The necessity of marketing in business operation in general and foodstuffs in particular
1.1.1 Some basic concepts of marketing:
Many individuals confuse marketing with mere selling and consumption activities, leading them to believe that marketing is simply a set of tactics employed by sellers to increase sales and maximize profits.
However, modern marketing is defined as follows:
Marketing is the process of promoting products or services to align with consumer demand and expectations It involves various human activities aimed at facilitating exchanges that satisfy these needs.
Marketing is a crucial function within an enterprise that facilitates the achievement of business goals by promoting the exchange of goods in the market It focuses on fulfilling the needs and expectations of target customers, ensuring that the enterprise effectively reaches its intended audience.
Demand refers to the human need for a product, encompassing a broader concept that requires business owners to enhance their knowledge to boost product consumption capacity It consists of three levels: natural demand, expectation, and payable demand.
Natural demand represents the intrinsic human need for specific products, driven by a sense of lack and serving as the foundation for expectations and motivations When faced with natural demand, individuals typically respond in one of two ways: they either impose constraints on their desires or actively seek ways to fulfill their needs Most often, people opt for the latter, reflecting the survival instinct inherent in human nature.
Marketing cannot generate natural demand on its own but can identify it If marketing professionals merely discover existing human needs and produce corresponding products, they may not invest significant time in strategy, potentially leading to diminished profits unless the product holds a monopoly position in the market.
Marketers cannot rely solely on natural demand; to develop products that align with market needs and enhance competitiveness, it is essential for administrators to understand the expectations of the market.
Expectation represents a natural demand influenced by individual conditions and characteristics, such as learning capacity and personal preferences For instance, hunger signifies a need for food, which is a universal human demand However, personal tastes vary—some may prefer bread while others favor rice—highlighting how different expectations arise from the same basic need for nourishment These variations in preference illustrate the importance of understanding and catering to diverse human expectations.
Expectation plays a crucial role in meeting natural demand, as it serves as the foundation for understanding consumer preferences It encompasses specific characteristics that can vary widely, influenced by cultural factors and individual traits As expectations evolve, they impact the demand for different types of goods To effectively cater to the market, businesses must identify and analyze consumer expectations, allowing them to design products that align with these preferences.
Human desires and expectations are infinite, prompting businesses to not only identify and create products that align with these needs but also to engage in exchanges that benefit both consumers and their own objectives Consequently, in addressing natural demands and expectations, businesses must also consider other aspects of market demand, particularly the concept of effective demand.
Payable demand is a crucial focus for marketing, as it represents actual consumer interest that can generate revenue and profits for a business This demand relies on consumers' purchasing power and their ability to pay, indicating that customers must not only have a desire for the product but also the financial means and willingness to make a purchase.
To succeed in a competitive market, marketing administrators must actively research consumer demand and market trends This proactive approach enables enterprises to effectively meet and exploit market needs, ensuring they remain leaders rather than passive participants in their industry Regular and thorough market research is essential for professional departments to identify opportunities and drive success.
In business, accurately measuring the supply and demand of commodities is essential for success To better understand market demand, companies must focus on product design, which encompasses all goods and services offered for sale that meet consumer expectations The true value of a product lies not in ownership but in its ability to satisfy consumer needs and desires Consequently, it is crucial for entrepreneurs to identify the specific demands and expectations of consumers, enabling them to produce and supply the most effective goods and services that fulfill these needs.
Many business leaders often make the mistake of focusing solely on their products without considering the benefits they provide to consumers In contrast, successful enterprises in marketing adopt a philosophy that prioritizes customer needs over the product itself, emphasizing the importance of delivering value and benefits to the customer.
When customers choose to purchase a product, they anticipate the benefits it will provide With diverse options available, various brands cater to different consumer preferences, as the benefits of goods can vary significantly While one product may excel in delivering a particular advantage, it might lack in another area Therefore, when making a buying decision, consumers must evaluate the ability of each product to meet their specific needs and expectations.
General concepts, matters and contents related to marketing strategy in the food sector
1.2.1 General concepts, matters and contents related to marketing strategy in the food sector:
According to the American Marketing Association (AMA), marketing is an organizational function that involves creating, communicating, and delivering value to customers while managing relationships through various strategies to benefit both the organization and its stakeholders.
Marketing plays a crucial role in society by facilitating the process through which individuals and communities fulfill their needs and desires According to Kotler, it is a socialized process that involves the creation, contribution, and exchange of valuable products and services, enabling freedom of choice and enhancing overall well-being.
Defining according to management way, marketing is often compared as
While many associate "sales" with marketing, the reality is that effective marketing goes beyond mere transactions Peter Drucker, a prominent management theorist, emphasizes that the ultimate goal of marketing is to make sales unnecessary by deeply understanding customer needs and delivering products that resonate with them Successful marketing should foster a natural readiness to purchase, leading to the creation of innovative products or services Notable examples include Sony's PlayStation, Gillette's Mach III razor, and Toyota's Lexus line, all of which demonstrate how strategic marketing can result in high demand and substantial orders by aligning product design with customer insights.
In the food industry, effective marketing is essential for product recognition and consumer acceptance, particularly regarding product quality and demand For instance, Vietfoods' gracilaria jelly must be strategically marketed to gain visibility among consumers and to be embraced as an alternative to traditional confectionery products Companies must develop tailored marketing strategies to ensure their products are well-positioned in the competitive market.
There are four primary ways individuals can acquire products or services: first, by creating them independently through activities like hunting, fishing, or foraging; second, by using force, which includes theft or robbery; third, by soliciting assistance, similar to how homeless individuals may ask for money or food; and finally, by engaging in trade, where they offer goods, services, or money in exchange for what they desire.
Exchange is a fundamental concept in marketing, defined as the process of obtaining a product by offering something in return For an exchange to take place, five essential conditions must be met.
- There is participation of at least 2 parties
- Each party must have anything valuable to the other
- Each party has capacity to exchange and deliver
- Each party is free in accepting or refusing exchange
- Each party believes that there is suitability and expectation when negotiating to the other.
When both parties reach a mutual agreement and negotiate favorable conditions that satisfy each side, they can proceed to implement the transaction.
Every transaction involves key elements, including two valuable considerations, mutual agreement on terms, and specific details regarding the signing time and location A robust legal framework underpins and reinforces the agreement between the parties involved.
Marketers make concept of marketing to learn about transfer conduct as well as transaction one wider.
To make transfer successful completely, marketers carry out investigating expectation of transaction object.
* What are introduced to the market?
Goods – Service – Event – Experience – Human – Place – Property – Organization – Information - Idea
Experience: A company can establish and make market their experiences.
Walt Disney's enchanting realm offers immersive marketing experiences, allowing guests to explore an Immortal Kingdom, embark on a pirate ship adventure, or venture into a ghost house Similarly, Hard Rock Café provides a vibrant atmosphere where patrons can savor delicious meals while enjoying live music performances.
Human: Human advertising technology is a main business profession At present, each big film company has an agent, an individual manager, and binds a PR person.
Place: City, subcommittee, region, or a nation competes actively to attract tourists, investment, main factory, and new residents.
Organizations engage in strategic consolidation to create a strong and unique brand image, often investing in advertising to enhance their visibility For instance, the German electronics company Philips promotes its message, "Let's make things better," while Tesco's "Every little bit helps" campaign has positioned it as a leader in the UK supermarket sector Additionally, universities, museums, art exhibitions, and non-profit organizations utilize marketing strategies to elevate their profiles and attract audiences and funding.
Information serves as a valuable commodity in various forms, such as dictionaries and newspapers The more comprehensive and widely disseminated the information about a product, the quicker it gains recognition and acceptance among consumers in the food industry This rapid dissemination allows customers to verify the details they care about, ultimately influencing their purchasing decisions.
Every market is driven by ideas, as highlighted by Charles Revson of Revlon, who stated, “In the factory, we make cosmetics; in the shop, we sell hope.” Products and services serve as essential vehicles for conveying these ideas and rights Social marketers actively promote impactful messages like “Friends don't let friends drive drunk” and “A brain is a terrible thing to waste,” emphasizing the importance of awareness and responsibility in society.
In the competitive food industry, it's crucial to focus on the idea stage of marketing With numerous similar products in the market, enhancing a product's appearance is essential, alongside ensuring its quality Implementing innovative and unique ideas can significantly boost a product's visibility and attractiveness, allowing it to stand out from conventional offerings.
Modern marketing theory emphasizes the importance of understanding and satisfying customer demand by analyzing market concentration and consumer behavior Companies should prioritize identifying the needs of potential customers before developing products or services The foundation of marketing theory and practice rests on the principle that customers will only engage with a product or service when they perceive a genuine demand or practical benefit from it.
Two main sides of marketing are seeking new customers, keeping close contact to existing customers.
Marketing methods are influenced by various socio-scientific fields, particularly psychology, social studies, and economics The evolving nature of human behavior plays a crucial role in shaping marketing strategies Effective market research lays the groundwork for these initiatives, while the advertising industry, as a key segment of marketing, emphasizes the importance of high-quality artistic creation.
Theoretical models and strategies of marketing management in foodstuff industry
The global food market, particularly in Vietnam, is thriving, with companies of all sizes focusing on developing effective business strategies A key area of emphasis is marketing administration, highlighted by the competitive advertising battles among major brands like Coca-Cola, Pepsi, and Red Bull In the local market, businesses are increasingly prioritizing the establishment of robust marketing strategies to enhance the visibility and appeal of their products.
The foodstuff industry in Vietnam is fundamentally rooted in the agriculture, forestry, and fishery sectors, which are vital to the Vietnamese economy This sector contributes 25% to the country's GDP, accounts for 30% of total export turnover, and employs 73% of the rural population in agricultural production and related activities.
The agricultural sector, particularly agricultural product processing and related industrial services, is crucial for boosting the value of agricultural output and diversifying demand This dynamic sector significantly contributes to industrial development and export growth, with processed rice, coffee, fruits, and vegetables representing a substantial share of agricultural exports Recognizing its importance, the Vietnamese Government has increasingly focused on enhancing the processing industry in recent years.
Foodstuff processing factories need to reinforce investment scale, expected investment demand for foodstuff industry of Vietnam in 2001-2020 periods as follows:
Vietnam's foodstuff industry is increasingly focusing on significant investments in advanced machinery, aiming to replace outdated equipment as part of its industrialization and modernization efforts This trend emphasizes the importation of modern processing technologies and the establishment of large- and medium-capacity processing lines to enhance efficiency and productivity.
In recent years, the Vietnamese government has established an ambitious goal to significantly increase the export value of foodstuffs annually To achieve this target, the foodstuff industry must focus on investing in advanced processing technologies, modern machinery, effective preservation and transportation methods, and comprehensive training programs in quality management and food safety.
The Vietnamese government is actively implementing investment policies in the foodstuff industry to enhance its competitive edge in exports, leading to a rising demand for advanced production, processing technologies, and preservation methods Currently, major exporting nations like China, Japan, Taiwan, Germany, France, and the United Kingdom have established a strong presence in the market However, the existing supply of technologies and processing facilities in Vietnam remains significantly below the anticipated future demand.
The recent developments present significant opportunities for foreign companies to supply food processing equipment and technologies to Vietnamese enterprises Additionally, this situation allows Vietnamese food production and trading companies to gain a competitive edge over their domestic rivals.
Food safety and hygiene pose significant challenges for food products in Vietnam Weaknesses in quality management and inadequate processing equipment severely impact product quality and safety Additionally, the scarcity of preservation facilities greatly affects the food processing industry.
There are few foodstuff processing factories in Vietnam have infrastructure in production, preservation and transportation meeting strict standards of the world.
In addition to the traditional 4P model used for analyzing business strategies and establishing marketing administration systems, there are various other theoretical frameworks derived from the 4P theory These models are designed to create marketing strategies tailored to specific business professions and adapt to market developments.
The mixed marketing model, commonly referred to as the 4P model, serves as a strategic tool for marketers to effectively implement their marketing strategies Marketing division heads utilize this approach to elicit optimal market responses by strategically combining four, five, or even up to seven key factors, ensuring maximum benefits for the company.
Understanding the principles of mixed marketing is crucial, as they represent variables that are often beyond our control The mixed marketing model should be periodically adjusted to align with the evolving demands of target customers and the dynamic nature of the market.
In today's competitive market, the belief that a good product will sell itself is outdated, as most products meet basic quality standards Customers now have the option to return items that do not meet their expectations, prompting businesses to focus on aligning their products with customer demands Therefore, it is essential for enterprises to identify and incorporate features that satisfy the needs and preferences of their target audience.
Function, quality, appearance, package, brand name, support and maintenance.
Determining the price that target customers are willing to pay is a critical aspect of an enterprise's evaluation strategy This decision should not be made impulsively, even if the company considers discounting its products Price competition, while a traditional tactic, still resonates with customers who are sensitive to sales and promotions However, the perception that higher prices equate to better quality can create challenges, suggesting that relying solely on price competition may not be a sustainable strategy for many businesses in the long run.
Market availability encompasses the right place, right time, and right quantity Technological revolutions, particularly the rise of the internet and mobile phones, have significantly transformed market dynamics.
Place, logistic, distribution channel, market share, customer service degree, Internet.
Marketing serves as a crucial tool for businesses to communicate with their target customers about their products and services It encompasses various strategies and tactics, including advertising, sales promotions, and customer relations Among the essential elements of the marketing mix, marketing stands out as the most significant, requiring focused attention for effective business growth.
Advertising, public relation, communication, direct sale, budget.
Function of mixed marketing is to develop some package combinations, not only meet demand of the target customer group but also enhance business efficiency of the enterprise.
Research methodology
Marketing professionals frequently encounter challenges when essential information cannot be obtained through secondary research or existing market data In such cases, companies must undertake primary data collection independently Whether the goal is to explore new insights or conduct experiments, the decision to pursue secondary research requires careful consideration due to the potential time and cost implications involved.
Furthermore, if information collection is not implemented correctly, the gained result may not bring necessary information as expected, or is more costly than its real value.
When conducting secondary research, the lack of information alone is not a valid reason to pursue it; instead, the focus should be on the practicality and value of the information relative to its cost Leaders are influenced by the practical outcomes of the data collected, prompting essential questions such as: "Why is this information important?" and "How will our decisions change based on the results?" Even if the information appears highly practical, it does not guarantee the need for primary research unless the value of the information outweighs the costs of its collection.
Basically, there are two methods of information collection: observing or investigating directly Direct investigation is used more often, however, in some cases, observation method is also applied.
This includes the note taking of information, not depending on the answer or memory of the research object For example, fixing calculation equipment into the
Television ratings are often estimated by observing viewer behavior, sometimes employing actors to simulate customer interactions and gauge seller responses This approach is particularly useful when participants are reluctant to answer personal questions, allowing researchers to gather insights indirectly.
Observation is particularly effective when research subjects may not provide truthful answers to direct questions For instance, individuals often overestimate their charitable contributions when asked Additionally, when inquiring about trivial matters, respondents may give inaccurate answers not out of intent to deceive, but simply because they lack precise recollection A common example is people's difficulty in recalling the exact amount spent on their most recent fuel purchase or the quantity of fuel bought In such cases, the observation method yields more reliable data This technique is also beneficial when working with groups like children, as it relies on direct observation to gather information.
Consumer behavior factors like attitude and reasoning cannot be recorded To enhance practicality and minimize costs, observations should adhere to two key criteria: the behavior must occur regularly within a predictable timeframe, and the observation period should be brief.
Observation can be conducted through various methods, including human or machine observation It can involve behaviors that occur naturally or are mandated, and it may be known or unknown to the subjects being observed Additionally, observation can take place through direct monitoring of behavior or by analyzing documented records of that behavior.
The direct information collection method involves obtaining data by directly asking research subjects, utilizing three primary formats: in-person interviews, telephone interviews, or research questionnaires The choice of method is influenced by the research objectives, the nature of the questions, and considerations such as time, cost, and available personnel.
Enterprises are continually seeking effective methods to collect information while minimizing costs and non-responses A mixed-method approach, which combines various direct investigation techniques within the same research, has proven to be beneficial Common combinations include telephone surveys paired with mail, as well as telephone and fax inquiries Participants often prefer telephone interviews due to their higher response rates, while questionnaires are typically dispatched via letter or fax to keep costs low.
The use of mixed method will develop in the future.
1.4.5 Applying the data method of the student group:
The selected research theme by our student group focuses on the area of Group 17 – Sai Dong – Long Bien – Hanoi, where Vietfoods products are prominently displayed in numerous supermarkets across Hanoi To gather data, our group opted for an experimental data collection method, following a structured implementation process.
Step 1: Meeting, interviewing and taking notes: Our student group registered and was received by Director of Vietfoods at the production place of the Company In the process of working, student group did introduce graduate theme, work draft to Vietfoods Company’s Director.
During our work, the Company Director presented us with a comprehensive overview of the business production model, organizational structure, financial capabilities, sales distribution channels, product market share, and competitive landscape.
In the process of working, our groups were taken by Company’s representative to see production chains and treatment technology of the Company; studied production operation processes of the factory.
Step 2: Ending the working day, with the enthusiastic support of the Company’s leader, two sides agreed to exchange continuing data through electronic channels, email with following details:
Company’s address: Group 17 Sai Dong street – Long Bien district – Hanoi city Tel: 84.4.38755738/38757444/38757446
Email : info@vietfoods.com.vn
Company’s Director: Mr Ha Ngoc Son
Branch in Ho Chi Minh City:
Address: No 761/1 Le Trong Tan, Binh Hung Hoa Precinct, Binh Tan district, Ho Chi Minh city
No Full name Title in the group Tel Email
1 Nguyen Duc Duong Group leader 0963919999 duongnd@evn.com.vn
2 Chu Van Tien Member 0985695816 i619@viettel.vn
3 Tran Van Thuong Member 0963687568 thuonghnpc@yahoo.com
4 Luong Quang Tuan Member 0963204778 tuanluongquang@gmail.com
1.4.6 Reason for choosing the research method:
Collecting and researching materials is essential for any scientific inquiry, as it provides the foundational knowledge necessary for effective research Scientific researchers rely on a wealth of accumulated knowledge, gathered over time, to inform their work Therefore, the primary objective of material collection and research is to enhance the quality and depth of scientific investigation.
- Help researcher hold method of researches which were implemented previously.
- Make the research theme clearer
- Help researcher have closer methodology or arguments
- Have wide, deep knowledge of the researched field.
- Avoid coinciding with previous research; thus, take less time, effort and finance.
- Help researcher build arguments (evidence) to prove scientific research assumption.
Classifying research materials is essential for researchers to effectively select, evaluate, and utilize resources relevant to their professional field or specific research focus These materials can be categorized into two main types: primary materials, which are original sources, and secondary materials, which analyze or interpret primary sources.
Primary materials are original resources gathered directly by researchers, often with minimal or no annotations In cases where research topics lack sufficient materials, it becomes essential to explore and uncover previously unknown sources To effectively manage this process, researchers must implement organized methods for note-taking and material collection.
Secondary materials are derived from primary sources that have been analyzed and interpreted These include syllabi, press articles, specialized journals, conference minutes, scientific reports, online information, reference books, dissertations, theses, statistics, as well as various forms of media such as pictures, videos, cassette tapes, and written documents like papers and manuscripts.
Collected materials to make research are found in following materials sources:
- Scientific arguments, theorem, rules, law, concept, etc can be collected from syllabus, specialist materials, references, etc
- Revealed data, materials are consulted from articles in scientific magazines, journal, report of scientific special subject, etc.
- Statistics are collected from statistical annual publication: Statistics Branch, Head Department of Statistics, etc.
- Restored materials, documents, profiles, documents on Law, policy, etc which are collected from State management agencies, politic-social organizations.
- Information on Television, radio, press, etc with mass nature are collected and treated to be scientific arguments to prove for the matter researched by the group.
- Directly interviewing Director of Vietfoods Company, observing some production lines of the Company; observing and buying products at 03 big supermarkets in Hanoi namely: Big C, Metro, Unimark, Finimark.
To this topic, researching group used studying methods, namely directly interviewing Director of Vietfoods Company, observing at points of sales of Vietfoods along with observing customers’ tastes.
General about Vietnam Foodstuff JSC
2.1.1 Process of formation and development:
Company’s name : Vietnam Foods Corporation
English name : Vietnam Foods Corporation
Registered headquarters: Room 30, Building B1 Giang Vo Collective zone,
Tran Huy Lieu, Giang Vo precinct, Ba Dinh, Hanoi.
Transaction address: Team 17, Sai Dong Street, Long Bien, Hanoi Branch: 761/1 Le Trong Tan, Binh Hung Hoa precinct,
Tan Binh district, Ho Chi Minh City
Website: http://vietfoods.com.vn
2.1.1.2 Process of formation and development:
The Vietnam Food Corporation traces its origins to the Vietnam Limited Company (VTC), which was founded on March 23, 1996, under business registration No 0472/UBKH in Hanoi City VTC primarily engaged in the production of handicrafts and fine arts, as well as the trading of consumer goods and acting as agents for goods consignment At its inception, Viet Thanh Limited Company had a charter capital of VND 400 million.
From its inception between 1996 and 2003, the company focused on distributing products for foreign businesses, primarily in Hanoi and Hai Phong This period allowed the company to gain valuable market insights and understand the distribution challenges faced by Vietnamese enterprises Additionally, it enabled the development of a skilled workforce, positioning the company for future growth and innovation.
In late 2003, the company ventured into the food production sector by establishing a factory for gracilaria jelly in Long Bien, Hanoi During its production journey, the company also explored the development of additional products, including chocolate marking biscuits and dissolved tea Currently, it is finalizing research on an egg cake product, aiming for production by 2010.
From 2000 to 2006, the company registered to change business professions for 6 times, its charter capital also increased accordingly.
In late 2006, to align with the market economy's operational mechanisms, the company initiated its equitization process Subsequently, on January 10, 2007, Viet Thanh Limited Company transitioned to Vietnam Food Corporation, adopting the structure of a Joint Stock Company.
2.1.1.3 Business profession and main products:
Business production professions of the company according to business registration certificate:
- Producing handicrafts and fine arts;
- Being agent of purchasing and buying, goods consignment;
- Having service of market research and survey;
- Having scientific – technological service in the area of economic management;
- Having service of eating and drinking;
- Processing food products, foodstuff with food technology;
- Importing and exporting goods commodities produced and dealt by the company.
The company specializes in a variety of products, including Gracilaria jelly and coconut jelly marketed under the brands Poke, Joy, and Hugo Additionally, they offer cream marking cake under the Romrop brand, yoghurt jelly under the ABC brand, and green tea products under the KANTA trademark.
The development objective of enterprises in the food sector, particularly Vietfoods, involves leveraging available resources—such as human capital and finances—to achieve specific goals These objectives typically manifest as profit levels, which are crucial for satisfying shareholders and investors, serving as a key criterion for evaluating resource efficiency The strategies employed by the company to reach these objectives include increasing market share, enhancing brand image, and achieving targeted revenue growth In practice, businesses often operate through functional divisions, making company-level strategies translate into objectives within those divisions.
The marketing objective defines specific details about the products offered by the enterprise and identifies the target market based on sales data The Ansoff Matrix serves as a valuable tool for establishing marketing objectives and is widely utilized in the context of Vietfoods.
Ansoff matrix model: Ansoff determines 4 possibilities that the enterprise can consider to determine market objective:
- Selling existing products into the market, that is penetrating wider into effective market, for example, opening more goods selling points.
- Expanding existing products to new market, that is exploiting more new markets but only with existing products.
- Developing new products in the existing market, which means increasing the number of products to existing number to serve the existing market.
Developing new products to enter untapped markets is a strategy that diversifies business operations and fosters growth opportunities However, this approach also carries inherent risks as companies venture into unfamiliar territories.
Market objectives involve specific commitments related to quantity, serving as benchmarks for assessing mission completion within designated timeframes These standards are typically expressed in terms of sales figures, such as the number of units sold or other profit metrics Additionally, completion criteria often include percentage targets and other obligations, such as the proportion of total shops within the distribution network.
Concept, importance of the determination of marketing objective “Smart” are analyzed as follow:
In marketing, establishing a clear objective is essential for developing an effective strategy to achieve that goal This specific objective not only allows marketers to assess the effectiveness of their strategies but also demonstrates their competence and commitment to the task at hand.
To effectively increase market share, it is essential to establish a specific objective, such as targeting a percentage increase in market share or a precise revenue boost in USD or Dongs Additionally, a clear timeline should be defined, detailing the number of days, months, or years required for completion It is also important to outline the strategies to be employed and identify the sources of capital and human resources necessary for achieving these goals.
Objectives should include specific units of measurement, such as percentages, currency (USD/Dong), timeframes (hours, days, months), weight (kg, ton), or customer counts This clarity allows for immediate assessment of whether the goals have been achieved at the end of the year, program, or plan.
Setting objectives should strike a balance between ambition and practicality; they must be high enough to leverage the full market potential and capabilities of the enterprise while remaining achievable If goals are perceived as unattainable, motivation diminishes, leading to a lack of effort among team members.
Setting realistic and achievable objectives requires a thorough understanding of the market and available resources It's essential to ensure that your goals align with your competencies while being grounded in practicality By evaluating your resources and market knowledge, you can define objectives that are not only attainable but also strategically sound.
How much time do you need to achieve the given objective, which date, month and year?
With over 12 years of experience in the food sector, particularly in gracilaria jelly processing, Vietfoods aims to be Vietnam's leading food supplier The company is committed to continuously improving product quality and enhancing the service standards of its sales and distribution teams, ensuring consumers receive the best products in terms of quality, price, and health safety.
Analyzing the situation and business production operation results of Vietfoods in 03
2.2.1 The business production operation situation
Vietnam Food Corporation, originally established as Viet Thanh Limited Company, underwent equitization in late 2006 and transitioned to a joint stock company model on January 1, 2007.
The company specializes in producing a variety of jelly products, including gracilaria jelly, which is its flagship offering Other notable products under the brand names Poke, Joy, and Hugo include coconut jelly and Romrop cream marking cake, as well as ABC yoghurt jelly and KANTA green tea Gracilaria jelly remains the primary focus of the company’s product line.
In 2003, the company established a Gracilaria jelly production factory in Sai Dong, Long Bien, Hanoi, positioning Gracilaria jelly as its main market product.
The company launched its own brand of gracilaria jelly at a time when the market was largely dominated by imported products from Taiwan and China, highlighting a unique opportunity to establish a local presence in this niche.
In the early years of production, the company enjoyed a favorable business environment due to limited competition However, as major players in the food industry recognized the market potential for gracilaria jelly, the landscape changed The relatively simple production and processing technologies, coupled with lower investment costs compared to confectionery, attracted numerous enterprises to invest in gracilaria jelly production, resulting in a highly competitive market.
In the gracilaria jelly market from 2006 to 2008, competition among enterprises primarily revolved around pricing strategies, as companies with pricing advantages achieved greater success During this period, firms focused on minimizing transportation costs, leading to a regional market division where each enterprise targeted specific areas Notably, Vietfoods emerged in the Northland, offering products such as Poke and Joy.
Hugo; Hai Ha confectionary company with Hai Ha products; Huu Nghi
Confectionary Company with Huu Nghi products The Southland had Long Hai
Limited Company with Long Hai products; Nghi My Limited Company with Nghi
Phu product; Lai Phu Company with Lai Phu products; Tan Tan Food Company with Tan Tan products.
As since 2006-2008, there were many enterprises participating in gracilaria jelly product market and market division according to region and area, products of
Vietfoods were mainly sold in the Northland to decrease delivery cost, creating conditions for price competition.
Between 2006 and 2008, Vietfoods experienced significant growth in the food sector; however, its sales and profits did not reach a "wealthy" status in the market Nonetheless, when evaluating revenue and profit targets alongside investment capital, Vietfoods' performance positioned it within the "wealthy" category based on the revenue and profit-to-investment capital ratio.
2.2.2 The business production operation results
Criteria reflecting business production result of the Company in the period of
2006 – 2008 is displayed in following table:
Table 2.1 Report on business production results from 2006 – 2008
3 Cost for sale assistant uniform - - 6,08
7 Cost for car and driver’s salary
Cost for store and area 149,95
0 environmental maintenance 2 8 9 3 7 Information (Telephone, Fax,
9 Cost for office electricity, water
Cost for office lease, repair 41,59
Cost for space lease, fee 56,72
TN due to asset liquidation 4,71
TN due to debt redundancy difference 8 6,45
TN due to exchange rate
Cost for false goods, packs 57,56
The statistics indicate a significant growth in business production targets, with revenue increasing by 30.14% from 2007 to 2008 and by 22.30% from 2006 to 2007 Additionally, profits saw a remarkable rise of 129.73% from 2007 to 2008, showcasing a strong upward trend in financial performance over the years.
That profit increase speed is higher than revenue increase speed according to each year proves that business production of the Company has achieved real efficiency.
The increasing costs associated with marketing, fair participation, and extracurricular activities each year demonstrate the Company's commitment to recognizing the importance of marketing efforts and ensuring sufficient investment in this area.
As revenue and profit goals rise, companies must also focus on managing financial targets that necessitate timely adjustments to mitigate risks, particularly concerning costs associated with defective products and packaging.
Analyzing business production targets of Vietfoods in the period of 2006-
In 2008, the company experienced significant growth, establishing a robust foundation for future expansion With plans to invest in business production and implement effective marketing strategies, the company is poised to enhance its product offerings and drive success in the upcoming period.
Figure 2.1 Sales revenue in 2006 – 2008 (Unit: Million dongs)
2.2.3 The effect of the business climate to the business production operation
The intense competition in the market significantly affects the production activities of the company, as numerous producers are offering similar products Additionally, the influx of affordable foreign products, particularly from China, poses a considerable challenge for local enterprises, including Vietfoods.
Despite the challenges faced, the emergence of convenience presents an opportunity for the Company to foster positive growth With limited investment capital, the Company is well-positioned to expand its market reach Currently, the transportation sector offers various methods that significantly lower transportation costs, enabling the Company to extend its operations beyond local areas into new regions.
The gracilaria jelly market operates under perfect competition, fostering a level playing field for businesses In addition to direct competition, companies can engage in joint ventures and collaborations to develop innovative products and trademarks By focusing on superior quality and appealing presentation, these enterprises aim to attract Vietnamese consumers, emphasizing food safety and enhanced product standards.
Gracilaria jelly is a natural and healthier alternative to traditional confectionery products that often contain unhealthy ingredients like flour and sugar With its numerous health benefits, gracilaria jelly is poised to capture a significant market share By implementing a strategic marketing approach and establishing efficient distribution channels, the company can build consumer trust and increase its popularity in the market.
Analyzing the issues on construction and management of marketing strategy of the company
2.3.1 The construction and deployment of marketing strategy in business of Vietfoods:
Compared with regional countries possessing coast such as: Thailand, China,Indonesia, Taiwan, Japan or Korea, etc, the appearance of products processed from seaweed (gracilaria) in Vietnam is quite late.
In several countries, the technology for processing flour from seaweed has been established for over 15 years, highlighting its significance in developing a profitable food industry that contributes significantly to the economy.
Vietnam's extensive coastline offers ideal conditions for seaweed cultivation and processing, yet this valuable natural resource has been underutilized due to insufficient investment from management agencies Currently, a few private enterprises in regions like Hai Phong and Quang Ninh are engaged in seaweed production, but their output suffers from low quality, leading to a lack of trust among businesses.
Seaweed flour-based products, particularly gracilaria jelly, have gained significant popularity in food processing due to their refreshing qualities and digestive benefits This growing consumer demand has prompted companies in developed countries like China, Japan, Thailand, and Taiwan to invest in industrial production facilities and marketing efforts for this innovative product line As a result, gracilaria jelly has become widely available in various business venues and is emerging as a formidable competitor to traditional confectionery producers, capturing a substantial market share.
Gracilaria jelly product has newly appeared in Vietnam in the past 10 years.
In the early 2000s, several companies in Saigon leveraged their connections with the Chinese community abroad to initiate technology transfers, leading to the production of Gracilaria jelly This marked the beginning of a new food industry in Vietnam, transitioning from high-priced imports to local production.
As the market evolves in both the North and South, consumers in major cities are increasingly becoming aware of Gracilaria jelly products This growing awareness is driving demand, leading to the emergence of companies dedicated to producing Gracilaria jelly.
In the early 2000s, Vietnam had only 2 to 3 institutions producing gracilaria jelly, but by 2003, this number increased to around 20, and by 2005, it exceeded 60 Today, the production industry of gracilaria jelly has gained significant traction, attracting major companies in the confectionery sector, including Hue Beer Company, Hai Ha Confectionery Company, Huu Nghi Confectionery Company, X22 Confectionery Company under the Ministry of National Defense, and Hanoi Milk Company.
Gracilaria jelly, which has been produced since the early 21st century, gained significant popularity in 2005 with the establishment of production facilities in major industrial areas like Hanoi and Ho Chi Minh City, as well as smaller provinces such as Nam Dinh and Ben Tre Initially enjoyed only by consumers in large urban centers, gracilaria jelly is now widely available throughout the country In addition to local offerings, consumers have access to a diverse range of imported products from countries including China, Taiwan, Thailand, Malaysia, and Indonesia.
When jelly products were first imported to Vietnam, they were limited to a simple 15g glassed jelly Today, the market has expanded significantly, offering a wide variety of options, including 50g and 100g glassed gracilaria water jelly, tin boxed gracilaria jelly, boxed yoghurt jelly, and tube boxed jelly This evolution has led to a rich diversification in both appearance and form, with jelly products now available in creative shapes such as fruits and animals.
Before gracilaria jelly entered the market, traditional confectionery products dominated shelves in supermarkets, confectionery shops, and sundry goods stores Today, gracilaria jelly is a staple at these selling points, indicating a significant shift in consumer preferences The introduction of gracilaria jelly has transformed the consumption structure and increased the production density within the local confectionery industry.
The student group analyzed the marketing theory and strategies employed in the development of Vietfoods' Gracilaria jelly, comparing it with competitor products like Long Hai This research aimed to identify key differentiators and enhance the product's market positioning.
Long Hai Joint Stock Company, Hai Ha Confectionary Company, Huu Nghi Confectionary Company, Nghia My Limited Company, and Tan Tan Food Limited Company are notable producers in the confectionery industry, offering a diverse range of products under their respective brands.
The fundamental 4P theory in marketing traditionally encompasses Product, Place, and Promotion However, depending on the profession and marketing strategy of a company, additional elements may be incorporated, such as People, Packaging, Positioning, Policy, Progress, Physical Evidence, Public Relations, or even Philosophy A tailored approach is essential for each specific case to effectively address unique marketing needs.
From 2010 to 2015, our student group developed and executed a marketing strategy for Vietfoods' gracilaria jelly, utilizing the "7P" theoretical framework We conducted thorough research on the local environment and aimed to enhance export opportunities to regional markets, ultimately striving to expand our reach to a broader audience.
Specifically, “7P” is applied for Vietfoods as follow:
To effectively sell any product offered by the Company, it is essential to strategically position it in the market This involves selecting optimal selling locations, such as establishing headquarters close to residential areas to meet consumer shopping demands Additionally, suppliers should utilize available distribution channels, including major agents, supermarkets, and local markets, to showcase and promote the Company's products.
From 2010 to 2015, the analysis group focused on examining the product distribution trends of Vietfoods through traditional channels, including agents, markets, supermarkets, and both wholesale and retail shops The company's primary strategy involved using branches primarily for product introduction, while supermarkets, agents, and markets played a crucial role in decisive distribution and sales.
Evaluation of marketing activities of Vietfoods, defining the existences of marketing
An effective marketing strategy serves as the foundation for success, much like the opening scene of a compelling film Just as a great movie requires talented actors to thrive, a successful marketing plan must be executed through a series of targeted activities.
Marketing and selling goods involve a complex interaction between customers and sellers, rather than just a simple transaction By enhancing this interactive process, businesses can convert more individuals into loyal customers, ultimately increasing their overall customer base.
Meanwhile, main ways to improve marketing procedure are improving the processes, elements of marketing strategy.
When parts of marketing strategy are improved, enterprise can:
- Creating the differences and raising the values for customers
- Saving the cost to help buyers become the potential customers.
Each activity of marketing has 4 main elements If you understand clearly these elements, you will have ability to improve each marketing activity They are:
- Attract the attention of customers
- Give customers things which can create values
▪ Attract the attention of customers:
To capture customer attention, businesses can utilize online advertising on platforms like Google and Yahoo, or create engaging content in trade magazines If a company already has established relationships with customers, it can further enhance engagement through direct communication methods such as phone calls and emails, ensuring that product availability is effectively communicated to facilitate easy access for customers.
When enterprises help customers on “purchasing way”, they will have many opportunities to contact them Customers are willing to receive the individual exchanges like email, calls, or meetings.
Give customers things which can create values
Creating value for customers is the cornerstone of effective marketing activities, as it enables enterprises to establish a strong connection with their target audience By understanding the problems and opportunities faced by customers, businesses can develop a key strategy that showcases their role in addressing these needs, ultimately driving customer loyalty and long-term success.
What are values here? It means all things that customers “paying”, not by money, by time and attention of customers.
Interactive marketing revolves around the exchange of value between enterprises and customers When a business delivers value to its customers, it earns the right to request something in return, such as an email address or consent to receive newsletters This mutual exchange fosters engagement and builds a stronger relationship between the brand and its audience.
Proposing converses not only allows enterprise to keeping process of customers and that of selling but also evaluating the marketing activities.
To enhance the effectiveness of marketing activities, continuous improvement is essential, which can only be achieved through thorough evaluation of results By analyzing these outcomes, enterprises can adapt and refine their interactive marketing strategies, ultimately leading to a more efficient marketing process.
Marketing and selling are essential processes that transform potential buyers into actual customers By clearly defining and enhancing these core activities, businesses can significantly improve their effectiveness Effective marketing strategies enable enterprises to identify and reach potential customers more efficiently.
The gracilaria jelly market has experienced significant growth in recent years and is expected to continue expanding in the future As a result, it is becoming a key product for businesses both domestically and internationally To capitalize on this opportunity, companies should develop targeted market access strategies for sustainable growth.
Vietfoods is currently prioritizing its marketing operations and the development trends for the upcoming period The company is actively training a group of trainees to enhance their understanding of these marketing strategies Additionally, Vietfoods is concentrating on optimizing its distribution channels while conducting market research to identify suitable processes for growth.
Besides investment in market selling channel in the North, Vietfoods also focuses on the strategic market like:
In Hanoi, establishing a distribution center allows the company to manage the allocation of goods effectively, enhance market access, and implement targeted marketing strategies, ultimately facilitating easier product delivery to customers.
Vietfoods has established a distribution head office in Da Nang to enhance product visibility and expand its business in the central area, despite its relatively small market share The trainees believe this aligns well with the company's current and future business strategy To successfully execute this initiative, Vietfoods must develop a specific business strategy and create a structured procedure for building its distribution system, which includes product introduction, advertising, agent implementation, and customer service.
In the South market, we are establishing a distribution branch in Ho Chi Minh City, focusing on product development and advertising within supermarkets Our strategy also includes expanding our reach to provinces in the Southeast region and the Central Highlands.
In the competitive landscape of food processing, Vietfoods faces similar challenges as other companies, primarily due to the inherent characteristics of food products, including their limited shelf life and reliance on short-term materials To maintain product quality and value, enterprises must invest significantly in storage and transportation Therefore, Vietfoods should implement a strategy to expand its production facilities across various regions nationwide.
2.4.2 Existences in marketing strategy of Vietfoods:
In comparison with some big competitors when participating in gracilaria jellies producing market, VFC Company has some following advantages and disadvantages:
- Having experiences in distributing consumer products.
- Already having systems of management personnel and market employees.
- Quick responding and being flexible with market demands.
- Leaders having basic knowledge about Marketing.
- Having limited investment capital, having not had accumulating process, so having no advantages of production scale.
- Having no investment budget on expenses for marketing activities.
- At the same time, there are many companies and establishments investing on producing gracilaria jellies, so there is tough competition in price resulting very low sector profit.
- Have not had experiences in production, production management staff, technology and so on; therefore, expenses on price are still high.
Viet Thanh Company, the predecessor of Vietfoods Company, transitioned from a goods distribution model to a production-focused business Initially, the company relied on its experience in sales systems, as marketing efforts were previously handled by other firms However, due to limited investment capital, the company faced challenges when it began its production journey.
In 2003, the company had an invested capital of 2 billion VND from its shareholders However, half of this amount was allocated to production factory expenses, leaving minimal funds available for sales activities, particularly in marketing efforts.
Analyzing the causes of existences stated above
The global economic crisis is accelerating faster than anticipated, prompting a meticulous review of marketing budgets Marketing professionals are now held accountable for their spending, with an increasing emphasis on effectiveness and value C-suite executives are urging marketing teams to align resources with high-value targets that promise substantial profits Despite the acknowledged importance of marketing budgets by senior leaders, marketers face challenges in fulfilling demands within constrained budgets, highlighting the current limitations of company resources.
Marketing offices play a crucial role in helping companies achieve their goals, particularly in areas such as revenue, distribution, growth opportunities, and market expansion While they utilize measurement systems to assess operations, questions remain about their effectiveness and accuracy Key metrics include customer response rates to marketing campaigns, website traffic, new customer acquisition, and campaign impact; however, these do not adequately reflect investment effectiveness or product positioning in the market As a result, marketing leaders often struggle to prioritize their efforts effectively To address these challenges, consider implementing the following five measures to enhance your marketing strategies.
Checking means of marketing are using:
This analysis focuses on evaluating the current marketing plan's targets and their impact on the company's overall objectives It is essential to summarize existing and upcoming marketing strategies to identify the most effective approach for the company's growth and development.
* Marketing strategy planning of the Company:
The Company has primarily focused on short-term strategies tied to seasonal events, lacking comprehensive long-term unifying plans Although there are numerous individual activities, they have not been effectively leveraged to create promotional opportunities.
The company's marketing budget is constrained, which limits its ability to develop comprehensive annual action plans As the budget is heavily reliant on the company's sales turnover, financial resources for promoting and disseminating products are restricted.
There are not specific specialized divisions having experiences and professional qualifications to lead Marketing activities and make long-term marketing development strategies.
In its early stages, the company's activities were primarily directed by the chief executive and sales marketing director, leading to fluctuations in business results However, by the end of 2008, the establishment of a dedicated marketing department significantly enhanced support for sales activities.
Products positioning is mainly basing on qualities and prices The Company has not invested on studying ages and genders to exploit effective selling methods.
Discuss frequently – exchange the marketing strategy of company:
Engage in discussions with leaders to understand their expectations regarding your marketing report, including target goals, evaluation criteria, and the impact of marketing activities on shared objectives It's important to recognize that leaders are primarily interested in reports that reflect operational success Additionally, key requirements for marketing initiatives involve expanding market reach, enhancing overall system efficiency, and minimizing the time needed to secure funding for new products.
Marketing is not like a oasis:
Enhancing marketing activities requires thorough cross-checking among departments such as marketing, sales, production, service, and finance This collaboration is essential for the marketing team to identify effective operational strategies Frequent cross-checking ensures the discovery of optimal conditions, which can then be shared with other departments to improve overall company performance.
Saving the effective marketing activities with the format of document
Documenting special activities through structured methods, effective measurement systems, and a comprehensive database is essential for success It's crucial to preserve the measurement and information related to these processes to ensure efficient task execution and tracking over time.
Training marketing staff on operational procedures and the value of marketing metrics is crucial for effective performance When marketing team members have a clear understanding of these elements, they are better equipped to execute successful marketing strategies.
Implementing the five key measures will enable the marketing office to concentrate on optimal resources, align with the company's primary objectives, maximize tasks within a limited budget, and enhance overall effectiveness.
Gracilaria jelly, while not highly valued, incurs transportation costs that exceed its worth, reaching 6% for Vietfoods, compared to the typical 1% for high-value goods This discrepancy poses significant challenges for the company's market implementation, particularly in remote areas, hindering the development and distribution of products in those regions.
Vietfoods' gracilaria jelly faces competition not only from well-known brands but also from lower-quality, low-cost imported jellies from China and products from smaller enterprises, impacting the company's market share.
To maintain a competitive market share, Vietfoods must allocate resources effectively for its sales team while operating within a limited marketing budget This necessitates a well-structured marketing plan that encompasses production, transportation, advertising, and overall marketing expenses to optimize product distribution and visibility.
To enhance their marketing strategy, companies should focus on their target market and leverage their unique advantages This involves developing existing strengths, improving technology, refining designs, and optimizing distribution systems It is crucial for companies to continuously monitor their marketing processes while ensuring that their strategies remain closely aligned with market demands, customer needs, and practical applications.