(Tiểu luận) international marketing screening andmarketing strategies of ananas vietnam

The best possible market entry mode for Ananas...33 Trang 4 CHAPTER 5: Recommendations and conclusion...401.. The greatest option forAnanas''''s entry into the Japanese market is an EMC in

FOREIGN TRADE UNIVERSITY

SCHOOL OF ECONOMICS AND INTERNATIONAL BUSINESS

-*** -

GROUP ASSIGNMENT

Course: International Marketing

INTERNATIONAL MARKETING SCREENING AND MARKETING STRATEGIES OF ANANAS VIETNAM

Class: MKTE401 (HK1-2324) 1.3 Tutor: Prof Pham Thi Minh Chau

Group: 8

Ha Noi, October 2023

GROUP MEMBERS

1 Nguyễn Mai Anh 2212570004 Executive summaryChapter 1

4 Phạm Quỳnh Chi 2212570011 Chapter 3Leader

LIST OF CONTENT

LIST OF CONTENT 3

LIST OF TABLES 5

LIST OF FIGURES 6

EXECUTIVE SUMMARY 7

CHAPTER 1: A brief background from Ananas Vietnam 8

1 Introduction about Ananas 8

2 About its products 8

3 Current situation and the export prospects of Vietnam footwear export 9

CHAPTER 2: Market screening model 10

1 Preliminary Screening 10

2 Fine-grained Screening 13

2.1 Market Attractiveness (MA) 13

2.2 Competitive Strength 18

3 Conclusion 26

CHAPTER 3: Market entry 29

1 Possible entry mode criteria and their advantages/disadvantages 29

1.1 Factors affecting market entry mode decision 29

1.2 Possible market entry modes 31

2 The best possible market entry mode for Ananas 33

CHAPTER 4: Marketing tactics 34

1 Product 34

2 Price 36

3 Place: 36

4 Promotion: 38

5 Conclusion: 39

CHAPTER 5: Recommendations and conclusion 40

1 Recommendations: 40

1.1 Selection of Indirect Export Mode (EMC) with Negotiated Terms of Control: 40

1.2 Integration of Customized Designs Rooted in Japanese Culture: 40

1.3 Transition to Direct Export Mode for Long-term Sustainability: 41

2 Conclusion: 41

REFERENCES 42

LIST OF TABLES

Table 1 Global Business Complexity Index Rankings in 2022 - Source: TMF Group 9

Table 2 Country risk ratings June 2023 review - Source: Allianz Trade 10

Table 3 Market Attractiveness of Singapore 14

Table 4 Market Attractiveness of Australia 15

Table 5 Market Attractiveness of Japan 16

Table 6 Relative Competitive Strength of Singapore 21

Table 7 Relative Competitive Strength of Ausrtralia 22

Table 8 Competitive Strength of Japan 23

Table 9 Suggested STP strategy for Ananas in Japan 26

Table 10 Sociocultural distance between Vietnam and Japan – Source: Geert and Gert Jan Hofstede’s site 28

Table 11 Advantages and disadvantages of export modes 30

LIST OF FIGURES

Figure 1 Sneaker market by brand shares in Japan - Source: Statista 18

Figure 2 Sneaker market by brand shares in Australia - Source: Statista 18

Figure 3 Sneaker market by brand shares in Singapore - Source: Statista 19

Figure 4 Applied MA-CS Matrix 25

Figure 5 Export mode models 30

EXECUTIVE SUMMARYThis study makes suggestions for Ananas's international entry into Japan Japan issuggested as the superior choice over Singapore and Australia in the report's comparison

of the three possible markets because of its political stability, high growth rate, and bigmarket size Choosing the niche market of youngsters in an aging country, Ananas canutilize its resources to optimize profits and serve the customers The greatest option forAnanas's entry into the Japanese market is an EMC indirect export mode, which isadvised

The report suggests Ananas carry out an in-depth analysis to comprehendconsumer preferences and market trends to ensure success in the Japanese market Thebusiness should carefully choose distribution avenues that complement its uniquecapabilities

This paper concludes by advising Ananas to enter the Japanese market with atargeted and strategic strategy Ananas can build a strong brand presence in Japan, notonly meet but exceed the expectations of discerning Japanese consumers, and increaseits market share in the global footwear market by choosing the best entry strategy anddoing careful research

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Snacks in Vietnam(Full Market…International

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Summary about Global Marketing ( A…International

Marketing 100% (2)

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VGCC Vin Fast Goes Global - Of cial Cas…International

Marketing 100% (2)

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Investigative Marketing Report OF…International

Marketing 100% (1)

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International Marketing - EXAM…International 100% (1)

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CHAPTER 1: A brief background from Ananas Vietnam

1 Introduction about Ananas

Ananas, despite having been established in 2010, experienced a relatively slow start inthe Vietnamese market Ananas has more than 20 years of experience as amanufacturer of famous shoe brands (Puma, Reebok, Keds, Burberry, etc.) Later, withthe desire to be self-employed, Ananas invested in developing its own products andmanaged to gain recognition among young consumers in 2017

Registered and legally owned by Hazza Corporation, Ananas is a footwear brand thatspecializes in providing shoes 100% originating from Vietnam, specifically targeting youngpeople between the ages of 18 and 26 The brand aims to offer shoes that are not onlytrendy but also allow wearers to express their personalities Their motto, "High quality,High fashion, and Affordable price," reflects their commitment to meeting customerexpectations

With the message "DiscoverYOU," Ananas encourages individuals to understandthemselves and their desires The tagline reminds everyone that whatever you do, youneed to understand yourself and know what you want Ananas also embarks on a journey

to discover its own brand identity and hopes to position itself as an affordable and quality shoe brand that is devoted to serving young, dynamic people

high-2 About its products

Ananas specializes in producing vulcanized shoes and sneakers These shoes aresimilar to popular brands like Converse and Vans Old Skool Ananas differentiates itselfwith its expertise in Vulcanized sneakers, drawing on 20 years of experience in this field

Vulcanized shoes take on a simple shape with rubber soles and minimal design This type

of shoe has been lasting for over a century but is still well-known and popular amongmany types of customers Vulcanized shoes are known for their versatility, making themsuitable for everyday wear in various settings, including school, work, social gatherings, oreven skateboarding practices The brand focuses on preserving the original attributes of ashoe while still keeping up with current fashion trends, aligning with the lifestyle itrepresents In addition to the four main shoe lines currently available in stores - Basas,Vintas, Urbas, and Pattas - Ananas also offers other clothing products to complement itsfootwear range

3 Current situation and the export prospects of Vietnam footwear export

According to the Ministry of Industry and Trade, Vietnam holds a significantposition in the footwear manufacturing industry Vietnam is currently the 3rd-largestfootwear manufacturer in Asia and the 4th-largest in the world Vietnam's footwearexport output ranks just behind China's market Vietnam exports over 1 billion pairs ofshoes each year to more than 150 markets around the world with key markets in the US,

EU, China, Japan, the UK, and others, bringing substantial foreign currency revenues forVietnam

In 2022, the sector grew by more than 30%, with one of the reasons behind thishigh growth being the effective utilization of free trade agreements (FTAs) such as theComprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), the EU-Vietnam Free Trade Agreement (EVFTA) Over the past years, the export of footwear tomarkets that have FTAs with Vietnam has recorded a growth rate of between 10% and20% This will be a basis for the entire industry to set an export target of US$27 billion thisyear

CHAPTER 2: Market screening model

1 Preliminary Screening

The international footwear market has always appealed to Vietnamese producers

As the Ministry of Industry and Trade informed, “Vietnam's footwear exports in October

2022 are estimated at over 1.96 billion USD” With the rising reputation of Ananas inrecent years, the brand has the potential to reach out to the global market

To determine the top 3 countries for footwear exports, the first dimension toconsider is the industry potential by region The higher the potential is, the higher thepossibility of success for the brand The top 3 largest global sneaker markets reported areNorth America, Europe, and Asia-Pacific (Global Market Estimates, 2023) While NorthAmerica has been dominated by key players such as Skechers, Adidas, New Balance, Nike,and Puma (Mordor Intelligence, 2023), the complicated technical barriers to trade in EUmarkets are struggling Vietnamese exporters (Nguyễn and Phạm, 2021) In contrast, AsianPacific obtained the highest revenue share of 39.6% in 2022 (Grand View Research, 2022)and it is expected to be the fastest-growing segment in the global sneaker market from

2022 to 2027 (Nguyễn and Phạm, 2021) Therefore, Ananas' target market should be Pacific region

Asia-After narrowing down the scope to Asia-Pacific countries (APAC), the seconddimension to analyze is the import volume as it implies the potential market size that thebrand can exploit Japan, India, China, South Korea, Thailand, Australia, and Hong Kongwere recorded to make up 78% of the total import volume in APAC, followed byIndonesia, Taiwan, Malaysia, Philippines, and Singapore (IndexBox, 2023) They are thetop 12 APAC footwear importers

Another important criterion to look into is the Business Complexity Index (BCI) Itconsiders various factors that can affect a business’s operations, such as “governmentregulations, taxes, political stability, infrastructure, and economic conditions” (TMFGroup, 2022) The index determines how difficult it is for Vietnam’s footwear producers

to penetrate the host market The results indicate that 9 out of 12 APAC Countries withlower BCI are Hong Kong, Australia, Singapore, Japan, Thailand, Taiwan, Philippines,Malaysia, and India (Table 1)

Table 1 Global Business Complexity Index Rankings in 2022 - Source: TMF Group

Moreover, country risk is also one of the key metrics in the preliminary screeningprocess for its influence on a business's international success as it pertains to regulations,political stability, and economic growth that affect the macro-environment of thebusiness According to Allianz's June 2023 review, the top 7 countries with lower countryrisks including Singapore, India, Japan, Thailand, Australia, Philippines, and Taiwan (Table

2)

Table 2 Country risk ratings June 2023 review - Source: Allianz TradeLastly, trade barriers can directly affect the ability to enter the market, exportvolumes and prices; therefore it is among the knock-out criteria with a view to footwear

exporting Ananas is a 100% local Vietnamese brand so the chosen market should haveloose trade barriers to qualify for the technical standards The Trade Barrier Index (TBI)differentiated Japan, Australia, and Singapore as the 3 most suitable potential markets forAnanas to export (Tholos Foundation, 2023).

2 Fine-grained Screening

2.1 Market Attractiveness (MA)

To look for the host countries’ opportunities (Japan, Singapore, and Australia) tothrive in this highly competitive industry, market size occupies 30% of weight, sincemarket attractiveness estimates how profitable or desirable a target market is for aparticular business

By calculating the population of potential customer segments, businesses canassess properly which market size will gain much bigger profit for their own Japanoutweighs Singapore and Australia with 11,699 thousand persons aged 15-24 years old(Knoema, 2020) The bigger market size is, the more demand for products a definedgeographical area will provide

In terms of market growth - criterion refers to the expansion or increase in the sizeand value of a particular market over time, both Singapore, Japan, and Australia areforecasted to overgrow soon with a higher growth rate percentage (Statista, 2023), which

is also shown in expected annual revenue Thus, the footwear market in APAC in general

is currently seeing a rise in demand for sustainable and ethically-made shoes However,the Australia market is expected to witness a slight decrease of 0.5% in 2024 but it willstill recover well and strongly develop

Another important criterion to consider whether all screened countries aresuitable for business to market their products or not is Purchasing Power Parity PPP is apopular macroeconomic analysis metric used to compare economic productivity andstandards of living between countries According to The Global Economy in 2022,Singapore ranked in the top 3 highest PPP values in the world while Australia and Japanstood in top 20 and top 36 respectively.

Regarding market access, import duty which refers to taxes levied on goods,capital, and services should be taken into account As a result, lower import duty meansthe easier openness of an economy to world trade for foreign business Singapore’s policyencourages other products to penetrate much better than Japan and Australia with itsrank at 118th position in the world (WTO_World Tariff Profiles 2023)

With a small 10% weight, the distribution channel of each country concerns thedelivery of the products from producers to end-users Singapore’s distribution and saleschannels are simple, direct, and open to foreign firms established in Singapore(International Trade Administration) Most consumer goods are imported by stockingdistributors who resell to retailers Others are imported directly for sale in the importer’sown retail outlets Meanwhile, e-commerce channels are rapidly growing in Singapore,like Lazada and Shopee, as well as Zalora and Amazon In Australia, there exists variouschannels: direct sales, wholesalers, agents, online marketplaces, retail chains, innovationprograms Local online retailers like The Iconic and international platforms like ASOS andAmazon are thriving in this market Distribution in Japan is the most beneficial for foreignproducts’ penetration because it has long been considered the most effective non-tariffbarrier to the Japanese market The most common channels include wholesalers,retailers, and trading companies (SME Japan, 2022) E-commerce is rising in Japan:Platforms like Rakuten and Amazon are popular for purchasing footwear online

Political and economic risks (10%) can significantly impact the internationalmarketing process of a product These risks can create uncertainties and challenges thatbusinesses must address when entering foreign markets For this criterion, both 3countries - Japan, Australia, and Singapore are put in low-risk areas according to a review

of Country risk ratings in June 2023 (Table 2)

For all analyzed criteria, the following table describes the market attractiveness ofAnanas compared to each potential market:

Table 3 Market Attractiveness of Singapore

Table 4 Market Attractiveness of Australia

Table 5 Market Attractiveness of Japan

2.2 Competitive Strength

By comparing the firm’s competitive advantages to the strongest competitors, itcan determine the most potential market out of the 3 countries Within the scope ofSingapore, Australia, and Japan, Ananas’ strongest competitors are Skechers in Singaporeand Australia, which gained 18% and 17% market share respectively, and Nike in Japanwith a 22% market share (Statista, 2023)

Figure 1 Sneaker market by brand shares in Japan - Source: Statista

Figure 2 Sneaker market by brand shares in Australia - Source: Statista

Figure 3 Sneaker market by brand shares in Singapore - Source: StatistaBased on the level of importance, “Products fit to demand” has the highest weight

of 30% Because global brands have acquired a major market share in all 3 countries, toobtain market share, the products of Ananas should first meet the consumers’ demand inthe host country Secondly, Price is the competitive strength that is most likely to winagainst competitors so this dimension should make up 25% of weight The next one is

“Access to distribution channels” with 20% weight for its vital role in supporting thebrand’s product to approach customers Easy access to distribution channels also helpsfirms find suitable business partners (wholesalers, retailers, brokers, trade companies, …).The 2 final dimensions are “Product diversity” and “Quality Conformance” They areadditional factors that help differentiate the brand from others; hence equally occupy15% weight each

Regarding the first dimension, Ananas is on par with its strongest competitors in all

3 countries While the design of Ananas can meet the increasing demand for limited

edition sneakers among fashion-conscious consumers (Statista, 2023), the sneakers'durable rubber material is also concerned with sustainability in Australia wheresustainable and ethically-made shoes saw a surge in demand (Statista, 2023) Japan-wise,

20 years of experience in manufacturing footwear will also make Ananas meet the highdemand for quality craftsmanship here (Statista, 2023)

Price is the key competitive strength that Ananas can win over competitors.Ananas is considered a mid-range brand with a pair’s price ranging from about 30$ to 60$(Ananas, 2023) Meanwhile, on Skechers Singapore and Australia websites, the pricevaries from 30$ to 150$ (Skechers, 2023), whereas Nike sneakers in Japan costs from 50$

to 200$ (Nike, 2023) Moreover, the non-luxury footwear market in Singapore, Australia,and Japan accounted for 78%, 82%, and 79% of sales respectively (Statista, 2023) Thus,Anana can utilize its price competitiveness in all 3 markets, especially in Japan as Nike is ahigh-end brand that targets high-income consumers

In terms of the third dimension, Ananas is equally accessible to distributionchannels in 3 countries as the strongest competitors While Skechers has various retailstores (Skechers, 2023) and Nike chooses direct-to-customer distribution and wholesalers(Mohit Oberoi, 2020), there are favorable conditions for Ananas’ trade cooperation.Particularly, Vietnamese SMEs were recommended to penetrate prevalent e-commercemarkets in Singapore like Taobao, Qoo10, Lazada, … to promote their products withoptimized cost (VietCham Singapore, 2020) The government also enhances exportingopportunities in the Australian market by introducing footwear products at exhibitionssuch as the International Sourcing Expo Australia (VietnamPlus, 2022) Meanwhile, Japanand Vietnam are economic partners and members of free trade agreements (FTAs).Furthermore, the Vietnamese Trade Office boosts trade promotion by joining fairs,exhibits, and business networking events Consequently, Ananas can benefit from close

proximity with Japan, resulting in cost-efficient logistics and transportation, and utilizingtrade rules under FTAs (VietnamNews, 2022)

Concerning product diversity, other than sneakers, Ananas produces apparel andtote bags but in limited types compared to the head-to-toes product range of Skechersand Nike so the competitiveness is not as high as theirs Referring to quality conformance,Ananas is as likely to fit Japanese preferences as Nike with classic and timeless designs.For Australia market where consumers prioritize sustainability, the quality conformance

of the core product of Ananas which is vulcanized sneaker is relatively poor, while ESGscore Skechers is rather low at 21 (S&P Global, 2023) Therefore, the 2 brands areequivalent in this dimension As to the Singapore market, lightweight and breathableshoes are preferable (Atome, 2021) so athletic-oriented shoes like Skechers outperformAnanas’ products

On the aforementioned analysis, the following tables demonstrate the competitivestrength of Ananas compared to the strongest competitors in each country:

Table 6 Relative Competitive Strength of Singapore

Table 7 Relative Competitive Strength of Ausrtralia

Table 8 Competitive Strength of Japan

3 Conclusion

On analyzing the MA-CS Matrix, we conclude that Japan is the most potential

market for Ananas to implement footwear exporting

The following table suggests STP strategy of Ananas in Japan market:

Figure 4 Applied MA-CS Matrix