Retaining Customer Loyalty Through Implementation of Recovery

Strategies in Viet Nam F&B Industry

Contents
Abstract......................................................................................................................................3
I. Introduction........................................................................................................................3
II. Literature Review................................................................................................................3
III. Methodology...................................................................................................................5
IV. Findings and discussion...................................................................................................6
V. Recommendations.................................................................................................................8
V. Conclusions.........................................................................................................................8
VI. REFLECTIVE JOURNAL......................................................................................................9
APPENDIX...................................................................................................................................9
REFERENCES.............................................................................................................................10
ABSTRACT
The study mainly discovered the factors that attract and retain loyal customers through
recovery strategies at F&B businesses in Vietnam. The study uses a quantitative method by
distributing questionnaires to 30 respondents as customers who buy and use products in the
F&B industry. Survey participants will contribute an objective view of the situation in the post-
Covid period before making assessments about the current situation of businesses in the
F&B industry. The survey results show that the impact of service quality, perceived value,
habits, and reputation correlates with customer loyalty, thereby reviewing and proposing
effective recovery procedures that can be applied.
Keywords (maximum of 5): Recovery procedure, retain the loyalty, recovery strategies

I. INTRODUCTION
In the period during and after Covid, a big challenge for many F&B businesses is retaining
loyal customers. The main focus of this study is to evaluate the factors related to customer
retention through the recovery procedure of restaurants and restaurants in Vietnam. The
purpose of the research is to investigate the correlation between those factors as well as find
a recovery procedure that is suitable for the vast majority of businesses. Furthermore, the
three main objectives of the study are to analyze the current business context and situation.
It then identifies the key factors influencing loyalty before making some recommendations for
evaluating recovery strategies. The implementation of this research is to find answers to the
study objectives, thereby proposing general recovery options to help businesses in the F&B
industry in general and the F&B industry, in particular, stabilizes in the new normal period.

II. LITERATURE REVIEW

The reason to chose this topic for the survey is that there is not any survey in Vietnam that
does this survey. The passing of the Covid pandemic brought dozens of consequences
related to the general business process of businesses. However, Food and non-alcoholic
beverage sales are anticipated to increase by 11.6% between 2018 and 2021 and reach $40
billion in sales (Business Monitor International Ltd). By 2020, 33 million individuals will be
middle class or wealthy (equivalent to a quarter of the population), according to Boston
Consulting Group, the F&B market in Vietnam is expected to snowball in shortly the near
future (BCG). In addition, the income of this population is forecast to increase from $6,000 to
at least $15,000 by 2035 and double by 2050 (according to PWC). 20% of the monthly
expenditure budget of Vietnamese households is spent on food. With such a proportion, the
food and non-alcoholic beverage markets are forecasted to grow by 11.6% (period 2018–
2021), reaching 40 billion USD in 2021 (Business Monitor International Ltd). Compared to
other sectors, this figure is close to the growth rate of alcoholic beverages and tobacco
(11.7%) and higher than the dairy industry (9%). Therefore, with the available data from
businesses and my own experience, I believe that F&B has a lot of potential and
development prospects in the coming years, which made me choose this field. Besides,
making this topic can be a good way to help F&B businesses in particular who are still
having difficulty in recovering to find a solution.
Loyalty is a phenomenon that has piqued the interest of marketers (Reddy et al 2011). Most
marketers' minds have been focused on customer loyalty in recent years, and numerous
companies have spent millions on customer relationship management programs with the
goal of building customer loyalty (Pitta et al 2006). Because of increased competition within
respective industries, loyalty has become increasingly important in recent years. In general,
customer loyalty refers to the intention to repurchase products and services, which is the
industry's goal (Pi, & Huang 2011).
According to BOSE and RAO (2011), loyalty is the customer's commitment to do business
with a specific organization, which results in repeat purchases of that organization's goods
and services in the business context. Additionally, it also leads to friends and associates
recommending the goods and services. Customer loyalty refers to a customer's intention to
repurchase or subscribe to a product or service in the future. According to Krumay and
Brandtweiner (2010), customer loyalty is viewed as one of the key factors of a company's
success.

Recovery has several theoretical and operational implications. When an entity has regained
a set of traits that it had previous to interruption, it is generally regarded as completely
recovered (Johnson and Hayashi, 2012). The state against which the firm is judged in the
business and organizational recovery literature is often measured either relative to some
pre-disaster conditions or according to the attainment of some stable state that may not be
directly comparable to pre-disaster conditions (Platt, Brown, and Hughes, 2016). According
to Parasurman et al. (1985), the recovery of a business/industry can be measured by four
factors including service quality, perceived value, habit, and reputation.
H1: Service quality has positive influences on customer loyalty
According to Parasuraman et al. (1988), service quality can be defined as an overall
judgment that is similar to attitude toward the service and is widely accepted as a predictor
of overall customer satisfaction. Service quality reflects an organization's ability to meet or
exceed customer expectations. Unlike tangible products, services are created and
consumed in the presence of both the customer and the service provider (Rahmseook et al.,
2010)

The relationship between loyalty and service is defined as “The degree to which a customer
exhibits repeat purchasing behavior from a service provider, possessing a positive attitude
toward the supplier. provided, and when a need for that service exists, they will only consider
using this service provider” (Gremler & Brown, 1996). According to Zeithaml & ctg (1996),
service quality affects the loyalty of service customers, satisfied customers tend to use the
service more and more often, tend to continue buying and word of mouth about the service.

H2: High Perceived value has a good affection on customer loyalty

Perceived value is a term that expresses a customer's assessment of the value of a product
or service and its ability to meet the needs and expectations of the business, especially
compared to competitors' offerings. Delivering great customer value is a critical approach for
organizations seeking a competitive edge and long-term success (Parasuraman, 1997;
Woodruff, 1998). There are four categories of perceived value that organizations may use to
improve their growth offer. Customers' perceived value evaluates items and services in two
ways: providing and receiving.

The following consumer loyalty models are available: morphological value, functional value,
temporal value, and ownership value (Parasuraman and Grewal, 2000). Customers would
be more likely to switch to competitive items to raise perceived value when the perceived
value was low, resulting in a fall in sales (Anderson và Srinivasan, 2003).

H3: Habit influence on customer’s loyalty

A person's habit may be described as what they do on a regular basis when there is a
behavioral preference in the present typically repeated. Habitual conduct results in the
repetition of the same sort of activity (Gefen, 2003). The majority of habitual behavior
originates and progresses swiftly, smoothly, and intuitively can forecast future consumer
behavior According to Ouellette and Wood (1998), once a behavior becomes a habit or well-
practiced behavior, it becomes automatic and is carried out without making a conscious
decision. Customers throughout the purchase process will be more likely to repeat selections
that result in great experiences.
Habit can have a direct impact on the behavioral intentions of the customers. According to
Caruana (2002), loyal customers are customers who make repeated purchases from the
same supplier, have a positive attitude towards the supplier, and only think of the supplier
when there is a development. demand for this service. Repetition in shopping behavior
represents the relationship with these loyal customers, which in turn helps businesses, in
general, to maintain profitability through stable mining with files. this customer.

H4: Reputation has influences on customer loyalty

Herbig and Milewicz (1993) defined reputation as an estimate of the constancy of an entity's
attribute through time. As a result, a business might have many reputations (for example,
pricing, product) reputations for quality and innovation) and/or worldwide reputation.

A favorable reputation may lead to increased sales and market share, as well as increased
client loyalty (Robertson, 1993). Customer behavior to shop by category versus conventional
shoppers is more influenced by the organization's reputation (Eastlick and Feinberg, 1999).

III. METHODOLOGY
Research design
The purpose of this study is to provide information on the factors affecting customer loyalty
and to understand the extent to which these factors affect customer retention as well as to
develop an industry recovery strategy. F&B Vietnam in the post-Covid-19 period. In this
study, I will use a quantitative method to survey and investigate. Quantitative research has
high generalizability, reliability, and highly representative answers for the results of the study.
Using quantitative research will save time, and be more convenient and objective than
qualitative research because quantitative data can be encoded into mathematical formulas.
In addition, the supporting quantitative approach makes data collection flexible, saving
unnecessary time and costs, thereby helping survey creators to capture results faster to
supplement. before the deadline. Therefore, the use of the quantitative method in this study
is completely reasonable.

Sample size and sampling technique

"Retaining Customer Loyalty Through Implementation of Recovery Strategies in Vietnam
F&B Industry" is the primary objective of this study. Therefore, the sample for this study will
be customers who buy and use F&B products/services in Vietnam with a sample size of
about 30 people. As mentioned above, the participants will include customers who have
purchased and experienced F&B industry products and survey respondents of different ages
as anyone can be a customer.
The sample for this study will be selected by probability sampling method and stratified
selection method. The limited study period (three months) is the reason why this method
was chosen because it is the fastest way to collect data.

Data collection procedure

The questionnaire was built based on my own experience working in the F&B industry, with
the main topic being the factors that make up a recovery procedure that affects customer
loyalty. The questionnaire also used a linear scale of 5 levels from 1 (strongly agree)
increasing to 5 (strongly agree). Metric variables used independently include Service quality,
Perceived value, Habit, and Reputation. Once designed, the survey questionnaire will be
released as an online form to any participants through social networking applications such
as Facebook and Instagram. Responses will be recorded within 6 days and in the process,
early responses will be recorded before the final results are released. Google Forms is the
tool used to distribute to 31 people. After evaluation as well as screening, all responses, all
30 responses will be taken for research and analysis purposes. Besides, Excel is also used
to analyze raw data from survey results.

Survey links: https://docs.google.com/forms/d/e/1FAIpQLSeKselv2E7-

SB1mQ1gXsRkbXDlAr1Q2Oaz1MGFfpWLhN0nZPQ/viewform

IV. FINDINGS AND DISCUSSION

In this sample, the majority of participants were under the age of 25, accounting for 77.4%;
9.7% are between the ages of 26 and 35; and both reached 6.5% in both large age groups,
36 to 45 years old and over 46 years old. The majority of survey participants are female,
accounting for 61.3%, while the number of men is 38.7%. Among the survey participants, the
percentage of people with monthly income below 3 million accounted for the most (41.9%);
ranked second is the number of people earning over 10 million a month (25.8%); meanwhile,
the number of people with incomes from 3-5 million and 5-10 million respectively is 12.9%
and 19.4%. Up to 41.9% of people go out to eat at restaurants 1-3 times a week; 35.5% eat
out 3-5 times a week, and 22.6% of people eat at restaurants/diners more than 5 times a
week. Among the types of restaurants selected, fast food restaurants, drinks shops, and
casual restaurants have a small difference and all of them are popular with customers. In
addition, fine dining restaurant is less chosen because of the nature of these restaurants, it
usually costs more money to experience.

Figure 1: Demographic Characteristics Table

The survey was conducted to find out 4 factors affecting customer loyalty to offer recovery
procedures for the F&B industry in Vietnam in the post-Covid context. Those factors include
Service quality, Perceived value, Habit, and Reputation.
 Figure 2: Descriptive Statistics Table

The average value of customer loyalty feedback is 3.93. With a range of only about 1.75, it
shows that the opinions of the participants are relatively similar. Besides, the Min of the
variable is only 3, which proves that most of the measured variables have a certain influence
on maintaining customer loyalty. Service quality with the average value of feedback reaching
4.3, with Max reaching 5 and Min reaching 3, proved that this is a factor that has a great
influence on customer loyalty, receiving "strongly agree" from the participants. family.
Reputation is also a factor that also has a high response average value of 4. The range at
about 2.33 shows that the relative difference comes from the responses, but most of them
are "totally agree" responses. “reputation” is one of the important factors. On the other hand,
Perceived value and Habit are two factors that have a common mean around 3.85 and the
difference is insignificant. Their ranges are 2 and 2.3 respectively, although not much
different from other factors, but when considering the same Mean index, we can see that
these two factors receive highly opposite responses.

Figure 3: Correlation Statistics Table

In this study, the dependent variable Customer loyalty and three independent variables
including Service quality, Perceived value, and Reputation have correlation coefficients of
0.07, 0.17, and 0.11 respectively. This shows that the correlation of customer loyalty for the
three independent variables above is positive, but relatively weak. In contrast, the correlation
coefficient of Customer Loyalty and Habit is only -0.07 reflecting the negative association
between the two variables..

V. RECOMMENDATIONS
The recommendations of this study point to some limitations to consider. First of all, the
sample size is only about 30 and this number is too small to represent the entire population
of Vietnam in general and the consumers who buy and use the products/services of the F&B
industry. Therefore, in the future researchers should increase the size of the sample to make
it easier to observe. Besides, the study also pointed out four factors affecting customer
loyalty. In the near future, researchers should consider the correlation between factors to
build a more suitable recovery procedure to apply to struggling F&B businesses.
 V. CONCLUSION
The study identified and analyzed four factors affecting customer loyalty in the F&B industry
in Vietnam in the post-COVID-19 context. While service quality, perceived value, and
reputation factors aid in maintaining customer relationships and building recovery
procedures for the business, habit is negatively correlated with maintaining loyalty
 VI. REFLECTIVE JOURNAL
Through my work, I learned a lot of new knowledge during the survey. Through access to the
knowledge imparted in a class by the lecturers and in the process of doing the test, I was
able to develop a working mindset in this short amount of time. In the course of doing
research, I myself have undergone significant changes. From the initial research stage to
developing it and implementing it through a draft, I not only took the initiative to learn more
research materials but also outlined another option with my coursemates: about the F&B
industry instead of the aviation hat travel industry. This not only helped me step out of my
comfort zone but also helped me reduce turn it in rate as well as increase the reference
source for the research paper. Everything was moving in the right direction as I wanted, but
at the stage of preparing the questionnaire and writing the article, I was not well prepared.
The reason is that in the last lessons of the course, the teachers carefully guided this part
and asked me to prepare in advance to be evaluated and corrected, but I got stuck for
personal reasons and missed school. As a result, I was passive and spent a lot of time on
these two parts, Besides, deciding on deadlines from other subjects as well as the school's
club caused me a lot of stress. However, up to now, I can confidently confirm that I have
managed my time well to be able to complete the deadlines on schedule.

APPENDIX
Survey questionnaire (Has been translated into English)
Hi Mr/Sister,
My name is Son Tung, a student at National Economics University. I conducted this survey
to collect actual data to complete my research on the topic of The relationship between
factors maintaining customer loyalty through the implementation of recovery strategies in the
future. business in the F&B industry in Vietnam. I hope you can spare some time to help me
complete this survey. I assure you that all answers will be used for research purposes only.

Please tick ✓ in the blanks or fill in the blanks, in the lines/columns that suit you. The
information provided is for research purposes only and will be analyzed and interpreted
according to the principle of anonymity. Providing your correct answer will greatly contribute
to my recommendation! Research results will be sent to you upon request.

A. GENERAL INFORMATION
1. Your gender?
a. Male
b. Female

2. Which of the following age groups do you belong to?

a. Under 25
b. 26-35
c. 36-45
d. Over 46

3. Your monthly income?

a. Less than 3 million
b. 3-5 million
c. 5-10 million
d. Over 10 million

4. How often do you go out to eat/drink in a week?

a. 1-3 times a week
b. 3-5 times a week
c. Over 5 times a week

5. What type of restaurant/restaurant do you usually choose? (If the type of

restaurant/restaurant is not in the selection, please select "Other" and specify the name)
a. Fast food restaurant
b. Drinks shop
c. Casual restaurant
d. Fine Dining restaurant
e. Other…

B. DATA COLLECTION
Please tick your choice in each of the questions below.

1= Totally disagree
2= Disagree
3= Neutral
4= Agree
5= Totally agree

SERVICE FACTOR: Evaluation of service quality through actual customer experiences

when choosing a restaurant/restaurant

I am attracted to eateries/restaurants with good service quality

Totally disagree
1
2
3
4
5
Totally agree

I am willing to pay a high price for a good service experience

Totally disagree
1
2
3
4
5
Totally agree

I will go back to the eateries/restaurants with good service quality

Totally disagree
1
2
3
4
5
Totally agree

FEELED VALUE FACTOR: Assessment of values and ability to meet customer needs and
expectations

The eateries/restaurants have many offers (eg discount, buy 1 get 1 free, redeem points for
rewards, ..) that attract me to come back.
Totally disagree
1
2
3
4
5
Totally agree

I was attracted by the presentation of the food/drink

Totally disagree
1
2
3
4
5
Totally agree

I was attracted by the decoration of the restaurant

Totally disagree
1
2
3
4
5
Totally agree

I am attracted to eateries/restaurants close to home and work

Totally disagree
1
2
3
4
5
Totally agree

I usually choose restaurants/restaurants that support fast shipping

Totally disagree
1
2
3
4
5
Totally agree

I usually choose restaurants/restaurants with fast service times

Totally disagree
1
2
3
4
5
Totally agree
FACTOR OF HABITS: Assess the habits of customers in choosing a place to eat/drink

Healthy products are my priority

Totally disagree
1
2
3
4
5
Totally agree

I give priority to eateries/restaurants that ensure food safety and hygiene

Totally disagree
1
2
3
4
5
Totally agree

I love going to the restaurants/diners that I've been to

Totally disagree
1
2
3
4
5
Totally agree

I like to go to cheap restaurants

Totally disagree
1
2
3
4
5
Totally agree

I like restaurants/restaurants that are advertised on the internet

Totally disagree
1
2
3
4
5
Totally agree

BRAND FACTORS: Assessing the influence of brands on customer choice

I usually choose restaurants/restaurants with great brand value (eg Starbuck, Highland,
McDonald's)
Totally disagree
1
2
3
4
5
Totally agree

I often choose restaurants/restaurants that give me confidence in product quality

Totally disagree
1
2
3
4
5
Totally agree

I often choose restaurants/restaurants that give me confidence in service quality

Totally disagree
1
2
3
4
5
Totally agree

GENERAL ASSESTMENT
The quality of service makes me come back to the restaurant
Totally disagree
1
2
3
4
5
Totally agree

Perceived value makes me return to the diner/restaurant

Totally disagree
1
2
3
4
5
Totally agree

Habits that make me come back to eateries/restaurants

Totally disagree
1
2
3
4
5
Totally agree

The brand of the restaurant/restaurant keeps me coming back

Totally disagree
1
2
3
4
5
Totally agree

REFERENCES

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assessment of some of the key antecedents of customer satisfaction in retail
banking. International Journal of Bank Marketing, 20 Issue: 4, pp.146-160.
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Contingency Framework’, Psychology & Marketing, 20(2), 123–138.

3. Gefen, D. (2003), ‘TAM or Just Plain Habit: A Look at Experienced Online Shoppers’,
Journal of End User Computing, 15(3), 1–13.
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implications, in Edvardsson, B., Brown, S.W., Johnston, R. and Scheuing, E.E. (Eds),
Proceedings American Marketing Association, pp. 171-180. in Caruana, A. (2000).
“Service loyalty– the effects of service quality and the mediating role of customer
satisfaction,” European Journal of Marketing, 36 (7/8), 811-823.
5. International Journal of Management and Marketing Research, Vol. 3, No. 1, pp. 37-
50, 2010
6. Ouellette, J. A., & Wood, W. (1998), ‘Habit and Intention in Everyday Life: The
Multiple Processes by Which Past Behavior Predicts Future Behavior’, Psychological
Bulletin, 124(1), 54–74
7. Parasuraman, A. and Grewal, D. (2000), ‘The Impact of Technology on the Quality–
Value– Loyalty Chain: A Research Agenda’, Journal of the Academy of Marketing
Science, 28(1), 168–174.
8. Parasuraman, A., Zeithaml, V., & Berry L. (1985). A conceptual model of service
quality and its implications for future research. Journal of Marketing, 49, 41-50.
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