MARKETING STRATEGIES IN VIETNAM OF LOCKLOCK LOCKamp;LOCK has set its corporate philosophy as quot;Company that values the environment and human” and has considered the healthy, safety and convenience of customers as our priority since the its foundation in 1978.
4/2017 MARKETING STRATEGIES IN VIETNAM OF LOCK&LOCK Teacher: MA TRUONG THI PHUONG TRANG Group: Members: Nguyen Thi Hong Tham Vo Le Hien Vy Le Thi My Linh Le Thu Lam Nguyen Thi Thuy Vi 40K01.2 40K01.2 40K01.2 40K01.2 40K01.2 MARKETING STRATEGIES IN VIETNAM OF LOCK&LOCK CONTENTS I OVERVIEW OF LOCK&LOCK Overview 2 Mission, Vision and core values History .4 Products of LOCK&LOCK: Foreign market of LOCK&LOCK: II LOCK&LOCK IN VIETNAM MARKET .9 The SWOT model of LOCK&LOCK when it entered the Vietnam market: Marketing Strategy of Lock&Lock in Vietnam market 10 a) Product Policy (Products of LOCK&LOCK to adapt to Vietnam market) 10 b) Price Policy (The price policy of LOCK&LOCK which booking in Vietnam market) 11 c) Place Policy in Vietnam market: 12 d) Promotion Policy: 13 Limitations of international marketing policy of LOCK&LOCK in Vietnam market 15 The marketing Method in Vietnam's market of LOCK&LOCK: 15 pg MARKETING STRATEGIES IN VIETNAM OF LOCK&LOCK I OVERVIEW OF LOCK&LOCK Overview Lock&Lock is a South Korean plastics company, headquartered in Seocho-Dong SeochoGu Seoul, Korea Established in 1978, the Lock&Lock line of products has been highly successful in competing with global brands like Ziploc, Tupperware, and Rubbermaid Bussiness name: Lock&Lock Co Ltd CEO: Chaiman Kim Joon-il Headquarters: Seoul, Korea Foundation date: 1978 Number of employees: 5024 Overseas branches: China, Vietnam, Thailand, India, Indonesia, Japan, Cambodia, U.S, Germany, Italy, Hong Kong Logo: Mission, Vision and core values a Mission “A Company that values the environment and humanity.” LOCK&LOCK has set its corporate philosophy as "Company that values the environment and human” and has considered the healthy, safety and convenience of customers as our priority since the its foundation in 1978 pg MARKETING STRATEGIES IN VIETNAM OF LOCK&LOCK Satisfaction: We seek customer satisfaction through product development that has eco-friendly materials and innovative design Better Life: We aim for differentiated challenges and change and we endeavor to improve the life value of customers Sharing: We realize business of sharing that the environment and humans can coexist in harmony and contribute to society b Vision “Global No.1 Comprehensive household products company” LOCK&LOCK aims to be the global No.1 comprehensive household products company that the world can trust with its finest quality and international competitiveness c Core values Honesty and Trust We promise to fulfill our responsibility to increase the value and happiness of our customers, shareholders and employees by providing the best product and service through credible and fair management that prioritizes health, safety and convenience of customers Ownership and Action We seek the growth and development with a mind of ownership and strong actions We promise to be the enterprise that leads such changes and creates cultures Creativity and Challenge We promise to continuously seek the new and innovation with a spirit of creativity and challenge and develop better products that satisfy the needs of customers and the market, taking the lead in changes and the market Responsibility and Contribution We commit ourselves to become a sustainable enterprise that is trusted for social responsibility and contribution to society, pursuing mutual growth based on the respect for society and humanity pg MARKETING STRATEGIES IN VIETNAM OF LOCK&LOCK History Since its establishment in 1978, Lock&Lock Co., Ltd has been grown as a global company that exports its products - Lock&Lock containers with a four-sided interlocking system - to more than 120 countries worldwide a 1978 – 2003: Birth of Lock&Lock With its continuous research and development, LOCK&LOCK has launched its sides interlocking container 'LOCk&LOCK' starting to build its reputation in the world 11.1978: Foundation of Kukjin Distribution Co.,Ltd 10.1985: Technical partnership with Japan Kukje Hwakong Foundation of Kukjin Hwakong Co.,Ltd 06.1987: Foundation of Hana Mart Co.,Ltd 05.1994: Relocation of Incheon Namdong Plant Changed the company name to Hana Cobi 10.1998: Release of LOCK&LOCK side locking container 01.2002: Completion of Gyeonggi Yongin Distribution Complex construction 03.2002: New launching of the official online shopping mall 'LOCK&LOCK Mall' 12.2002: Started the official online community 'LOCK&LOCK Supporters' 06.2003: Changed the name of 'Hana Mart Co.,Ltd' to 'LOCK&LOCK Co.,Ltd pg MARKETING STRATEGIES IN VIETNAM OF LOCK&LOCK 11.2003: Opened the official company website b 2003 – 2010: LOCK&LOCK, leading forward into the global world LOCK&LOCK is taking a great leap forward to be a global company through aggressive expansion on products along with foundation of overseas sales and manufacture corporations 04.2004: Establishment of Shanghai sales unit in China 06.2004: Completion of Chungnam Asan Plant construction 10.2004: - Completion of China Plant No.1 in Weihai - China Plant No.1 in Weihai 10.2004: Merge Incheon Plant to Asan Plant pg MARKETING STRATEGIES IN VIETNAM OF LOCK&LOCK 12.2005: Divestiture to B&B Co.,Ltd, Hana Cobi Co.,Ltd, LOCK&LOCK Co.,Ltd 05.2006: Establishment of Beijing sales unit in China 11.2006: Completion of China Plant No.2 in Manshan 12.2006: Merge of LOCK&LOCK and B&B 08.2007: Merge of 'Hana Cobi' and 'LOCK&LOCK' 09.2007: Establishment of Shenzhen sales unit in China 10.2007: Completion of China Plant No.3 in Suzhou 11.2007: Establishment of Dong Nai production unit in Vietnam Dong Nai production unit in Vietnam 01.2008: Opened the 1st directly operated store in Korea 04.2008: Opened the 1st directed operated store in Vietnam 11.2008: Establishment of distribution unit in Thailand distribution unit in Thailand 02.2009: Establishment of Hanoi sales unit in Vietnam 04.2009: Completion of Dong Nai production plant construction in Vietnam pg MARKETING STRATEGIES IN VIETNAM OF LOCK&LOCK c 07.2009: Establishment of sales unit in Indonesia 2010 – Present: LOCK&LOCK, the worldwide brand LOCK&LOCK currently exports to 120 countries throughout the world, leading the kitchen living culture of the global world 01.2010: Securities Market Certificate 03.2010: Establishment of Ho Chi Minh sales unit in Vietnam 09.2010: Establishment of Vung Tau production unit in Vietnam 11.2010: Opened the Korean Pavilion on Taobao China 11.2010: Establishment of sales unit in Germany sales unit in Germany 12.2010: Opened the 1st directed operated store in Lebanon 02.2011: Opened the 1st LOCK&LOCK PLUS (LOCK&LOCK franchise) in Korea 03.2011: SAP ERP system implementation 05.2011: Opened the official Facebook page 10.2011: Opened the 1st LOCK&LOCK PLUS (LOCK&LOCK franchise) in China 11.2011: Completion of Automation Distribution Center construction in Asan, Chungnam 12.2011: Completion of Vung Tau Glass Plant construction in Vietnam 08.2012: Completion of Vung Tau Cookware Plant construction in Vietnam pg MARKETING STRATEGIES IN VIETNAM OF LOCK&LOCK 10.2012: Opened the 1st directed operated store in Australia 12.2012: Opened the 1st directed operated store in Myanmar 05.2013: Established the official university student 'LOCK&LOCK GREENMATE' 07.2014: Opened the official Instagram supporters Products of LOCK&LOCK: The boxes preservating food of LOCK&LOCK have typical advantages It’s 100% airtight and has no BPA, which is harmful to the health of consumers.The design is briefness and convenient that can hang on the motorbike pg MARKETING STRATEGIES IN VIETNAM OF LOCK&LOCK Foreign market of LOCK&LOCK: Formed in 1978, Lock&Lock from the Korean market introduced and developed its products on a global scale with typical products that are food container with locks sides Today the company has brought its products to more than 100 countries on over the world II LOCK&LOCK IN VIETNAM MARKET The SWOT model of LOCK&LOCK when it entered the Vietnam market: On April 2008, Lock&Lock penetrated the Vietnam market and became increasingly developed Strengths Weakness - It has strong financial resources than - For the price, Lock&Lock can not compete the business in local with other businesses in Vietnam - The origin of products is considered as good, cozy up with Vietnam customers - "Green" products satisfy the desire to ensure the health of local consumers Opportunities Threats - Vietnam has abundant labor It is cheap - The income of Vietnamese people is low, labor for Lock&Lock when building the needs for plastic household items in the factories here medium segment as Lock&Lock is still limited - Vietnamese culture is family lifestyle that should be a large market for - Lock&Lock is a "latecomer" in the market household items such as Lock&Lock for household plastic in Vietnam.So this products market has been filled in segment by local business and imported goods from other - The Vietnamese sympathize with countries products that have Korean origin pg MARKETING STRATEGIES IN VIETNAM OF LOCK&LOCK Marketing Strategy of Lock&Lock in Vietnam market a) Product Policy (Products of LOCK&LOCK to adapt to Vietnam market) The available characteristics of LOCK&LOCK which are putting in Vietnam market - Its main products from plastic airtight containers to comprehensive kitchenware use diverse raw materials including glass, porcelain, and stainless steel When entering any markets, Lock&Lock maintains its competitive edge in the field by manufacturing containers using environment-friendly materials considering the health of customers and environment - Green products: LOCK&LOCK attachs special importance to health and safety of consumers The company continuously launched “green” products, which is made from high quality material: tempered glass, stainless steel, Tritan plastic - the perfect combination between glass and plastic and safety for health and environmental protection as food storage box with advantage: keeping foods fresh longer and preventing the escape of vitamins and nutrients, watertight, non- toxic arising ; types of cookware designed cover helps retain flavoring and nutrients of food - Design of products brings them ability for customer, notice to the smallest handy Such as the Cook plus for kitchen (pots and pans), the Tritan plastic storage box - Bisfree Tsble Top or water bottles made by steel - Hot & Cool The development of product suits Vietnam market Vietnamese staff often stay in their offices at lunch so they prepare their lunch at home and bring them to the work More over, it is Vietnamese habit to store food in a box to keep it and eat later As a result, LOCK&LOCK has developed typical products for Vietnam market such as design neat bags, can hang on motorcycles; lunch box disigned small bulkhead for sauce and desserts The product policy of LOCK&LOCK applied in Vietnam market + Diversification of LOCK&LOCK products: Range of LOCK&LOCK products almost covered the demand for household appliances of the family, such as: bowls, chopsticks, kitchen utensils, food containers, with dozens of various designs bring extensive selection for customers In addition, LOCK&LOCK also expands their business with many product lines such as household appliances, furniture, tourism products, the products for children, to give customers more choices pg 10 MARKETING STRATEGIES IN VIETNAM OF LOCK&LOCK + Annually, the company invests more than 5% of total annual sales for research and development of new products, to bring satisfaction to users, and encourage inventions and new products More than 700 different products are launched annually, which means that different products are developed every day + Continuous innovation of product models LOCK&LOCK has turned all the familiar everyday objects into living things and brings new exciting experience In 2012, LOCK&LOCK has won the Vietnam Imprint of Designs for their products b) Price Policy (The price policy of LOCK&LOCK which booking in Vietnam market) LOCK&LOCK appears as a high quality plastic products LOCK&LOCK established in the consumer's mind that the company's product line is the high-up products So there is also a difference when comparing to the plastic products in the country But to suit the pockets of the people of Vietnam, the product is applied from top to bottom The price positioning in the Vietnam market: - At the commercial center, the price is highest, lower cost at supermarkets and small stores has more lower prices The construction of the factory in Vietnam will also help reduce costs of LOCK&LOCK products - In order to have the reasonable price, meet all distribution channels and users, setting up a factory in Vietnam is a necessary strategy Despite the good quality, variety of designs but compared with the market of household plastic in Vietnam, the price of Lock&Lock is quite high, because we have to import products from abroad so we must pay many intermediary costs, import tax pg 11 MARKETING STRATEGIES IN VIETNAM OF LOCK&LOCK - Meanwhile, wage costs in Vietnam is lower In fact, the production in Vietnam has helped Lock&Lock products cost to be lower about 30-40% than imports - Although the price is reasonable, low-income consumers are not familiar with Lock&Lock yet, so we offer the F2C (Factory to Customer) model, meaning that the product will be sold directly from the factory to the users, no intermediary costs, this model will be extended to the middle income customers This model is currently applied in Ho Chi Minh City, Da Nang and Hai Phong c) Place Policy in Vietnam market: Based on the strategy to locate Lock&Lock as a luxury kitchenware and home appliances brand in Vietnam, Lock&Lock opened 21 Lock&Lock stores and four Ecopia brands, Textile brand belonging to Lock&Lock These shops are designed modern, luxurious with a membership system incentives desire to contribute to bring a better life In addition to key stores, Lock&Lock's products are currently distributed in about 300 sales channels including supermarkets, home shopping channels, boutiques and B2B channels The company used its advantages in modern distribution system when they cooperation with retailers By this time, Lock&Lock has many shops selling products, including supermarkets such as Big C supermarket system, Metro, Coop mart, commercial centers like Vincom, Crescent Mall,… in many major cities across the country In addition, the company also distribute products through other channels such as direct sales through television: SJC home shopping, HTVC and channels: Yes24 Vina, muachung.vn, cungmuasam.net, lazada.vn, gohappy.vn pg 12 MARKETING STRATEGIES IN VIETNAM OF LOCK&LOCK On July 26th 2013, LOCK&LOCK officially opened the 20th store in Vietnam and is also the largest store in the northern region with an area of over 1,000 m2 It has been located at B2, Trade Center - Vincom Mega Mall Royal City (Thanh Xuan District, Hanoi) This store is also the Southeast Asia's largest of LOCK&LOCK Conclusion: The distribution network of Lock&Lock products in Vietnam is growing very strongly d) Promotion Policy: The trade promotion tools are used: - Promotion sales: This tool is best used with many different forms such as discounts, lucky, on special occasions such as holidays, birthday of company There are many discount programs held every year For example, in WEEKLY PROMOTION, the price of the product thermos bottles are sale 40% In WOMEN’S DAY SPECIAL SALE, women can buy every thing and get 30% off In addition, the company also has sales promotion to intermediate: • Sale for famous electronic companies or cosmetic companies such as LG, Sony, Samsung, Pond 's for promotional products • Trade discount: for wholesalers, partners who buy a big number of products pg 13 MARKETING STRATEGIES IN VIETNAM OF LOCK&LOCK - Advertising: Using the strategy “Storm of advertisement” Ads are posted on the VTV3 channel The company also advertises on newspapers or magazines to introduce their products to the customer They show their goods at the points of sale The company also issues catalogs, product descriptions They advertise on the internet by the website of the consumer, the forum which is related to women as Webtretho, put into use by Vietnamese website ( http://locknlock.com.vn ) to serve the Vietnam market Also, they use Facebook- Lock&lock Vietnam to advertise their products The information of Ads are posted on facebook quickly every day to attract a variety of customers - Personal Sellings: Lock&Lock holds competitions and training sessions, in order to increase sale skills of employees, helping employees capture a clear understanding about the products - especially new products The staff have experience and good skills to realize the potential customer, then promote direct exchange, usually for customer being organizations - Direct Marketing: Marketing by e-mail or direct mail The company usually sends a letter to customer’s email address or home address - Public Relations: At the Movies: Using the influence of waves of " Hallyu " onscreen Vietnam incorporating elements of Korean movies on the advertisements • Show goods at the points of sale to attract customers and to be convenient for customers • By the uniforms of the staff, by the way staff interact with customers and how to communicate between staff together • Developing corporate image: LOCK&LOCK - the company of community and environment - Sharing love: LOCK&LOCK often visits, gives gifts and helps nursing homes, orphanages, women be disadvantaged Especially, Lock&Lock manufactured the Love Bottle with the design of actual painting that children from Losun Elementary School in Hoang Van Tu in Northwest Vietnam had drawn and donated part of sales profit to classroom extension construction business They provided new classrooms to 120 students who suffered from unstable education environment in such an obsolete classroom and has continued to support them through sisterhood relationship pg 14 MARKETING STRATEGIES IN VIETNAM OF LOCK&LOCK - In recent years, LOCK&LOCK spent profit from the sale of products to build new classrooms for students in the difficult mountainous Lo Son, Hoa Binh province Limitations of international marketing policy of LOCK&LOCK in Vietnam market When Lock&Lock entered Vietnamese market, almost no one knows what this brand and product is LOCK&LOCK logo and the slogan "Product being harmless to the environment" are also unfamiliar to them That is the reason why they had to go to its outlets, introduced products to customer through face to face conversation Despite its good quality and nice design, products would fail on the market if the price is high It is difficult for Vietnamese consumers to understand why plastic products are expensive After the success of Lock&Lock, many Vietnamese companies joined race to launch high-end plastic box products, which makes this market become very competitive Besides, there are other drawback that can be mentioned, such as: The advertisement is not attractive to consumers For personal selling, the employees are lacking of experience and skills Lock&Lock only produces the items for household uses pg 15 MARKETING STRATEGIES IN VIETNAM OF LOCK&LOCK LOCK&LOCK in Vietnam are trying to improve their performance by bring the best value to buyers The marketing Method in Vietnam's market of LOCK&LOCK: Marketing strategy in Vietnamese market of LOCK&LOCK can be describe as: It focuses on improving designs and quality of the products This help their goods become more eye-catching and stand out from the crowd Moreover, they are always eager to receive feedbacks from users to make products that meet their demand It also concentrates on running promotion campaign to build their brand in customers mind For example, it sponsors the creation of Liberal Arts Program in Hanoi Open University and support children in need Lock&Lock has released the “Love Bottle” series designed by Vietnamese children The purpose of this campaign is building more elementary school classrooms in Lo Son province Lock&Lock is planning to expand its distribution channels by opening flagship shops in department stores and large-scaled shopping centres from HCM and Hanoi to midsized cities It also plans to double the size of its distribution network by focusing on TV online shopping and B2B distribution pg 16 MARKETING STRATEGIES IN VIETNAM OF LOCK&LOCK - Finally, paying attention to the information network is one of LOCK&LOCK’s key methods The company has launched a website in Vietnamese (http://locknlockcom.vn ) serving Vietnamese market Likewise, they use e-commerce distribution channel via social network such as Facebook, muachung.vn, cungmuasam.net, lazada.vn,… to reach more customers with minimum expense pg 17