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UNIVERSITY OF ECONOMICS AND FINANCE HO CHI MINH CITY
SUBJECT: MARKETING CHANNEL MANAGEMENT FINAL REPORT: THE MARKETING CHANNEL
Lecturer: Nguy n Thễị Ngọc Dung
Class: 231.MKT1127E.A01E
Ho Chi Minh City, 20/10/2023
Trang 2LIST OF GROUP MEMBER
Trang 3Figure 1: Traditional fish sauce Cố Nhỉ 2 t
Figure 2: Traditional fish sauce Siêu Hạng 3
Figure 3: Traditional fish sauce Cao Đạ 3 m Figure 4: Traditional anchovy fish sauce 4
Figure 5: Ngư Vị anchovy fish sauce 4
Figure 6: Bay Hong Hanh channel 6
Figure 7: B y H ng H nh Channel ả ồ ạ 11
Figure 8: E-commerce Channel 11
Figure 9: General Trade Channel 11
Figure 10: Statista about the rate of online shopping 13
Figure 11: Our Survey 34
Figure 12: Contacting manager distribution by our team 35
Figure 13: Post on Facebook 36
Figure 14: H ng H nh on Shopee platform ồ ạ 37
Table 1: Direct Competitors 10
Table 2: Indirect Competitor 10
Table 3: Service Output Demand 15
Table 4: Function in General Trade 21
Table 5: Function in E-commerce 25
Table 6: Service Gap for General Trade 29
Table 7: Service Gap for E-commerce 30
Table 8: Cost Gap for General Trade 31
Table 9: Cost Gap for E-commerce 32
Trang 5First of all, our team would like to express our sincere thanks to Mrs Nguyen Thi Ngoc Dung
of the Marketing Channel Management class, who enthusiastically taught, imparted knowledge as well as helped, and guided us to the end love for us during the course That dedication has helped us to have more interesting experiences in the subject and successfully complete today's report.
Besides, I would like to thank all members of the group for their companionship, cooperation, and best efforts until the research is completed As well as the members of class A01E, for listening, contributing, and building ideas to help our group improve on the shortcomings of the group's topic.
However, our group's report still has many shortcomings in the implementation process because of its immaturity in professional knowledge and limited practical experience, so we hope to receive your contributions from teachers so that the group can improve those shortcomings and complete the research paper in the best way.
Finally, we are very grateful and grateful to the school for creating conditions for us to have more opportunities to collide, contact with reality and from there learn many new things in this subject At the same time, it helps us to apply useful practical knowledge through the subject Marketing Channel Management.
Trang 6Hong Hanh fish sauce is one of Vietnam's oldest brands of fish sauce Hong Hanh fish sauce's market share increased significantly between 2009 and 2013, however with changes in society and consumer preferences, this product slipped into a condition of unstable brand recognition in the domestic market The major issue is due to the brand's distribution channel management, which results in items not reaching the people when compared to young companies
We discovered concerns in the cost gap and service gap after examining the present channel From there, we presented a "Make" or "Buy" orientation for firms, as well as ideas tailored to the specific circumstance.
Trang 7Distribution channel management is a critical strategic component of providing items to end consumers However, some businesses continue to have distribution channel issues, resulting in items being brought to market that do not efficiently reach customers Hong Hanh sauce fish is one such example Even though it has been in the market for a long time, its brand awareness is still low when compared to other contemporaries and emerging businesses
The study team has significant points concerning the case of Hong Hanh fish sauce - circling around the issue of cost gap and service gap in the distribution channel system, particularly General Trade and E - commerce - based on practical investigation and analysis the true scenario.
Trang 8CHAPTER IV: CURRENT CHANNEL ANALYSIS 11
CHAPTER V: END-USER ANALYSIS 13
5.1 End-user Segmentation: 13
5.2 Targeting End-users by Service Output: 14
CHAPTER VI: CHANNEL ANALYSIS 16
6.1 Marketing function in General Trade: 16
6.2 Marketing function in E-commerce: 22
CHAPTER VII: THE EFFICIENCY OF MARKETING CHANNEL 26
7.1 General Trade Channel: 26
Trang 9CHAPTER VIII: GAP ANALYSIS 28
8.1 Service gap analysis: 28
8.2 Cost gap analysis: 30
8.3 Key Finding 32
8.3.1 General Trade 33
8.3.2 E-commerce 36
CHAPTER IX: MAKE - OR BUY 38 -
CHAPTER X: DESIGN MARKETING CHANNEL OF HỒNG HẠNH FISH
Trang 101
CHAPTER I: THE COMPANY OVERVIEW 1.1 Company Information:
The Hong Hanh brand is a long-standing fish sauce of Bay Hong Hanh Service Trading Production Co., Ltd, which was founded in 1986 and has grown with the country's integration The firm uses fresh raw materials fished off the coast of Phu Quoc and has a closed, sophisticated manufacturing process
1.2 About History:
1986, established Bay Hong Hanh Service Trading Production Coconsec 1993, exported to Japan and Taiwma
1998, honored to be voted by consumers as High-Quality Vietnamese Goods for many consecutive years
2003, processing and manufacturing separate products for Mega Market supermarket
2007, completed HACCP and ISO 9001 integrated quality management system 2015, achieved Halal certification, fully meeting the most stringent
requirements for food safety according to Islamic standards
2016, certificated by FDA (United States) that the product meets export standards for the US market
2017, one of the first businesses to receive the title of high-quality Vietnamese goods with integration standards
2019, change to new brand identity Modern, and luxurious but still retains typical traditional features
Trang 112
CHAPTER II: THE PRODUCT OVERVIEW 2.1 Product:
Hong Hanh sauce fish comes in five varieties: Traditional fish sauce Cốt Nh : ỉ
Use: Specifically designed for scoring
C t Nh are the first droplets of traditional fish sauce produced after 12 - 16 ố ỉ months of fermentation in hardwood barrels with charcoal anchovies and fine salt
Cốt Nhĩ preserves the most authentic, rich, and delectable flavor of traditional Phu Quoc fish sauce
Traditional fish sauce Siêu Hạng:
Use: Specifically designed for dipping raw meat with seasoning Figure 1 Traditional fish sauce C t Nh: ốỉ
Trang 123
Siêu H ng fish sauce is made completely with Phu Quoc charcoal anchovies ạ and Ba Ria Vung Tau fine salt, and it contains all natural nutrients, making each meal not only seductively tasty but also healthy
Traditional fish sauce Cao Đạm:
Use: Specifically used for marinating and cooking
Cao Đạm fish sauce includes a high concentration of natural amino acids, which assist to excite taste receptors and give flavor to each meal
Figure 2 Traditional fish sauce Siêu H ng: ạ
Figure 3: Traditional fish sauce Cao Đạm
Trang 134
Traditional anchovy fish sauce:
Uses: Specifically used for marinating and cooking
Each drop of Anchovy fish sauce includes a high concentration of natural amino acids, which excite the taste buds and give flavor to any meal
Ngư Vị anchovy fish sauce:
Use: Seasoning, braising, and cooking
Ngu Vi is the ideal alternative for making family dinners more tasty and appealing by offering moderate and economical costs while yet retaining the flavor of traditional Phu Quoc fish sauce
Figure 4: Traditional anchovy fish sauce
Figure 5: Ngư Vị anchovy fish sauce
Trang 14Traditional anchovy fish sauce 500ml: 72.000 VND
Ngư Vị anchovy fish sauce: 900ml: 36.000 VND 4,9 lít: 112.000 VND
Trang 167
General Trade:
Traditional markets and grocery stores around the nation sell Hong Hanh fish sauce, with the largest markets being Ho Chi Minh City, Vung Tau, Binh Duong, Binh Phuoc, Dong Nai, Tay Ninh, and other regional provinces Southwest
Furthermore, Hong Hanh continues to grow and promote the Northern market Modern Trade:
Horeca:
Trang 178
Export:
Hong Hanh fish sauce is now exported to the following countries: Japan, Taiwan, the Philippines, Singapore, and European and North American nations (France, Canada)
2.4 Promotion:
For end-users:
In 2019, Hong Hanh Company started a marketing program for end-users at Co.op Mart supermarket Most promotions are performed for Modern Trade and E-commerce channels, while General Trade is rarely used
On certain occasions, use promotions
Trang 189
For retailers:
3% discount on orders of 3,000,000 VND or more for shops (according to Binh Tan agent, 116/2 Le Dinh Can, Tan Tao, Binh Tan, Ho Chi Minh City)
Trang 19Tinh túy hương vị trăm năm
Company MASAN GROUP JOINT
Trang 2011
CHAPTER IV: CURRENT CHANNEL ANALYSIS
Channel Diagram
→ PICK: GENERAL TRADE and E-COMMERCE
Figure 7: Bảy Hồng H nh Channelạ
Figure 8: E-commerce Channel
Figure 9: General Trade Channel
Trang 2112
REASON: Focus on these two channels because there are many problems in the distribution channel system compared to the remaining channels, which affects the way the product reaches end-users in the market
→ Hypothesis about Hồng H nh Companyạ Advantages:
Hong Hanh fish sauce has been produced since 1986, this is a long-standing brand and certified for food quality from the state.
Hong Hanh sauce fish's distribution channel has wide coverage in traditional channels and E-commerce This makes it easy for customers to find brand products at key markets in Ho Chi Minh City, as well as easily place orders at E-commerce platforms Hong Hanh sauce fish's distribution channel promotes exports compared to the domestic market.
Although the channel has wide coverage, brand awareness is poor, the brand does not run much advertising, mainly uses the word-of-mouth method.
Product discounts for agents and retailers are unstable, so the products are not sold for a long time in key markets.
There are few promotions for General Trade, but promotions for E-commerce channels often follow holidays
Trang 2213
CHAPTER V: END-USER ANALYSIS 5.1 End-user Segmentation:
Bay Hong Hanh segments customers into 2 main groups based on purchasing behavior: Online buying trend and direct purchasing at the store (Modern women and Traditional women).
Since the pandemic two years ago, consumer behavior has changed quite a bit Customers use e-commerce platforms to shop more.
Specifically in the sauce industry, data from Statista shows that in 2020, 0.5% of revenue will come from online but by 2023 it will be 1.1%, 1.5% in 2024 and 2% in 2020 2025 This is an opportunity for Hong Hanh to reconsider investing in e-commerce channels to expand the market and compete with competitors However, more than 97% of revenue will still come from offline channels, so Hong Hanh should improve the quality of channel operations to meet a large amount of market demand and compete with competitors.
Main concern: They are people who care about their personal interests, like to enjoy a quality life, they believe in using reputable products with quality assurance on health safety
Figure 10: Statista about the rate of online shopping
Trang 2314
5.2 Targeting End-users by Service Output:
Segment name
Descriptor Level demand Descriptor Level demand
Spatial Convenience
“I often cook so I want to have fish sauc immediately when need it.”
"I think I don't care whether the buying
"I want to have man choices for the product want to buy, maybe won't find it or it will be out of stock when I go t many product line because I want to kno more products instea of just one type.”
"I want to clearly understand the necessa
whenever I have questio about products or qualit problems."
Bulk Breaking
“My house is near the market so I don't nee to store a lot of fish sauce.”
"I think if you have ordered, you should ord more than one product be able to apply discou codes or use promotion policies from the store."
Medium
Trang 2415
Delivery/ Waiting Time
“I don't urgently need a bottle of fish sauc right away, because can buy it when I go t the market or at th grocery store, becau I often pass by thes places."
"I chose to purchase o the e-commerce platfor and I accept that th delivery time to my hom may take longer tha expected."
Table 3: Service Output Demand
Trang 2516
CHAPTER VI: CHANNEL ANALYSIS 6.1 Marketing function in General Trade:
Physical possession
(1) The manufacturer has warehouses to store packaged fin products at two warehouses: Cu Chi (37 Street 142, Hamlet 8, My Commune, Cu Chi District, Ho Chi Minh City), Phu Quoc (1 Nguyen Trung Truc, Quarter 8, Duong Dong, Phu Quoc) (1) The fish sauce warehouse distributed from manufacture distributor is located at the warehouse in Cu Chi, Ho Chi Minh with an area of 5,000 m2
(1) Manufacturer will work and ship the goods to the distributor their own means or the shipping company will assist in transportation -> Manufacturer will bear the cost of storage delivery
(2) In each area in Ho Chi Minh City, distributors have their o warehouses so they can replace manufacturers and distribute th wholesalers
(3) Wholesalers store goods at their business locations (3) Distributors provide and manage deliveries, distributors will b shipping costs and loading labor costs when delivering good wholesalers
Trang 2617
(4) Retailers import goods through wholesalers, with large quan they will be delivered to your door and with small quantities they have to transport the goods themselves
(5) End-users will go to retail stores to purchase and pay directly
Ownership There are about 35 distributors in TP.HCM
(1) Manufacturer manages more than 1200 containers in stock (1) Hàng hoá t nhà s n xu t trong quá trình v n chuyừ ả ấ ậ ển distributors thu c quy n s h u c a nhà s n xu ộ ề ở ữ ủ ả ất.
(2) Each distributor keeps about 280 boxes in stock.
(2) Distributors who own their warehouses will bear the cost storing, and losing goods in the warehouse
(2) Goods from distributors during transportation to wholesalers owned by distributors
(2) If goods are delivered to wholesalers if there is breakag damage to the product due to the manufacturer, the goods w returned to distributors => Returned goods are owned by distribu (3) Goods in transit from wholesaler to retailer will be owned distributors.
(3) Goods, after being delivered to the wholesaler's store, wareh and after payment, will be owned by the wholesaler
(4) When stored and inventory goods expire, the retailer will be s responsible
Promotion (1) Manufacturer offers a 3% discount on wholesale invoices wholesalers and retailers over 3 million VND
Trang 2718
(1) Manufacturer supports printing and construction of store n signs for retailers
(2) After establishing a goodwill relationship between the distrib and wholesalers, the distributor will give an additional 1% disco for wholesale invoices over 10 million VND to wholesalers (2) Distributors have preferential policies for wholesalers, w wholesalers buy 6 boxes of 500ml super quality fish sauce, they get 1 box of the same line for free
(2) Distributors have preferential policies for wholesalers W wholesalers buy 1 box of 900ml super quality fish sauce, the price be reduced by 20,000 VND for each box purchased
(2) Distributors have a preferential policy for wholesalers W wholesalers buy 8 1 liter boxes of fish sauce, they will get 1 free of the same line
(3) Wholesalers offer promotions, discounts to retailers who goods in wholesale quantities and place regular orders (5) The end user will be the direct recipient of incentives from brand through promotions for end users
Financing (1) The manufacturer bears the cost of shipping returns from distributor
(2) Distributors bear all costs of shipping and returning goods f wholesalers, provided that the wholesaler is within the distribu management area