The application of Internet marketing in Vietnam status & solution

VIETNAM NATIONAL UNIVERSITY, HANOI SCHOOL OF BUSINESS NGUYEN VUONG PHUONG AN THE APPLICATION OF INTERNET MARKETING IN VIETNAM STATUS & SOLUTION Major: Business Administration Code: 60 34 05 MASTER OF BUSINESS ADMINISTRATION THESIS Supervisor: Dr NGUYEN THI PHI NGA Hanoi – 2010 CONTENTS Page INTRODUCTION CHAPTER 1: OVERVIEW INTERNET MARKETING 1.1 THE CONCEPT OF INTERNET MARKETING 1.1.1 Marketing concept 1.1.2 Internet concept 10 1.1.3 Concept of Electronic marketing and Internet marketing 12 1.1.4 Some of the different characteristics between E-marketing, Internet marketing and traditional marketing 14 1.2 ACTIVITIES OF INTERNET MARKETING 16 1.2.1 The Internet produce 16 1.2.2 The channel of Internet direct distribution 18 1.2.3 Price and control of price by Internet 19 1.2.4 Integrated Marketing Communication 20 1.2.5 Customer Relationship Management 21 1.3 THE ROLE OF MARKETING VIA INTERNET 23 1.3.1 For the customer 23 1.3.2 For the society 23 1.3.3 For business activities 25 1.4 THE INTERNET MARKETING ACTIVITIES IN OTHER COMPANIES IN THE WORLD 28 Chapter STATUS OF INTERNET MARKETING IMPLICATION IN VIET NAM 30 2.1 CONDITIONS OF INTERNET MARKETING IMPLICATION IN VIETNAM 30 2.1.1 Conditions of infrastructure 30 vi 2.1.2 Human resource conditions 31 2.1.3 Awareness conditions 32 2.2 INTERNET MARKETING ACTIVITIES IN VIET NAM 33 2.2.1 Situation of Internet marketing application in Vietnam 33 2.2.1.1 Website establishment 33 2.2.1.2 Online advertisement 35 2.2.1.3 E-mail marketing 38 2.2.1.4 Marketing by searching engine 40 2.2.1.5 Marketing by “virtual society” 43 2.2.1.6 PR on Internet 46 2.2.1.7 Viral marketing 47 2.2.2 Assessment of Internet marketing in Vietnam 48 2.2.2.1 Some of the results achieved through Internet marketing activities in Viet Nam 48 2.2.2.2 Some shortcomings of Internet marketing in Vietnam 54 CHAPTER SOLUTIONS TO THE EFFICIENT DEVELOPMENT OF INTERNET MARKETING IN VIET NAM 61 3.1 DIRECTION TO THE DEVELOPMENT FOR INTERNET MARKETING IN VIET NAM 61 3.1.1 Direction for the State 61 3.1.2 Direction to the development of Internet marketing 63 3.1.2.1 Training improvement in E – Commerce and Internet marketing 65 3.1.2.2 Extensive use of online advertisement 66 3.1.2.3 Increase PR activities to establish trademark 67 3.1.2.4 Internet marketing engines 67 vii 3.2 SOLUTIONS TO THE EFFICIENT DEVELOPMENT OF INTERNET MARKETING IN VIET NAM 68 3.2.1 Solutions at the governmental level 68 3.2.1.1 Developing of legal infrastructure 68 3.2.1.2 Developing infrastructure technology 69 3.2.1.3 Training and educating, popularization of E-Commerce 71 3.2.1.4 Improving a safe system of internet 73 3.2.1.5 Co-operating actively in international E - Commerce and Internet marketing area 73 3.2.2 Solutions at the business enterprises level 75 3.2.2.1 Changing perceptions about the Internet Marketing and Marketing 75 3.2.2.2 Internet Marketing planning 76 3.2.2.3 Internet Marketing plan budgeting 79 3.2.2.4 Internet Marketing Training 79 3.2.2.5 Internet Marketing engines application 80 CONCLUSION 88 APENDIX 89 viii LIST OF TABLE MAP AND IMAGE Map 1.1: Planning business strategies 25 Image 2.1: Image 2.2: Image 2.3: Leading search engine in the world Vietnamworks’ website Hapro’s website 41 49 54 Table 1.1: Customer care supplying channel 22 Table 1.2: The number of people using internet throughout the world 24 Table 2.1: State of development of internet in Vietnam 30 ix LIST OF ABBREVIATIONS VNNIC Viet Nam Internet Network Information Center www World wide web AMA American marketing association B2B Business to Business B2C Business to Customer B2G Business to Government PDA Personal Digital Assistant PR Public Relationship SWOT Strengthen, Weakness, Opportunities, Threaten TCP/IP Internet Protocol Suite VCCI Vietnam Chamber of Commerce and Industries x INTRODUCTION The necessary of the research According to Viet Nam Internet Network Information Center (VNNIC) statistics, the number of Internet users in Vietnam in 2007 was 18.5 million equivalents to 22% of the population and the number of Internet subscribers had reached 5.2 millions subscribers; 20-25% of the 150,000 businesses in the nation have its own website These statistics indicate the Internet’s significant development in Vietnam as well as enterprises’ perceptions about the advantages of the Internet Internet does not only criminate distant time but also makes the traditional business activities become more effectively as well as create more opportunities in business The Marketing concept has just been known in Vietnam since the late 1990s Although many Vietnamese enterprises have not been accustomed to the new marketing knowledge with the booming of Internet, they saw the extremely interesting variation of this activity Internet marketing is not only the great advantages but also the exciting challenges to many companies because Internet has its characteristics that are different from traditional business Therefore it is not suitable to apply traditional Marketing methods to Internet Although 20-25% of Vietnamese enterprises have websites, most of them are simple such as establishing website to give information monotonously or advertising on Internet… The general marketing knowledge and Internet marketing methods are not known widely and deeply in Vietnam Therefore, researching in Internet marketing systematically in Vietnam is really important Literature Review Marketing activities in general and Internet marketing in particular have been researched by many economic experts such as Philip Kotler, Judy Strauss, Dave Chaffey, etc In Vietnam, the issue of Marketing was taught in the universities for about 10 years ago Though the knowledge of Internet marketing activities are new, many research have been conducted on it as scientific research project For example, the ministerial research “Solutions to apply e-Marketing for exporter’s enterprises in Vietnam” was implemented by Dr Pham Thu Huong in 2007 The Objects and scope of the research The research concentrates on the Internet marketing activities in small and medium-sized businesses to shown the strength as well as the shortcomings of these activities Thus we can propose the solutions and requirements to make the Marketing system more suitable for Vietnam enterprises For the curent research’s scope, it only focus on the period of years recently when Internet is exploded and the E - Commerce’s appearance creates the necessary of Internet marketing activities in small and mediumenterprises in Vietnam Research Questions: - How is the situation of internet marketing in Vietnamese Enterprises? Are there any problems in that situation? - How is the trend of internet marketing applications in companies in the world? - What are the solutions to enhance the effecient of internet marketing application in Vietnam in coming years? The Research methodology This research combines differentt methods which are the following: Second data using: Because it’s a new matter in Vietnam so the author applied this method to learn the theories and the realities of Internet marketing application in the enterprises so we could have an overview of Internet marketing development Data analysis: The statistic data will help us consider the Internet marketing development to have more accurate predictions so we can recommend more effective solutions The structure of the research This research was constructed into chapters: Chapter 1: OVERVIEW OF INTERNET MARKETING Chapter 2: STATUS OF INTERNET MARKETING APPLICATION IN VIET NAM Chapter 3: SOLUTIONS TO THE EFFICIENT DEVELEOPMENT OF INTERNET MARKETING IN VIET NAM CHAPTER 1: OVERVIEW INTERNET MARKETING 1.1 THE CONCEPT OF INTERNET MARKETING The break-out of internet have created many great changes in every aspect of life and have lead to many excellent things that have never been created before Moreover, many new concepts which are related to Internet have appeared such as: E- Marketing, Internet Marketing, marketing online… So what is Internet? What are Marketing and the new concepts was born from a combination between internet and Marketing? In this part, we will bring out the meaning of Internet concept, marketing concept Then we will consider them in the relationship with new concepts like Internet marketing, E-marketing to find out the differences 1.1.1 Marketing concept There are many different notions of marketing Marketing is a process of organizing sales force to sell the company’s products Marketing is a process of advertising and selling Marketing is the activity of learning about and satisfy the market’s need Marketing is doing market, researching market to satisfy it In this research, the author followed this definition: marketing is socioeconomic structures which organization and individuals use to meet their needs and wishes fully by a process of exchanging products on the market According to Philip Kotler, Marketing is a process of managing that has social characteristics Therefore individuals and teams have what they need and want by the activity of creating, selling and exchanging the products that are valuable for other people This Marketing concept is based on the core concepts: need, want and demand, product, value, expense and satisfaction, exchange, transaction and relationship, marketplace, marketing and marketers ... problems in that situation? - How is the trend of internet marketing applications in companies in the world? - What are the solutions to enhance the effecient of internet marketing application in Vietnam. .. Assessment of Internet marketing in Vietnam 48 2.2.2.1 Some of the results achieved through Internet marketing activities in Viet Nam 48 2.2.2.2 Some shortcomings of Internet marketing in. .. Chapter 1: OVERVIEW OF INTERNET MARKETING Chapter 2: STATUS OF INTERNET MARKETING APPLICATION IN VIET NAM Chapter 3: SOLUTIONS TO THE EFFICIENT DEVELEOPMENT OF INTERNET MARKETING IN VIET NAM CHAPTER