FINAL REPORT - GROUP 2

MINISTRY OF EDUCATION AND TRAINING UNIVERSITY OF ECONOMICS AND FINANCE HO CHI MINH CITY  COUNTRY NOTEBOOK FINAL ASSIGNMENT Lecturer: Dr Le Nguyen Hoang Subject: International Marketing - MKT1106E.B10E Ho Chi Minh City, January 10th, 2022 TEAM MEMBERS Members Performance Review TABLE OF CONTENTS I Overview Heineken International is a Dutch brewing company, founded in 1864, with headquarters in Amsterdam Heineken is the third-largest brewer in the world Originating in the Netherlands, HEINEKEN is a family company with more than 150 years of history, producing and distributing over 300 brands of beer and fermented apple juice in more than 190 countries And the market that we choose to plan international marketing is Vietnam In Vietnam, HEINEKEN produces and distributes beer brands: Heineken, Tiger, Amstel, Larue, BIVINA, Sol, Desperados, Affligem, and Strongbow fermented apple juice And the product here we choose to plan international marketing is Heineken beer From the beginning with around 20 employees, today Heineken Vietnam has more than 3,000 employees and become the second largest brewery in Vietnam Every year, Heineken Vietnam contributes significantly to the Vietnamese economy, accounting for 0.88% of national GDP Logo: Slogan: “It could only be Heineken” 4|Page II Cultural analysis History In the past, when the society was not as developed as it is now, the Vietnamese had known how to combine rice with many different fruits for fermentation to create alcoholic beverages In addition, Vietnam is an agricultural country, the leading food is rice, so using rice to ferment into alcoholic beverages has been popular a long time ago For that reason, the culture of using alcoholic beverages has also appeared for a long time in Vietnam In many traditional rituals of 54 ethnic groups in Vietnam, such as festivals, weddings, and funerals, alcoholic beverages are indispensable drinks According to the old concept, the culture of drinking alcoholic beverages of the Vietnamese people has differences in each social class Farmers have a habit of drinking alcohol with meals or at meetings with friends As for business people, they offer alcoholic drinks to each other in discussions with partners to understand each other In particular, the alcoholic culture of the intelligentsia has a fascinating point They often drink alcohol to inspire composing literature, poetry, and science Climate Vietnam is a country with a tropical monsoon climate Therefore, Vietnam's climate is typical of the tropics The weather all around the year is in high temperatures and humidity The average temperature of Vietnam ranges from 23°C to 32°C and increases from the North to the South The climate is a tropical monsoon climate in the North and has four distinct seasons: spring, summer, autumn, and winter The temperature in the South is relatively stable and remains high all year round With such a hot and humid climate all year, Vietnam's beverage consumption is enormous According to the survey, soft drinks, especially beer, and alcoholic beverages in the summer months or months with high temperatures, increase 2-3 times compared to the remaining months It can be seen that, with the hot and humid weather and high temperature, Vietnamese people often have the habit of consuming soft drinks and beer to cool off Family Relationships in Vietnamese families are more complicated than those in Western countries The majority of families in Vietnam are extended families as many generations co-live to take care of each other Family in Vietnam looks similar to a system of minisociety with the most elderly having the most vital voice and taking charge of most activities in the house Each family has its own rules and values that members should conform to The younger generation shows respect for the older generation and vice versa, and the old generation tolerates the young In Vietnamese extended families, every weekend usually has a culture that all generations in the family will gather together, eat together, and share funny stories that happened during the week Women and children often drink soft drinks in these gatherings, and men usually use beer and other alcoholic beverages with their meals Political 5|Page Vietnam is one of the more politically stable countries in South East Asia Vietnam’s leadership does not welcome political dissent Internal conflict is strictly controlled, and large-scale and politically sensitive protests are quelled Political Stability and Absence of Violence/Terrorism: Percentile Rank in Vietnam was reported at 44.81 % in 2020, according to The World Bank collection of development indicators, compiled from officially recognized sources Vietnam has benefited from its stable government and social structure, making it ideal for capital investment Political stability is one factor that makes Vietnam an attractive market, attracting foreign investors to invest in Vietnam In addition, it also promotes business development Enterprises investing in Vietnam not have to worry too much about political instability, they can focus on their business activities Moreover, political stability also increases the consumer’s consumption Legal According to Vietnamese law, alcoholic beverages are goods had to pay special consumption tax Special consumption taxpayers are organizations or individuals that produce or import those goods Currently, the tax on alcohol and beer in Vietnam is 65% and accounts for about 30% of the retail price, while in many other countries, the tax ranges from 40% to 85% of the retail price The Government of Vietnam is currently proposing to increase the special consumption tax on alcohol, beer, and tobacco products to protect people's health and increase the government's budget Group behavior Drinking alcohol baverages has been a great culture of Vietnamese people for a long time It is said that “Betel is the beginning of the story, the cup of wine or beer is the beginning of the fun.” This cultural feature is also evidence for the potential consumption of beer in Vietnam As reported by a survey of the Ho Chi Minh University of Education, most young people in Ho Chi Minh city agree that drinking beer is a common way to build and maintain relationships in Vietnamese culture In Vietnamese culture, when you have just made friends with someone, then going out to drink beer with that person will be one of the ways to make that relationship closer Or when they meet an old friend Vietnamese people often choose to drink beer together to reconnect that relationship Beer gradually becomes an indispensable drink in meetings with friends In Vietnam, drinking beer has become a way of communication for modern young people, a feature when socializing, not just a beverage anymore In addition, Vietnamese people often drink beer on special occasions such as weddings, birthdays, holidays, vacations, weekends, or whenever they have time to gather It is believed that drinking beer on these occasions is the best way to express their happiness Not only on special occasions, it is not difficult to see that Vietnamese people drink beer both when they are happy and when they are sad A group of people sitting on a plastic chair with a bottle of beer in their hand and along with it is the unique culture slogan “Mot, hai, ba, do! has become a familiar image in foreigners' minds whenever they visit local 6|Page bistro in Vietnam Vietnamese usually drink relaxing and another is for business purposes for two main reasons, one is for When conducting a survey on a group of people aged 22-40 about using alcoholic beverages, nearly 80% of the survey group drank beer and other alcoholic drinks, and the percentage drank only beer was 75% More than 1/4 drink beer at least once a week, and more than 20% drink more than once a week That is a reason why Vietnam is one of the largest beer markets in the world When the world beer market is relatively saturated with consumption growth of about 1% per year, the Vietnam beer market has nearly tripled in the period 2010 – 2019 Conclusion We can see that using beer and other alcoholic beverages has appeared for a long time in Vietnam Gradually drinking beer has become a typical culture of Vietnam on special occasions such as holidays, new year, weddings, birthdays, or every weekend In addition, with high temperatures and hot climate all year round, beer is also used as a common beverage to cool off Sometimes people drink beer just because they feel thirsty or tired, and drinking beer makes their spirit more energetic Although beer is a relatively high taxed item in Vietnam, this does not impact beer consumption in the Vietnamese market According to data released by the Ministry of Health, the percentage of Vietnamese people who drink beer and other alcoholic beverages is among the highest in the world, with more than 80% of men and nearly 12% of women The rate of beer and alcoholic beverage consumption in Vietnam increased beyond all expectations when in 2018, it reached nearly 4.7 billion liters of beer In addition to the enormous annual beer consumption, political stability is also one of the factors increasing this consumption Thereby, we can see that the alcoholic beverages market in Vietnam is very potential III Economic analysis Introduction Some brief information about Vietnam's economy Thanks to economic reforms in 1986, combined with favorable global trends, Vietnam has rapidly grown from one of the poorest countries in the world to a lower middle-income country within a short time From 2002 to 2020, GDP per capita increased by 2.7 times, reaching nearly 2,800 USD Also, during this period, the poverty rate (according to the standard of 1.9 USD/day) dropped sharply from more than 32% in 2011 to less than 2% Thanks to a solid foundation, Vietnam's economy has shown remarkable resilience in times of crisis, most recently the COVID-19 pandemic In 2020, Vietnam is one of the few countries that recorded positive GDP growth when the pandemic broke out Vietnam's shift from a centrally planned to a market economy has transformed the country from one of the poorest in the world into a lower middle-income country Vietnam now is one of the most dynamic emerging countries in East Asia region Vietnam is setting more ambitious development visions, aiming to become a high-income country by 2045 Population According to the latest figures from the United Nations, the current population of Vietnam is 98,580,201 people on January 8, 2022 7|Page In 1999-2009, the average annual population growth rate was 1.2%/year, a decrease of 0.5%/year compared to 10 years ago and the lowest rate of increase in the past 50 years In the 2011-2013 period, the average annual population growth rate, although decreased, was still at a high level of 1.05% With a large population size and high population growth momentum, our population will continue to increase until the middle of the 21st century, with more than 100 million people It will be in the group of 10 countries with the largest population in the world As of early 2022, Vietnam has the following age distribution: -The number of people under 15 years old accounts for 25.2% -The number of people between 15 and 64 years accounts for 69.3% -The number of people over 64 years old accounts for 5, 5%  Vietnam is one of the 15 most populated countries in the world, large population can increase the consumption of goods in the market, especially in the field of FMCG (Fast moving consumer goods) and F&B (Food and Beverages) In addition, Vietnam is in the period of “golden population” A prominent feature in the "golden population" period is that the population from 15 to 64 years old accounts for a high proportion, currently accounting for about 69.3% of the total population In which, the number of people between the ages of 20-50 years old accounts for more than 50% of the population, this is the age group that regularly uses alcoholic beverages  Segmentation of potential customers for Heineken beer products Income The average income in 2020 will reach about 4.23 million VND/person/month, down about 2% compared to 2019 However, in the period 2016-2020, the average income per capita/month increased by 8, first% By region, the average income in urban areas is 5,538 million VND/person/month, nearly 1.6 times higher than in rural areas According to Boston Consulting Group, reports Nikkei Asian Review, Vietnam currently has the fastest-growing middle class population in Southeast Asia With 56 million people in the middle class, Vietnam is forecast to jump up from the current 26th position to 18th in the global ranking of 30 economies with the largest middle-class populations A World Bank report recently released shows that the Vietnamese middle class has been expanding rapidly with 1.5 million people each year in recent years Market research firm Nielsen has estimated that the number of middle class Vietnamese will reach 95 million by 2030  Vietnam's fast-growing middle class is an important indicator for Heineken beer products Because Heineken beer is a product of the high-end segment, the customer segment that Heineken Vietnam wants to target is the middle and upper class in Vietnam With the rapid growth of the middle class in Vietnam, it can be seen that Heineken beer products will have many opportunities to develop in this market Communication system Common communication systems in Vietnam include: internet, wireless networks, electronic mail, smart phones, social networks 8|Page There are 68.17 million people are using internet services in Vietnam There are 65 million Vietnamese are using social networks in 2020 There are more than 145.8 million mobile data network connections in Vietnam  The communication system in Vietnam is quite developed, with more than 70% of the population in Vietnam using the Internet and popular social networks This creates favorable conditions for marketing activities in Vietnam We can leverage the communication system to create messages that are shared with a target market, create effective marketing campaigns, resonate with target audiences and persuade people to make a purchase, build and maintain relationships with customers Channels of distribution There exist many different retail channels in Vietnam They are traditional distribution channels including markets and grocery stores and modern distribution channels including supermarkets and convenience stores, and e-commerce channel According to statistics of the Domestic Market Department (Ministry of Industry and Trade), there are about 8,660 markets, 800 supermarkets, 168 trade centers of all kinds and more than million household grocery stores in Vietnam The number of mini supermarkets and convenience stores is constantly increasing Currently there are more than 1,000 convenience stores The model of convenience stores and mini supermarkets has undergone significant changes over time First appeared in the Vietnamese market about a decade ago, this model has really attracted the attention of consumers and is gradually replacing the traditional type of grocery Due to the impact of the Covid-19 pandemic, e-commerce has experienced dramatic growth However, modern retail channels only meet 25% of the needs of people, while the traditional distribution channels are responsible for the other 75% And also due to the impact of the Covid-19 pandemic, consumers are changing their behavior, which is switching from shopping at traditional markets to e-commerce Although the traditional retail channel accounts for 74%, the growth rate is only 1%, while the modern retail channel accounts for 26% of the market share but is growing in double digits at 11.8% per year  Retail channels in Vietnam are very developed The number of retail channels available in the market is very large, including traditional distribution channels and modern distribution channels Retailers serve as an important distribution channel for goods from producers The more retail channels, the easier for consumers to get the product With a large number of distribution channels available in the market, it’s will not be too difficult to bring the product to consumers In addition, having many distribution channels will create price competition Retailers will compete with each other to offer the best price to their customers so that customers can buy your products at the best price In addition, you can use these retail channels as an marketing channel by using right placement, banners, advertisements, offers, and other strategies to increase sales in these retail stores Media 9|Page Marketing activities in Vietnam associated with social media channels from 2008-2009, but only really flourished in 2011-2012 with the "blooming" of Facebook There are 58 million Vietnamese users using social media on mobile platforms in 2020 The most popular media channel used by the most users in Vietnam is Youtube, Facebook, Tiktok, Zalo and Instagram According to statistics in June 2021 of NapoleonCat (a tool to measure social network indicators), the total number of Facebook users in Vietnam is nearly 76 million people, accounting for more than 70% of the national population, increased by 31 million users compared to 2019 and still leads the list of popular social networks in Vietnam According to the latest report published in October 2021 by We Are Social, the number of TikTok app users over 18 years old in Vietnam is 39.65 million people, accounting for 40% of the national population, which has increased by more than 5.4 million users in a short time The age of tiktok users is mostly young generation who from 18-35 years old  These figures can prove that social media has developed very strongly in Vietnam in recent years This will be an opportunity for Heineken Vietnam to take advantage of these popular social media channels to carry out marketing campaigns with various purposes such as increase brand awareness, reach target customers, enhance brand loyalty, increase sales, directly interact with customers and also enables them to directly interact again In addition, if taking full advantage of social media, we can have a lot of data about customers and we can use this information to make more marketing ideas IV Market audit and competitive market analysis Evaluation of the product by the intended market In term of product quality, the key factor that makes Heineken's success worldwide is the superior and consistent quality of the products in any country To this, Heineken always adheres to a series of strict regulations on pure water, premium ingredients, product packaging… Along with that, quality assurance processes are applied at all Heineken factories worldwide In Vietnam, Heineken beer is produced with the best ingredients from Europe under the strict supervision of quality and technology by the global Heineken corporation The Heineken brewery of Vietnam Brewery Co., Ltd operates under international quality standards ISO 9001, ISO 14001 and ISO 22000, ensuring that each can of Heineken beer delivered to consumers is strictly controlled from the production of cans to the final product  Heineken's quality criteria are completely consistent with the quality criteria in Vietnam Regarding the taste of Heineken beer, Heineken beer has a mild sour taste, a little sweet and has a characteristic aroma In general, the taste of Heineken beer is not too different from other beers in Vietnam So Heineknen beer tastes quite suitable for the taste of Vietnamese people However, the ingredient that creates the unique taste of Heinekne beer is A-Yeast, which is an exclusive yeast found only in Heineken beer This yeast that makes Heineken beer different from other beer And when launched in Vietnam market, this unique taste has made a strong impression on Vietnamese consumers 10 | P a g e  Vietnamese market consumers quite like the typical taste of Heineken beer Beers in Vietnam have an alcohol level about 1% to 8% The alcohol level of Heineken beer is 4% to 5% depending on the type of beer This is also quite consistent with the beer market in Vietnam Regarding product packaging, when developing in Vietnam market, Heineken keeps its product packaging design Heineken beer products in Vietnam market have the same packaging as Heineken beer products in the international market This not only does not lose Heineken's competitive advantage, but also makes a strong impression in the minds of consumers by green bottle with red star The price of Heineken beer on the international market is $0.817/can When developing in Vietnam market, Heineken still maintains the same price, Heineken beer in Vietnam market is priced at 18,000 VND/can Since Heineken beer is a high-end beer, Heineken's target customer segment in Vietnam is middle-class and upper-class in Vietnam, so despite the high price compared to other beers, This also does not affect the sales of Heineken beer in Vietnam market, because middle and upper-income people in Vietnam are willing to spend a higher amount than usual to own Heineken beer products In the international market, Heineken focuses on distribution to retail channels such as supermarkets and retail stores And this is completely suitable for the Vietnamese market when retail channels in Vietnam market account for more than 75% of the distribution channels in the market However, in order to match the consumption habits of Vietnamese people, we will need to have more development strategies in terms of distribution channels as well as appropriate distribution channel management, such as focusing more on traditional retail channels rather than modern retail channels and expand distribution on ecommerce channels, because e-commerce is rapidly developed in the Vietnamese market in recents year Evaluation of the target market With business culture on the drinking table, Vietnam is one of the largest beer markets in the world When the world beer market is relatively saturated with consumption growth of about 1% per year, the Vietnam beer market has nearly tripled in the period 2005 – 2019 According to Euromonitor data, in 2005, the total beer consumption in Vietnam was just over 1.2 billion liters with the average consumption volume of 14.74 liters / person / year In 2019, beer consumption was 4.9 billion liters, growth rate made up for 18% compared to those of 2015, with an average consumption of 50.88 liters / person / year The beer brands’ coverage and consumption tended to be divided by region Specifically, Sabeco dominates the South, Carlsberg mostly presence in the Central region, Habeco is the market leader in the North and Heineken has wide coverage in the Central and South Thus, the South will be the most ideal place in the country for beer consumption thanks to the climate with no cold season According to FPTS research, in the South 59% of beer consumption in the country In addition, the habit of dining out compared to other regions makes the South an attractive region Therefore, beer companies always choose the South, especially the Southeast, as the first consumption market when they first enter the 11 | P a g e Vietnamese beer market Sapporo, ABInBev, Heineken, SanMiguel or Masan all built the first breweries in the South Despite being considered a fertile piece of cake, but the beer industry is facing a large segmentation, 90% of the market share in the whole industry is dominated by four giants, Sabeco, Habeco, Heineken and Carlsberg Vietnam In the product segment, Sabeco and Habeco dominate the affordable and mid-end segments; Meanwhile, the premium beer segment belongs to foreign beer companies According to data from Euromonitor International, in the 2016-2019 period, the market shares of the top 10 beer brands consumed by Vietnamese people did not change much Sabeco with familiar and long-standing products such as Saigon Export, 333,… Export and Saigon Special are still the most consumed beers in the market Besides, in the North, 12 | P a g e Habeco has relatively good coverage with the three most consumed products, namely Hanoi beer (9.2%) and Bia Hoi Hanoi (1.7%) Regarding the consumption market share of foreign brewers, Heineken also has products in the top 10 most consumed beers: Heineken beer (4%), Tiger beer (23.4%), Tiger crystal (2%) and beer Larue (4.1%) These products have been very familiar to Vietnamese people for many years The remaining beer in the top 10 is Huda Beer, owned by Carlsberg, which is the most consumed beer in the North Central Coast (from Thanh Hoa to Thua Thien Hue), accounting for 4.2% of total beer consumption In context of the high-end trend, domestic beer companies are also trying to target the high-end segment such as Sabeco with Sai Gon Export, Saigon Special, Saigon Lager and Habeco with Truc Bach beer, Lac Viet Beer (released in June 2020) … However, in recent years, Heineken still leading the premium beer segment with a number of other foreign beer brands The market share in the high-end segment of Sabeco and Habeco is still small due to the “xenophile” of Vietnamese people The trend of high-end consumer goods consumption is going strong, but growth is concentrated mainly in big cities: Hanoi, Ho Chi Minh, Hai Phong, Can Tho, Nha Trang and Da Nang People in other provinces still tend to drink beer in the affordable and midend segments more and these two segments are expected to continue to be consumed the most in Vietnam  Vietnam's beer market operates quite competitively, with many famous brands such as Tiger, Heineken, Hanoi, Halida, Saigon, 333, , from low-end segments such as draft beer to high-end beer segment The two main consuming markets are the Southern (Ho Chi Minh) and the North (Ha Noi) 50-60% of the beer market share belongs to large Vietnamese corporations, Sabeco and Habeco, and Heineken V Preliminary marketing plan Targeted market In the current Vietnamese beer market, beers are for familiar people, and the middle class makes up the majority of the market Even in a market segment with many diverse products and services, customers still feel unsatisfied and wait for something new and different That leaves Heineken manufacturers looking for a new market with fewer competitors, leading to more extensive sales Because of the substantial investment in marketing and sales, this market segment needs individuals who can afford to spend their efforts Ideally, those in that segment would be active users of whatever product or service they offer And the premium market was chosen by Heineken With a dynamic and growing Vietnamese economy and an increasingly improved life, we can be confident about the position of Heineken beer in the future Targeted customer In the world market in general, the Vietnamese market in particular, the customers that Heineken targets are people with high income compared to the broad surface of society They are business people, rich people, and successful people who achieve and have careers, most of them are mainly in urban areas and cities Therefore, Heineken's advertising is only 13 | P a g e aimed at the successful group, but the benefits of the brand change to suit the shifting needs of beer drinkers Then, feeling the need to drink beer of the successful class, there was a shift from the business relationship to enjoying life And the basis for Heineken to be able to convince successfully is the number one beer in the world And there is another department that mainly uses Heineken, which is the bar and discotheque However, most of these departments are not regular customers and are not loyal to the brand SWOT analysis: 3.1 Strengths With a long history, famous brands: Heineken was founded in 1864 This is a company with a long history and a powerful brand known all over the world Heineken has a strong reputation built during the 1.5 century it has existed Since its establishment in 1873, the Heineken brand has always been considered synonymous with quality, not only in beer taste but also in business relationships, work, and forward-thinking the set Besides, Heineken always has a close connection with customers and what is happening in the outside world Heineken is a product of high quality and trusted worldwide: In 2010, according to Interbrand's ranking, Heineken was ranked 114th globally with a brand value of up to 6.6 billion USD Also, according to Business Week and Interbrand magazine, Heineken is the only beer brand to be classified in the group of famous brands on a global scale (in the same rank as Coca-Cola, GM, ) In Vietnam, Heineken is the world's leading premium beer brand voted in the Top 10 famous brands most loved by Vietnamese consumers Products with high quality, unique taste: Beer is prepared with special yeast Thanks to the special yeast that gives Heineken beer a unique characteristic flavor This yeast is carefully distilled in Switzerland and supplied to 110 Heineken breweries every month The beer was born with a rich, unforgettable taste and consistently outstripped the competition in blind taste tests between beers Among Heineken testers in 2003, 90% said they knew they would choose Heineken again Quality is the most crucial factor, and Heineken always ensures that its products are processed under the most standard conditions to ensure the beer always has the purest flavor Modern production lines: At Heineken Vietnam, the company makes the finest quality beers and fermented apple juices to serve its customers All of the company's products strictly comply with the quality management standards of the Ministry of Health, as well as the strict regulations of the global Heineken group Skilled and responsible engineers and workers operate the modern production system In addition, investment in machinery and equipment is focused, especially on the production line with a capacity of 50,000 bottles/hour and 90,000 cans/hour As the most modern factory in the region and the country, the production process is closed, with most of the stages being fully automated In addition to investing in machinery systems in the production process, Heineken also invests in modern equipment to protect the environment during production 14 | P a g e Have substantial financial resources: As a large national corporation in more than 170 countries worldwide, along with a long history, Heineken has significant financial resources and is ready to spend on all its business strategies 3.2 Weaknesses There are many production facilities worldwide, requiring talented managers with a broad vision: Heineken Beer is ubiquitous, and Heineken owns more than 130 breweries in more than 70 countries, has more than 66,000 employees globally; producing and selling in the market more than million glasses of Heineken beer per hour… to manage a production line with such a global scale, managers must have a broad vision and strategy to be able to ensure the smooth running of the business Heineken's colossal scale makes it challenging to expand the market: Since Heineken has always done well in the distribution field, most of the world has its manufacturing plants Currently, there are very few gaps in the market, which is also a difficulty in expanding the market Besides, another factor also makes Heineken beer challenging to compete when the business product is a product that is not recommended to use much Relatively high product prices: In general, Heineken's target customers are successful young people who are also high-end beer brands, so its costs are in a relatively high range compared to the public market beer 3.3 Opportunities in the Vietnam market: Golden population structure, rapidly increasing income: Vietnam is a country with the fastest-growing middle class in Asia According to Nielsen and VBA, in 2020, there will be about 33 million middle-class consumers under the age of 30 and will spend approximately $173 billion A large and growing market with strong purchasing power like Vietnam has been a lucrative land to exploit Vietnam is the country that consumes the most beer among 11 countries in Southeast Asia Beer consumption in Vietnam has increased by an average of 6.6% per year over the past six years (global growth is only 0.2%) The great potential of the "non-alcoholic beer" segment is considered a product that ensures consumers' health and safety while driving Due to the alcohol-free ingredients, consumers can comfortably use it without worrying about violating traffic laws Nonalcoholic beer promises to open a promising future for the beer industry in Vietnam The attractive point is that this segment is still relatively young The number of non-alcoholic beer brands on the Vietnamese market is only counted on the fingers, such as Sagota, Steiger, Bavaria, Oettinger, 3.4 Threats in the Vietnam market: Many competitors: As one of the top beers, Heineken still has to compete fiercely with many other famous Vietnamese brands: Sabeco, Habeco, Carlsberg, Some potential competitors, such as Budweiser by Anheuser Busch - a beer expected to establish a better result when Anheuser - Busch Cos enters Vietnam through a strategic alliance with Sabeco 15 | P a g e Another premium beer, Czech Pragold, also expressed its intention to penetrate deeper into the Vietnamese market Pressure of substitute products: Due to local habits and culture, Heineken is under a lot of pressure from substitute products such as wines, juices In particular, the export market of soft drinks, especially fruit juices and nutritious drinks, has increased in recent years COVID-19: The mass closure of business locations during the epidemic has caused beer consumption to freeze Heineken faces legal challenges: • According to this law, Vietnam's Law on Prevention of Harmful Effects of Alcohol (from January 1, 2020), people who use alcohol are restricted from using means of transport, thus reducing beer consumption It can be said that this is a complex problem that requires many changes in product strategy, advertising, and reestablishing the consumption habits of users • Advertising Law (from February 24, 2020) makes it challenging to carry out the company's marketing activities due to strict regulations in beer advertising Therefore, it has a significant impact on the process of Marketers and Agencies on strategy, creation, and execution of advertisements for beer, alcohol brands • Taxes and production permits: Up to now, alcoholic beverages in Vietnam are subject to types of taxes: import tax (from 5-80% depending on the kind of FTA), valueadded tax (10%), and special tax consumption (increased sharply from 50% to 65% in 2018) Strengths: - Has a long history and famous brand - Products with high quality, unique taste, and trusted worldwide - Modern production lines - Have substantial financial resources Weaknesses: - Relatively high product price - Difficulty in the management process due to many production facilities - The product is not recommended for heavy use Opportunities: -The population structure is golden, income increases rapidly - There is a large beer consumption - Great potential of the "non-alcoholic beer" segment Threats: - Many competitors - Pressure from substitute products - The situation of the Covid-19 epidemic has not been entirely resolved - Faced with many strict laws 3.5 Recommending a SWOT solution: Enhance advertising: We all know that Heineken's promotional clips are creative, unique, and funny If we continue to promote those advantages and at the same time combine with advertising in the voices of each locality, including the characteristics of each region, Heineken's products will come closer and more deeply engraved in the hearts of consumers improving the ability to expand the market 16 | P a g e Increased presence at convenience stores: With the development trend of the modern industrial economy, convenience is increasingly valued Distribution channels through convenience stores should be more focused Environmental friendliness: in the production process, it is advisable to make the most of raw materials and scrap to avoid waste and environmental pollution Regarding materials for making beer bottles and beer cans, it is advisable to research and apply recyclable materials that are both economical and environmentally friendly Invest, provide efficient production lines Marketing Plan - Mix: 4.1 Product strategy: Product quality To become a "Global beer brand'', the quality of the beer is something that the company needs to pay attention to The beer production process must always be taken seriously, ensuring that its products are always processed under the most standard conditions Heineken beer is available all over the world, and in the Netherlands, all made according to a traditional recipe since 1873 About ingredients, Heineken beer: - No additives, preservatives; - No fat; - Contains vitamins B1, B3, and B11; - Mineral; - Antioxidants Design and packaging: To ensure that consumers can see the difference between domestic beers and recognize the quality of the product, we use green bottles instead of brown ones Because the green color exudes freshness, nature, purity, this helps consumers feel that Heineken beer is more premium, better than other beers To make the Heineken bottle unique, the combination of the green color, chic styling, convex shoulders, racetrack label with black stripes, signature Heineken branding, and red star makes the Heineken bottle special making it the most recognizable beer bottle Services associated with the product: Guidance on how to drink and preserve products Heineken will set up a hotline specializing in consulting and answering customers' questions Providing door-to-door delivery services creates trust and satisfaction for customers 4.2 Cost strategy With a growing Vietnamese economy and improved living standards, we can trust the growth of the number of successful entrepreneurs in the future, trusting the number of potential customers in the segment This song is growing For high-class customers, drinking beer is not simply drinking beer, but they also seek in it the satisfaction, the desire to express themselves, the pride that transcends all levels So they are willing to pay extra to get the feeling of a successful businessman However, when he first entered the Vietnamese 17 | P a g e market, Heineken encountered many difficulties, not only from competitors Besides, it is mainly necessary to mention cultural barriers and the average income of the people It is a fact that the average income of Vietnamese consumers is still relatively low While the price of the product lines of Heineken beer is considered to be fairly high Specifically: • Heineken 330ml Price: 330 VND.000/carton (24 cans) • Heineken 500ml Price: 450.000/barrel Moreover, in Vietnam, beer is an indispensable drink every Tet holiday in every family, in which canned beer is trendy, used as a gift for partners, friends, and relatives Every holiday and Tet, the price of beer on the Vietnamese market increases continuously, and at the same time, the selling price of this item also varies greatly Many people think that the cost of Heineken is too expensive, and there are also opinions that such a price is reasonable Regarding Heineken's valuation in the Vietnamese market, we have researched and come up with such a price that is suitable for the target market that the company wants to target Those are high-income consumers The assessment of the Vietnamese market shows that if Heineken's products are launched into the market with a strategy of penetrating or covering the market massively, they will probably fail Instead, we will take risks, and prudently use market segmentation methods to find for ourselves attractive and potential market segments for substantial profits 4.3 Distribution channel strategy: Besides the competition in terms of products and prices, brewers are most interested in the distribution system With a national distribution strategy, from retailers to leading distributors, it is a popular and indispensable drink for men, whether in daily meals or large and small parties at home or in a restaurant It is helping consumers to search and buy anywhere Therefore, distribution channels are divided into three specific types: + Traditional channels (On-premise), also known as on-site consumption channels, include pubs, restaurants, bars, and clubs + Modern distribution channels (Off-premise) in supermarkets and stores + Cooperate on e-commerce sites such as Shopee, Lazada to distribute and sell to consumers more straightforward and faster efficiently However, brewers will promote traditional distribution channels because most consumers in Vietnam often have the habit of drinking beer in groups and at bars Distribution channel management: The distribution network is an essential link in the company's business strategy Helping to bridge the gap between manufacturers and customers, bringing products to consumers worldwide + For distributors: The company will make strict commitments, standards, and criteria to become a distributor of Heineken Every Heineken product delivered to consumers must ensure the absolute highest safety and quality, which is the company's top priority 18 | P a g e + For retail points: At retail points, Heineken products are displayed as eye-catching, diverse, and full of product categories 4.4 Promotion strategy: To quickly leave a beautiful and unforgettable impression in the minds of Vietnamese customers, Heineken will promote promotion and image building from the feat of designing logos, concise slogans that imply, and implementing advertisements Unique, attractive, and special attention to environmental management and energy saving Advertising: Advertising is one of the effective means to convey information about the quality and advantages of a product to dispersed consumers at a low cost Each promotional clip of Heineken products will appear with the main slogan "It could only be Heineken," which will make a deep impression on customers and remember the product -Television: The company will cooperate with Vietnamese TV channels, broadcasting advertisements in prime time frames on HTV7, HTV9, VTV1, VTV3, The Internet: Science and technology are developing more and more The number of Internet users is increasing On that criterion, Heineken has fully exploited Internet advertising to introduce products to consumers everywhere The company will also promote advertisements or programs on its social networking sites to reach a wider audience quickly In addition, the marketing campaigns of Heineken will be deployed on the mobile websites of VnExpress, Ngoisao.net, Bongdaplus, etc - Press: Heineken will choose to advertise products in newspapers with high distribution density and quite popular such as Youth, Youth, Family Marketing, Labor, Sports, Cultural Sports These are also the newspapers that men usually read In particular, Tuoi Tre and Youth newspapers have nationwide distribution, so consumers can quickly and easily know them -Public Relations: 19 | P a g e Sports: The company will continue to sponsor tournaments for Vietnam One of them is the Heineken Challenger tennis tournament, an annual tournament that helps Vietnam's top tennis players have the opportunity to compete with world names And It will allow Vietnamese fans to directly enjoy the top-notch ball between the world's tennis superstars and Vietnam + Music: The company will continue to sponsor competitions such as "talent of DJs" every year, creating opportunities for young people to freely compete in the modern music world and opening up opportunities for newcomers to join the competition—the most creative DJ talent in Vietnam Or you can sponsor contests that are resonating in Vietnam, such as Vietnamese Rap, Vietnamese Voice, In addition, to reach more diverse audiences or new products of the year, for example, Heineken 0.0: The company will sponsor music videos or MVs with specific themes such as Tet - The season that People buy much beer during the year for gifts, parties, etc 20 | P a g e And this is also a straightforward approach and easy to remember for viewers because the images, sounds, melodies, etc., are easy to create viral Then you can take advantage of social networks by viral dance videos and challenges on Tiktok, youtube short, + Welcoming New Year's Eve with Heineken: The company will still organize Heineken Countdown over the years, considered a feature of unique and desirable year-end programs in Vietnam Heineken Countdown 2022 will be held in Hanoi and Nha Trang on New Year's Eve this year; it promises to bring Vietnamese audiences eye-catching experiences, marking the moment to welcome the new year 2022 with unforgettable impressions - Promotions: Organizing promotions to launch Heineken 0.0 non-alcoholic beer, such as buying case of Heineken or Heineken Silver will give you four cans of Heineken 0.0 Organize a promotion program to buy one box of Heineken 0.0 and give away scratch cards with prizes such as phones, travel tickets, phone cards Organizing promotions on holidays: The company will coordinate the remarketing staff of stores, restaurants, supermarkets to schedule a lucky draw for customers when buying Heineken beer products - Direct marketing: To be able to control, solve customer problems, plan and forecast sales, collect market information and perform other marketing tasks such as: helping 21 | P a g e intermediaries to develop plans Marketing plan, implementation of marketing measures the company will send staff with professional qualifications, communication ability, comprehensive relationship as well as an understanding of the market situation, at the end of each month will go monitor, collect information as well as the appropriate promotional strategies or programs from distributors, agents, and customers Financial projection for implementing the marketing plan * Cost of input materials: The bottle supplier for Heineken is Heye Glas Nederland, which supplies a full range of green bottles for Heineken's worldwide distribution of beer Previously, Heineken only held a 33% stake in Glas Heye to ensure a low-cost supply of high-quality export bottles to meet demand, but since 2002 Heineken has kept 100% of the company's shares Beer is produced by water, wheat, hops, and yeast These ingredients are supplied mainly by farmers Therefore, the threat of supplier power is relatively high In addition, the competition of agricultural products from the biotech industry also affects their costs * Advertising and selling expenses: The company will spend about 20% of its revenue on marketing campaigns for the product This is also in line with Heineken's purpose of building a premium and quality beer brand 22 | P a g e ... products Income The average income in 20 20 will reach about 4 .23 million VND/person/month, down about 2% compared to 20 19 However, in the period 20 1 6 -2 020 , the average income per capita/month... channels from 20 0 8 -2 009, but only really flourished in 20 1 1 -2 0 12 with the "blooming" of Facebook There are 58 million Vietnamese users using social media on mobile platforms in 20 20 The most popular... countries in the world to a lower middle-income country within a short time From 20 02 to 20 20, GDP per capita increased by 2. 7 times, reaching nearly 2, 800 USD Also, during this period, the poverty