A study on customer behaviors in chain coffee shops in vietnam

Kelleri 1993i conceptualizedi thei modeli ofi CBBE,i andi Nami eti al.i 2011iemployedi thisi concepti toi studyi thei effecti ofi brandi equityi oni customeri satisfactioniandi brandi lo

VIETNAM NATIONAL UNIVERSITY, HANOI

VIETNAM JAPAN UNIVERSITY

-*** -NGUYEN HUU CUONG

A STUDY ON CUSTOMER BEHAVIORS IN CHAIN COFFEE SHOPS IN VIETNAM

MASTER'S THESIS

Hanoi, 2020

VIETNAM NATIONAL UNIVERSITY, HANOI

VIETNAM JAPAN UNIVERSITY

-*** -NGUYEN HUU CUONG

A STUDY ON CUSTOMER BEHAVIORS IN CHAIN COFFEE SHOPS IN VIETNAM

MAJOR: BUSINESS ADMINISTRATION

This research aims to investigate and understand the relationship betweenprice, customer-based brand equity, customer satisfaction, and brand loyalty in theVietnam’s chain coffee shops The chain coffee shops are earning big money andgrowing fast in Vietnam so that it is necessary to appreciate the importance ofcustomer behaviors to manage this type of business To do that, we set brand loyaltyand customer satisfaction as dependent variables and set price, congruence, andquality as independent variables then describe the difference of those relationships

in two empirical cases in Hanoi and Ho Chi Minh City

We use the quantitative approach on a sample of 427 respondents inHighlands Coffee and The Coffee House, which are two major Vietnamese coffeeshop brands We utilize the structural equation modeling (SEM) method by SPSSsoftware Descriptive analyses and path analyses of the multivariate regressionmodel support the validity of the proposed model

The findings in this study are that significant positive effects from price,quality, and congruence on customer satisfaction and satisfaction on brand loyalty

in Hanoi and Ho Chi Minh City chain coffee shops The analyses also indicate thatamong three antecedents of customer satisfaction, quality has the most substantialinfluence, follow by congruence and price Moreover, the analyses tell that in HoChi Minh City, customer satisfaction has much higher impact on brand loyalty than

in Hanoi Several implications might be withdrawn to coffee shop brands as aconsequence of these results

Keywords: Price; Food and Service Quality; Customer Satisfaction; Brand Loyalty;Martketing; Branding; Chain Coffee Shop; Vietnam

After two years of studying and researching at Vietnam Japan University, it is

my privilege to be able to write this dissertation From the first interview session foruniversity entrance, I have been keeping the research orientation on the subject, which I

am interested in, customer behavior in the coffee shops industry The study includednot only academic but also practical aspects with implications for understanding thecustomer The subjects and knowledge I gained through coursework sessions also play

an essential role in supporting my research activities I hope that my research cancontribute to researches on the customer behavior in the coffee shop industry

First of all, I would like express my gratitude to my advisors, ProfessorPeijun Guo and Professor Nguyen Viet Khoi, for their guidance and comments.Especially the time when I was in Yokohama, Japan, my advisors gave me valuableadvice about how I should proceed with the researching process Without theirprompt and patient instructions, I cannot finish the thesis I want to say thanks to all

of my friends, respondents of the questionnaires for their support andencouragement Finally, thanks to my family for emotional and financial supportthat motivate me for making effort to complete the research Remarkably, thanks to

my mother, despite her leg injury recovering period, she has always encouraged andsupported me so that I can focus on the study

TABLE OF CONTENTS

ABSTRACT

ACKNOWLEDGMENT

LIST OF ABBREVIATIONS

LIST OF TABLES

LIST OF FIGURES

CHAPTER 1: INTRODUCTION 1

1.1 Background of the research 1

1.2 Problem statement 5

1.3 Research objectives 6

1.4 Scope of the research 6

1.5 Significance of the research 7

1.6 Thesis structure 7

CHAPTER 2: LITERATURE REVIEW 8

2.1 Brand equity 8

2.2 Customer satisfaction 10

2.3 Brand loyalty 10

2.4 Price 11

2.5 Relationship between brand equity, price, customer satisfaction and brand loyalty 12

2.5.1 Brand equity and customer satisfaction 12

2.5.2 Price and customer satisfaction 14

2.5.3 Customer satisfaction and brand loyalty 15

2.6 Research model 17

CHAPTER 3: METHODOLOGY 19

3.1 Research design 19

3.2 Data collection instruments 20

3.3 Data analysis 22

CHAPTER 4: FINDINGS 23

4.1 General results 23

4.1.1 Demographic information 23

4.1.2 Demographic customer behavior 23

4.2 Descriptive analysis 25

4.3 Analytical results 27

4.3.1 Statistical results in Hanoi 27

4.3.2 Statistical results in Ho Chi Minh City 31

CHAPTER 5: DISCUSSION AND CONCLUSION 38

5.1 Discussion 38

5.2 Practical implications 39

5.3 Limitations and future research recommendations 41

REFERENCES 43

APPENDIX 50

Average Shared Variance”

“Average Variance ExtractedCustomer-Based Brand EquityConfirmatory Factor Analysis”

“Comparative Fit IndexComposite ReliabilityDegrees of FreedomExploratory Factor AnalysisGoodness of Fit Index

Ho Chi MinhKaiser-Meyer-OlkinMaximum Shared VarianceRoot Mean Square Error of Approximation”

“Strutural Equation ModelingThe Coffee House

Tucker-Lewis Index

LIST OF TABLES

Table 1.1 Leading coffee shops brand in Vietnam in 2019 3

Table 3.1 Questionnaire scale and construct 21

Table 4.1 Profile of respondents……… 23

Table 4.2 Demographic customer behavior 24

Table 4.3 Descriptive analysis 26

Table 4.4 Reliability test in Hanoi 27

Table 4.5 KMO and Bartlett's Test in Hanoi 28

Table 4.6 Pattern Matrix in Hanoi 28

Table 4.7 Results of GOF tests of CFA factor analysis in Hanoi 29

Table 4.8 Convergent and discriminant validity in Hanoi 30

Table 4.9 Results of SEM analysis in Hanoi 31

Table 4.10 Reliability test in HCM City 31

Table 4.11 Pattern Matrix in HCM City 32

Table 4.12 KMO and Bartlett's Test in HCM City 33

Table 4.13 Results of GOF tests of CFA factor analysis in HCM City 33

Table 4.14 Convergent and discriminant validity in HCM City 34

Table 4.15 Results of SEM analysis in HCM City 36

LIST OF FIGURES Figure 1.1 Total domestic coffee consumption in Vietnam from 2010 to 2018 2

Figure 2.1 Research model……… …….17

Figure 4.1 CFA path analysis in Hanoi 29

Figure 4.2 SEM path analysis in Hanoi 30

Figure 4.3 CFA path analysis in HCM City 34

Figure 4.4 SEM path analysis in HCM City 35

CHAPTER 1: INTRODUCTION

1.1 Background of the research

As a developing country, Vietnam has a massive capacity of agricultural landaccounts for 39% in the total area with the contribution to GDP at 15% in 2017(Statista, 2020) The report by Statista also indicated that the primary labor force ofVietnam is in the agriculture sector, with 40% of employment amounted toapproximately 20 million people in 2018 In this sector, the coffee industry is vitalfor both domestic and foreign markets as Vietnam has been maintaining the position

as the world’s second-largest coffee exporter in consecutive years

In the early twentieth century, coffee was first introduced into Vietnam in thetime of colonization by France, coffee production then increased rapidly and becameone of the most crucial agricultural products The first instant coffee plant with amanufacturing capacity of 80 tons per year, was established in Dong Nai Province, in

1969 The two main kinds of coffee beans in Vietnam are Robusta and Arabica,containing 1.6 to 2.7% caffeine and 1 to 1.5% caffeine, respectively, making the taste

of coffee here bitter and healthier than the coffee drinks in the world

According to Tran (2019), in the marketing year of 2018/2019, domesticconsumption of coffee is at 3 million bags, and the experts forecast this number willdrastically increase due to the fierce competition of both international and local coffeebrands in Vietnam The domestic consumption of coffee casts for approximately 10%

of total coffee production, much lower than the exported amount of coffee, which

means the local coffee shops still can grow From Table 1.1, we know the upwardtrend in consuming coffee of Vietnamese consumers from 2010 to 2018, and thisupward trend signifies the continuing increase in domestic coffee consumption inthe future

2010 2011 2012 2013 2014 2015 2016 2017 2018

Figure 1.1 Total domestic coffee consumption in Vietnam from 2010 to 2018

(Unit: 1000 sixty-kg bags) (Source: statista.com)

There are many newly-built coffee chains in recent years in Vietnam

According to Le (2018), coffee chains have competitive advantages in quickly

detecting target customers and creating a standardized management system Also,

coffee chains have more competency in attracting consumers when they become

professional brands Additionally, it is difficult to have a precise number of coffee

shops in Vietnam for the fact that the independent coffee shops locate sparsely and

have a short life cycle However, the coffee chains have been the trend for business

in coffee shops in Vietnam, along with the evolution of e-commerce and delivery

service There are leading brands in the coffee chain market in Vietnam that prevails

in the number of stores and revenue, namely Highland Coffee, Starbucks, The

Coffee House, and Trung Nguyen Coffee

American giant coffee shops brand Starbucks, which entered Vietnam in

2013, now runs 60 shops, mostly in Hanoi and HCM City However, Starbucks

offers a higher price than local chains like The Coffee House or Highland though

they are in the same premium segment Domestic coffee chains in Vietnam manage

a wide variety of products, from drinks to foods as well as secure Wi-Fi connection

and tranquil space, especially sensitive in market trends and taste of the customer

Nowadays, fast-pace economic development in Vietnam encourages

competition in various business and service sectors Many big firms try to invest

substantial financial sources to gain market share and revenue despite losing profit,

especially in creating chain businesses Other than the growth of convenient store

markets, supermarkets, and food chains, the coffee chain market is among thefastest-growing sector in terms of the number of stores and revenue.

In 2019, Euromonitor evaluated Vietnam’s chain coffee shop industry has abusiness volume at above one billion US$ for the improvement in living standards andurbanization This data shows that the coffee chain sector is essential In comparison,according to Statista, the revenue in the hot drinks market in Vietnam amounts to 8.817billion US$ in 2020 In this hot drinks market, the most prominent industry is coffee,which has a business volume of 5.682 billion US$ According to a report by BMIResearch, Vietnam’s coffee consumption increased remarkably from 0.42 kilogramsper person per year in 2005 to 1.39 kilograms per person per year in 2015 Therefore,domestic coffee chains play a crucial part in the coffee market

However, Euromonitor also reported in 2019 that the five leading brands inthe coffee chain market account for 15.3% of market share, with Highlands holding7.2% Among the leading chains, Highlands Coffee, The Coffee House, andStarbucks are the biggest in earning revenue Table 1.1 shows the revenue andnumber of stores from leading coffee shop brands in Vietnam in 2019

Table 1.1 Leading coffee shops brand in Vietnam in 2019

Highlands Coffee The Coffee House Starbucks

(Unit: billion dong)

(Source: VIRAC)Highlands Coffee and The Coffee House are brands that originated fromVietnam, while Starbucks is a foreign competitor However, Highlands and TheCoffee House consider their targeted customer is the middle class with a pricingsegment of 30000 to 60000 VND This study then chooses these two Vietnamese

brands to be objects for collecting empirical data The conclusions from the researchmight be useful findings for Vietnamese brands, especially Highlands Coffee and The

Coffee House, to understand the behavior of their customers

Besides, the phenomenon to research on the coffee chain market is the scenarioapproach There is a big difference between the number of stores between the two cities

of Vietnam, Hanoi and HCM City Currently, the Coffee House has 32 stores

in Hanoi and 88 in HCM City Also, Highlands Coffee maintains 81 and 111 stores

in Hanoi and HCM correspondingly This data incurs curiosity if there is adifference in customer behavior between two cities

Highlands Coffee is the number one coffee chain in Vietnam The founder ofHighlands, CEO David Thai, started the business in 1998 and opened the first store in

2002, but it gained much brand awareness and investment after 2012 From that time,Highlands continually expands its business, from 50 stores in 2012 to 300 stores in

2019 The strengths of Highlands are its attractive location in bustling districts,comfortable space, and high-quality products Moreover, Highlands has the ambition tobring Vietnamese coffee to the global; recently, they opened their first outlet in thePhilippines As a leading coffee shop in Vietnam in a long time, Highlands hascontinuously been improving brand awareness and quality, especially on the deliverysystem or corporate social responsibility campaign Moreover, Highlands is prevalentnot only on in-shop foods and drinks but also on roasted&ground coffee, instant coffee,and ready-to-drink coffee, which are its signature products Highlands connects withfood reviewing website Now.vn or Foody.vn for delivery service in addition totraditional telephone booking or its website

The Coffee House (TCH) is a young and unique brand starting from 2014,currently holds second place in the Vietnamese market of the coffee chain CEONguyen Hai Ninh shared three strengths of TCH for attracting customers are thesocializing space, staff behavior, and convenience TCH also identified that itsstrategic competitor is Highlands Coffee in the same segment TCH is alsocontinuously adapting its menus with the current trend, and especially, they had theacquisition with the Ten Ren brand to compete with milk tea shops Gradually, TCHsets up the foundation for long-term growth from the raw materials to customerservice Besides, TCH also serves the customer with roasted coffee beans orsubscription combos in diversifying menus They concentrate much on convenientdelivery service experience, especially on developing the TCH app on smartphones,even on Momo, an e-wallet app that generates many users in Vietnam recently

People are coming to coffee shops these days for a variety of purposes, not onlyfor having a drink but a place to gather, socialize with friends and acquaintances.Therefore, it is necessary to study the significance of customer satisfaction and

loyalty Both Highlands Coffee and TCH share the same idea about the difference inthe Hanoi and HCM market in Vietnam Despite success in HCM City, many coffeeshop brands are skeptical about expanding business in Hanoi CEO of TCHappreciated that customers in Hanoi prefer the attractive open space However, notmany brands can provide though the potential of doing business in this city is veryhigh Therefore, this research hopes to study customer behavior in Hanoi and HCMCity and contribute findings to the coffee shop brands.

1.2 Problem statement

From academic perspectives, brand equity, customer satisfaction, and brandloyalty are vital for promoting sustainable development to the companies Asatisfied and loyal customer does not only repeat their purchasing behavior but alsobut showing a willingness to spend extra money on their favored brand (Hoyer andMacInnis, 2008) Nowadays, loyalty also transforms into sharing positive comments

on the brand, referring the brand to networks and family members Theseadvantages from customer behavior bring word-of-mouth effect and brand image,which contribute to the sustainable growth of a brand

For service industry as coffee chains in Vietnam, the price is high in relation tothe customer expenditure Therefore, it is vital to focus on CBBE and brand loyaltywhile the demand is still growing Coffee shops nowadays is a premium service whichcustomer are willing to pay big money and become a regular customer Given theexample of fast-food chains in Vietnam like the KFC or Golden Gate, despite charging

a much higher price than a local restaurant, they still have a large number ofpatronages However, food chains or coffee chains face many difficulties in competingwith competitors Thus, it is of great value for them to focus on educating loyalcustomers and gaining customer satisfaction, which helps to keep customer stay

Kelleri (1993)i conceptualizedi thei modeli ofi CBBE,i andi Nami eti al.i (2011)iemployedi thisi concepti toi studyi thei effecti ofi brandi equityi oni customeri satisfactioniandi brandi loyaltyi fromi empiricali datai ini thei UK.i Besides,i Tui eti al.i (2012)i alsoiresearchedi oni satisfactioni andi loyaltyi ofi customersi ini Starbucksi Coffeei ini Taiwani

byi structurali equationi modelingi (SEM)i method.i However,i therei isi noi ori littleiresearchi toi investigatei thei relationshipi betweeni brandi equity,i price,i customerisatisfaction,i andi brandi loyaltyi ini thei Vietnamesei market.i Withi thei existingi

literaturei ini thei fieldi ofi Vietnami coffeei chains,i thisi researchi aimsi toi helpi iniunderstandingi thei customeri behaviori ofi Vietnamesei customersi byi makingi aniinvestigationi oni factorsi affectingi brandi loyalty.i Ini ai morei commoni sense,i iti willihelpi toi learni whetheri Westerni modelsi ofi brandi equity,i customeri satisfaction,i andiloyaltyi arei significanti fori explainingi thei Vietnamesei customeri behaviori towardibrands.i i i i i i i i

Thei theoreticali contributioni ofi thisi researchi isi that:i thei researcheri addsi ainewi factori pricei oni thei existingi modeli toi investigatei thei impacti ofi pricei onicustomeri satisfaction.i Wei examinei howi thei pricei contributesi toi customerisatisfaction,i brandi loyalty,i andi brandi equity.i i

Thei practicali contributioni ofi thisi researchi isi thati wei bringi insightsi fori brandimanagementi ini chaini coffeei shops,i especiallyi spottingi thei differencei ini customeribehaviori ini twoi scenarios.i Iti isi alsoi helpfuli fori thei personi aimingi toi seti upi ai coffeeishopi ini Vietnami ini thei futurei becausei ofi thei vitali rolei ofi investigatingi customeribehavior,i namelyi customeri satisfactioni andi loyalty

This paper offers an understanding of the importance of factors affectingbrand loyalty and customer satisfaction from an empirical study in Vietnam Futureresearch can further test with more factors or in other markets in Vietnam to gainknowledge about customer behavior

1.3 Research objectives

Thisi studyi hasi threei objectivesi asi follows:i

 Toi investigatei thei effecti ofi price,i congruencei andi qualityi oni customerisatisfactioni ini chaini coffeei shopsi ini Vietnami

 Toi investigatei thei effecti ofi customeri satisfactioni oni brandi loyaltyi ini chainicoffeei shopsi ini Vietnami

 i Toi describei thei customeri behaviori fromi analysisi resultsi ini twoi scenariosi ofi coffeeichainsi ini Hanoii andi HCMi City

1.4 Scope of the research

This study focuses on three objectives, as mentioned above Therefore, theresearch samples concentrated on the customer of Highlands Coffee and The CoffeeHouse in Hanoi and HCM City The quantitative questionnaire was employed tostudy the phenomenon and examine the hypotheses stated in the next chapter

1.5 Significance of the research

This research aims to examine the relationship between price, CBBE, andcustomer satisfaction in the coffee chain sector in Vietnam The data collection tool

is questionnaire surveys with a sample of 400 respondents in two coffee chains inHanoi and HCM City This quantitative approach enables this research to analyzethe data across the sample and test the theories

The chain coffee shops sector is imperative and contributes to the growth ofthe coffee industry or service industry simultaneously This study then provides newdata that can support brands to understand customer preferences It alsorecommends implications on branding which benefit coffee chains as well as othermarkets in Vietnam

From the literature reviews, the researcher found little or no academic paperdirectly studies the effect of price, congruence, quality on customer satisfaction, andbrand loyalty in the case of Vietnamese coffee chains Because of this scarcity inresearch about the customer of coffee shops in Vietnam, scholars should also considerthis research useful and information regarding the measurement of variables Theresults of this paper reveal knowledge about Vietnamese customer behavior in thismarket, and they are also useful to future research orientation in a related market

1.6 Thesis structure

This paper consists of five chapters starting with the chapter of the researchbackground to overview and centralize the scope of the research In chapter 2, the literaturereviews are given to describe the theoretical relevance of previous researches and todevelop the model as well as hypotheses for further examination In chapter 3, we show themethodology, data collection, and data analyzing technique The fourth chapter shows thefindings of the research, which represent descriptive analyse and analytical results In thefinal chapter, we discuss the results, make conclusions about the research, answer theresearch objectives correspondingly, recommendations to subjects, and future researches

CHAPTER 2: LITERATURE REVIEW

2.1 Brand equity

Brandi equity,i fromi thei 1980s,i hasi becomei onei ofi thei essentiali conceptsi ofimarketingi andi branding,i hasi beeni describedi andi researchedi ini variousi ways.iPreviousi studiesi discussedi thei ideai ofi brandi equityi ini threei primaryi prospects,iincludingi ai customer-basedi perspectivei (Aaker,i 1991),i financiali perspectivei(Simoni andi Sullivan,i 1993)i andi thei combinedi viewi ofi thesei twoi (Anderson,i2007).i Accordingi toi Aakeri (1991),i brandi equityi refersi toi thei arrayi ofi differentiliabilitiesi andi brandi assets,i associatedi withi thei brandi fori instancei includingisymbol,i name,i andi others,i addingi andi subtractingi fromi thei valuei providedi byiservicesi andi productsi toi thei firmi asi welli asi toi firm’si consumersi andi customers

Correspondingly,i Kelleri (1993)i definedi CBBEi asi thei differentiali effecti ofibrandi knowledgei uponi consumeri responsei toi thei marketingi ofi thei brand.iTherefore,i thisi perspectivei relatesi toi threei criticali concepts,i includingi brandiknowledge,i differentiali impact,i andi consumeri responsei toi marketing.i Brandiknowledgei designatesi thei combinationi ofi brandi imagei andi brandi awarenessi andi itsiideasi ini consonancei withi thei relationshipsi andi characteristicsi ofi brandi associationidepictedi earlier

Likewise,i comparingi customeri responsei toi thei marketingi ofi ai brandi withithei reactioni toi similari marketingi fromi ai fictitiouslyi namedi ori ani unnamedi versioni

ofi thei producti ori servicei decidesi thei differentiali effecti ofi brandi equity.i Theidefinitioni ofi customeri responsei toi marketingi isi followingi customeri perceptions,ipreferences,i andi behaviori arisingi fromi marketing-mixi activities;i fori example,i itiinvolvesi reactionsi toi couponi promotions,i perceptioni ofi copyi pointsi fromi ani ad,i orievaluationsi ofi ai proposedi brandi extensioni andi others

Oni thei otheri hand,i brandi equityi isi thei enhancementi ini perceivedi utilityi andidesirabilityi thati ai brandi namei confersi ini productsi ori servicesi (Lassar,i Mittal,i andiSharma,i 1995).i Besides,i Christodoulidesi (2010)i representsi brandi equityi asi ai seti ofiattitudes,i perceptions,i behaviors,i andi knowledgei oni thei parti ofi consumers,i resultingi inithei enhancedi utilityi ofi productsi andi services,i whichi facilitatesi thei brandsi toi generateimorei significanti revenuesi andi marginsi thani that,i withouti thei brand

Aakeri (1991)i offeredi thei measurementi ofi brandi equityi conformingi toidifferenti elements,i aspects,i andi dimensions.i Thei authori relatesi thei brandi equityi toimultiplei issues,i includingi brandi association,i brandi awareness,i perceivedi quality,ibrandi loyalty,i andi otheri proprietaryi assetsi ofi brands.i Fromi thisi part,i CBBEi isi theitypei ofi brandi equityi thati thei authori wantsi toi focusi oni andi researchi ini thisi study.i

Asi explainedi byi Washburni andi Planki (2002),i fouri concepts,i includingi brandiawareness,i perceivedi quality,i brandi association,i andi brandi loyalty,i arei fundamentalidimensionsi toi measurei CBBE.i Thei authorsi alsoi notedi thati thei perspectivei ofi otheriproprietaryi assetsi ofi brandsi isi irrelevanti ini consumer-basedi brandi equityimeasurement.i Besides,i Yooi andi Donthui (2001)i reportedi thati consumer-basedi brandiequityi ati thei individuali leveli ofi customeri breaksi intoi behaviorali andi cognitiveiperspectives;i therefore,i conductingi consumeri surveysi isi ai validi measurement.i i i i i i

Additionally,i consumer-basedi brandi equityi isi thei synthesisi ofi physicaliquality,i staffi behavior,i brandi identification,i lifestyle-congruence,i andi ideali self-congruencei (Nami eti al.,i 2011).i Consequently,i thisi paperi exploresi thei impactsi ofithosei characteristicsi ofi consumer-basedi brandi equityi oni brandi loyalty,i iniconsiderationi ofi customeri satisfactioni asi ai medium.i Koi andi Chiui (2006)i viewedithei coffeei shopi industryi asi ai parti ofi thei servicei industry,i notablyi thei foodi andiservicei industry,i consequently,i reflectingi andi reutilizingi thei itemsi fromi theimeasurementi ofi CBBEi ini thei studyi ofi Nami eti al.i (2011)i isi viable.i Furthermore,iO’Louhglini andi Szmigini (2006)i portrayedi thati developingi andi designingi theirelationshipi ofi brandi associationi andi fivei dimensionsi ofi consumer-basedi brandiequityi helpedi toi meeti functionali needsi asi welli asi thei symbolici needsi ofi customers.i

Besides,i fori thei resemblancei ini thei researchi matteri asi ani areai ofi thei serviceiindustry,i thisi studyi appliesi consumer-basedi brandi equityi byi incorporatingi fouridimensionsi illustratedi byi Nami eti al.i (2011).i Thei authorsi formulatedi ai modeli withi

ai measurementi ofi fouri dimensionsi ofi consumer-basedi brandi equityi withi aimingi toiresearchi thei casei ofi hotelsi andi restauranti industryi ini thei UK.i Thus,i fori similarityi

toi thei casei ofi hotelsi andi restaurantsi industry,i thisi paperi employsi thei physicali foodiandi servicei qualityi dimensionsi asi welli asi thei symbolici dimensions,i includingilifestyle-congruence,i andi ideali self-congruence,i toi measurei consumer-basedi brandiequityi ini thei coffeei shopsi industry

2.2 Customer satisfaction

Manyi typesi ofi research,i especiallyi ini thei marketingi field,i recognizedicustomeri satisfactioni asi ai criticali factori fori thei long-termi successi ofi ai brandi(Pappui andi Quester,i 2006).i Accordingly,i ai largei numberi ofi scholarsi employedicustomeri satisfactioni asi ai dominanti factori toi explorei thei post-purchasei behaviori ofithei customer,i fori example,i attitudinali loyaltyi andi behaviorali loyalty.i Nematii eti al.i(2011)i describedi customeri satisfactioni asi thei leveli ai producti ori servicei servesi theicustomeri andi satisfiesi hisi ori heri expectations.i

Customeri satisfactioni hasi bothi cognitivei andi affectivei aspects.i Theicognitivei aspectsi relatedi toi thoughtsi andi judgmentsi abouti thei producti ori serviceiandi thei brandi whilei thei affectivei perspectivesi encompassi ai subjectivei feelingi thatithei overalli experiencei ini dealingi withi thei firmi isi positivei (Tui eti al.,i 2012).i Baigiandi Khani (2010)i believedi thati retainingi customersi isi certainlyi worthwhileifinanciallyi ini correlationi toi thei costi ofi gainingi newi customers,i whichi isi fari moreiexpensive.i Consequently,i customeri satisfactioni isi ai vitali factori wheni doingibusinessi ini suchi profoundlyi competingi markets,i mainlyi thei hoteli andi restaurantiindustryi ori coffeei shopsi industry

Among two forms of customer satisfaction, including cumulative satisfactionand transaction-specific satisfaction, researchers concentrate more to study related tocumulative types, which refer to the extent of post-purchase satisfaction of thecustomer Tu et al (2012) evaluated the overall satisfaction of the latest consumptions

of products and services along with the rendezvous with the brand or their employees

2.3 Brand loyalty

Previousi studiesi havei definedi andi developedi thei concepti ofi brandi loyaltyi asi aniimportanti factori ini brandingi andi marketing.i Brandi loyaltyi isi thei repeatedi purchasingiproductsi andi services,i asi welli asi supporti thei brandsi resultingi fromi thei positiveiattitudei towardsi thei brandi fromi customersi (Hoyeri andi McInnis,i 2008).i Accordingi toiJacobyi andi Chestnuti (1978),i brandi loyaltyi refersi toi thei perspectivei whichi isi biasedibehaviorali responsei conveyingi overi ai periodi madei byi decisionsi ofi consumersiconcerningi thei purchasei ofi ai particulari brandi ori multiplei brands,i consideri asi aiprocessi ofi psychologicali thinkingi ofi customers.i Thei authorsi alsoi highlightedi theiimportancei ofi brandi loyaltyi withi thei rolei ofi simplifyingi thei purchasingi decision,i fori

example,i thati withi existedi positivei experiencesi withi thei brand,i thei customeri tendsi

toi keepi buyingi asi ai signali ofi loyalty.i Therefore,i throughi brandi loyaltyiconcentration,i ai firmi ori ai brandi cani buildi upi theiri regulari customeri ori customeribase,i whichi isi moralei fori expandingi businessi scalei andi growth.i i i i

Becausei brandi loyaltyi isi ai psychologicali concepti definedi byi manyi scholars,i iti

isi difficulti toi measurei iti objectively.i Onei method,i includingi pricei sensitivityi andipurchasingi behaviors,i isi widespreadi andi mentionedi ini variousi studies.i Moreover,ibrandi loyaltyi isi informativelyi measuredi byi inspectingi customersi toi assessi theiricommitmenti toi thei brandi basedi oni criticali itemsi suchi asi thei attitudei towardi theiproducti andi theiri consistenti opinionsi overtimei (Mohammad,i 2012).i Previousi studiesisuggesti twoi perspectivesi toi viewi brandi loyalty.i Attitudinali loyaltyi attributesi toi theipositivei feelingi ori opinioni oni thei brandi itselfi ori thei productsi providedi byi thei brandi(Gremleri andi Brown,i 1996).i Therei arei multiplei waysi toi measurei attitudinali loyalty,ifori example:i “intentioni ofi wordi ofi mouth”i (Bouldingi eti al.,i 1993)i ori “willingnessi toipayi ai premiumi price”i (Narayandas,i 1996).i Oni thei otheri hand,i behaviorali loyaltyiregardsi asi thei purchasingi behaviori ori repeatedi thei frequencyi ofi purchasei productsi ofithei samei brandi overi timei (Chaudhurii &i Holbrook,i 2001).i Bandyopadhyayi andiMartelli (2007)i consideredi thei causei andi effecti relationshipi betweeni attitudinali andibehaviorali loyalty;i fori instance,i ifi ai customeri holdsi ai pleasanti experiencei withi theibrand,i consequently,i hei ori shei favorsi becomingi ai repeatedi consumer

Choi et al (2011) developed a set of brand loyalty items that were useful forfurther researches This measurement of brand loyalty helped in mitigating the risk

of other factors affecting behavioral brand loyalty, such as convenience or habit.Besides, Nam et al (2011) also described a set of items to assess brand loyalty Thisresearch then employs items from previous papers to study the correlation betweenbrand loyalty and other variables

2.4 Price

A price refers to the amount of payment or compensation given by one party

to another in exchange for one unit of goods or services (Schindler, 2012) Price isalso an element of marketing mix together with product, place, and promotion.Besides, from the business viewpoint, marketing mix is a critical tool for firm andorganization to achieve marketing target as well as increase the sale and financial

performance (Bay, Petrizzi and Gill, 2008) In the service industry, the price has theintangible nature of service, then in case other information is missing, pricebecomes a pivotal quality degree (Olander, 1970; Zeithaml, 1981) Moreover, it isimperative that the firm also confronts with setting price competitively, for example,

a customer considers price as a basis to choose the brand in situation among severalcompeting service organizations (Yelkur, 2000)

According to Olson (1977), the objective or actual price has been defineddistinctively from perceived price, and whether the price is low or expensive isunderstood by the actual price by the customer Moreover, Yoo et al (2000)represented that price is subjectively perceived by the consumer; it is possible tomeasure it by collecting the opinion of the consumer Using items of Smith and Park(1992), the authors also developed eight items related to price measurement; forinstance, “the price of this brand is high.” This paper, therefore, will adapt andemploy this method of price assessment as a part of the scale for measuring theresearch variable

2.5 Relationship between brand equity, price, customer satisfaction and brand loyalty

2.5.1 Brand equity and customer satisfaction

Servicei qualityi isi ai fundamentali parti ofi marketingi andi helpsi ini sustainingiandi succeedi ini businessi (Fitzsimmonsi eti al.,i 2001).i Previousi studiesi alreadyiresearchedi servicei quality,i andi thisi paperi utilizesi twoi perspectivesi ofi serviceiqualityi comprisingi staffi behaviori andi physicali qualityi toi investigatei ini thei fieldi oficoffeei shopsi industry.i Thei staffi behaviori reflectsi thei competence,i friendliness,i andihelpfulnessi ofi staffi membersi ini thei servicei industry,i whilei thei physicali qualityidimensioni refersi toi thei physicali facilitiesi ofi thei brandi (Bloemeri andi Kaspe,i 1995)

Thei physicali facilitiesi accommodatei firmsi toi givei thei customeri ai pleasantiexperience,i whichi mayi incuri noti onlyi repeatedi purchasingi behaviori buti alsoi word-of-mouthi effect.i Consequently,i ai goodi andi pleasanti experiencei alsoi provokesicustomersi ini termsi ofi stronglyi affectingi theiri leveli ofi satisfactioni andi loyaltyi(Bloemeri andi Kaspe,i 1995;i Ryui andi Jang,i 2008)

Oni thei otheri hand,i thei staffi behaviori hasi ani impacti oni customeri satisfactionibecausei duringi servicei providingi processi customeri hasi ai particulari experience,i iti cani

bei positivei ori negative.i Thei staffi andi employeesi ofi ani organizationi playi ani importantirolei ini creatingi customeri satisfactioni asi theyi havei ultimatei responsibilityi ini contactingiandi providingi servicei toi customers,i meetingi theiri expectationsi (Zeithamli eti al.,i 1986).iPasti researchesi havei describedi thati low-skilledi staffi mighti inducei thei negativeiemotionali experiencei ofi thei customeri becausei thosei staffi mighti bei reluctanti toi copeiwithi thati emotioni ofi thei customeri properlyi whilei theyi arei thei representativei ofi theifirmi (Bloemeri &i Kaspei 1995;i Lemminki andi Mattsson,i 2002).i Additionally,i Hani eti al.i(2015)i believedi thati thei behaviori ofi employeesi hasi ai significanti effecti oni overallicustomeri satisfaction.i Besides,i Bhattacharyai andi Seni (2003)i researchedi thei explicitiservicei attributei andi reportedi thati thei politenessi andi attentivenessi ofi staffi alsoi havei

ani impacti oni customeri satisfaction

Also,i therei arei numerousi scholarsi identifiedi andi employedi thei relationshipiamongi customeri satisfaction,i physicali qualityi andi staffi behaviori ini differentisectorsi ofi thei servicei industryi fori theiri studies,i namelyi Parasuramani eti al.i (1988);iBergamii &i Bagoiii (2000);i Bradyi &i Cronini (2001);i Ryui &i Jangi (2008)

The lifestyle of people refers to how they purchase products or choose a brand,for example, luxury goods or services Brands and brand settings are expressions oflifestyles (Solomon, 2002) Peter and Olson (2008) defined lifestyles as the specificmanner that people conduct their lives Also, Solomon et al (2006) described lifestyle

as a way to differentiate people belong to a group or not According to Casswell andMaxwell (2005), interpretation desired experiences and lifestyles when the customeruses a product or service facilities to build a brand Similarly, the authors believed thatthe suitability of the brand and personal lifestyle of consumers stimulates the rightattitude of the customer with the brand Lifestyle-congruence describes the degree towhich brand consumption supports consumers’ unique pattern of living as expressed bytheir activities, interests, and opinions (Nam et al., 2011)

Sarkii eti al.i (2012)i portrayedi purchasingi behaviori asi relatesi toi emotioni moreithani rationale.i Thisi researchi alsoi mentionedi thati encouragingi customersi toi buyiproductsi ori servicesi ofi ai brandi isi influencedi byi manyi externali factorsi suchi asiculturei andi lifestyle

Solomoni (2002)i alsoi identifiedi thei mechanismi fori thei marketingi ofi lifestyle,iwhichi aimsi toi gaini customeri satisfactioni isi harmonizingi thei specifici lifestylei ofi thei

customeri toi brandi strategy.i Researchesi abouti thei effecti ofi lifestylei oni thei leveli ofisatisfactioni ofi customeri towardsi ai brandi confirmi thati therei isi ai positiveirelationshipi betweeni customeri satisfactioni andi lifestylei (Kyungnam,i 2011;i Awaniandi Rehman,i 2014).i Ai furtheri studyi conductedi byi Nami eti al.i (2011)i alsoiconfirmedi thati thei congruencei betweeni thei lifestylei ofi consumeri andi ai brandistronglyi reinforcei customeri satisfaction.

The construct of congruence relates the personality of brands to the concept of consumers (Nienstedt et al., 2012) Accordingi toi Baumeisteri (1999),iself-concepti refersi toi thei sumi ofi thoughtsi andi feelingsi ofi ai personi abouti himselfi

self-ori herself,i includingi thei comprehensioni ofi thati personi abouti whoi andi whati thei selfi

is.i Carli Rogersi (1959)i alsoi identifiedi threei perspectivesi ofi self-concept,i includingiself-image,i self-esteem,i andi ideali self.i Ini thesei threei concepts,i thisi paperi employsithei usei ofi ideal-self,i whichi meansi whati individualsi wishi theyi werei becoming

Sirgyi eti al.i (2000)i developedi self-congruencei theoryi andi definedi congruencei asi thei extenti toi whichi actuali andi ideali self-congruencei matchesi withithei brandi image;i thisi leveli theni partiallyi influencei customeri behavior.i Ambleri eti

self-al.i (2002)i alsoi sharei thei samei opinioni oni self-congruence;i thei individuali ownsi oribuysi brandsi toi enhancei theiri self-esteem

Hei andi Mukherjeei (2007)i consideredi self-congruityi asi ai cruciali factori iniresearchingi variousi aspectsi ofi customeri behavior,i andi iti isi ofi greati importancei inibeingi antecedenti toi impacti customeri satisfaction.i i Previousi studiesi byi Andreasseni(1994),i Bakeri (1987),i andi Grewali &i Mangleburgi (2000)i alsoi supportedi thati therei

isi ai positivei correlationi betweeni customeri satisfactioni andi ideali self–congruencei inithei servicei industry.i Ini thei studyi abouti thei effecti ofi brandi self-congruencei oni theibehaviori ofi thei customer,i brandi self-congruencei hasi morei impacti oni satisfactionithani attitudei andi preference.i

Thisi studyi theni combinesi thei physicali quality,i staffi behavior,i lifestyleicongruence,i andi ideal-selfi congruencei dimensionsi ofi CBBEi intoi qualityi andicongruencei dimensionsi toi explorei theiri impactsi oni customeri satisfaction

2.5.2 Price and customer satisfaction

According to Peng and Wang (2006), the customer has to pay the price as thefinancial cost they purchase products or services, then the customers consider price

as a crucial thing to decide between buying a product or service There is a closerelationship between the fairness of price and customer satisfaction (Al-Msallam,2015) The authors found that price fairness is one of the critical determinants forcustomer satisfaction because the customers often switch to any other brand whichoffers a reasonable price This idea means that as long as a brand offers a fair price,the customer will stick to them for a longer-term.

Most of the customers view price with the service quality; when there is amatch, the result is customer satisfaction and vice versa (Oliver, 1997) This ideameans the customers have a tendency to pay for the product or service if they feelthe deal given by the service provider is reasonable There are two perspectives incalculating the price perception (Cheng et al., 2008) The first one is thereasonableness of price, which refers the customer’s perception of thedifferentiation between one brand and the others The other aspect is how thecustomers consider the relative position of a brand; then, they perceive the fairness

of price concerning the value of money Ordinarily, the products or services withlow quality are often cost lower than those with high quality (Chitty et al., 2007)

Many studies proclaimed that there is a positive correlation between priceperception and customer satisfaction (Oliver, 1997; Cheng et al., 2008) The leadingcause of customers changes service providers stays in price problems; for example, thelack of fairness or reliability in pricing policies of the firms (Peng and Wang, 2006).Consequently, a brand, in order to gain customer satisfaction, should consider thefairness of pricing under maintaining and improving the service quality

2.5.3 Customer satisfaction and brand loyalty

Accordingi toi Oliveri (1999),i ati thei affectivei stagei ofi customeri satisfaction,iconsumersi wouldi nurturei ai positivei attitudei towardsi thei service-provideri ori theibrandi patronagei resultingi fromi satisfactoryi repetitivei purchasingi actioni overi time.iThisi brandi experiencei theni makesi customeri satisfactioni ai criticali factori iniembracingi brandi loyalty.i Numerousi studiesi havei focusedi oni thei explorationi ofi thisiloyalty-satisfactioni relationshipi (e.g.,i Szymanskii andi Henard,i 2001;i Choii eti al.,i2011;i Songi eti al.,i 2012)i andi thati customeri satisfactioni isi thei predecessori ofi brandiloyaltyi (Kapferer,i 2008;i Martisiutei eti al.,i 2010;i Nami eti al.,i 2011).i i

Besides,i Bennetti andi Rundle-Thielei (2004)i believedi thati ifi customersi areisatisfiedi withi thei producti andi servicei ofi ai brand,i theyi havei highi tendenciesi toikeepi usingi thei brand,i encouragei othersi toi usei thisi brand,i andi theyi arei lessi likelyi toiswitchi toi otheri brands.i Moreover,i thei relationshipi betweeni satisfactioni andi loyaltyi

isi significanti ini bothi thei short-runi andi long-run;i theyi arei likei twoi uniquei conceptsi

ori stepsi relatingi toi thei attitudei ofi customersi towardsi brandi ori brandi seti (Mittali andiKamakura,i 2001).i Ini otheri words,i brandi loyaltyi isi thei finali stagei thati resultedifromi thei responsesi ofi thei customeri toi thei offeringsi ofi thei brand,i whichi followifromi thei initiali satisfactioni stage

Brakusi eti al.i (2009)i conductedi ai studyi ini thei USi marketi toi investigatei theirelationshipi betweeni brandi loyaltyi andi customeri satisfactioni andi foundi outi thatisatisfactioni withi brandi experiencei isi ani influentiali mediatori affectingi brandiloyalty.i Researchesi ini manyi sectorsi andi thei empiricali studiesi demonstratedi aipositivei correlationi betweeni loyaltyi andi satisfaction:i Backi andi Parksi (2003)i ini theiservicei industry;i Rusti andi Zahoriki (1993)i ini retaili banksi andi hoteli industry;iMcDougalli andi Levesquei (1994)i ini multiplei sectors

Nami eti al.i (2011)i presentedi ai modeli ini whichi customeri satisfactioni playedi theirolei ofi mediatori ofi brandi loyaltyi andi consumer-basedi brandi equity.i Thei authorsiconductedi empiricali researchi ini thei hoteli andi restauranti industryi ini thei UK,i andi theiresulti isi unsurprised,i therei isi ai positivei effecti ofi brandi equityi oni brandi loyaltyithroughi customeri satisfaction.i Lateri ini 2012,i Tui eti al.i alsoi investigatedi thisicorrelationi ofi loyaltyi andi satisfactioni ini Starbucksi coffeei shopsi ini Taiwan,i whichisupportedi similari results.i Thisi casei means,i asi ai parti ofi thei servicei industryi ori foodiandi beveragei sector,i coffeei shopsi arei ai potentiali contexti toi conducti ai studyi toi exploreithisi relationshipi ofi brandi loyaltyi andi customeri satisfaction

Suh and Yi (2006) highly valued the strong effect of customer service on brandloyalty with the direct connection rather than typical advertisements or brand image.This view implies that focusing on customer satisfaction helps in strengthen brandloyalty, especially for the product and service of the brand The coffee shops offerproducts in a service-based manner; therefore, the essence of customer satisfactionmust be higher in both tangible and intangible aspects (Morrison and Crane, 2007)

On the other hand, studies by Zeithaml et al (1996); Bloemer et al (1999);Cronin et al., (2001); Johnson et al (2001) also supported that satisfied customersexposed additional loyal behavior In the situation in which the service has a vitalrole along with brand experience, enhancing brand loyalty needs more than justhaving tasty product offerings.

2.6 Research model

The above literature reviews are about CBBE, brand loyalty, price andcustomer satisfaction, and their relationships From these conceptual constructs, thispaper foresees the influences of price and brand-equity on customer satisfaction andcustomer satisfaction on brand loyalty Although different from the conceptualmodel from Nam et al (2011), we do not test the role of the brand identificationdimension in the model because the coffee chains market in Vietnam is stilldeveloping with little awareness from the customer about brand identification.However, it is of the great potential that there is a positive effect of the price oncustomer satisfaction, which is a new dimension to the conceptual model.Moreover, from the phenomenon about location, the hypotheses are developed andtested as two separate empirical cases in Hanoi and HCM City Therefore, theauthor developed the research model with four hypotheses as follows:

Figure 2.1: Research model

 Hypothesis 1: Pricei hasi ai positivei effecti oni customeri satisfactioni ini chainicoffeei shopsi ini Vietnam.i i i

 Hypothesisi 2:i Qualityi hasi ai positivei effecti oni customeri satisfactioni ini chainicoffeei shopsi ini Vietnam

 Hypothesisi 3:i Congruencei hasi ai positivei effecti oni customeri satisfactioni inichaini coffeei shopsi ini Vietnam.i

 Hypothesisi 4:i Customeri satisfactioni hasi ai positivei effecti oni brandi loyaltyi inichaini coffeei shopsi ini Vietnam

CHAPTER 3: METHODOLOGY

3.1 Research design

Thisi studyi aimsi toi identifyi andi investigatei thei relationshipi betweeni price,icongruence,i quality,i customeri satisfaction,i andi brandi loyaltyi ini thei coffeei shopsiindustryi ini Vietnam.i Thei researcheri adoptsi deductivei reasoningi withi ai theoryiabouti thei concernedi topici insteadi concentratesi oni formulatingi testablei hypothesesi

byi collectingi observationsi andi gatheringi datai thati concernsi thei confirmationi ofi theioriginali theory

Besides,i thisi paperi usesi ai quantitativei researchi strategyi generatingi theinumericali representationi ofi ai particulari phenomenoni throughi collectedi data.i Ititheni employsi thei survey-stylei questionnaire,i whichi isi populari andi effectivei asi theipreviousi researchesi ini thei field.i Underi timei andi resourcei limitations,i thei authoriconsidersi thei deductivei approach,i quantitativei researchi strategy,i andi questionnaireiarei thei mosti suitablei designi toi conducti thisi paper

First, this study utilized secondary data coming from journal articles,textbooks, and media stories, which ensured the research motivation and literaturereviews The process follows a pilot test for the validity purpose of thequestionnaire by the 47 offline surveys (27 in Hanoi; 20 in HCM City) Thesesurveys reinforced the meaning of research items and the translation ofquestionnaire items into the Vietnamese language The author then conductedsurveys to collect primary data in the one month between February and March 2020

in Vietnam under a common sampling technique Thisi paperi collectsi datai byi onlineiquestionnairesi withi thei purposivei samplingi followingi choseni criteria:i (1)i Theirespondenti arei customersi ofi Highlandsi Coffeei ori Thei Coffeei Housei ini Hanoi,i andiHCMi City;i andi (2)i Thei respondenti hasi purchasedi thei producti ori servicei ofi theseibrandsi ati leasti threei timesi ini recenti threei months

Asi ai structurali equationi modelingi (SEM)i research,i thisi studyi includesi theiexploratoryi andi confirmatoryi factori analysis,i andi accordingi toi Gorsuchi (1983),i thoseifairi samplesi requirei thei minimumi samplei ofi 200i observations.i Also,i accordingi toiHairi eti al.,i (2010),i thei leasti ratioi ofi observationsi overi ai questionnairei itemi isi 5:1,i andiKlinei (2015)i believedi thati thei N:qi ratioi shouldi bei 20i toi 1i ori eachi parameteri ini theimodeli requiresi 20i participants.i Therefore,i thisi studyi withi 24i itemsi andi fouri

parameters i from i the i research i model i needs i to i collect i at i least i 120 i respondents i

Thei authori generatedi 450i questionnairesi equallyi distributedi ini Hanoii andiHCMi City.i Afteri checki andi eliminationi ofi falsei ori incompletei responses,i thereiwerei 427i completedi andi validi answersi fori thei analyzationi stepsi (218i ini Hanoii andi

209i ini HCMi City),i whichi indicatedi thei validi ratei ofi 94.9%

In terms of analytical technique, this study utilized IBM SPSS Statistics 20and AMOS 21, which is an added module of SPSS to conduct multivariate analysesand test hypotheses AMOS is a popular tool in SEM, and it also helps to graph and

to modify the relationship between variables

3.2 Data collection instruments

This paper studies the relationship between five variables, including price,quality, congruence, customer satisfaction, and brand loyalty The scale using forthe research has been used in previous researches to apply to the case of the coffee

shops industry in Vietnam In specific, the price variable consists of four items dropped from Yoo et al., (2000) The congruence variable comprises of six items of

ideal-self congruence and lifestyle congruence adopted from Nam et al., (2011) The

product and service quality variable was evaluated with six items from Nam et al.,

(2011) Customer satisfaction and brand loyalty measured by four itemsrespectively, were adopted from Choi et al (2011)

Apart from demographic questions, surveys of this study also employed afive-point Likert scale for all those variables to assess the answers of respondentsranging from strong disagreement to strong agreement The table below thensummarizes the scale and construct of the questionnaire:

Table 3.1 Questionnaire scale and construct

CodePR1 The price of this brand is higher than other brandsPR2 The price of this brand is lower than other brands

Price PR3 The price of this brand is more affordable than other

brands

PR4 The price of this brand is more expensive than other

brandsQL1 Quality of foods and drinksQL2 Staff behavior

Quality

QL3 Physical quality

QL4 Staff behaviorQL5 Quality of atmostphere and spaceQL6 Attitude of staff

CON1 Self-congruence from other personal viewCON2 Lifelstyle support

Congruence

CON3 Self congruence from other people’s view

CON4 Lifestyle congruenceCON5 Ideal self expectationCON6 Personal lifestyleCS1 Foods and drinks satisfactionCustomer CS2 Staff behavior satisfaction

Satisfaction CS3 Good experience in this coffee chain brand

CS4 Choosing this brand is a right choiceBL1 Sharing good comments about the brandBrand BL2 Continue purchasing and using the brand in futureLoyalty BL3 Prefer this brand to others

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3.3 Data analysis

Structural equation modeling (SEM) has advantages in running multipleregression models simultaneously, while one variable might be both independentand dependent This study follows the typical steps in an (SEM) research toinvestigate the relationship in literature Firstly, each latent variable will go throughthe reliability check based on the Cronbach’s alpha indices If the observedvariables meet the required threshold, the remained indicators proceed to theexplanatory factor analysis (EFA) for testing if they belong to the same variables.The critical result is the principal axis factoring with the convergence of criteria intoiterations The CFA analysis step follows to examine the reliability of themeasurement items as a whole with the goodness-of-fit and statistical indices Thelast step is to run the SEM analysis, where the path loading of the proposed modelwill be tested In this study, the objects are the coffee chain market in Hanoi andHCM City; therefore, we will run the model twice for checking the hypotheses andcomparing the results of two cases

CHAPTER 4: FINDINGS

4.1 General results

4.1.1 Demographic information

The first part of the questionnaire focused on the profile of respondents

There were a total of 450 surveys given in which 427 responses are valid to

continue to the next step In these valid responses, the majority were male in both

cases of Hanoi and HCM City In terms of age, this research has a relatively equal

distribution of three groups; each of them accounted for 30% of the total sample

Highlands Coffee and The Coffee House are the objects of the study because they

are competitors, serve the targeted customer in the same price range Please see

Table 4.1 for the presentation of the demographic background of the sample

Table 4.1 Profile of respondents

4.1.2 Demographic customer behavior

The next few questions in the surveys explored the behavior of respondents

when purchasing products or services of chain coffee shops This study concentrated on

the customers who used the service of coffee houses at least three times in the last three

months, and the most highest frequency is the group of four times Also, it is surprising

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of coffee shops more than five times Although the direct visits method still

prevails, more than half of the customers use the delivery service The delivery has

now become a trend and an effective medium for the food and beverage industry

Instead of conventional coffee-related products, tea drinks are the most popular for

the fact that the coffee shops also have to compete with the bubble tea shops The

coffee shops renew their menu and adapt to a new trend, diversify the product line

with juice or foods like cakes or snacks Besides, the primary respondents are

coming to coffee shops to discuss business and meeting friends or acquaintances

Table 4.2 illustrated all the detail about demographic customer behavior

Table 4.2 Demographic customer behavior

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