Solution to enhance the effectiveness of advertising activities a case of vietnam international bank (VIB)

UNIVERSITY OF ECONOMICS HO CHI MINH CITY International School of Business Nguyen Thi Nhat Linh SOLUTIONS TO ENHANCE THE EFFECTIVENESS OF ADVERTISING ACTIVITIES: A CASE OF VIETNAM INTERNATIONAL BANK (VIB) ID: 22130035 MASTER OF BUSINESS ADMINISTRATION SUPERVISOR: NGUYEN THI MAI TRANG ACKNOWLEGEMENT Writing this thesis needed a long duration of hard working from the author and careful instructing from the team of Supervisor of International School of Business The thesis has been finished with the help of Ms Nguyen Thi Mai Trang - who has given us the useful and excellent information about the way of identifying and solving problem in thesis We would like to give a special thank to Ms Mai Trang and other Supervisors in ISB for their help, guidance throughout the process of making this thesis TABLE OF CONTENTS I Executive summary II The problem identification .2 2.1 Company introduction 2.2 Symptom and real problem 2.2.1 Business situation of VIB and other banks in recent years 2.2.2 The first in-depth interview 2.2.3 Possible reasons of low revenue of VIB 13 2.2.4 The most important problem: ineffective advertising activity 17 2.3 Cause and effect diagram 19 III Solutions 21 3.1 Alternative one: Enhancing advertising activities for VIB .23 3.1.1 Advertising on LCD screen in elevators 25 3.1.2 Advertising on print media 27 3.1.3 Advertising on television 30 3.2 Alternative two: Electronic word of mouth 32 3.2.1 Email 33 3.2.2 Social media 35 3.3 Choosing best solution for VIB 39 IV Implementation 41 V.Conclusion 45 VI Supporting Information 46 6.1 Research methodology 46 6.1.1 Primary data 46 6.1.2 Secondary data 48 6.2 Result of the first qualitative research 50 6.2.1 Interview five current customers of VIB .50 6.2.2 Interview five customers of other banks .51 6.2.3 The common theme of the first in-depth interview 63 6.3 Result of the second in-depth interview on five customers 64 Reference 85 LIST OF TABLES Table Chartered Capital of the four banks in 2015 Table Revenue from business activities of four banks in Viet Nam in the past three years .6 Table List of studies investigated the antecedents of revenue Table List of studies investigated factors affecting effectiveness of advertising .21 Table Expected cost of advertising on printed media and LCD in 2016 28 Table Expected cost of advertising on television in 2016 31 Table List of sources of secondary data .49 Table The answers of current customers of VIB in the first in-depth interview 50 LIST OF FIGURES Figure Revenue from business activities of four banks in Viet Nam in the past three years Figure Cause and effect diagram of Low revenue .20 SOLUTIONS TO ENHANCE THE EFFECTIVENESS OF ADVERTISING ACTIVITIES: A CASE OF VIETNAM INTERNATIONAL BANK (VIB) I Executive summary The thesis is to solve problem of insufficiency in advertising activities of VIB The symptom in VIB at present is low revenue in recent years when comparing the level of revenue of VIB in recent years with three other banks that have the same chartered capital Basing on literature reviews, author identified fours aspects which were proved that they directly impact on the revenue of corporation including advertising activities, product innovation, product quality and capability of staff To investigate these aspects, author used results of the in-depth interviews and secondary data from VIB The results showed that there is no problem with product innovation, product quality and capability of staff of VIB With advertising activities, VIB is still launching many new programs but the customers cannot catch information as well as pay more attention to them Basing on literature review, result of the in-depth interview, secondary data from VIB and the current situation of the bank, the author identified that advertising activity is the main problem that leads to the low revenue of VIB Solutions of problem were proposed basing on four aspects They include literature review, current situation of VIB, secondary data from many sources, opinions of customers through the second in-depth interview There are two main solutions which are proposed In first solution, there are three small solutions and the second solution includes two small solutions Therefore there are totally five small solutions but there are four small solutions that will be chosen basing on the analysis of their advantages and disadvantages To be more specific, the whole process of identifying and solving problem is presented clearly in the next parts II Problem identification 2.1 Company introduction According to Leung (2009), since 1990, Vietnamese banking system was divided into two systems according to two levels, including Central Government banking and Commercial banking system After establishing in 1990, banking industry has had a strong developing speed Since 2007 to now, the rising speed of turnover in the whole industry is 19.47%, higher three times than the rising speed of average GDP (2007 – 2014) of the whole Vietnamese economy from 2007 About the industrial structure, Vietnam’s banking sector includes four majors and one minor state-owned commercial bank (SOCB), thirty-one joint stock banks (JSBs), six joint venture banks and six 100 per cent-owned foreign banks From the day of becoming the official member of World Trade Organization (WTO) in 2007, a new era of opportunity and challenge is opened for the Vietnamese economy as well as the other fields According to the commitment of joining WTO, the foreign trading banks are established with 100% foreign capital at Viet Nam Vietnam International Commercial Joint Stock Bank, abbreviated as Vietnam International Bank (VIB), was founded on 18 th September 1996 Before the opportunity and challenge of the international integration, VIB has continuously made efforts and improved the product quality in each filed of operation Going through eighteen years of operation and development, now VIB has become one of the leading commercial joint stock banks at Viet Nam VIB‘s area operations has spread on several diversified products For customers who are individuals, VIB provides products regarding to saving, loans, insurance, etc For customers who are organizations, VIB focuses on offering the products of cash management, e-banking, loans, trade finance, etc These information above are taken from VIB website On this research, the author focuses on both the customers who are individuals and organizations to analyze and study about the problems that VIB is facing To increase the effectiveness in every fields of its operation, VIB has performed and followed the aim of becoming the most innovative and customer-centric bank of Vietnam as the vision for its whole system VIB also defined the missions separately for each objects For customers who are individuals and organizations, VIB follows the way of providing innovative, customer- centric solutions to satisfy their needs For employees, VIB improves and encourages the high performance culture, entrepreneurship and openness in the work environment For shareholders, the bank provides sustainable and attractive returns to their shareholders and also support development for community Besides, VIB also concentrates on the five main core values including customer focus, excellence, honesty, teamwork and discipline 6.3.4 Customer: Mr Hoang Minh th Time: 10:35am,14 November 2015 Place: 35 Ngo Duc Ke, Ward 12, Binh Thanh District, HCMC Type of interview: In-depth interview Interviewer: Ms Nhat Linh Transcript: Interviewer: Hello! My name is Nhat Linh At present I am performing the MBA thesis at ISB Institute of University of Economy The topic of my thesis is the solutions to enhance effectiveness of advertising activity for Vietnam international bank (VIB) Please spend a little bit of your time for sharing your opinions regarding to the solutions for improving the effectiveness of advertising activity of VIB Firstly, tell me your name and job? Mr Hoang Minh: My name is Hoang Minh and I am working as an IT for GNT Company Interviewer: At present, you use products of any bank? Mr Hoang Minh: I am using products of Vietcombank and Vietin Bank Interviewer: Which factor that makes you have attention and leads to the decision to use products of a bank? Mr Hoang Minh: I used products of Vietcombank and Vietin Bank because my company provided the master card of these bank for staffs to receive salary through card In addition, I also like these banks because their offices are near my house so it is convenient for me to perform the transactions with them Interviewer: Besides the factor of convenience or the position is near your house, are there any other factors that make you have attention and affect your purchasing decision towards products of a certain bank? Mr Hoang Minh: I also feel interested in attractive advertising campaigns of banks Interviewer: You feel interested in attractive advertising campaigns of banks For examples, Marketing campaigns with attractive gifts, offering special benefits for customers in their birthdays, something like that, right? Mr Hoang Minh: Yes, that is right I like it Interviewer: Can you tell me which channels of Marketing campaign that make you pay attention to most? For example, if we launch it on facebook, email, magazine, or LCD in buildings, you feel enjoyable when approaching with these channels? Mr Hoang Minh: Ok, I think facebook, email, or LCD are ok I am working in a building and often see advertisings on LCDs which are installed inside and outside of the elevators I also feel interested in advertisings on LCDs I rarely read advertisings on newspapers and magazines Interviewer: Ok If getting that kind of Marketing campaign of a bank from these channels, are you willing to share this information to your relatives? Mr Hoang Minh: Yes, I I am willing to share this information to my friends, but just my close friends Interviewer: Besides advertising channels that I have suggested, are there any channels that make you feel interested in and they can affect their purchasing decision in the future? Mr Hoang Minh: I just think about above channels I think they are enough Interviewer: Do you often watch advertisings on television? Mr Hoang Minh: No, I not Interviewer: Why not you watch them? Mr Hoang Minh: Because I also not watch television, I just watch youtube for entertainment Interviewer: Therefore you cannot share with me anything about advertising on television, right? Mr Hoang Minh: Yes, that is right I not know anything about it Interviewer: Ok, thank you for your sharing I will put your opinions into my thesis as a good idea to contribute in building advertising activityfor VIB Thank you very much Mr Hoang Minh: Thank you 6.3.5 Customer: Ms Minh Hoan th Time: 09:27 pm,17 November 2015 Place: online interview Type of interview: In-depth interview Interviewer: Ms Nhat Linh Transcript: Interviewer: Hello! My name is Nhat Linh At present I am performing the MBA thesis at ISB Institute of University of Economy The topic of my thesis is the solutions to enhance effectiveness of advertising activity for Vietnam international bank (VIB) Please spend a little bit of your time for sharing your opinions regarding to the solutions for improving the effectiveness of advertising activity of VIB Firstly, tell me your name and job? Ms Minh Hoan: My name is Minh Hoan and I am working in Human Resource Department of a Korean Company Interviewer: At present, you use products of any bank? Ms Minh Hoan: I am using products of ACB Interviewer: Which factor that makes you have attention and leads to the decision to use products of a bank? Ms Minh Hoan: I choose ACB because of its convenience My job is in nine-to-five hour ACB has one branch on Cong Hoa Street that allows customers to business with ACB after the nine-to-five hour I choose ACB for that reason Interviewer: Besides the factor of convenience, you often read the information of banks on media channels? Ms Minh Hoan: My first priority is convenience In addition, I feel the promotional programs of banks are also quite interesting and I would like to share this information to my relatives Interviewer: Why you want to introduce this information to your relatives instead of directly joining? Ms Minh Hoan: As I said before, my priority of choosing products of a bank is the convenience and ABC has satisfied me However, I am willing to share with friends about the advertising programs of banks if they are really attractive Interviewer: How you feel about the Marketing campaigns on online channels of banks that giving customers gifts on their birthday or something like that? Ms Minh Hoan: Oh sure, I will introduce to my relatives right away because it is so interesting Interviewer: Ok Do you often read the Marketing campaigns of banks in media channels, like newspaper, magazine, etc.? Ms Minh Hoan: I not often read them before but after this interview I will read it frequently because I think there are will be more better banks than ACB that giving me the more convenient products Interviewer: The convenience here means it is near your house, right? Ms Minh Hoan: Yes, it can be near my house and the most important thing is to allow customers to contact after the nine-to-five hour Interviewer: How you often share information with your friends? Ms Minh Hoan: I often share it on facebook, I sometime share on emails Interviewer: Besides them, are there any channels that make you feel interest? Ms Minh Hoan: At present I see the chatting application - Zalo is also advertising so much Interviewer: Does Zalo advertise on the page of users? Do you often use Zalo frequently? Ms Minh Hoan: Yes, I I also see many people are using Zalo I think the popularity of Zalo is the same with facebook Interviewer: Besides them, are there any channels that make you feel interest and can affect your purchasing decision? Ms Minh Hoan: I think it is Viber because I am also using Viber Interviewer: Oh, in general, they are the application for chatting, right? Ms Minh Hoan: Yes, that is right because I am using many applications of chatting for free Interviewer: Do you often watch advertisings on television? Ms Minh Hoan: Yes, I I often watch them on television Interviewer: Why you pay attention on them? Ms Minh Hoan: Because they are advertised on television and I feel secure about kinds of product that are advertised on television Interviewer: Can you tell me more detail about that kind of product? Ms Minh Hoan: They are the fast moving consumer goods like milk, drink, detergent, etc Interviewer: And how are about the kind of banking products? Ms Minh Hoan: With banking products, when they are advertised on television, I have less attention because I not feel trust on them immediately, I just feel secure with advertisings of fast moving consumer goods Interviewer: Therefore you also not often have purchasing decisions for banking products through this channel, right? Ms Minh Hoan: Yes, that is right Interviewer: Ok, advertisings on television will be suitable with products of kind of fast moving consumer goods, not for services like banking, right? Ms Minh Hoan: Yes, that is right Interviewer: Thank you for your sharing I will put your opinions into my thesis as a good idea to contribute in building advertising activity for VIB Thank you very much 6.3.6 The common theme of the second in-depth interview Interviewer: Do you often read information of banks on media channels and introduce to your relatives? Interviewees: I am willing to share advertising programs of banks if they are interesting Interviewer: How you feel about advertising campaigns of banks on online channels like email, social media and giving gifts for customers? Interviewees: I feel these programs are so interesting and I am willing to share them to my relatives Interviewer: Which online channels that you often use most? Interviewees: They are mainly email and facebook In addition, we often use Zalo, Viber, etc Interviewer: Do you often watch advertisings on television and pay attention on them? Interviewees: I not watch them frequently and I not trust them much Interviewer: Can you describe your habit when watching advertisings on television? Interviewees: With fast moving consumer goods, I sometimes watch their advertisings on television and have purchasing decision basing on them With services like banking, I pay less attention on their advertisings on television and not feel enough trust to use their products through advertising on television Interviewer: Therefore you also not often have purchasing decisions for banking products through this channel, right? 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Most of interviewees said that they not know about these advertising campaigns Some of them said that they just care of advertising activities of the bank that they are using Some of them indicate