INTRODUCTION
Introduce business and field of activity
Nestled within the vibrant pulse of Vietnam's business landscape, Suntory PepsiCo Vietnam stands tall as a paragon of refreshment and quality excellence Born from the collaboration of two industry titans, Suntory Holdings Limited and PepsiCo Inc., our company emerged with a clear vision: to satiate the nation's thirst with beverages of unparalleled quality Since our inception, we have become more than a mere beverage provider; we are the embodiment of innovation, integrity, and above all, refreshment. Exploring Our Diverse Beverage Universe
At the heart of our enterprise lies an intricate tapestry of beverages that cater to every palate Our core activities revolve around the meticulous crafting and widespread distribution of an extensive range of drinks From the effervescent joy of carbonated soft drinks that fizz with excitement to the wholesome goodness of our healthy juices and the invigorating allure of our teas, every sip encapsulates the essence of our dedication to excellence
A Commitment to Quality, Sustainability, and Beyond
What sets Suntory PepsiCo Vietnam apart is not just our diverse array of beverages but our unwavering commitment to quality and sustainability We have meticulously carved a niche in the market, earning the trust of discerning consumers through products that tantalize taste buds while nourishing bodies Our commitment to sustainability runs deep, woven into the fabric of our operations We employ eco-friendly practices, championing a greener tomorrow while ensuring that our products continue to grace the tables of millions.
Beyond Refreshment: We Enrich Lives
Our journey transcends mere business transactions It's a narrative of enriching lives, fostering communities, and creating memorable moments Each beverage we produce is a testament to our dedication to enhancing the lives of millions of Vietnamese consumers We don't just quench thirst; we inspire moments of joy, celebration, and togetherness.
In Closing: A Future Refreshed with Innovation
As we move forward, our vision remains clear: to be more than just a beverage company.
We are architects of refreshing experiences, custodians of taste, and pioneers of sustainability With innovation as our guiding star, we are poised to script a future where every sip is not just a momentary delight but a lasting memory
Headquarters: Suntory PepsiCo Vietnam Beverage Company Limited Sheraton
Building, No 88, Dong Khoi Street, Ben Nghe Ward, District 1, Ho Chi Minh City,Vietnam
Historical development
A Journey of Innovation and Growth
Suntory PepsiCo Vietnam's story began in [year of establishment], when the partnership between Suntory Holdings Limited and PepsiCo Inc gave birth to a venture that would redefine Vietnam's beverage industry In the subsequent years, our company experienced exponential growth, leveraging cutting-edge technology and a deep understanding of consumer preferences to introduce a myriad of refreshing beverages to the market.
Through strategic acquisitions, relentless research, and a commitment to community development, Suntory PepsiCo Vietnam expanded its operations, becoming a market leader known for its quality and reliability Our historical development is a testament to our resilience and adaptability in the face of evolving market dynamics.
December 24, 1991, a joint venture between Suntory Pepsico and Marcondray (Singapore) contributed capital to establish the International Beverage Company (IBC). Hoc Mon Factory was launched in 1992.
1994 – PepsiCo officially entered the Vietnamese market when it entered into a joint venture with IBC International Beverage Company with the launch of its first two products, Pepsi and 7Up.
1998 - 1999 – This time was also the time when the capital structure was changed with 100% ownership belonging to PepsiCo
2003 – The company was renamed PepsiCo Vietnam International Beverage Company. Many non-carbonated beverage products continue to be launched such as: Sting, Twister, Lipton Ice Tea, Aquafina.
In 2004, the company expanded production and started doing business in Quang Nam. This is through merger and acquisition with the Dien Ban factory.
As of 2005, Suntory Pepsico Vietnam was officially recognized as one of the largest beverage companies in Vietnam.
April 2013 – Suntory PepsiCo Vietnam strategic beverage alliance was established between Suntory Holdings Limited and PepsiCo, Inc in which Suntory accounts for51% and PepsiCo accounts for 49% with the launch of new products Olong Tea+ Plus and Mountain Dew.
Vision and mission
At Suntory PepsiCo Vietnam, our vision reaches beyond the realms of ordinary aspirations We aim to transcend the conventional boundaries of a beverage company, striving to become the most admired and innovative entity in Vietnam's ever-evolving market Central to our vision is an unwavering commitment to three pillars: quality, sustainability, and customer satisfaction These pillars not only shape our products but define our purpose We envision a future where our beverages do more than quench thirst; they become a source of nourishment for the soul In this future, our drinks don't just refresh the body; they create moments of pure joy and contentment, enriching lives and fostering a sense of community among our consumers.
Crafting Exceptional Moments, One Sip at a Time
Our mission is a promise, a pact we make with every consumer who trusts us We are dedicated craftsmen, meticulously creating and distributing exceptional beverages that cater to the vast tapestry of tastes and lifestyles in Vietnam In this pursuit, innovation is our guiding light We understand that preferences change, and so do lifestyles Hence, we embark on a journey of continuous innovation, ensuring that our products are not just in tune with but ahead of the evolving trends and preferences of our diverse consumers.
Simultaneously, our mission goes beyond individual delight We are stewards of sustainability Environmental harmony is not just a choice; it's our responsibility We invest tirelessly in eco-friendly practices, ensuring that every sip is a step toward a greener planet Moreover, our commitment to community initiatives is unshakeable We actively engage in projects that contribute positively to society, forging connections and making meaningful differences in the lives of the communities we serve.
Through our mission, we are not just bottlers of beverages; we are architects of happiness and refreshment Each drink we create is an opportunity to inspire, to evoke smiles, and to refresh both body and spirit We understand that our role extends beyond the confines of commerce; it's about weaving moments of genuine joy and making a tangible, positive impact in the lives of our consumers and communities.
CURRENT MARKETING CHANNEL ANALYSIS
Current channel structure
Suntory PepsiCo Vietnam has a wide distribution network nationwide, including distribution channels such as supermarkets, convenience stores, agents and hotel restaurants This helps the company reach customers everywhere and meet their needs. Suntory PepsiCo Vietnam products can be easily found and purchased at familiar retail locations such as Family Mart, Circle K, Vinmart and large supermarkets such as Big C, Coopmart In addition, Pepsi also expanded its distribution channel system by cooperating with agents and fast food stores such as Lotteria, KFC and McDonald's.
Suntory Pepsico distributes directly to key customers These are customers and organizations with large sales volumes such as supermarkets, convenience stores or places such as restaurants, hotels and fast food chains with large sales volumes.
Suntory Pepsico distributes from manufactures to distributors such as: CJ Logistic, Minh Quang Mekong, Khai San Food, HT Sai Gon From those distributors, they distribute to three main channels: GT, MT and Horeca
GT is the traditional channel and the main distribution channel of Pepsico in Ho Chi Minh City Retailers in the GT channel are usually retail establishments within the coverage area of the retailer's upper intermediary Retail establishments can be traditional physical stores such as grocery stores, markets, or stores that have applied technology to the process of providing goods and services self-service shop but not on a large scale PepsiCo has a widespread agent network in Ho Chi Minh City, with more than 10,000 retailers level 1 and 20,000 retailers level 2 Retailers lv1 will distribute to retailers lv2 and then distribute directly to end users These retailers provide PepsiCo products to grocery stores, markets, across the city The total number of GT channels is more than 30000 retailers and all are aimed at the end user In this channel, Pepsico can contact many consumers, thereby helping Suntory PepsiCo reduce inventory, lack of products supplied to consumers and act as a "lubricant" to help products reach the hands of consumers consumers in the fastest and most convenient way.
In the MT channel, Suntory PepsiCo distributes products to locations with large consumption such as large supermarket chains (AEON Mall, Emart, Mega Market, Coop Mart, Lotte Mart, Big C, ) and other models Modern retail stores such as convenience stores (VinMart, BHX, Circle K, GS25, Family Mart, Satra, B'Mart, ) and Pepsico also create convenience for customers when distributing products at the machines vending machine (Vending Machine VN, Sunwon, Kootoro, TSEdding) In addition, Suntory PepsiCo mainly distributes drinking water products to users through online platforms such as e-commerce floors On the e-commerce platform, Suntory PepsiCo is present on major platforms such as Shopee, Lazada, Tiki,
Suntory PepsiCo's decision to choose and focus on direct distribution via e-commerce platform is necessary in accordance with the current progressive era Deploying distribution via e-commerce platforms helps Suntory PepsiCo save costs and increase revenue instead of having to go through agents and distributors to bring products to consumers Reach customers quickly and easily when these e-commerce platforms have a huge number of users Easier to manage and compare business metrics than traditional channels.
In addition, Suntory PepsiCo's products are also distributed through an intermediary quite different from the above intermediaries, the Tiki e-commerce platform Suntory PepsiCo products are delivered to customers through Tiki Trading Tiki Trading is a business store on the Tiki e-commerce platform and is directly managed by Tiki Suntory PepsiCo products on Tiki distributed by Tiki Trading will be purchased by TikiTrading from Suntory PepsiCo and then sold through the Tiki e-commerce platform to users that Suntory PepsiCo does not directly manage.
Suntory Pepsico VietNam has a very extensive distribution network, including all restaurants, hotels and catering in Ho Chi Minh City, and the number that the group can count is very large, so it can be narrowed down Furthermore, the group will highlight a few manifestations in two locations: fast food and cinema PepsiCo has invested heavily in this distribution channel to meet the increasing needs of customers The company has cooperated with many large cinema and fast food chains in Vietnam At fast food, there are two most prominent brands: McDonald's (18 stores) and Lotteria (90 stores) In cinemas, the highlights are CGV (20) and Galaxy (9) The total number that the team has counted on the Horeca channel is 137 stores and all are aimed at end users.
Suntory Pepsico will distribute 3 parallel channels including GT channel, MT channel and Horeca channel.
With the GT channel, Suntory PepsiCo, through the wholesaler level including exclusive and non-exclusive distribution agents, distributes goods to retailers, mainly retail establishments following the traditional model system, from these retail points the products are resold to consumers.
With MT channel and Horeca channel, Suntory PepsiCo will distribute products to a system of supermarket chains, convenience store chains, restaurants, hotels, and Tiki and through these intermediaries, the product will resold to users.
PepsiCo has invested heavily in its distribution system in Ho Chi Minh City to ensure the company's products can reach consumers everywhere PepsiCo's distribution system in Ho Chi Minh City is considered effective and flexible, helping the company meet the increasing demands of consumers.
End – user analysis
Customers have the mentality of regularly using products that are familiar to them
Customer groups may include businesses, such as restaurants, bars, and convenience stores that purchase large quantities of the company's products to sell to their customers
Customers want to buy products in large quantities in boxes or blocks to use for parties, family, friends
High High High Medium Low Low who purchase
Pepsico products for a convenient meal before work or school may be busy individuals or families who appreciate the convenience of being able to purchase
Pepsico products through multiple channels.
Customers buy it to make snacks or to enjoy while watching movies or
Customers are people who want to
(2) experience and evaluate soft drinks.
Figure 2: Suntory Pepsico's customer segment Table …: Suntory Pepsico's customer segment
After researching and reviewing, we decided to choose 2 target customer groups is:
Companion customers are more likely to purchase Suntory PepsiCo products more frequently, generating more revenue for Suntory PepsiCo.
Marketing to loyal customers is less expensive than attracting new customers because they are familiar with Suntory PepsiCo's products and brands, so they are more likely to respond to marketing campaigns.
They are also more likely to recommend Suntory PepsiCo products to their friends and family, which can help Suntory PepsiCo attract new customers It also helps reduce competitive pressure on customers compared to other competitors.
Bulk consumers are people who buy large quantities of products, often for large businesses such as restaurants, hotels, event venues, or households They are important to Suntory PepsiCo because they generate a significant portion of the company's revenue.
By focusing on the bulk consumer segment, Suntory PepsiCo can increase its revenue because when they buy products in bulk, they generate a significant portion of Suntory PepsiCo's revenue.
In addition, customers buying large quantities of products also helps reduce costs such as shipping and other costs.
Suntory Pepsico must also build strong relationships with customers and increase brand awareness to increase their likelihood of repeat purchases.
Segmentation is important to Suntory PepsiCo because it makes marketing more targeted, uses resources more efficiently, helps identify and address customer needs.
Channel system audit
After researching, our team decided to focus on analyzing Suntory Pepsico Vietnam's distribution channel in Ho Chi Minh City for deeper analysis.
Coopmart will be done by CJ
VietNam has two warehouses in
This warehouse is located in the Long
Park and serves as the company's main distribution hub for southern
Province: This warehouse is located in the Việt
Industrial Park 2 and serves as the company's main
Coopmart's regular partner for home delivery is Grap
Customers can choose to have it delivered to their home or take it home themselves distribution hub for central and northern Vietnam
Vietnam is responsible for the risk of loss or damage to the products until they are in Coopmart's possession.
Vietnam sets the prices of its products that are sold to Coopmart.
Coopmart may then set its own retail prices for
Coopmart is responsible for the risk of loss or damage to the products until they are sold to customers.
Does not perform ownership function
VietNam advertisements often feature celebrities to advertise the products
Sponsors events and activities popular with
Use social media such as Facebook,
Coopmart often offers POS promotions such as discounts and free gifts to encourage consumers to purchase their product
Word of mouth,Social media marketing to connect with consumers and promote products.
Negotiation Suntory Pepsico VietNam and Coopmart have equal power, so the Negotiation rights of both parties are equal
Does not perform negotiation function
Coopmart to buy goods and will pay for the goods within 45 days from the date of receipt of the full invoice.
Coopmart does not perform financing functions with end users.
Coopmart is a retail company, and its primary function is to sell goods and services to consumers.
Does not perform financing function
Risking Risk of loss or damage to goods have completed all documents confirming delivery and acceptance
In case the goods have been transferred to
Coopmart but are transferred back to
Suntory Pepsico for any reason, the risk of loss or damage will also be transferred back to Suntory Pepsico.
Coopmart has implemented a number of risk management functions for end users when there is a risk of loss or damage to goods such as extended warranties, return and exchange policy, delivery options.
Does not perform risking function
Vietnam uses a variety of methods to forecast demand for its products, including historical sales data, economic trends, and competitive activity.
PepsiCo Vietnam has finalized its sales forecast and negotiated contracts with its suppliers and distributors, the company places orders for the products and services it needs
Vietnam uses its ordering function to manage its inventory levels.
Coopmart can decide to order Suntory Pepsico products with CJ Gemadept Logistic or directly with Suntory Pepsico depending on the size of the order, the delivery deadline, and the cost of shipping.
If Coopmart needs to place a large order or if they need the order to be delivered quickly, they may choose to order directly from Suntory Pepsico.
If Coopmart only needs to place a small order or if they are not in a hurry to receive the order, they may choose to order from CJ Gemadept
Gemadept Logistic offers a variety of services that can help Coopmart save money on shipping.
Does not perform ordering function
Coopmart to pay by bank transfer and must complete payment within 45
The total amount payable to Suntory Pepsico VietNam under the Order shall be paid by bank transfer and
Customers can choose to pay in cash or by bank transfer or e- wallets. days from the date of receipt of full goods. payable within 45 days from the date of receipt of the full order.
VietNam uses mass communication tools such as newspapers, magazines, television and radio to share information with the wider public.
VietNam has a website and social media accounts such as Facebook,
Twitter, Instagram and LinkedIn to provide information about products, business strategies and company activities.
Coopmart has an official website that provides information about products, promotions, services and finding their nearest stores.
Figure 3: Suntory Pepsico VietNam participation in various channel function
An assessment of common indicators for product and service-related factors shows that product ownership and management, along with advertising campaigns, are highly rated.Meanwhile, financial management and elements of negotiation, ordering, payment, as well as information sharing are underestimated There is potential to improve service quality and maximize profits by focusing on these areas.
3.1 Auditing channels using The efficiency template
Figure 4: The efficiency template Analysis of Supply Chain Cost and Benefit Allocation
In evaluating the intricate dynamics of supply chains, it becomes evident that a delicate balance exists among the key stakeholders: manufacturers, retailers, and end users The following in-depth analysis sheds light on the specific cost and benefit allocation among these entities:
This metric evaluates the ability to hold inventory Manufacturers play a predominant role, scoring the highest at 55 points, signifying their significant responsibility in inventory management End users also hold a crucial role, accounting for 15 points, indicating their involvement in short-term storage.
Responsibility and ownership rights are moderately distributed, with retailers having a major responsibility, scoring 50 points Manufacturers hold a slightly smaller role at 40 points, indicating their ownership rights within a defined scope.
Advertising costs are almost evenly shared between manufacturers and retailers, each scoring 30 points, reflecting equal contributions End users also bear some advertising costs, amounting to 10 points.
During negotiations, retailers exert the most influence with a score of 60, indicating their superior bargaining power regarding pricing and terms Manufacturers and end users share a lower influence at 40 points and 0 points, respectively, highlighting their limited negotiation power.
Financial support predominantly comes from retailers, with a significant score of 50, while manufacturers play a lesser role, scoring 50 points End users do not contribute financially, marked by a score of 0.
Risk and associated responsibilities are equally divided between manufacturers and retailers at 60 and 40 points, respectively End users bear minimal responsibility, indicated by 0 points.
Ordering decisions primarily lie with retailers, accounting for 50 points, while manufacturers and end users have scores of 30 and 20 points, respectively, indicating their lesser involvement.
Payment responsibilities are evenly distributed between manufacturers and retailers, each scoring 50 and 30 points, respectively End users contribute to a lesser extent, represented by 20 points.
Information sharing is relatively equitable among all entities, with manufacturers leading at 40 points and retailers following closely at 30 points End users also play a significant role, scoring 30 points.
Analyzing Normative Profit Share for Manufacturer, Retailer, and End Users
Explanation: The manufacturer receives 56% of the profit share, recognizing the value of producing high-quality products and efficiently managing the supply chain Investment in research and development, coupled with optimized manufacturing processes, enables them to achieve a higher profit margin.
Explanation: The retailer receives 31% of the profit share, appreciating their role in connecting products with end consumers They are responsible for advertising, sales, and maintaining customer relationships Deep market understanding and fulfilling customer needs help them maintain a stable profit margin.
Explanation: End users receive 13% of the profit share, valuing the receipt of quality products or services that meet their needs They are not just buyers but also a vital source of inspiration for developing new products and improving service quality.
The normative profit share in this supply chain is distributed fairly, based on the roles and responsibilities of each party The manufacturer, having significant responsibilities in producing quality products and sustaining the supply chain, receives the majority of the profit share The retailer, acting as the bridge between products and the market, gets a moderate portion of the profit share Lastly, end users, though receiving a relatively small portion, are crucial in determining the product's success and the business's overall success This profit share distribution is intriguing and balanced, especially as the interconnections between parties in the supply chain become increasingly vital in a competitive market.
3.2 Auditing channels using gap analysis
Stable Price Expectations: Consumers are accustomed to a specific price range for PepsiCo's soft drinks and mineral water There is no significant pressure to reduce or increase prices, maintaining price stability across distribution channels.
Satisfaction with Service: PepsiCo's services, including product quality and shopping experience, have earned customer satisfaction This satisfaction helps maintain stable pricing, as consumers don't feel the need to explore alternative options.
Competition Dynamics: In a competitive market like the beverage industry, maintaining stable prices among products can be a strategy to sustain and enhance market share This also helps minimize price discrepancies between different channels.
Stable Price Levels: With the prices of soft drinks and mineral water being stable and satisfying consumers (at around 10,000 VND for soft drinks and 5,000 VND for mineral water), there isn't much room to increase prices without decreasing customer satisfaction.
Key findings
The proportion of channels where Suntory Pepsico's own goods transportation activities accounts for about 20% to 30% This means that the majority of Suntory Pepsico's products are shipped by third-party shipping partners, such as CJ Gemadept.
Suntory Pepsico chose to both transport goods itself and cooperate with CJ Gemadept as a shipping partner in managing marketing channels to balance control, flexibility and cost savings.
In the context of Vietnam's strong economic development, the demand for goods transportation is increasing, leading to increased transportation costs A sudden increase in transportation costs in 2023 will likely have a significant impact on Suntory PepsiCo.Because higher transportation costs will increase product costs, resulting in higher prices for consumers, which in turn could reduce demand for Suntory PepsiCo products.
CHANNEL STRATEGY’S PROPOSAL
New channel structure
Target Market: Consumers in Vietnam
Increase beverage sales by 15% in the coming year.
Reach new customers and expand market share.
Enhance brand awareness and perception.
1.1 Reasons for not building a new channel
PepsiCo Suntory is a major beverage distributor in Vietnam, and they have already penetrated most of the existing channels This poses challenges in establishing a new channel in managing marketing efforts Constructing a new channel to reach customers is a highly resource-intensive endeavor Building a new channel not only demands a significant amount of time but also requires hiring and training staff to operate the new channel Furthermore, substantial investments are needed in infrastructure, such as warehouses and distribution centers, incurring massive costs.
Additionally, there is no guarantee that the new channel would be successful PepsiCo Suntory might face intense competition from other companies operating within the new channel Moreover, there are numerous hidden risks associated with this venture.
Considering these factors, we have determined that opening a new channel at this juncture would not yield the best results for PepsiCo Suntory Instead, focusing on optimizing existing channels and enhancing PepsiCo Suntory's performance within these established channels appears to be a more prudent strategy.
PepsiCo Suntory will employ a multi-channel strategy to sell its beverages in Vietnam. The company will distribute its products through the following channels:
Traditional Retail: Including local grocery stores, convenience stores, and supermarkets.
Modern Retail: Including hypermarkets, grocery stores, and specialty shops. E-commerce: This encompasses online marketplaces and websites directly targeting consumers.
Food Service: Partnering with restaurants, cafes, and bars to sell their beverages.
Vending Machines: This includes vending machines and kiosks placed in high- traffic areas.
PepsiCo Suntory will implement various strategies to execute its channel strategy:
Traditional Retail: PepsiCo Suntory will collaborate with local distributors to reach more traditional retail outlets The company will provide training and support to its distributors on effective product selling and marketing strategies. Modern Retail: PepsiCo Suntory will partner with modern retailers to develop and execute marketing and sales plans The company will also provide modern retailers with promotional support and discounts.
E-commerce: PepsiCo Suntory will optimize its product listings on online marketplaces to ensure potential customers can easily find its products The company will run targeted advertising campaigns on online platforms.
Food Service: PepsiCo Suntory will collaborate with restaurants, cafes, and bars to sell its beverages The company will offer promotional support and discounts to its food service partners.
Vending Machines: PepsiCo Suntory will place its vending machines in high- traffic areas such as schools, office buildings, and shopping centers The company will also introduce discount programs and promotions to encourage consumers to purchase beverages from its vending machines.
1.3 Focus on the Grocery Store channel
Convenience stores are a convenient and accessible way for consumers to purchase food and beverages These stores typically offer a wide variety of products, are frequented by families with children, and serve as a reliable source of information for consumers This channel meets the diverse needs of consumers, providing both convenience and the ability to buy in bulk at affordable prices.
We propose a new marketing strategy for PepsiCo Vietnam focusing on enhancing product presence in convenience stores This strategy will utilize influencer marketing techniques We suggest creating a special program where popular and appealing celebrities will act as sales staff in convenience stores for a specific day To add value to the product, we will design special packaging featuring images and autographs of the celebrity.
As part of the program, a portion of the profits from product sales will be allocated to charitable activities selected by the participating celebrities Each product with this special packaging will be sold across PepsiCo's entire distribution network, primarily targeting convenience stores Additionally, PepsiCo will contribute 10% of the revenue from this special product line to charitable activities.
We believe that this campaign will not only enhance product awareness but also attract attention from customers due to the influence of famous artists Moreover, it can assist PepsiCo in executing meaningful and positive social activities.
Our strategy focusing on grocery stores is not only aimed at increasing sales immediately but also emphasizes the goal of building strong and sustainable relationships with customers By concentrating on this channel, we aim to achieve the following results:
1 Increase Awareness and Engagement: By placing PepsiCo products in grocery stores, we create a direct interaction environment with customers They can see and touch the products, enhancing awareness and providing a real-life experience.
2 Build Trust and Credibility: Product visibility in grocery stores, a place where customers trust and shop daily, enhances the brand's reputation Customers feel confident in choosing our products in an environment they are familiar with and trust.
3 Convenience for Customers: Grocery stores are frequented by consumers regularly, providing convenience as they can buy PepsiCo products where they shop daily This enhances product accessibility and boosts sales.
4 Establish Long-term Relationships: Focusing on grocery stores is not just a temporary transaction but also about building long-term relationships with retailers By creating special programs and collaborating with them, we forge strong and enduring connections, ensuring our continued presence and accessibility in grocery stores.
5 Promote Steady Growth: Grocery stores often bring a large number of regular customers By focusing on this channel, we shape a stable and consistent image, making it easier to predict and manage market demand and supply.
In summary, the strategy focusing on grocery stores is not just about immediate sales growth but also about building a solid foundation for PepsiCo's sustainable development in the Vietnamese market.
Detailed Plan for PepsiCo Vietnam's Influencer Marketing Campaign in the Grocery Store Channel
- Conduct market research to identify popular and highly influential artists currently trending.
- Choose one or more artists aligning with PepsiCo's values and image, and who have a strong influence on PepsiCo's target audience.
2 Program Development and Special Packaging:
- Design a special event program, including the date, location, and activities to take place in grocery stores.
- Create unique product packaging featuring the artist's images and autograph to create high appeal and recognition.
- Reach out and discuss with grocery store chains to coordinate the event at their stores.
- Discuss with the stores to ensure product display space and facilitate a convenient environment for the event.
- Develop advertising campaigns on various media platforms, including television, radio, and social media, to announce the special event.
- Create teaser videos, posters, and unique advertising visuals to generate excitement among the audience.
5 Event Execution in Grocery Stores:
- Set up product display areas in the store with ample space for the artist and PepsiCo products.
- Allocate specific areas where the artist can interact and take photos with fans.
- Support and train store staff on how to advise and sell this special product effectively.
- Use tracking tools to evaluate the performance of the campaign, including online views, product purchases, and social media interactions.
- Conduct surveys and gather feedback from customers to understand their perceptions of the product and the event.
7 Charitable Execution and Results Reporting:
- After generating revenue, allocate a portion as committed to charitable activities as part of the program.
- Prepare detailed reports on the amount raised for charity and how it was utilized to support community initiatives.
Channel gaps closing
Cost Analysis Report for Suntory PepsiCo Marketing Channel: 2023
Total Marketing Channel Operational Costs: $10,000,000 USD
- Transportation Costs: Increased by 5% compared to the previous year due to rising fuel prices.
- Warehousing Costs: Remained unchanged from the previous year.
- Inventory Holding Costs: Decreased by 10% due to improved inventory management practices.
- Pricing Costs: Increased by 2% due to rising raw material prices.
- Promotion Costs: Increased by 3% due to the growing use of digital marketing channels.
- Customer Service Costs: Decreased by 5% due to the implementation of a new customer service system.
1 Address Transportation Costs: To reduce the increased transportation costs, Suntory PepsiCo can explore new transportation technologies, such as autonomous transportation or drone delivery These technologies can handle small cargo loads efficiently, are highly flexible, not affected by traffic conditions, and ensure timely and convenient deliveries.
2 Implement Efficient Inventory Management: Suntory PepsiCo can invest in advanced Warehouse Management Systems (WMS) to track inventory more effectively. Forecasting systems can accurately determine inventory needs WMS automates manual processes like inventory entry, auditing, and packaging, saving time and improving accuracy WMS provides comprehensive visibility into inventory, helping identify inventory issues early and make better decisions Additionally, WMS enhances forecasting capabilities to ensure having enough inventory to meet customer demands without overstocking.
3 Evaluate Digital Marketing Campaigns: Due to the 3% increase in digital marketing promotion costs, Suntory PepsiCo should assess the effectiveness of digital marketing campaigns to ensure the allocated budget is wisely spent Various Key Performance Indicators (KPIs) like Click-Through Rate (CTR), Conversion Rate (CR), Bounce Rate, and other measurement tools can be utilized to evaluate campaign effectiveness. Conclusion:
Suntory PepsiCo's marketing channel operational costs are managed well; however, there are opportunities for cost reduction By implementing the above recommendations,Suntory PepsiCo can further enhance the efficiency of its marketing channel operations.
CONCLUSION
In light of the comprehensive analysis of Suntory PepsiCo Vietnam's distribution channels and its strategic proposals, several key findings emerge that will guide the company towards more efficient and effective distribution channel management
Firstly, a substantial portion of goods transportation activities is outsourced to third-party shipping partners, which accounts for around 20% to 30% of their distribution channels. This mix of self-transportation and partnering with companies like CJ Gemadept offers Suntory PepsiCo a balance between control, flexibility, and cost savings, contributing to the effectiveness of its distribution strategy.
However, it is essential to consider the potential impact of increased transportation costs in 2023 due to Vietnam's strong economic development Rising transportation costs may lead to higher product costs, ultimately affecting consumer pricing, potentially reducing product demand Therefore, the management of these escalating costs is of paramount importance to Suntory PepsiCo's future success.
In response to the current distribution landscape, the proposed channel strategy offers a multi-faceted approach to meet diverse customer needs, boost brand awareness, and increase market share By optimizing existing channels, collaborating with local distributors, modern retailers, and e-commerce platforms, and expanding vending machine placement, Suntory PepsiCo aims to enhance accessibility and customer engagement.
Furthermore, the special focus on the Grocery Store channel is a strategic move to increase awareness and engagement, build trust and credibility with consumers, provide convenience, establish long-term relationships, and promote steady growth The introduction of an influencer marketing campaign, in particular, is expected to not only drive immediate sales growth but also contribute to the long-term sustainability of the brand.
Channel management is key to ensuring the successful execution of the proposed strategies, with a blend of direct and indirect methods Tracking and managing customer interactions through Customer Relationship Management (CRM) for direct channels and maintaining strong partnerships with distributors for indirect channels are critical aspects of effective channel management.
To optimize operations, it is recommended that Suntory PepsiCo addresses transportation costs, explores new technologies, and implements more efficient inventory management practices Additionally, it should closely evaluate the impact and efficiency of digital marketing campaigns to make informed budget allocations.
In conclusion, the comprehensive channel strategy and cost management approach presented in this report are well-equipped to elevate Suntory PepsiCo Vietnam's distribution channels By striking the right balance between self-transportation and outsourcing, diversifying distribution channels, and addressing cost concerns, SuntoryPepsiCo is poised for further growth and success in the Vietnamese beverage market.The proposed strategies not only align with the company's objectives but also lay the groundwork for enhanced customer engagement, brand loyalty, and sustainable development in the dynamic Vietnamese market.