principles of marketing ofjapanese acecook companyin vietnam market group assignment

PRINCIPLES OF MARKETING OFJAPANESE ACECOOK COMPANYIN VIETNAM MARKET GROUP ASSIGNMENT... With their administrative center in Suita,Osaka, and ensuing branches all through Japan, Acecook s

PRINCIPLES OF MARKETING OF JAPANESE ACECOOK COMPANY

IN VIETNAM MARKET

GROUP ASSIGNMENT

P rimary research on marketing of

Acecook in Viet Nam

SUBJECT: MKT101

LECTURER: Trầần Di u Thúy ệ

GROUP MEMBERS: Nguyễễn Công Tuầấn Anh – HS163316

Nguyễễn Thúy Linh – HS163409

Lễ Th Tuyễất – HS163420 ị

Nguyễễn Đình Vi t Khôi – HS160922 ệ

Trầần S n Tùng – HS150574 ơ

Table of content

I, Introduction

1.1 Company description

1.2 The Product’s STP ( Segmenting - Targeting – Position )

II, Business environment Analysis 2.1 Micro-Environment

+ Company

+ Suppliers

+ Customers

+ Competitors

+ Marketing intermediaries + Public

2.2 Macro-Environment

+ Demographic

+ Economic

+ Natural

+ Technology

+ Political/Legal

+ Cultural

III, The company’s current marketing mix

IV, Conclusion and Recommendation

V References

I INTRODUCTION

I.1 Company Description

Acecook was first settled in Japan as the Umeshin Confectionery Company, prior to changing their name to Acecook in 1964 With their administrative center in Suita, Osaka, and ensuing branches all through Japan, Acecook sells dried and instant noodle items, soups, sauces, fixings and soda pops in the Japanese and Vietnamese business sectors

(Acecook 2020) Kajiwara Junichi, CEO of Acecook Vietnam, started from the craving of "adding to improve the food culture in Vietnam and the world through the creation and exchanging of great food" (Acecook 2020) In

1993, Acecook Vietnam JSC was set up dependent on the venture of Acecook Group, one of the biggest instant noodle makers in Japan Since its foundation on December

15th 1993 and authority introduction in 1995, Acecook

Vietnam Joint Stock Company has been continually

creating and turning into a main maker of groceries in

Vietnam

I.2 PRODUCT’S STP Segmenting:

Segment Demography Psychography Behavior Geography College students Age: 18 to 25 years old

Family life cycle: young

and unmarried

Education: high school

graduate

Occupation: current

college/university

students, unemployed

Monthly income: Under

3,000,000 VND (part-time

jobs)

Social class: Lower to middle class Lifestyle: academic focused, balancing work and school, socially active, like to enjoy life rather than focusing on themselves

Personality characteristics:

optimistic, energetic, flexible, youthful, outgoing, sensitive

Benefit sought: low pricing point, have a variety of flavors, convenient User status: Regular user

Usage rate: Medium user Loyalty status:

Medium

Density: Urban areas, mainly in dominant cities

Single office

staffs

Age: 22 to 30 years old

Family life cycle: young,

single

Education:

college/university

graduate

Occupation: civil service

workers, clerks,

receptionists, managers,

secretaries

Monthly income:

5,000,000-15,000,000

VND

Social class: lower to middle class Lifestyle: busy balancing work and family, focus on making ends meet, prefer things to be fast and convenient

Personality characteristics:

persistence, agile, progressive, skillful, enthusiastic, creative, active

Benefit sought:

convenient, shorter cooking time, have many ways to cook

User status: potential user

Usage rate: Light user Loyalty status:

None

Density: mostly urban areas, and a small part of suburban

Factory workers Age: 25 – 50 years old

Family life cycle: married,

old

Education: High school

graduate

Occupation: garment

workers, knitting

workers, craftspeople,

electronic workers,

miners

Monthly income:

3,000,000 - 6,000,000

VND

Social class: lower class Lifestyle: working overtime, family focused, have little to

no time taking care of themselves, repetitive work, focus on making ends meet

Personality characteristics: hard-working, realistic, determined, homebody, handy

Benefit sought:

cheap price, fill the stomach, long time preservation

User status: Regular user

Usage rate: Medium user Loyalty status:

Strong

Density: mainly rural area and some

in the urban areas

Targeting:

Acecook Vietnam, or Hao Hao specifically, has used the Differentiated Marketing Strategy to target various market segments by introducing new lines (ramen, rice noodle, and vermicelli noodle) and flavors basing on the customers’ high demands In recent years, they mainly focus

on targeting the ‘College students’ segment These youthful adults are at the age where they

want to enjoy exploring life and having fun, so that they will not regret it in the future They are

so busy with their social life that they forget to take care of themselves properly One of their most popular reasons for not following a healthy lifestyle is not having enough time (Jennifer & Melissa 2012) This lack of time preparing meals had led these students to purchase convenient and low-priced packages of instant ramen In addition, in 2019, Hao Hao together with a

popular singer, Truc Nhan, produced a music video that was dedicated ‘to their loyal customers and their prospects in an attempt to celebrate 20 years of establishment’ (Vpopwire 2020) This colorful and lively video with the catchy music has brought the brand even closer to the younger generation Thus, this created a fun and exciting image of Hao Hao

Another segment that is being targeted by Hao Hao is the Factory worker According to

Vietnam Briefing, the number of laborers in Vietnam had an increase of 400,000 people within one year, from 2016 to 2017 (Vietnam Briefing 2018) They make up a substantial amount of the country’s population Their needs are usually focused on having quick and filling meals between working hours, so they can take in the needed energy and get back with the flow Moreover, the products are quite accessible as they are being sold in most supermarkets, convenience stores, and traditional Vietnamese markets The company not only focuses on serving the customers nourishments, but also focuses on their mental health By organizing a fully sponsored trip to Maldives for the luckiest customers (VnExpress 2020), they have helped the customers to get away from their hustling, stressful, and monotonic life On top of that, they also have

promotional programs, which loyal buyers of Hao Hao can have a chance to win Honda SH motorcycles, Sony Televisions, or Toshiba washing machines (Tuoi Tre News 2018) This strategy increased the loyalty status of the customers, since there many rewards and gifts that they can get in return for buying Hao Hao regularly The remaining “Single office staffs” segment can be seen as the least focused target out of the three segments mentioned above The reason is that this group has many other healthier options to choose from (home-cooked meals, dining out, and delivering food) other than instant noodles A small number of this group is the potential customers, but not the majority of them This is the reason why the company does not heavily focus on this segment, but rather putting more effort on the other segments

Positioning

The positioning map illustrates the two attributes which are flavor and nutrition of six kinds

of Vietnamese noodles According to the map, Hao Hao and Gau Do instant noodles have the most flavor, with a total of seven tastes, among the other noodles Due to the variety of Hao Hao products, customers can select the options that fit their taste the most as well as switch between each flavor of noodles to maintain diversity in the taste In terms of nutrition, Hao Hao only ranks behind Omachi noodles, however, still offers enough nutrition and energy for consumers with 350kcal per 75g In short, Hao Hao is such a worthy option due to its variety in flavor and sufficient nutrition

Besides its strength in taste and nutrition, Hao Hao is also popular for its price as it is affordable for every consumer of different standard living With VND 3,500 each package, Hao Hao becomes the best choice for those who demand low-cost food but still contain enough nutrition The second feature is the quality of noodles which is one of the most vital factors that many consumers are concerned about With many international and domestic certifications of food quality and safety, Hao Hao is dominant for its quality compared to the other competitors

II, Business environment Analysis

2.1 Micro-Environment:

COMPANY

The structure of a company is one of the most important factors that affects the marketing performance That helps people work in harmony to lead the organization successfully Under the administration of Mr Kajiwara Junichi, General Director of Acecook Vietnam, the company ranked 13 in the “100 best places to work for in Vietnam” in 2020 (Nguyen 2020) In other words, not only its management structure is ideal but also the working environment is friendly

In terms of financial situation, Acecook Vietnam’s revenue went up from 7,882 billion VND in

2015 to over 9,800 billion VND in 2019 Their annual profit raised about 20% each year to above

1,300 billion in 2018 Moreover, its Hao Hao instant noodles is the best-selling brand (VIRAC 2020) Therefore, it can be seen clearly that the company’s finance is very strong

To sum up, Acecook Vietnam holds a viable and professional human resource as well as its great annual profit That significantly contributes to the company's sustainable development

SUPPLIERS Suppliers are businesses or individuals providing essential resources for the company to produce its goods and services About this area, Acecook Vietnam has well-concentrated on the qualities of ingredients Hence, the input ingredients are always controllable They usually conduct evaluations and give instructions to their suppliers about high-quality raw materials Moreover, according to Giang (2018), the company had seven branches and eleven factories Acecook Vietnam invested $50 million for each factory using Japanese technology to fulfill customers’ needs as well Furthermore, each factory is almost 80% automatic In those factories, the main material used is wheat flour imported from Australia and Canada Additionally, vegetable oil is imported absolutely from Malaysia In other words, because of the cutting edge of Japanese technology and their credible suppliers, Acecook Vietnam’s products can constantly appeal to their consumers

CUSTOMERS

Customers are the core value of the Micro-environment The main consumers of Acecook Vietnam are the Vietnamese of all ages and occupations To serve customers better, Acecook Vietnam has produced a lot of delicious products, suitable for the taste of the Vietnamese such

as the sour and spicy flavours of pork ribs, fried garlic, braised beef and so on They not only have reasonable prices but are also tasty Moreover, the company is really successful in winning customers' hearts That is to say, Hao Hao has held a dominant position in the market In particular, Hao Hao was officially acknowledged as the “instant noodles with the highest consumption quantity in Vietnam in 18 years” by Vietnam Book of Records - Vietkings

(Thanhnien 2018) Hence, Hao Hao is well known for its safety and taste as well

COMPETITORS

In 2019, Vietnam had over 50 instant noodle brands (Thi Ha 2019) In other words, although the company has usually achieved higher profit compared to other companies, it is also

concerned about two main direct competitors, that are Masan consumers and Asia Food About Masan consumers, it has Omachi and Kokomi brands, which abundantly contribute to their revenue Masan focuses on high-end segmentation Moreover, there are many famous

celebrities advertising Omachi and Kokomi As a result, many people tried it and they have liked these brands as well (vietnambiz 2020) Additionally, there are some indirect competitors with different instant products such as Gau Do instant porridge of Asia Food

MARKETING INTERMEDIATIES Marketing intermediaries help companies to promote, sell, and distribute their products to end consumers They include wholesalers and retailers, distributors, financial firms as well as marketing agencies About resellers, Acecook’s products are distributed to a wide range of places Their main resellers are Co-op Mart, Citimax, Vinmart Supermarket, Ministop, Circle K, B'smart convenience stores and many food stalls in Vietnam Additionally, thanks to Covid-19 pandemic, the customers tend to shop online Therefore, e-commerce websites such as Shopee, Lazada and Tiki have been good places for people to buy things online A wide distribution network is one of the strongest advantages of Acecook Vietnam About marketing agencies, the company has a variety of TV advertising campaigns with special promotion For example, “Be An Instant Noodles Billionaire”, “Acecook Vietnam Congratulates Vietnamese National Football Team on being the Champion of AFF SUZUKI CUP 2018” and “Tet with Hao Hao, earned a Lexus” (Acecook Vietnam n.d.) For 25 years, it can be said that most Vietnamese have known Hao Hao very well

PUBLIC

Acecook Vietnam has many social activities that can help build the relationship between the company and its public Under the pressure and difficulty of Covid-19 Pandemic, General Director Kajiwara Junichi wrote a letter to the consumers saying that the company cared about their customers' feelings and motivated them to be stronger (Acecook Vietnam n.d.)

Furthermore, the company also sent 13,900 noodle boxes to the locals heavily affected by disasters in Central Vietnam (Acecook Vietnam n.d.) Another thing is that Acecook Vietnam has

a lot of promotions such as “Eat Hao Hao, Be wealthy" (Acecook Vietnam 2019) The message was that the company always wished Vietnamese consumers luck and wealth For those meaningful activities, Acecook Vietnam has built a better emotional connection with the public 2.2 Macro-Environment:

Demographic - Acecook sells its Hao Hao instant noodles to business to business reseller markets such as to a widespread of local convenience stores and larger supermarket chains across Vietnam The majority of the reselling markets are located in larger towns and cities across Vietnam, in urban populated areas The urban population is forecasted by the UN to rise

by more than 50% by the early 2040s creating opportunities for Acecook (Fitch Solutions Country Risk & Industry Report 2020) Growth in the urban population will help to enlarge their customer equity due to there being a larger market of potential buyers available in cities This will also be simultaneously benefitted by the changes in Vietnam’s population In the year 2020 Vietnam currently has a population of 97.34 million people and is on the incline, projected to increase to 103.26 million by 2024 (Fitch Solutions Country Risk & Industry Report 2020) This allows Acecook to have incentive to appeal to more segments, as there is a higher population of potential buyers, making new segments greater in numbers and worth targeting

Economic - Real GDP which tracks the economic growth of Vietnam, was previously estimated

to be 3.0% in 2020 but was revised to 2.6% (Jason Yek & Michael Langham 2020) This is important to note as the economy has not been drastically affected, influencing the stability of Acecook’s brand Instead, there is a stronger rebound to come in 2021 with real GDP at 8.2% Furthermore, since 110% of Vietnam’s GDP is reliant on exports, Acecook is also counting on the external economic environments of its biggest export regions to help support business figures (Jason Yek & Michael Langham 2020)

According to the deputy planning minister in October of 2020 it was said that “Vietnamese people should earn around $5,000 per year on average by 2025, up from $2,750 now”(Asia News Monitor 2020b) Revealing that Vietnam has a growing middle class that is soon to extend

to the majority of Vietnamese people Unfortunately, this sees disadvantages for Acecook, as their customers gradually move up to a higher economic status, they are less inclined to prioritize the cheapness and convenience of Hao Hao instant noodles They may prioritize more expensive and nutritious products, since their status gives them that luxury However, this depends on how well Acecook has constructed the loyalty retention of its customers

Furthermore, the global instant noodle market is to reach $32.1 billion by 2027 (Market Reports 2020) Vietnam greatly contributing to the market by being the 3rd most country of instant noodle consumption per capita at 56.9 servings (Instant Noodles at a Glance 2017)