A REPORT INTO VIET DONG a TRAVEL SERVICE COMPANY LIMITED

A REPORT INTO VIET DONG A TRAVEL SERVICE COMPANY LIMITED’S MARKETING STRATEGY FOR INBOUND TOURS IN 2011 AND 2012: FACTS AND SOLUTIONS Chapter I: INTRODUCTION 1.1 Background of the company 1.2 Reasons for the study 1.3 Purpose of the study 1.4 Significance of the study 1.5 Methods of the study 1.6 Limitation 1.7 Organization Chapter II: LITERATURE VIEW 2.1 Marketing 2.1.1 Definition of Marketing 2.1.2 Marketing in Tourism 2.1.3 The Role of Marketing in Tourism 2.1.4 The Necessary of Marketing in Tourism 2.2 Marketing strategy 2.2.1 Definition of strategy and marketing strategy 2.2.2 The steps of marketing strategy 2.2.3 The role of marketing strategy Chapter III: DATA ANALYSIS AND DISCUSSION 3.1 Report from Interviews the Director 3.2 Report from Statistics Chapter IV: SOLUTIONS Chapter V: CONCLUSION Chapter I: INTRODUCTION 1.1 Background of the company Viet Dong A Travel Service Company Limited (Viet Dong A Company) was founded on August 14, 2010 Its office is located at 109/809C Nguyen Kiem Street, Go Vap District, Ho Chi Minh city Viet Dong A Company is a joint-stock company It was founded with the board of directors of people and the number of 10 permanent employees The company’s structure is divided into departments (as being seen in the organizational chart below) Even though Viet Dong A Company is a young and small tourist agency, its activities also include all the main typical functions of a big one as follow: - Providing inbound and outbound tours with different destinations - Air plane ticket Agency of Vietnam Airline - Providing services of booking rooms, restaurants, and other amusing activities Vietnam is open to overseas investment and tourist, which brings up potential traveling market; Viet Dong A Company was born to satisfy this huge demands After almost years of operation, this company has obtained certain improvement to complete itself gradually Organizational Chart Viet Dong A Company’s products focus on the Vietnamsese internal market including Ha Noi, Ha Long Bay, Da Nang, Hoi An – Quang Nam, Hue, Nha Trang, Phan Thiet, Phu Quoc island, Cuu Long River Delta - the company’s major destinations To the oversea market, the company provides the tours to some famous places like Laos, Campuchia, Thailand, Malaysia, Philippine, Singapore, China and Korea Viet Dong A Company has limited experiences about American and European market but it is trying to widen those markets and varying its products to these potential destinations 1.2 Reasons for the report How to face with rising difficulties and deal with certain obstacles is the most considerable thing which will keep the firm alive These issues just can be dealt successfully by an appropriate Marketing strategy which will help every single company approaches its target market easily Nevertheless, in travel, the marketing tasks have not been evaluated and applied appropriately in terms of finance and human resources The performance of the whole company will definitely be affected due to the lack of awareness towards marketing activities; they should be considered as the central of a business process 1.3 Purposes of the report In this report, the researchers have the task to identify the real situation of the company’s marketing strategy for inbound tours This company has strengths and weaknesses in the system of marketing Besides, they found that many factors that influence this company’s operation After understanding the problems, they will suggest some solutions to solve these problems at the end of this study Hopefully, the suggestions can help the company solve their problems and improve their company 1.4 Significance of the report Through the research, the researcher has observed and studied the marketing activities and strategies of Viet Dong A Company especially in 2012 The marketing strategy should be viewed as a package of offerings designed to attract and serve the customer or visitor For Viet Dong A company, marketing strategy helps approach its target market easily and increase its profits Therefore, the researcher hopes to contribute her findings of the report to the company to be aware of the facts and to improve the company’s marketing strategy For the researcher, she has the chances to apply her knowledge at university to the reality and accumulate her experiences in marketing strategy for her own which she can only learn during the research 1.5 Methods of the report In this report, the researcher uses some methods to collect information and data to serve the research’s purpose such as interview and statistics The researcher is provided with data from the company to statistics which will help reveal the effectiveness of the current marketing strategy at Viet Dong A Company Besides, the researcher can also interview the members of the company to collect information to support the report All the information and data collected during the research will be discussed and analyzed in Chapter III 1.6 Limitation The study is carried out during the internship from 12 March, 2013 to 12 May, 2013 and in Viet Dong A Company, 109/809C Nguyen Kiem street, Go Vap District, Hochiminh City Due to the lack of time, the study mostly focuses on the marketing strategy for inbound tours Hopefully, the findings of the study will reflect the status of the problem and help the company solve this problem to attract tourists 1.7 Organization The study is divided into five chapters as following: Chapter I is the introduction to the whole study, which covers the background of Viet Dong A Travel Service Company Limited, the reasons for study and the purpose of this study, the significance, the methods and the limitation of the study Chapter II reviews the literature, which concerned all the theories of marketing in tourism, marketing strategy in tourism, marketing roles and its necessity in tourism, marketing and tourism sustainability, marketing mix Chapter III is the discussion which focuses much on analyzing the information and data collected from Viet Dong A Company to help find out the marketing strategy for inbound tours of the company Chapter IV presents the findings which show the researcher’s contribution to Viet Dong A Company as well as his suggestions to help Viet Dong A Company improve the situation Chapter V is the final words to conclude the entire research Chapter II: LITERATURE VIEW 2.1 Marketing 2.1.1 The definition of Marketing Philip Kotler defines marketing as “satisfying needs and wants through an exchange process” Customers will only undertake the exchange, if they feel that their needs are being satisfied, clearly the transactional value cannot be more than the amount customers are prepared to pay to satisfy their need P.Tailor of www.learnmarketing.net suggests that “ Marketing is not about providing products or services it is essentially about providing changing benefits to the changing needs and demands of the customer” According to the American Marketing Association, marketing is the process of planning and executing the conception, pricing, promotion and distribution of ideas, goods and services to create exchanges that satisfy individual and organizational objectives This definition is long and complex because of the many different types of marketing activities and the variety of businesses and other organizations that use marketing A simpler definition of marketing describes its importance to businesses and consumers Marketing develops and maintains satisfying exchange relationships between businesses and consumers 2.1.2 Marketing in Tourism There are many definitions of marketing in tourism: “Tourism is defined as including any activity related to short-term temporary migration of people to destinations other than where they normally live and work, together with the activity during the period that they were there.” (The Tourism Society 1979) According to the book "Handbook marketing and promotion of sustainable tourism in Vietnam" organized by FUNDESO compiled and published: “The tourism marketing is defined as a process that directly enables businesses and travel agencies schedules determine existing customers and potential influence intentions and customer initiatives at the local, national regional and international businesses have the ability to design and create tourism products to enhance customer satisfaction and achieve its objectives.” “Tourism marketing is the process of "operating" allows businesses and tourism organizations identify current customers and your potential, contact them to find out the needs and impact estimates wants and their engines at the level of local, national and international to introduce and adjust products that satisfy the needs of tourists and expand the purpose of the organization” – (SF Witt, L Mountinho et al, Tourism Marketing and Management Handbook, London, Prentice Hall, 1989.) In short, the tourism marketing is the application of the principles and techniques of marketing to the general field of tourism The marketing is a natural complement to the marketing and tourism can be defined as a systematic strategy, built on the needs and expectations of the market To optimize the use by local authorities, the factors and elements that contribute to the enhancement of attractions and tourist services, or offered by a given territory 2.1.3 The Role of Marketing in Tourism The industry of tourism and hospitality is one of the most important of the world economy It is estimated that the tourism industry holds about 10% of workforce worldwide Travel services and tourism is a constantly growing sector, particularly in developing countries, contribute a significant portion of the economic growth of national income (GDP) Vietnam is a country with much scenic diversity across the country, and a great potential to be developed on the basis of ecological protection, the environment, and meet the expectations of tourists domestic and international Marketing is essential in developing products - services, particularly tourism marketing has its own characteristics should be considered in the planning process toward successful marketing Marketing plays an important role in management to achieve a balance between the economic value and environmental value, and benefits of the social responsibility of business, between quantity and quality, and competition between cooperation between batch and serviceoriented customer service, the balance between the role of big business (multinational companies) and small businesses Introduce the tourism products to travelers The key is to increase sales of tourism products 2.1.4 The Necessary of Marketing in Tourism Through research and analysis of the historical development of the economy Marketing and Marketing confirms first born is to ensure effective support for commercial activities, product consumption, solve problems risk risks that businesses face as well as identify business opportunities, thereby helping enterprises provide business solutions are most effective Marketing is also very important function which is the function of all activities connected with the market now Tourism Marketing today has become a combination of advertising methods as a complete tour dates for use in investing and improving the tourism market, especially the market potential and development effort as Vietnam Marketing has really become more necessary than ever to meet the needs of people traveling So far there is no complete definition covers the whole meaning and content of tourism marketing Depending on the region, each sector, each one stated that the purpose of the definition of various tourism marketing But surely, despite how well different, and the core principles of marketing and tourism are based on the core principles of marketing and general: “Trade Marketing goal ultimately is to ensure the profitability of the enterprise may be involved in the business process on the market But direct target of Trade Marketing can be defined as creating the greatest opportunity for sales of products through which businesses can reach profit targets Marketing research and commercial development is to minimize risks in commercial activities The essence of marketing is to redefine commerce in accordance with the conditions of modern economic position of the business and customers in economic activity Since it uses an asynchronous manner and science of modern theoretical perspectives on the organization and management of business processes and conquer approach to customer consumption.” 2.2 Marketing Strategy 2.2.1 Definition of strategy and marketing strategy Johnson and Scholes (Exploring Corporate Strategy) define strategy as follows: "Strategy is the direction and scope of an organisation over the long-term: which achieves advantage for the organisation through its configuration of resources within a challenging environment, to meet the needs of markets and to fulfil stakeholder expectations" Marketing strategy is defined by Prophet's David Aaker as a process that can allow an organization to concentrate its resources on the optimal opportunities with the goals of increasing sales and achieving a sustainable competitive advantage Marketing strategy includes all basic and long-term activities in the field of marketing that deal with the analysis of the strategic initial situation of a company and the formulation, evaluation and selection of market-oriented strategies and therefore contribute to the goals of the company and its marketing objectives 2.2.2 The steps of marketing strategy Developing a strategic marketing plan is important to the success of business but it takes time and resources Marketing strategy is a written business plan that identifies the marketing goals of company, and explains how they will achieve those goals within a given time period Their marketing strategy will help them identify and communicate their target market segment; position their product or service in the marketplace; determine their marketing mix; and outline how they will allocate their resources The first step in developing a marketing strategy is to identify target market the need Their marketing strategy involves narrowing their marketing focus and choosing a group or several groups of people they will promote your product or service to If a need has been defined by other purveyors, their task is to develop a strategy to convince the client that their product is better than other competitor's The second step is writing down their key differentiators Once they know who their target customer is, the next stage is to determine how their product or service is better than other competitors Use the information from their target customer profile to describe how their services will solve the problems of these key customers Write down a list of product features and benefits that differentiate your business A feature is what their product does, while a benefit is what their products for the end user The third step is determining their marketing mix The "marketing mix" is a term used to describe the resources and tactics they will use to market their products and services The marketing mix includes the "four P's," which are price, product, place and promotion For this stage, identify how they will price the products; communicate the product life cycle; choose the channels in which they will distribute their product or service; and identify the ways they will promote your product Outline how they will allocate each of these resources The final stage of the marketing strategy is the implementation plan, in which they outline a plan for how they will allocate their resources With their target customer and marketing mix in mind, develop a chart or timeline that shows which marketing tactics they will use and when they will use them State how they will measure and test the effectiveness of their marketing strategies Finally, start building their marketing materials, after that take their strategy to market 2.2.3 The role of marketing strategy The Marketing strategy identifies the strengths of the product (Anderson, Role of Marketing Strategy) Part of the Marketing plan's purpose is to explain, in detail, the many benefits of the product and how customers can realize some sort of return by using product For the customer, that return could be in the form of saving money, or it could be a competitive advantage that grabs more market share The marketing strategy also identifies the ways in which product is superior to the competition, and the reasons why customers should consider product over the competition One important role of a comprehensive marketing strategy is a detailed description of the target customers In order to create effective marketing campaigns, your strategy needs to identify important details about the customer demographic have determined to be the best fit for the campaign Some of those details include age group, median income, geographic location and the advertising medium that would best be used to reach that target buying group In order to develop an effective marketing campaign, the marketing strategy needs to offer a detailed description of the competition The role of the marketing strategy is to give historical information on how the competition has advertised products in the past, the target market the competition goes after and the product features that the competition offers Other factors such as competition pricing, the competition's distribution network and the sales methods of the competition are also part of a comprehensive marketing strategy A marketing strategy is used to determine the revenue that the campaign will deliver All of the parts that go into determining revenue, including the budget allotted to the campaign, product cost, selling price and the life span of the product, should all be part of the marketing strategy The revenue goal can be measured against the actual revenue, and that information can be used to create future marketing strategies that are more successful Chapter III: DATA ANALYSIS AND DISCUSSION 3.1 Report from Interviews the Director Viet Dong A company is a regular and dynamic member in taking part in every activity related to Marketing, Promotion and Branding like: Tourism fairs, Traveling festival, Vietnamese Food Weeks, International or domestic events about tourism and so on According to the Director of Viet Dong A, participating in these activities is a best way to popularize his company’s image and its comparative products Marketing activities of Viet Dong A lately has only focused on the traditional markets and domestic markets To Viet Dong A, its advertising tasks are not very strong There have been many positive changes in the way the company make its brand and products advertised since 2011 It is still using the traditional advertising methods which use newspaper, magazine, and website as the main means to inform it However, these methods are not strong to draw people’s attention to the name Viet Dong A Comparing with the giant competitors, Saigon tourist, it is obvious for their to say, Viet Dong A needs to spend more on its Advertising as well as Marketing tasks if it wants to be continued into the race Saigon tourist is one of the most popular names Vietnamese Tourism Industry They can easily see its information and pictures in every “hot pot” of traveling like a Gas Stations, Air Ports, and Bus Stops and so on Into the internal field, Saigon Tourist is the leader in this “non-smoking” industry about advertising and marketing, they even spent a large number of money inviting the filmmakers, journalists, televisions from Japan and Korea to make interesting films to introduce Vietnam’s tourism Viet Dong A has had some achievements in the sales promotion tasks as taking part in many seminars, fairs to present the name of Viet Dong A and its products to the domestic as well as international market Through these activities, the company had won a number of contracts and attracted many tourists to Vietnam The company researches and expends its markets share via Internet, newspaper, recommendations of the loyal customers and of the other business relationships differing in industries It also maintains and establishes the good relationships with some internal communicating organizations like: HTV, VTV, Binh Duong, etc and intensifies in establishing new international relationships Viet Dong A uses sales promotion tools as: price packs offer consumers saving off the regular price of a product; premiums are goods offer either free or at low cost to buy a product; advertising specialties are useful articles imprinted with the advertiser’s name, logo or message 10 that are given as gifts to consumers; samples offer a trial amount of a product; coupons are certificates that give buyers a saving when they purchase specified products; cash refunds are similar to coupons except that the price reduction occurs after the purchase and contests, sweepstakes, games give consumers the chance to win something, such as cash, trips, or goods, by luck or through extra efforts To be more specific, in the domestic field, the lesson about branding and branding strategies named Viet Travel is the most considerable one for Viet Dong A to learn At the starting point, Viet Travel was a small tourism company in Ho Chi Minh City and its performing functions was only in small scale However, with the logical and special branding programs, Viet Travel became one of the most popular names in Vietnamese tourism industry To sum up, advertising, promoting and branding strategies are aimed at one common purpose, attracting more customers and win more market shares They are considered as an original feature and special strategy of every single enterprise The more single company performs well, attractively, comparatively and variously in its marketing strategies the more it is successful in making its business profitable The limitation of Viet Dong A and almost the rest of tourism agencies are not aware enough of the importance of the advertising tasks There probably have no firms to have its brand advertised on several famous channel likes Traveling, BBC news and Discovery Viet Dong A should dig deeper into this matter if it wants to be more competitive Viet Dong A has to face with the aggressive competition posed by the national rivals Thus, it needs to be different and comparative with many kinds of traveling products and has to have appropriate marketing programs to keep pace with its major competitors consisting of Viet travel or Saigon Tourist To domestic sorts of customers, Viet Dong A in specific needs to show what and how it can satisfy services are, the larger number of tourist we get, especially those who come from oversea We need to find out how to make their visits last longer and make they spend their money as much as possible 11 3.2 Report from Statistics Performances In The Last two years OBJECTIVE UNIT I Customers in total PERSON Performing figures in the last two years 2011 2012 Target 2013 1.External Customers PERSON 2484 3492 5426 -Asian Destinations -Other destinations PERSON PERSON 2053 431 2397 1095 3950 1524 2.Vietnamese customers go aboard 3.Internal Customers II.Gross Turnover PERSON PERSON Million VND 561 389 740 708 575 945 1200 1150 1500 II.Gross Profit Million VND 240 345 500 1.Working staff PERSON 10 10 20 2.Salary budgets Million VND 4.1 5.0 7.0 IV.Staff Because of the establishments, in 2011, the number of tourists is not much They only have 2484 people and the gross profit is only 240 milliion VND Although the Customers increase from 2484 people to 3492people in the next year and the gross profits is 345 million VND, but the numbers did not increase significantly The main reason is due to the crisis of the global economic affecting the “non-smoking” industry In addition to Viet Dong A Travel Limited Service Company, because of being young and limited in financial capacity, it has only one head office located in Go Vap district For this reason, the distributing network of the company is not very wide, so that in the near future, they need to open some more branches in Southern areas such as Binh Duong, Can Tho, Dong Nai, etc where have big potential consumers This will generate huge avenues and create long term profitable businesses if they win to serve these areas with the right marketing plan and the wise distributing network In addition, marketing activities of Viet Dong A Travel Limited Service Company has only focus on the traditional markets and domestic markets 12 Firstly, the advantage is having some achievements in the sales promotion tasks such as taking part in many seminars, fairs to present their name and its products to the domestic as well as international market, intensify establishing new international relationships, etc Secondly, at the starting point, Viet Dong A Travel Limited Service Company was a small tourism company in Ho Chi Minh City and theirs performing functions was only in small scale However, with the logical and special branding programs, they became one of the most popular names in Vietnamese tourism industry However, besides that the company still has the disadvantage The first disadvantage of the company is the traveling tour packages of Dong A Travel Limited Service Company have not featured differently from the others’ products Their products focus on the Vietnamese internal market including Hue, Nha Trang Vinpearl Land, Phu Quoc island, Ha Long Bay, Hoi An - the major of the company destinations They not have the original and striking factors in their products that are the reasons which prevent them from being strong comparative The second is its advertising tasks are not very strong It is still using the traditional advertising methods which use newspaper, magazine, and website as the main means to inform it 13 ... tours to some famous places like Laos, Campuchia, Thailand, Malaysia, Philippine, Singapore, China and Korea Viet Dong A Company has limited experiences about American and European market but it... operation, this company has obtained certain improvement to complete itself gradually Organizational Chart Viet Dong A Company? ??s products focus on the Vietnamsese internal market including Ha Noi,...Chapter I: INTRODUCTION 1.1 Background of the company Viet Dong A Travel Service Company Limited (Viet Dong A Company) was founded on August 14, 2010 Its office is located at 109/809C