Kaikki kirjoittajan LAMKpub artikkelit

Motivation for employer consultation in Transversal Skills and Employability

Articles in English, Kiertotalouden ratkaisut, LAMK Pro

The purpose of the employer consultations made for the local employers was to get clarification of transversal skills and employability attributes sought by renewables sector in Lahti area. This data was used during the project to benchmark the contents of the intensive study periods (ISP) and basic scientific knowledge behind the program design. This in its part guaranteed quality and actuality of teaching and learning. 

Author: Juha Hyytiäinen

The view of PEETS program design team concerning transversal skills

The view of transversal skills of the design team of the PEETS program is summarized in picture one. This picture is also used in student induction to give students an overall view what transversal skills mean so that they can better reflect what they learn during the ISPs. The questions asked during the employer consultations were devised based on this framework.

Figure 1. Transversal skills divided into four fields (Belt 2017).

Method used to get the employer/stakeholder view

The method in getting the employer view in Lahti was three staged. In the first stage in 2017 seven energy/renewables sector companies in Lahti area were contacted by phone and asked three basic questions about transversal skills and if they seemed interested a fourth additional question that probed the willingness to cooperate with the project in the future. The persons contacted were CEOs, HR-managers or key officers within the company.  At the second stage in 2018 small student teams and individual students made stakeholder interviews as course prework in renewables sector according to the instructions from Dr. Jantien Belt (The Hague University of Applied Sciences) mainly in Finland, Netherlands and Scotland. Finnish team did four interviews with one exception, which was a timber company in Australia. The types of interviews students made varied some despite the common framework. Third stage composed of free questions asked during the company presentations and visits (4 companies) during the ISP2.

Results of the employer consultations

The most frequently mentioned new employee skills from the seven 2017 phone interviews are summarized in table one.

Personal/social skills intercultural attitude/knowledge foreign languages
Motivation/willingness to work (3) Openness (4) English (6)
Team work skills (3) Recognizes cultural differences (3) Swedish (4)
Initiative (2) Ability to make contact/ask (2) Russian (3)
Situational awareness (2) Ability to accept different kinds of people (1) German (3)
Honesty, openness, ability to learn new, critical thinking (1) Adaptability (1) According to the target country (2)

Table 1. Summary of results from 2017 phone interviews made in Lahti area for seven companies. Numbers in brackets represent the times the attribute was mentioned in the interviews.

The key attributes concerning new employees from 2018 student team interviews (3 + 1 a timber company in Australia) are listed below.

  1. Willingness to learn, Willingness to learn/work, communicating effectively and behaving properly with the people from other cultures, English and Swedish
  2. What really matters is education and your personality, Finnish and English
  3. All the transversal skills are important – I can’t choose between them, Being able to say no to someone and talk about difficult topics without making people feel bad, curiosity about other cultures, English other foreign language competency isn’t that important since you can find someone to translate
  4. Good ethic, ability to do the job with little supervision, Being able to interact with others in a positive and effective way and communicating effectively and behaving properly with the people from other cultures, languages needed depends on business

The key points that rose from questions asked during the company visits and company presentations during the 2018 ISP included attitude, listening to the customer, finding the right team for the job.

Conclusions from the employer/stakeholder consultations

The most important attributes that rose from the consultations belong to the attitude field of the picture one. A supervisor engineer in a big multinational company that was visited during the 2018 ISP in Finland stated that attitude is the most important thing in a new employee. The ability to communicate with different people was also considered a key attribute. Language wise English was the most frequently mentioned and it was considered a basic requirement. Other language needs arise from the environment or target country. Also translators can be also used e.g. in places there languages differ from main European languages.

The stakeholder consultations have helped to develop PEETS program further. The results also point to a direction of a learning environment that develops positive attitudes towards doing work, learning new things and willingness to participate. A multicultural and multidisciplinary environment

helps to promote communication skills between different people. Problem solving and project work in real life cases with real and simulated difficulties make this more realistic. The build in reflection system enhances the learning or at least focuses students and staff to think the key points in their experiences and learning. PEETS program has used this approach from the start and it has developed with every iteration. This approach and four fields of transversal skills could be used as a tool to develop and benchmark programs and courses in LAMK.  

References

Belt, J. 2017. Transversal skills. Power point presentation. The Hague University of Applied Sciences.

Author

Juha Hyytiäinen works as a Senior Lecturer at the Faculty of Technology in Lahti University of Applied Sciences.

Illustration: https://pxhere.com/en/photo/596254 (CC0)

Published: 25.4.2019

Reference to this publication

Hyytiäinen, J. 2019. Motivation for employer consultation in Transversal Skills and Employability. LAMK Pro. [Cited and date of citation]. Available at: http://www.lamkpub.fi/2019/04/25/motivation-for-employer-consultation-in-transversal-skills-and-employability/

Enhancing the Collaboration between Finnish and International UASs Students – Finnish Student’s Perspective

Articles in English, LAMK Pro, Uudistava oppiminen

What is the Finnish UAS’s students experiences and expectations about international students while studying together at UAS? Do the UASs supply opportunities for local students to study/work together with international students? Universities of applied sciences (UAS) throughout Finland, offer various opportunities for such situations. This article describes one such opportunity: internationalization at home. The article also suggests some solutions for UAS to improve the experiences of the Finnish UAS students – to be more successful.

Authors: Hoa Vu & Tarja Ahonen

International Studying in Finland

Finland’s educational background is well-known worldwide because it is the heart of the Finnish welfare society. Every year, UASs in Finland welcome thousands of international students to study there. This huge amount of newcomers give a chance for all students to work and study in a multicultural environment. However, the multicultural environment might affect local students due to the cultural diversity in the classrooms. The research, based on the perspective of local students, aims to enhance the collaboration between Finnish and international students within Finland’s UASs. The study determines the expectations and experiences of Finnish students while they study/work with international classmates. Based on these aspects, suggestions are given to help UASs fulfill the gaps. It also helps UASs improve the experiences of their local students.

Internalization at Home and Gap Model of Service Quality

In 2017, the total number of international students in Finland account for 6,8% of total number of all higher education students while 9,551 local students applied for the exchange program and 10,445 international students came to Finland for their exchange period (Study in Finland 2017). This shows that there are many Finnish students who do not study abroad. Internationalization at home is the process whereby the intercultural, international and global dimensions are mixed intentionally into the education systems for students in a country. The programme brings opportunities for students to develop further their knowledge, experience, and soft skills e.g., in intercultural understanding, multicultural, intercultural and critical thinking, etc without traveling aboard. (Beelen & Jones 2015) Thus, “internationalization at home” programmes should be applied by educational institutions effectively to bring international studying environments to Finnish students.

The research considers Finnish UASs students as the customers. The analyses part of the research mentions the service quality, customer experiences, satisfaction and Gap Model of Service Quality. The Gap Model of Service Quality is used to demonstrate the gaps between service quality and customer satisfaction. There are five gaps in total, in which the gaps between customer expectation and management perception as well as between management perception and the service quality specification are mentioned in the research. The gap between customer expectation and management perception happens when service providers do not realize which characteristic of products and services should be fulfilled to meet customer’s needs. The gap between management perception and the service quality specification occurs when the companies completely realize their customer’s expectation, but they do not have enough resources to fulfill the needs. (Parasuraman etc. 1985, 44-45)

Findings

The expectation and experience of Finnish students are determined. Finnish students have several expectations such as enhance language skills, expand network, have knowledge of cultural difference. The experiences of Finnish students are divided into two types of experiences. The positive experiences include having a chance to meet lovely people from around the world, having interesting times, gaining knowledge of cultural differences, increasing the language skills. The negative experiences include the lack of responsibilities of some international students in teamwork, lack of punctuality and problems in communicating due to the cultural differences. (Vu 2019, 48-49)

The gaps between expectations and experiences of Finnish UASs students with other international classmate are determined. The gap of language difficulties is due to the gap of ”customer expectation and management perception”. Thus, both Finnish and international students do not have the necessary English language skills to understand each other. However, the UASs do not recognize this situation and therefore the schools do not necessarily have actions to fulfill it. The author also believes that the gap of cultural difference is due to the gap between ”management perception and the service quality specification”. Studying among different nationalities might cause some cultural conflicts. Although the UASs are aware of the existing conflicts, they do not have sufficient resources to fulfill the gap. (Vu 2019, 41)

The ” internationalization at home” programme is seen to be successful since several respondents have positive feedback to the programme. Respondents emphasize how it helps them to develop and enhance their knowledge of cultural differences, improve language skills, further develop soft skills such as communication, teamwork, have an international studying/working environment, save abroad living costs and traveling time. (Vu 2019, 42)

Recommendation for Enhancing Collaboration

The first recommendation is make language courses compulsory to local students to help them improve their English skills. These courses can include some tips/guidelines on how to communicate more effectively. These courses also fulfill the gap of ” customer expectation and management perception”. Second, UASs should open cultural courses for newbies. These courses provide students knowledge of different cultures and supplies different skills and tools on how to study/work among other nationalities without having conflicts. The gap of ” management perception and the service quality specification” are also narrowed down through those cultural courses since new students obtain the necessary knowledge from the beginning of their studies. The third recommendation is the arrangement of local tutor students for international newbies. The combination brings Finnish tutors a chance to make new friends, reduce the cultural shock and to gain experience in the international studying/working environment. The fourth solution is increasing the involvement of teachers during the courses by managing the teamwork and helping students when needed. They can also make a survey after the course to evaluate the participation of each student during their teamwork assignments. Finally, UASs could provide programmes that let students take courses from different faculties. Students can gain knowledge and get new friends at the same time through these programmes. (Vu 2019, 45-47)

References

Beelen, J. & Jones, E. 2015. Redefining Internationalization at Home. The European Higher Education Area. [Cited 23 March 2019]. Available at: https://link.springer.com/chapter/10.1007/978-3-319-20877-0_5

Parasuraman, A., Zeithaml, V. & Berry, L. 1985. A Conceptual Model of Services Quality and Its Implications for Future Research. American Marketing Association. The USA: American Marketing Association.

Study in Finland. 2017. Higher Education in Finland 2016-2017. Study in Finland.  [Cited on 17 October 2018]. Available at: http://www.studyinfinland.fi/instancedata/prime_product_julkaisu/cimo/embeds/studyinfinlandwwwstructure/100601_Higher_Education_Finland_2016_2017.pdf

Vu, Hoa. 2019. Enhancing the Collaboration between Finnish and International UASs Students – Finnish Student’s Perspective. Bachelor’s thesis. Lahti University of Applied Sciences, Business and Hospitality Management. Lahti.

Authors

Vu, Hoa. 2019. Fourth-year International Business student. Lahti University of Applied Sciences. Finland.

Ahonen, Tarja. 2019. Senior Lecturer. Lahti University of Applied Sciences Ltd, Business and Hospitality Management. Lahti.

Published: 16.4.2019

Reference to this publication

Vu, H. & Ahonen, T. 2019. Enhancing the Collaboration between Finnish and International UASs Students – Finnish Student’s Perspective. LAMK Pro. [Cited and date of citation]. Available at: http://www.lamkpub.fi/2019/04/16/enhancing-the-collaboration-between-finnish-and-international-uass-students-finnish-students-perspective/

Vietnamese Cosmetics Market: Consumers’ Expectation from Brands

Älykäs liiketoiminta, Articles in English, LAMK Pro

The cosmetics industry is one of the biggest businesses in the world. As the industry continues to expand, it has led to fierce competitiveness and rising consumer expectations. Thus, consumer behavior plays a fundamental role in creating marketing strategy. The Vietnamese cosmetics market is not an exception to this fact. Cosmetics brands in Vietnam have to understand their consumer to satisfy their demand and build a strong market standing. This articles aims to discuss Vietnamese consumers in the cosmetics market and provide marketing practices based on consumer behavior for foreign brands.

Authors: Thi Kim Khanh Nguyen, Thanh Thao Nguyen and Marja Viljanen

Vietnamese consumers in the cosmetics industry

In recent years, Vietnam has seen a lot of changing patterns in buying behaviors, especially in young people who belong to Generation Z and the late of Millennials. Since these generations have been exposed to many development privileges as well as the Internet and globalization effect at earlier ages, there have been a lot of changes in their thinking. The improvement of living standards together with globalization effect has led to a remarkable increase in consumers’ consciousness of quality. This makes them demand for more original products and high-quality customer service. (Oxford Business Groups 2019.)

The usage of cosmetics and makeup products has gradually increased its social values and meanings among Vietnamese consumers, especially among women. The percentage of people who do not wear makeup decreases, from 24% in 2016 to 14% at the beginning of 2019. Vietnamese women also increasingly use skincare products, as 73% of 480 respondents in research done by Q&Me use skincare products at least once a week. (Q&Me 2019.)

Together with the growth of online shopping, online communication and media have affected Vietnamese consumers a lot in shopping behaviors. Recent years have seen rise in beauty blogging and influencing, where individuals express opinions on cosmetics products. According to a survey by Kengo (2018), 91% of people who took part in his survey and usually use makeup products admitted to watching YouTube for cosmetics review and makeup tutorials. A typical Vietnamese spend circa 50USD a month for cosmetics products, among other entertainment products and clothes (Chi 2018). This amount of money is not enough to afford any luxurious brand cosmetics. Therefore, Vietnamese consumers have the tendency to look for price value cosmetics and other related products that last for a long time.

Marketing practices for foreign cosmetics brands

The research was carried out on Shiseido Group, a Japanese multinational cosmetics company. They have been promoting their business in Vietnam from 1997. Because of the growth of the Vietnamese cosmetics market, Shiseido Group wishes to expand its business and strengthen its position in the market. (Vinny 2017.) Although the suggested marketing practices are designed for Shiseido Group Vietnam, it is also applicable for other international cosmetics brands in Vietnam to some degree. The empirical research included three interviews and an online survey with 197 valid responses. (Nguyen & Nguyen 2019.) Based on the empirical data and secondary data, marketing practices were proposed for the case company.

The first proposal concerns the case company’s product. As consumers are environmentally aware, the case company should concentrate on producing cosmetics products with natural ingredients. The packaging should be oriental style to appeal to Vietnamese aesthetics sense. Skincare products are Shiseido’s specialty. Thus, they can focus on promoting high quality skincare products that provide good value. Second, the case company’s prices are quite expensive to Vietnamese consumers. It will be quite challenging for Shiseido Group to lower their price, as they need to take account of other costs. It is suggested that the company should focus on the Millennial generation from 23 to 38 years old, who have stable income to afford the brand’s premium price. The case company should conduct promotion for consumers such as discount events and membership program. (Nguyen & Nguyen 2019.)

Third, to make the company’s product more accessible for consumers, it should open its own independent retail store and showroom in major urban areas in Hanoi and Ho Chi Minh City. This can also assure the consumers of products’ origin because of counterfeit products in the market. Finally, in terms of promotion, the official Shiseido Vietnam Facebook page should be more attentive in responding to users’ questions and comments. Instagram and YouTube page should be opened with the Vietnamese language. Aside from social media, beauty magazines and websites can also be used for advertisement. As YouTube is one of the largest channels for sharing makeup tips amongst Vietnamese consumers, the company can also cooperate with beauty bloggers and celebrities to use its product. If a reputable consumer can provide authentic support for the products, new consumers will be interested in trying out the brand. (Nguyen & Nguyen 2019.)

Conclusion

As Vietnamese market is monopolized by foreign brands, it serves as the driving force to promote business in Vietnam. At the same time, the competition between international brands also becomes more intense. Being able to satisfy consumers’ needs is a factor that put companies in a favorable position. With the rapid development of technology and the Internet, consumers are changing in their behaviors, perceptions, and opinions. Therefore, companies should observe and tailor to the ever-changing consumer behaviors.

References

Chi, K. 2018. Vietnam’s US$2 billion cosmetics market controlled by foreign brands. Vietnamnet. [Cited 8March 2019]. Available at: https://english.vietnamnet.vn/fms/business/198524/vietnam-s-us-2-billion-cosmetics-market-controlled-by-foreign-brands.html

Kengo, K. 2018. Cosmetics Market in 2018 and the growth of online shopping. Brands Vietnam. [Cited and translated 8 March 2019]. Available at: https://www.brandsvietnam.com/congdong/topic/9223-Thi-truong-my-pham-2018-va-su-bung-no-mua-hang-truc-tuyen

Nguyen, K. & Nguyen, T. 2019. Developing Marketing Practices Based on Consumer Behavior. Case Company: Shiseido Group Vietnam. Bachelor’s Thesis. Lahti University of Applied Sciences, Business Administration. [Cited 14 April 2019]. Available at: http://urn.fi/URN:NBN:fi:amk-201903304042

Oxford Business Group. 2019. Foreign Brands Eyeing Vietnam Due to Growing Young Population and Liberalising Reforms. [Cited 4March 2019]. Available at: https://oxfordbusinessgroup.com/overview/talking-shop-growing-young-population-and-liberalising-reforms-have-foreign-brands-eyeing-vietnam

Q&Me. 2019. Research on Vietnamese cosmetics market 2019. [Cited 8 March 2019]. Available at: https://qandme.net/en/report/research-vietnam-cosmetic-market-2019.html

Vinny, H. 2017. Nars comes to Vietnam. Retail in Asia. [Cited 6 October 2018]. Available at: https://retailinasia.com/in-sectors/health-and-beauty/nars-comes-to-vietnam/

Authors

Thi Kim Khanh Nguyen has studied Business and Administration at Faculty of Business and Hospitality Management at Lahti University of Applied Sciences and has graduated and received a BBA degree in April 2019.

Thanh Thao Nguyen has studied Business and Administration at Faculty of Business and Hospitality Management at Lahti University of Applied Sciences and has graduated and received a BBA degree in April 2019.

Marja Viljanen works as a Senior Lecturer at the Faculty of Business and Hospitality Management, Lahti University of Applied Sciences.

Cover image: https://pxhere.com/en/photo/804550 (CC0)

Published: 16.4.2019

Reference to this publication

Nguyen, T. K. K., Nguyen, T. T. & Viljanen, M. 2019. Vietnamese Cosmetics Market: Consumers’ Expectation from Brands. LAMK Pro. [Cited and date of citation]. Available at: http://www.lamkpub.fi/2019/04/16/vietnamese-cosmetics-market-consumers-expectation-from-brands/

What is service marketing and where is it heading

Älykäs liiketoiminta, Articles in English, LAMK Pro

Marketing is a constantly changing field where service marketing is becoming more and more common. When marketing services it is essential to acknowledge how service marketing differs from marketing products and why. This article focuses on highlighting the most essential aspects of service marketing by relying on research based information about the subject. A practical point of view is given by taking a close look on how a cloud computing service should be marketed according to theory. Since the industry is so changing, also some trends are given thought to that seem to be relevant for marketing in the future.

Authors: Julia Backman and Riku Nummikoski

Service marketing by utilizing technology

There is a fundamental difference in marketing between products and services. When marketing products a marketer can rely on the products being tangible. When services are in question, the marketer has to promote commodities that are intangible. (Isohookana 2011, 65.) Creating a marketing and communications plan for a service has to focus on finding the right target audience by choosing the right channels for marketing. The content of marketing should also be in the interest of that target audience. (Todor 2016, 1-6).

Digital marketing is a modern tool for marketing goods and services using digital technologies (Todor 2016, 1-6). The different digital channels are much used in the modern world and they enable an effective way of marketing intangible commodities. (Kotler, Kartajaya & Setiawan 2010.) When marketing services, the environment where the service can be presented to the customer needs to be chosen carefully. Social media is a mainstay in the modern communications and should therefore be utilized for finding the right target audience. (Chaffey 2018.)

A model for marketing planning called the SOSTAC model consists of six different aspects which are situation, objectives, strategy, tactics, action and control. The SOSTAC® Planning framework is created by PR Smith (2019) and it makes the marketer create a marketing plan that starts from considering the current situation of the company. It defines the objectives for the company and how their commodities should be offered. When the objectives are determined the plan for carrying them out in practice needs to be considered. When it is time for action the marketer has a clear plan in mind how the different operations will be done. After doing different marketing activities the success of the activities should be monitored. The last part of the model is the control part where the results of marketing is analyzed and measured. (Chaffey 2018, Smith 2019.)

Image 1. The essential parts to consider in service marketing (Backman 2019)

Marketing plan: From plan to action

A thesis called Marketing- and communications plan for a cloud computing service Riihi DMA, CASE Riihisoft was done that concerns this topic closely. In the beginning of the study it was crucial to note the difference between marketing products and services. Soon only the digital channels for marketing were chosen for the study. The current situation for the company was analyzed by following the steps of the SOSTAC model by doing a micro and macro analysis. The micro analysis pointed out the target audience for the company, which was middle- and large-sized companies. (Backman 2019.)

The micro analysis soon lead to a competitor analysis where the other operators on the field were discovered and analyzed with SWOT analysis. One important aspect to find out was which digital channels they are using and if those channels seem to be support their marketing. The information received led to choosing those channels for marketing that the case company already was using frequently and focus on them. It also turned out that a new channel, a blog, should be opened and invested with time and thought. (Backman 2019.)

The 5s’s pointed out how to determine objectives. At this stage of the study the competitive advantage for the service Riihi DMA was discovered. The scalability and a turnkey solution that this service offered are aspects that the marketing plan would definitely highlight when defining what the marketing content should consist of. It became an objective to clearly send this information to the target audience and make all the marketing channels to support this endeavor. By choosing the right channels and by maintaining a systematic grip on marketing, good results might be expected in the future. (Backman 2019.)

Some key findings

A good starting point for creating a working marketing plan was a deep understanding of the company’s current situation. The objectives set for the plan right from the start gave a framework which to follow and in the end to check the results. Along the way of making the plan the planning model brought out many important aspects to highlight in the marketing content. The competitive advantage can be discovered especially when conducting a competitor analysis. The marketing planning overall is a whole that consists of multiple different activities that all should have clear objectives that support each other. The  constructed plan never seems to be all-inclusive since it has to be updated from time to time. This is no wonder since the field itself is changing all the time.

The way forward

Marketing is already utilizing a lot of data. In the future it is presumable, that the amount of data received will grow. The issue will be finding the right information from the information flow. Marketers should create better ways of collecting the right data to being able to create marketing campaigns for their customers that actually work. The second area the marketers should focus on is creating such content that they can target an even larger audience for creating engagement and new customers. The content has to provide the potential customer an experience that they value and what makes them choose one company out of another. The marketeer should keep in mind that people value authenticity in content. (Gruhler 2018.)

Image 2. The fast changing nature of technology globally (Backman 2019)

Artificial Intelligence is also arising and already used as a tool in marketing. The further knowhow and use of that advanced technology can be a gamechanger for a company. The marketing environment changes constantly and so does the marketing activities. The marketeer should still utilize the basic interests people have towards enjoying good stories and experiences, especially those that outweigh their expectations. The companies need to give a great thought on how to deliver that to the customers in the form of their value proposition now and in the future. (Gruhler 2018.)

References

Backman, J. 2019. Marketing and Communication Plan, CASE: Riihisoft Oy, RIIHI DMA. Bachelor’s thesis.  Lahti University of Applied Sciences, Degree Programme in International Business. Lahti. [Cited 20 May 2019]. Available at: http://urn.fi/URN:NBN:fi:amk-201903273910

Chaffey, D. 2018. Setting goals for your digital marketing. Smart Insights [Cited 4 Dec 2018]. Available at: https://www.smartinsights.com/goal-setting-evaluation/goals-kpis/goals-for-your-digital-marketing/

Gruhler, T. 2018. Five Trends Shaping The Future Of Marketing. Forbes. [Cited 20 May 2019]. Available at: https://www.forbes.com/sites/forbesagencycouncil/2018/04/18/five-trends-shaping-the-future-of-marketing/#2e27166b4d36

Isohookana, H. 2011. Yrityksen markkinointiviestintä. Suomi: Sanoma Pro Oy.

Kotler, P. Kartajaya, H. & Setiawan, I. 2010. Marketing 3.0: From Products to Customers to the Human Spirit. Hoboken, New Jersey: John Wiley & Sons.

Smith, PR. 2019. PR Smith’s SOSTAC® Planning System. [Cited 8 Apr 2019]. Available at: https://www.sostac.org/

Todor, D. 2016. Blending traditional and digital marketing. Bulletin of the Transilvania University of Braşov Series V: Economic Sciences. No. 1/2016 [Cited 24 Oct 2018]. Available at: http://webbut.unitbv.ro/BU2015/Series%20V/2016/BULETIN%20I%20PDF/06_Todor%20R.pdf

Authors

Riku Nummikoski works as a Senior Lecturer at the Faculty of Business and Hospitality Management, Lahti University of Applied Sciences.

Julia Backman is a student in Lahti University of Applied Sciences and a soon to be Bachelor of International Business.

Cover image: https://pxhere.com/en/photo/1452891 (CC0)

Published: 3.4.2019

Reference to this publication

Backman, J. & Nummikoski, R. 2019. What is service marketing and where is it heading. LAMK Pro. [Cited and date of citation]. Available at: http://www.lamkpub.fi/2019/04/03/what-is-service-marketing-and-where-is-it-heading/

Inside Food Delivery Services Market in Vietnam: Connecting and Understanding Generation Z and Millennials as Customers

Älykäs liiketoiminta, Articles in English, LAMK Pro

Today in the ever-expanding digitalized world, ordering food home through online services is extremely popular. As a matter of fact, the market for food delivery service is growing strong all over the world; Vietnam is not an exception. With the next great buying power coming from Millennials and Generation Zs (Gen Zs), food delivery services in Vietnam need to understand what these two generations need and want to capture their interest and loyalty.

Authors: My Nguyen and Marja Viljanen

Millennials and Gen Z as Consumers

According to Pew Research Center (2019) specified, Millennials are those who were born in 1981-1996 (23-37 of age as of 2019) and Generation Zs begins with those who were born starting from 1997 (22 of age as of 2019). In Vietnam, as of 2018, Millennials and Gen Zs accounts for 35% of the country’s population.

Millennials are and will have a major impact on the economy. Their spending is projected to amount at $1.4 trillion (=€1.2 trillion) in the US by 2020, accounting for 30% of retail sale. (Gapper 2018.). When marketing to Millennials, there are a few characteristics of this generation that brands and businesses need to be aware of. Millennials love having their opinions listened to, they want to have a part in creating the products with the brands. When Millennials shop, they utilize online platforms in every stage of the decision journey from searching online, making payment to signing up for membership card. Millennials don’t just acquire food, products, services or media silently; they share the experience with their friends through both offline and online means. Millennials value experience and seek adventure and newness. They are also driven by values, meaning that they integrate their beliefs when choosing products. Over 50% of US Millennials pick companies that support the causes they care about. (Solomon 2018.) It is extremely hard to gain Millennials’ loyalty but they make especially loyal customers, if they feel like they are treated right by the companies (Donnelly 2018).

The clean line that cut between Millennials and Gen Zs is that Gen Z never knows a world before digital access. This sets Gen Z’ expectation for brands to be as digital-savvy as they are, demanding even more seamless shopping experience with up-to-date technologies. Gen Z are more entrepreneurial than their predecessor generation. (Hodgson 2018). Gen Z love brands with a personality and fun brand voice. Ads for Gen Z are no longer a showcase of product, it must be something entertaining to attract Gen Zs’ attention and make an impact. (Watson 2018.) While Gen Z can be reached predominantly via social medias, forming connection with them takes a lot more work. Marketing messages must be tailored to specific social medias while maintaining the same message across platforms as each social media is used for different purposes by Gen Z. (Perlstein 2017.)

How food delivery services in Vietnam accommodate Millennials and Generation Z

As the food and beverage sector in Vietnam experience an exponential growth, the market share of food delivery service also expands. A survey was carried out to learn about the behaviors of Vietnamese Millennials and Gen Zs towards food delivery services (Nguyen 2019). Out of 134 respondents, 57% of Vietnamese Millennials and Gen Zs take to Google and social medias and 38% turn to friends and family members to decide which food delivery service to use. They don’t trust online advertisements as a valid information source. Instagram and Facebook are the most used social media by Vietnamese Millennials and Gen Zs.

When picking a food delivery service, there are a few elements that Millennials and Gen Zs value over others. Respondents were asked to rate a series of seven elements on the scale of one to five, with one being strongly disagree and five being strongly agree. Speed and quality of delivery is the most valued element when Millennials and Gen Z pick a food delivery service. In addition, high quantity of promotions, recommendations from friends and relative, and easy-to-use ordering system are also highly considered. (Nguyen 2019.)

As Millennials and Gen Zs in Vietnam trust recommendations from someone they know in real life, it will do food delivery services in Vietnam well to focus on deepening the bonds that they already have with existing customers. Word-of-mouth phenomenon will draw in new customers and earn their trust instantly. Food delivery services should concentrate on addressing the needs and wants for convenience and seamless online and offline experience of Millennials and Gen Zs to create instant connection with them. A little fun and characteristics to a social media post is what keep Millennials and Gen Zs interested. Shareable, valuable contents such as infographic, trendy memes are highly valued.  (Nguyen 2019.)

References

Dimock, M. 2019. Where Millennials end and Generation Z Begins. Pew Research Center. [cited 14 February 2019]. Available at: http://www.pewresearch.org/fact-tank/2019/01/17/where-Millennials-end-and-generation-z-begins/

Donnelly, C. 2018. Who are the millennial shoppers? And what do they really want? Accenture. [Cited 14 February 2019]. Available at: https://www.accenture.com/fi-en/insight-outlook-who-are-millennial-shoppers-what-do-they-really-want-retail

Gapper, J. 2018. How Millennials became the world’s most powerful consumers. Financial Times. [Cited 14 February 2019]. Available at: https://www.ft.com/content/194cd1c8-6583-11e8-a39d-4df188287fff

Hodgson, A. 2018. Generation Z: The Next Wave of Consumers. Euromonitor International. [Cited 14 February 2018]. Available at: https://blog.euromonitor.com/generation-z-next-wave-consumers/

Nguyen, M. 2019. How food delivery services in Vietnam accommodate millennials and generation Z. Bachelor’s Thesis. Lahti University of Applied Sciences, Business Administration. [Cited 14 February 2019]. Available at: http://urn.fi/URN:NBN:fi:amk-201902142351

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Authors

My Nguyen has studied Business and Administration at Faculty of Business and Hospitality Management at Lahti University of Applied Sciences and has graduated and received a BBA degree in February 2019.

Marja Viljanen works as a Senior Lecturer at the Faculty of Business and Hospitality Management, Lahti University of Applied Sciences.

Illustration: https://pxhere.com/en/photo/1459569 (CC0)

Published 27.3.2019

Reference to this publication

Nguyen, M. & Viljanen, M. 2019. Inside Food Delivery Services Market in Vietnam: Connecting and Understanding Generation Z and Millennials as Customers. LAMK Pro. [Cited and date of citation]. Available at: http://www.lamkpub.fi/2019/03/27/inside-food-delivery-services-market-in-vietnam/