forces have important roles that are essential factors that ST will deploy successful promotion program on market via customer satisfaction, trust and loyalty However, there were also many negative feedbacks that many Caterers had not satisfied quality service in BP P3.2018 Mr Nguyen Khanh Vu – Project manager (agency Trio) replied that

There were a lot of Cateters said that they did not know clearly program, forgot or ignored Banquet because they were so busy in daily business There had one main reason because ST had not well communicated with them Eventhough, there are some provinces with low performance such as Phu Yen, Hue, Kon Tum ect., where we were already flexible support them to serving the parties with in 24 hours but Caterers also did not know anything When we had a changing in mechanism, ST should more actively

to communicate with Caterers to improve the Banquet performance

Shahin et al (3) also share that the KPI are used for improvement rather more for simple valuation Therefore, the main TMK’s mission must to find out the best effective solution

to improve the performance, quality, and process for BP in 2019 To do that - TMK has conducted the survey with 9 in-depth interviews which divided by four main groups as belows:

The first group is TMK department: project owner, RTMK and channel development manager These people are mainly responsible BP who understand very deeply about the program

The second group is agency Trio: project manager who helps TMK and ST directly deploy, execute, activate BP on market

The third group is ST: sales representative, sales supervisor, ASM who have responsible to deploy, follow, manage the program on market

The fourth group is Caterers: one Caterer with good performance and the other poor performance who have roles as a bridge to connect PO with HVB products

The questionnaires include nine questions as detail

Interviewee’s introduction: question 1 which understand stakeholder’s background and their roles in BP

Viewpoint’s informants to BP P3.2018: question 2 and 3 which understand clearly how the interviewees think about the BP contribution to HVB and BP performance in P3.2018

Discovering potential central problems lead to BP P3.2018 poor performance which are clear in question 4 and 5

Determining the main problem lead to BP P3.2018 do not meet requirements which presented in question 6

Finding out some potential causes and confirming the main cause lead to that main problem which are more detail question 7

Susgesting possible effective solutions from stakeholders to improve performance BP which give out in question 8 and 9

After interviewing nine informants, there are four potential problems which directly effect

to BP performance such as (1) Distraction of ST to BP, (2) Unqualified agency service, (3) Unattractive mechanism from TMK, (4) Unpredictable market factors

3.2 Potential problems

3.2.1 Distraction of sales team to Banquet program

Le et al (5) stated that ST and marketing team maybe following their own agenda because they have different in their target These issues will lead to poor coordination and destructive tension between the two groups In reality, there were many programs to deploy

at the same time so ST could be easily distracted out the BP One more thing, BP P3.2018 took place in the peak and the busiest time of the year When there had a lot of not only activations from TMK such as trade loyalty program, display program, gala TLP ect., and events from brand marketing such as Tiger remix, Heineken F1, Larue UTL ect., but also many tactical promotion programs and trade incentive promotion from ST also deployed into market to push SV on this occasion All activations deployed at the same time like that easily made ST losing focus on some programs

Kotler et al (6) also discussed about the role of sales and marketing which have separately functions in an organization When working, they do not always get along together Beside many programs which ST had to deploy in market, they are also busy in their daily duties such as visit at least 20 outlets per day, take order from outlets, do EOE at outlets ect These are the main jobs which take a lot of time of ST They have to priority more than in daily works because it relates and effects to their KPI in monthly, quaterly ect

Mr Tran Ngo Vinh Phuc – RTMK shared some his real experience about ST from market

ST did not focus on BP such as Soc Trang only achieved 27.5%, An Giang (53,8%) compared to Kien Giang neighbour province was quite good 93,1% performance Moreover, Hau Giang achieved over the target because the enthusisatic of the sales supervisor push the pressure to all team to complete the target With the good performance, he already was promoted in ASM this year My viewpoints, ST atitude is the key factors effect to BP performance

Le et al (7) announced that if sales and marketing has closer and greater collaboration, the organization will have more and more benefit through improved their business performance Actually, TMK had not well enough in briefing and communicating insight content programs for to understand clearly the important BP roles to HVB strategy It led

to ST has not seen the full impact of BP to their performance Mr Le Thai Hung – Project owner contributed valuable reasons which lead to ST lose focusing to BP

TMK, RTMK have not well communicated and transfered the initial insights of Banquet

to ST TMK has not presented the roles and contribution of program to ST It led to lose focusing from ST whose execusion program on market

Blatterg (8) stated that communication of the promotion to buyers and consumers who need

to know clearly about the program is very important Retailers use signage, display, standee, banner, leaflet ect which supplied by business organization to communicate

attractive information of promotion program In reality, ST lose focusing on BP which would lead to they did not enthusiastic in deployment program at outlets When the BP P3.2018 took place, there were many participated Caterers did not clear about the mechanism BP, not know the process of the program even though with Caterers who already signed agreements Mr Nguyen Khanh Vu – Project manager (agency Trio) supported more proofs as follows

ST had not well in communication with both Caterers and consumers before and while running program ST had a very important roles in contrubution to performance Banquet: comunicating with Caterers such as sharing, getting relationship to receive the supports from Caterers to get the party which is very necessary

Following Le et al (5), if there have supports from managers to collaborate between the sales and marketing functions and the use of aligned right reward structures will create positive effects in reducing conflict and/or improving their performance There were many managers who did not care and clear BP ASM has not seen the value, impact and contribution of program to their performance Therefore, they did not deploy, explain, manage well to ST Mr Phan Long Duyen – Sales supervisor talked with his real experiences from BP P3.2018

There were many sales representatives, supervisors unclear about the program information to transfer to Caterers When meeting with TMK, only supervisors and ASM took part in, after that supervisors would brief for sales representatives but sometimes it was not clearly communication

Le et al (7) had viewpoints that senior management have strongly effects toward collaboration between sales and marketing if they are positive atitudes They will lead to reduce the conflict of interdepartment via improving in communications There are important antecedents to be effective collaboration between of them Their performance will be improved in cases the conflicts are reduced ASM and supervisors have very important roles to support sales team deploy Banquet market In last phase, there were many managers did not much care about the promotion which led to ST also lose focusing

on Banquet too Mr Nguyen Phi Cong – Sales representative shared his viewpoints about these problems as follows

I saw that many sales representatives did not know what was the BP such as ST submitted with the long list of Caterers but did not explain for Caterers clear about the mechanism of program

In general, both ASM and supervisors did not concentrate to the BP that is the main causes which led to sales representative also distracted in promotion program too Via the combination the theory and interview many stakeholders showed that this is the most important cause led to the poor performance Banquet P3.2018

3.2.2 Unqualified agency service

Baker et al (9) indicated in their research that managers of agency service are also barriered by the lack of successful business practice and practical management framework Moreover, Trio agency just work follow every independent project or even they do and execute more than one project at the same time, so some of Trio employees are not clear about whole process and mechanism of banquet program Most of Trio’s employees are temporaly so they are not high responsibily in their work

Eagle (10) presented that lacking of suitable between service of agency and their client’s expectations The clients wish to perform as well as their requirments as being a major source of potential dissatisfaction with agency performance The quality Trio’s service has not adapted yet with the wide scope of the program that spread out nationwide over 30 provinces Trio also met many difficulties in guarantee the highly qualified program, they also gave out many reasons to explain for the poor in performance program These situations below that are also considered as additional reasons that reduce NoP For example:

The party address was hard to find especially in rural area Therefore, the supervisors (delivery) took a lot of time to determize party location to arrive for delivering vouchers/gifts One more reason was that the PO felt uncomfortable when the Trio staffs called for asking directions or even though the PO and the Caterers did not pick up the phone So, they could not delivery gifts for these PO

Vouchers/gifts were not delivered at the same time with party happening because of some unpredictable situation such as rain, storm, broken bike, or supervisors covering many parties per day ect

There were parties in deep rural far away from the city center 60km to 150km where supervisors took a day to serve a party The NoP in Da Nang, Quang Nam and Binh Dinh

a lot where an average of 40-60 parties per day, so Trio sometimes could not cover all these parties

The PO was bothered because the supervisors took pictures of the party In case, taking photography that prohibited in some of the wedding, year-end parties of state organizations If PO could not permit the supervisors take the photo, so no promotion Acording to Mr Nguyen Khanh Vu – Project manager (agency Trio) said that

The party owner had often used beer before the agency supervisors arrived but they still asked for voucher or beer but the current quantity did not meet the mechanism regulations so the staff did not deliver because they could not check the quatity used beer at party by pictures as merchanism of BP These reasons also led to decrease in successful NoP

Kallmeyer et al (11) explained in their reseach that most of agencies can only integrate all necessary communications and solve, manage activation to a small extent and scope because insufficient employee’s skills would effect directly in implement and run promotion program Agencies will have to address these issues because clients may doubt their agency's ability to integrate all the activation, because they do not have humman resource to do these jobs Banquet P3.2018 also met the same reasons which mentioned above that is quality service: Trio was only serving the party if the Caterers called and reserved the participated parties to hotline before 48h If Trio agency could improve their service such as serving all party which called to hotline before 24h, the NoP would increase more than 30% There were some inportant parties (such as wedding) that PO ordered by two days and Caterers could call to hotline before 48h But, the other party (birthday, grand opening new house, dead aniversary etc.) which they did not have habit to call before 48h,

so many parties like that will be felt because these parties did not adapt the rules of program Mr Le Thai Hung – Project owner shared his opinion that

Agency Trio lacked of experience in managing program also effected to BP performanc such as cannot serve the 24h parties, sometimes stuck in hotline, the agency staffs have not had professional attitude yet

Rowley (12) said that the agency service and the customers can elicit information about consumer requirements, also permit the service of agency to explain the promotion program and how these might meet the end consumer’s expectation Delivery is essential part of the promotion service With the limited management, Trio had not assured that

qualified for all parties especially in deep rural area Mr Nguyen Thanh Tuan - Channel development manager had some contributed opinions

Agency Trio, TMK could not expand in deep rural, with current ability, we just serviced

in urban and center of rural but in deep rural where are many parties

Kallmeyer et al (11) said that the big problems which are most of agencies meet that is a lack of expertise to manage communication programmes that become a common problems

in many companies Trio could not reduce the time for serving party reserved to hotline within 24 hours because they afraid that did not sure in quality services Mr Nguyen Khanh

Vu – Project manager (agency Trio) also shared some difficulties which agency used to meet on market

There were also one reason effect to Banquet performance was that we could not cover the parties within 24h because of the limitted Trio abilities These parties account for 30%-40% versus total, especially in Mekong Delta provinces

Generally, unqualified agency service also one of the reason effect to performance BP Many respondents from interviews also reveal the practical evidents to prove that performance BP can be improved if we can solve these issuses Combination between practical respondents with recorded theory as above which give more foundation framework for TMK have approriate solution to improve BP in future

3.2.3 Unattractive mechanism Banquet program

Silva et al (13) stated that the retail market environment is rapidly changing and retailers

or consumers also altering their behaviors so that the promotion should be adjusted in mechanism to adapt to quickly market fluctuation In the currently process for the proposal preparation Banquet which took at least two months that is one of the reason led to it became easily out out of date when it was deployed on market There are many cross-funtions which related to program that project owners had to align such as line mananger, controller, finance, sales manangers With many people involved in program that was not easy to finalize mechanism and deploy BP in shortly Mr Le Thai Hung – Project owner shared his opinion

From TMK, actually has not been good in preparation and plan in mechanism program There also had positive adjustment to adapt quickly changing on market beacause TMK has not correctly estimated right many complicated outside aspects from the beginning of program

Blattberg et al (14) stated that two fundamental factors influence the trade promotion program: the present or absence which considered as visibility of a information promotion

on market, and how much promotion discount for customers, buyers and end consumers The BP has not been implemented widely and just only applied for some selected outlets which signed agreement and branded communication such as standee, banner, poster, leaflet, sticker ect BP also were not advertisement in public areas such as television, radio, online, news paper ect Therefore, it was difficult to find, buy, take part in promotion and end consumers did not clear where the outlets, which had promotion or not The results were that many PO did not know much about the program

Mury et al (15) shared in report that the outlet owners believe they should receive better rewards, because more than two-thirds of all buyer’s decisions are made by the seller’s recommendation at the retail store The incentive for Caterers of Banquet program also had very strongly effect to performance because some Caterers in wedding venue receive only 100,000 vnd per party so they were not happy because of small incentive (compare to their profit) which led to they were not enthusisatic to introduce program to PO

Beside that competitors were one of the reason effect to Banquet performance such as Sabeco already used tactical promotion (2 cartons per party for PO, incentive by cash 200,000 vnd to 500,000 vnd per party for Caterers) Budweiser’s also had big promotion for Banquet: buy 10 cases get 01 sound bar, buy 20 cases get voucher 2 million VND and buy 30 cases get 01 PNJ gold (3.6 million VND) also effected to HVB Banquet performance

Limitation participated Caterers in BP P3.2018 which would lead to the other Caterers (not

in the registered list) who wanted or had party but they could not invite PO join to the program as one more reason could not increase NoP Mr Nguyen Thanh Tuan - Channel development manager also had contributed opinion about Banquet mechanism

Mechanism program from TMK limited in participated Caterers (DIP do not join BP

or SIDP, TLP have not had incentive ect.) also one of the main reason let reducing NoP

Payment for Caterers after program (as previous phase) have taken a lot of time also made Caterers unhappy to join the current phase

Mury et al (15) emphasized in paper that the effect of personal relationships on participation is important and significant, but it is less important than the effect of bonus