strategies analysis for coolmate

The company''''s vision is to become the leading men''''s fashion e-commerce platform in Vietnam.To realize this, the company prioritizes customer satisfaction by investing significantly in th

UNIVERSITY OF BEDFORDSHIRE

SCHOOL OF BUSINESS

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FOREIGN TRADE UNIVERSITY

HO CHI MINH CITY CAMPUS

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END-MODULE ASSIGNMENT

Strategy and Innovation Code:

STRATEGIES ANALYSIS FOR COOLMATE

October 2023, Ho Chi Minh City

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STATEMENT OF AUTHORSHIP

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Ho Chi Minh City, October 2024

Table of Contents

STATEMENT OF AUTHORSHIP 3

I INTRODUCTION 5

1 Company Overview 5

2 Vision and mission 5

II STRATEGIES ANALYSIS 6

1 External Environment 6

1.1 PEST Framework Analysis (macro environment) 6

a) Political Factors 6

b) Economics Factors 6

c) Social Factors 7

d) Technology Factors 7

1.2 5 Forces Analysis (micro environment) 7

2 Internal Environment 9

2.1 Resources and Capabilities 9

2.2 Competencies and VRIO Framework 10

3 SWOT Analysis 11

III CONCLUSION 13

IV REFERENCES 14

I INTRODUCTION

1 Company Overview

Coolmate is a men's fashion e-commerce startup in Vietnam It was founded in 2019 with the mission to make men's fashion more accessible and convenient Coolmate offers a wide range of high-quality men's clothing and accessories at affordable prices, and it delivers directly to its customers' doorsteps Coolmate is one of the fastest-growing e-commerce startups in Vietnam In

2022, it achieved a revenue of over $100 million, making it one of the leading men's fashion e-commerce platforms in the country Coolmate is now valued at over $500 million, and it is well

on its way to becoming a multibillion-dollar company

The success of Coolmate can be attributed to meticulous strategic planning, a pivotal factor in their rapid growth Crafted in 2020, a five-year strategic plan delineated the company's vision, core values, and goals A cornerstone of this plan was an unwavering dedication to customer satisfaction Innovation emerged as another cornerstone as a dedicated team focused on developing novel products and enhancing existing ones Guided by strategic insights, Coolmate delved deep into understanding the target demographic, informing product development, marketing strategies, and customer service This informed approach helped build a reputable brand synonymous with high-quality, affordable men's fashion, giving Coolmate a significant edge over competitors

2 Vision and mission

Coolmate's mission is to make men's fashion more accessible and convenient

The company's vision is to become the leading men's fashion e-commerce platform in Vietnam

To realize this, the company prioritizes customer satisfaction by investing significantly in their customer service team and logistics, offering perks like free returns, and ensuring a seamless shopping experience Coolmate stands out by providing a wide array of high-quality, affordable products, ranging from clothing to accessories Their strong brand reputation, synonymous with quality and affordability, gives them a competitive edge Technological investments ensure an effortless online shopping journey, reflected in their user-friendly website and quick checkout process

II STRATEGIES ANALYSIS

1 External Environment

1.1 PEST Framework Analysis (macro environment)

a) Political Factors

Coolmate operates within a largely favorable political environment in Vietnam, marked by government support for startups and e-commerce businesses The absence of major political risks has allowed Coolmate to thrive However, there are potential challenges on the horizon The government's ability to introduce new regulations and alter tax policies could impact the e-commerce industry, potentially affecting Coolmate's operations and profitability For instance, Vietnam's government supports e-commerce growth through policies like Decree

85/2021/ND-CP, establishing a fair and competitive environment, ensuring legal guidelines for e-commerce activities, and safeguarding consumer interests (Government of Vietnam, 2021) Therefore, Vietnam's supportive political environment benefits Coolmate, an e-commerce startup Government backing fosters growth, but impending regulations and tax policy changes pose threats To thrive, Coolmate must stay compliant, engage in proactive discussions, and adapt swiftly to evolving political factors, turning challenges into opportunities for sustained growth

b) Economics Factors

Coolmate benefits from a generally favorable economic landscape in Vietnam The country's rapid economic growth, driven by factors like domestic demand, exports, and foreign investments, propels the e-commerce sector, aligning well with Coolmate's business With a young, tech-savvy population and a burgeoning middle class with increasing disposable incomes, the market presents ample opportunities However, challenges such as potential inflation, income inequality, and the looming threat of a global economic downturn require vigilant consideration Coolmate's strategy should include diversifying products, exploring new markets, and investing

in technology to enhance operational efficiency and customer service For instance, the increasing income of male citizens in Vietnam, as evidenced by the General Statistics Office of Vietnam's report that average monthly income increased by 7.4% year-over-year in 2022, is a positive development for Coolmate, as it means that its target customers have more disposable income to spend on its products, which leads to bigger market for Coolmate to develop

c) Social Factors

Coolmate benefits from a favorable social landscape in Vietnam, with a young, tech-savvy population and a growing middle class These factors align well with the company's e-commerce offerings While the increasing brand consciousness and popularity of social media present opportunities, challenges arise from traditional values and gender stereotypes, given Coolmate's focus on men's underwear Adapting marketing strategies to emphasize health aspects and product quality can address these challenges Moreover, with the burgeoning online shopping trend, Coolmate can maintain its edge by focusing on brand reputation, unique offerings, and technological enhancements, ensuring its competitiveness in the evolving market

d) Technology Factors

Coolmate operates in a technologically developing landscape in Vietnam, benefiting from the widespread adoption of smartphones and internet-connected devices, driving e-commerce growth The integration of advanced technologies like artificial intelligence and machine learning presents opportunities for Coolmate to enhance operational efficiency and customer service According to Global Digital Insights (2023, January 20), 91.3% of Gen Z and 90.8% of Gen Y in Vietnam use the internet This means that the vast majority of Coolmate's target customers are online and active users of the internet Social media platforms such as Facebook, TikTok, and Instagram bolster Coolmate's outreach efforts and brand recognition However, to sustain its competitive edge, Coolmate must continually invest in technology to meet evolving customer demands Coolmate can leverage artificial intelligence for tailored product suggestions and machine learning to prevent fraud, thus optimizing customer experiences Furthermore, embracing augmented reality and virtual reality technologies can create immersive shopping experiences, solidifying Coolmate's position as a tech-savvy industry leader

1.2 5 Forces Analysis (micro environment)

Supplier power in Vietnam's e-commerce sector remains relatively low due to the abundance of suppliers and minimal switching costs Coolmate benefits from a diverse pool of suppliers, ensuring flexibility and negotiation power However, vigilance against over-reliance on any single supplier is crucial to minimize vulnerability and maintain operational stability (Vietnam Digital 2023) Secondly, buyer power is robust in Vietnam's competitive e-commerce landscape,

driven by informed consumers and low switching costs The market is flooded with alternatives like Lazada, TikTok Shop, and Shopee This proliferation empowers buyers, compelling Coolmate to focus on unique selling points, exceptional customer service, and tailored marketing strategies to foster customer loyalty and mitigate the impact of strong buyer influence

Next, the e-commerce sector in Vietnam faces a high threat of new entrants due to low barriers to entry and escalating market demands Start-up costs are relatively low, and technology accessibility is widespread, facilitating the entry of new players To counter this, Coolmate must emphasize brand differentiation, invest in innovative technologies, and cultivate a robust online presence to establish itself as a distinctive and reputable e-commerce platform, thus deterring potential new entrants And for the threat of subsitute, e- commerce substitutes in Vietnam primarily include traditional brick-and-mortar stores and online marketplaces like Lazada, TikTok Shop, and Shopee However, the convenience, accessibility, and vast product variety offered by e-commerce platforms create a unique advantage Coolmate can strengthen its position by continuously enhancing its product range and user-friendly shopping, ensuring competitive pricing, and providing an unparalleled customer experience, thus solidifying its position as a preferred choice amid limited substitutes

Lastly, Internal rivalry within Vietnam's e-commerce industry is intense, driven by the presence

of well-established competitors like Lazada, TikTok Shop, and Shopee The e-commerce market demands constant innovation and superior customer service Coolmate, in this scenario, must focus on differentiation through unique product offerings, engaging marketing campaigns, and exceptional customer service Addressing customer needs effectively and efficiently can bolster customer loyalty, creating a competitive edge in a crowded marketplace Additionally, investing

in strategic partnerships, efficient supply chain management, and innovative technologies can enhance Coolmate's market position and enable it to thrive amidst fierce internal rivalry

In brief, Coolmate operates within a highly competitive e-commerce landscape in Vietnam While the industry offers immense opportunities driven by a growing tech-savvy population and increasing disposable incomes, it also presents challenges in the form of powerful buyers, the constant threat of new entrants, and intense internal competition To succeed, Coolmate must

continuously innovate, focus on customer-centric strategies, cultivate a strong brand identity, and invest in technology to differentiate itself from competitors, thus ensuring sustained growth and market prominence in Vietnam's dynamic e-commerce sector

2 Internal Environment

2.1 Resources and Capabilities

a) Porter Value Chain Framework

Coolmate's competitive edge in Vietnam's e-commerce industry is thoroughly planned by a well-executed used of the Porter's Value Chain model Through meticulous inbound logistics and robust supplier relationships, the company ensures a seamless flow of goods, maintaining efficient inventory management For example, this platform has formed its strategic partnership with Vietnam Post, one of the biggest logistic enterprise in Vietnam to support its inbound logistics, thus bring the best shipping price to its customers (Forbes Vietnam, 2022) Operations are streamlined with a highly automated order fulfillment process and a stringent focus on quality control, bolstering customer satisfaction and trust In outbound logistics, diverse shipping methods and on-time deliveries enhance customer experiences Furthermore, Coolmate's strategic approach to marketing, employing multi-channel strategies and a user-friendly website, coupled with exceptional customer service, as highlighted in the e-Conomy SEA report, solidifies its market position in many social media platform (Google, Temasek, & Bain & Company, 2022) This, combined with strong support activities like efficient procurement, continuous technology investments, and a focus on talent acquisition, cements Coolmate's reputation as a leading e-commerce player in Vietnam, setting industry benchmarks in operational excellence and customer-centricity

Coolmate's success story extends to its corporate culture, rooted in innovation and outstanding customer service, aligning seamlessly with its commitment to social responsibility By nurturing

a culture of excellence and incorporating it into every facet of its operations, Coolmate not only maintains its competitive advantage but also shapes the industry landscape, becoming a hallmark

of quality and reliability in Vietnam's thriving e-commerce sector, forward to its vision to become the Vietnam version of Uniqlo

b) Resources Analysis

Coolmate boasts a rich array of tangible and intangible resources, shaping its success in the competitive e-commerce market Tangibly, its well-established warehouse and logistics network are pivotal, ensuring seamless product handling and timely deliveries, addressing customer demands effectively Technologically, Coolmate's investments in advanced systems like Warehouse Management (WMS), Transportation Management (TMS), and Customer Relationship Management (CRM) enhance operational efficiency, streamlining processes and improving customer interactions

Intangible assets include a dedicated workforce, where experienced employees are deeply committed to the company's mission These human resources drive Coolmate's growth, contributing to its operational excellence and customer satisfaction Strong relationships with suppliers, cultivated through a long-term approach, are instrumental Coolmate's collaboration isn't merely transactional; it involves training and support, fostering mutual growth This symbiotic partnership ensures consistent high-quality products, competitive pricing, reduced costs, and increased innovation

2.2 Competencies and VRIO Framework

Coolmate's success in the competitive e-commerce industry can be attributed to its strategic blend of threshold resources and distinctive competencies A crucial threshold resource is its well-established logistics network, allowing seamless product handling and delivery, meeting customer demands efficiently Coolmate's distinctive competence lies in efficient order fulfillment, ensuring rapid and accurate shipping, a vital customer expectation in e-commerce

Moreover, the company's strong supplier relationships stand out as a distinctive resource, emphasizing its collaborative approach This approach involves active information sharing and idea exchange, enhancing the overall supply chain's quality and efficiency In addition to these, Coolmate excels due to its commitment to innovation, continuous investment in technology, a strong brand presence, and an unwavering focus on excellent customer service These unique resources and competencies underscore Coolmate's position as a customer-focused,

technologically advanced, and efficiently operated e-commerce enterprise, ensuring its success in the dynamic market

VRIO Analysis

Resource/Competence Valuable Rare Inimitable Organized to Use

Strong supplier relationships Yes Yes Yes Yes

Collaborative supplier management Yes Yes Yes Yes

Commitment to innovation Yes Yes Yes Yes

Strong brand Yes Yes Yes Yes

Coolmate's competencies can be analyzed via VRIO framework, focusing on the sustainability of these resources and competencies Firstly, Coolmate's strong supplier relationships are valuable, rare, and inimitable The long-term approach, coupled with training and support, establishes unique trust and goodwill, providing a sustainable competitive advantage Secondly, the commitment to innovation is valuable, rare, and inimitable Coolmate's willingness to take risks and invest in research and development creates a culture of creativity and experimentation, making it a source of sustainable competitive advantage

Thirdly, investment in technology is also valuable, rare, and inimitable Coolmate's specific knowledge and expertise in technology usage set it apart, leading to continuous operational improvements This investment becomes a sustained advantage through its IT department and focus on ongoing enhancements Lastly, the strong brand is valuable, rare, and inimitable Coolmate's reputation, built on trust and customer goodwill, forms a robust foundation Marketing efforts and customer-centric focus contribute to sustaining this advantage

Among these, Coolmate's strong supplier relationships stand out as the most sustainable competitive advantage While innovation, technology, and brand are pivotal, supplier relationships, rooted in trust and specific collaborations, are harder to replicate, providing Coolmate with a long-term strategic edge in the market

3 SWOT Analysis

Strengths and Weaknesses