develop a communication strategy for celano

LIST OF FIGURES/ CHARTS/PICTURES AND TABLES IN REPORT Figure 1.1 NBO Company Shares of Ice Cream: % Value 2011-2015 Figure 2.1 The communication process Figure 2.2 Cost effectiveness of

MMCoM9

NGUYEN THI NGOC DUNG NGUYEN HOANG THANH THUY

DEVELOP A COMMUNICATION

STRATEGY FOR CELANO

MASTER FINAL PROJECT MASTER IN MARKETING AND COMMUNICATION MANAGEMENT

Ho Chi Minh City (2016)

DECLARATION

We declare that this study does not incorporate without acknowledgement any material previously submitted for a degree or diploma in any university; and that to be the best of knowledge it does not contain any material previously published or written by another person except where due reference is made in the text

Master of Marketing and Communication intake 9

We are using this opportunity to thank all Facilitators, Coordinators, Classmates and the numbers of the Postgraduate Office at Open University HCHC and Solvay Business School for their contribution in assistance and encouragement in completing this project

Last, but not least, we would like to say thanks to all our classmates and our families who have given us much encouragement and support during the time we perform this thesis

ACADEMIC TUTOR AND PRACTICAL TUTOR’S COMMENTS AND APPROVAL SIGNATURE

Academic Tutor: Prof Hoang Thi Phuong Thao

Practicing tutor: Mr Le Minh Duc

Tutor’s comments

It is nice working with Thuy and Dung on this project The two members have shown

a lot of efforts in order to bring the best results for the project

In general, both project members have shown their understanding on the flow of how to solve the marketing problem and how to use the knowledge learned into the whole process

At the recommendation, Thuy and Dung are quite creative and insightful, taking the

advantage of knowing well the product, which is the target of the project

Nevertheless, it is needed to have a logical link from all the data to come up with recommendations, which will make them worthy and reliable The sampling on the research needs further validity

The project team should have given a better timing to provide good opportunity for adjustment and correction

I suggest the project to be presented in front of the jury, conditionally that the presentation is well prepared on selective content

I am glad that this project is part of Thuy and Dung’s achievement after two years investing for knowledge to aim at the better career promotion and development

Good luck to the presentation

Le Minh Duc

LIST OF FIGURES/ CHARTS/PICTURES AND TABLES IN REPORT

Figure 1.1 NBO Company Shares of Ice Cream: % Value 2011-2015

Figure 2.1 The communication process

Figure 2.2 Cost effectiveness of three different communication tools at different buyer

readiness stage Chart 1 Location that customer choose to enjoy ice-cream

Chart 2 Brand awareness about what ice cream is consumed

Chart 3 Customers’ awareness about company produce ice cream

Chart 4 Brand recognition of cone ice cream

Chart 5 Consumers’ favorite brands

Chart 6 Media channel which customers often to see

Chart 7 Customers advocate about ice cream

Table 1 Porter 5 forces analysis

Table 2 Brief of Lap campaign

Table 3 SWOT analysis

Picture 1 SKU of Celano

Picture 2 Banners of Color of Celano campain

ABSTRACT

The research starts with introduction about Kido Then we write about problem statement and set the objectives for research Besides that we mention about scope and limitation of research Research methodoly and structure of project is the last part of chapter

I

Chapter II is written with some literature reviews, covering all the concepts that supports fundamentally for setting the strategy Firstly, some definitions about communication strategy are extracted from various sources Though phrasing in different ways, most of the definition share commonality Marketing communication mix is another concept that is mentioned the most when people discuss about communication strategy The next part in the review refers Integrated Marketing Communications - the new marketing communications model and Communication Process Models To Develop Effective Marketing Communication, all basic steps must be set well and this is the part flowed in the literature review

Chapter III shows firstly market analysis and Brand key of Celano Secondly, it analyzes Brand and communication activities in 2015 We based on theories of developing effective communication process to analyze the process and give comments about the results Then, we check customers ‘reaction to find out the current situation It helps to find out the key points for setting the communication strategy which is oriented to the customers

In this part, it explains the process, and displays the data with finding comments

From all the outcome of the analysis and research, it comes to some suggestion to improve the communication process

The appendixes shows the questionnaires for the research

Table of Contents

DECLARATION

ACKNOWLEDGEMENT

TUTOR COMMENT

ABSTRACT

TABLE OF CONTENT

CHAPTER I – INTRODUCTION 9

1.1 INTRODUCTION ABOUT KIDO COMPANY 9

1.2 PROBLEM STATEMENT 11

1.3 RESEARCH OBJECTIVES 11

1.4 SCOPE AND LIMITATION OF RESEARCH 11

1.5 RESEARCH METHODOLOGY 12

Role of the survey: 12

Objectives: 12

Expecting deliverables: 12

Collecting data: via Google form to synthesize the result of the questionnaire 13

1.6 STRUCTURE OF THE PROJECT 13

CHAPTER II: LITERATURE REVIEW 14

2.1 WHAT IS MARKETING COMMUNICATION? 14

2.2 MARKETING COMMUNICATION MIX 14

2.3 INTEGRATED MARKETING COMMUNICATION 15

2.4 THE COMMUNICATION PROCESS 16

2.5 STEPS IN DEVELOPING EFFECTIVE MARKETING COMMUNICATION 17

2.5.1 Identifying target audience 17

2.5.2 Determine Communication Objectives 17

2.5.3 Designing a Message 17

2.5.4 Select channels 18

2.5.5 Establish budget 19

2.5.6 Decide on media mix 19

2.5.7 Measure results 20

2.6 BRAND AWARENESS 20

2.6.1 What is a brand? 20

2.6.2 What is brand awareness? 20

CHAPTER III: ANALYSIS OF CURRENT COMMUNICATION STRATEGY OF CELANO 22

3.1 MARKET ANALYSIS IN 2015 22

3.1.1 Trends 22

3.1.2 Competitive landscape 22

3.1.3 Prospects 23

3.1.4 Porter 5 forces analysis 24

3.2 CELANO – TARGET BRAND ANALYSIS 25

3.2.1 Brand key 25

3.2.2 Marketing communication activities at the end 2015 analysis 27

3.2.3 Consumers’ attitude toward communication strategies of ice cream brand 33

3.2.4 SWOT analysis of marketing communication: 38

4.1 DEVELOP A NEW MARKETING COMMUNICATION STRATEGY FOR CELANO 39 4.1.1 Identifying the target audience: 39

4.1.2 Determining the communication objectives: 39

4.1.3 Designing a message 40

4.1.5 Establishing the budget 40

4.1.5 Design on media mix 40

4.2 OTHER RECOMMENDATIONS 41

CONCLUSION 42

REFERENCE 43

CHAPTER I – INTRODUCTION

In this chapter, we introduce about Kido company Then, we write about problem statement After that, we give the objectives of our research, scope and limitation of research and research methodology

Kido Group, formerly Kinh Do Corporation, was established in 1993 and has become one of the leading Food & Flavor companies in Vietnam In its 23-years history, Kido Group has remained the market leader in confectionery across a wide array of products such as sponge cake, bread, moon cake, cookie and ice-cream under the Kinh Do brand name

Leveraging the existing foundation, Kido Group aims to maintain their market leader position in ice-cream with two brand names Merino and Celano, yogurt products under the Well-Yo brand name and expand their product portfolio into the staple food category with instant noodle, spices, sauces, cooking oil and packaged food under the Dai Gia Dinh brand name to take care of the Vietnamese kitchen and meet customers’ needs throughout the day

With a solid financial position and competitive advantages honed in the combination

of well-established distribution channels, manufacturing capability, branding and sales strategy, KIDO Group is step by step realizing its vision to become the premier Food & Flavor Company in Vietnam

At the core of business philosophy is the well-being of the customer, as demonstrated

by the dedication of our founders and people, the quality of our products, and consumers’ confidence in the Kinh Do brands

Kido Group’s mission is to offer an original and creative product experience that exceeds consumers’ expectation with our commitment to quality They are proud to continue creating happiness for and improve the well-being of our consumers while generating value for all stakeholders, including consumers, suppliers, partners, employees, and communities

Above is the brief about Kido Group, here we will give some information about Kido company – subsidiary of Kido Group

Right in 2003 when the concept of M&A was relatively new to most businesses in Vietnam, Kinh Do impressed the industry with the takeover of Wall's Cream owned by Unilever, which held more than 50% of cream market share in Vietnam at that time Then Kido was established It is a part of Kinh Do Corporation which has just changed its name to Kido Group

After 10 years of operation, the average revenue of the company has been increasing from 30-40% Its profit annually increases 40-50%, according to Kido Group Kido had the highest growth rate in Kinh Do Corporation

Kido factory is located on 2.4ha of land in HCM City’s Tay Bac Cu Chi Industrial Park

Kido is currently the industry leader with 37% market share in ice cream and more than 30,000 retail outlets across the country Impressive achievement that Kido achieved within difficult economy was a testament to the growth and sustainable development of the company KIDO has 2 brands for ice cream: Merino – mass ice cream, Celano – premium ice cream

According to Euromonitor 2015 LBN Brand Shares of Ice cream, Merino is top of the list with 20.2% retail value rsp while Celano is 2nd players with 13.3%

Figure 1.1

NBO Company Shares of Ice Cream: % Value 2011-2015

% retail value rsp

Source: Euromonitor International 2015

Eating ice cream has become a popular in Vietnam With the reasonable prices, the domestic ice cream market is still controlled by Vietnamese brands However, the makeup of the market may be change in the near future Vietnamese brands have been warned that the positions may change any time as foreign investors have been flocking to Vietnam The foreign brands attract Vietnamese consumers, especially youth, though the imported products are expensive As living standards rise, consumer demand for snacks, convenience and luxury F&B items such as ice cream has increased

Besides that, foreign brands have experiences and large budget in doing marketing in other countries They bring new trends and focus on integrated communication strategy to attract young consumers In contrast, Vietnamese ice cream companies do not focus on it; they concentrate more on traditional communication marketing

Celano of KIDO company is premium brand ice cream, compete with foreign brands especially Wall's Although, Celano also have some activities in integrated communication recently, they are feeling the pressure from foreign rivals Market share is more divided To keep the market leader position in premium brand, Celano wants to strengthen customers’ relationship, build loyalty so that they can increase the market share and keep the leading position in premium ice cream

This research is to find out current problem in marketing communication strategy of Celano and customers’ reaction with integrated marketing communication of ice cream brand From there, the writers suggest some recommendation for developing an effectiveness communication strategy that supports the long term operation of company

Due to the limited time, the authors selected Hochiminh city as the main city to do the research In which, the target customers will be selected randomly to do the survey

The research focus at analyzing and evaluating Celano marketing communication activities in 2015 Because there are many sku in Celano brand, we decided to focus on Cone which had some activities last year

Because the time and budget constraints, the authors just could carry out the research

in Hochiminh city with limit number of survey data

Finance is confidential information so that we could not find out marketing budget of Celano We wrote about it but did not analyze in details

In order to get enough data and information for the research, the authors will apply both quantitative and qualitative method in collecting data The data is from many sources including primary and secondary data

Collection of secondary data: The secondary data are collected by many resources

such as internal information of Kido Company (sales report, products, and results of campaigns) and many diversity channels (Facebook fanpage, Kido group website)

Collection of primary data:

Questionnaire: The questionnaire applied for respondents (50 samples); focusing on details so as to get response of people about habit of consumption as well as perception of brand through marketing communication of Celano and competitors

Survey has 50 respondents as details:

Male 27.7%

● Group of age: 15-19: 53.2%

20-25: 46.8%

Role of the survey:

Identifying customer’s reaction with advertising campaigns of Celano as well as competitors

Objectives:

Investigating the habit of consumption about ice cream market

Investigating the perception of the brand Celano and finding what problem in communication strategy

Expecting deliverables:

It is expected that the results would give data to deal with the following problems:

 Habit of consumption: (question 3,4,5) finding out where do customers enjoy ice cream and do they use different brand?

 Brand awareness: (question 6,7,8,9,10) including brand recognizing, we want

to know position of Celano cone in people’s mind

 Brand recognition: (question 12,13,14,15) with two different objects about imagine of brand and deliver message of Celano as well as competitors Do target customers recall brand? What did channels or activities impress them most?

 WOM effectiveness: (question 16,17,18) can Celano create a buzz to have WOM effectiveness? Are target customers pleased to give comment on advertising campaigns?

Collecting data: via Google form to synthesize the result of the questionnaire

Apart from the acknowledgement, abstract, and appendixes, the project is structured with 4 chapters:

Chapter 1: Introduction

Chapter 2: Literature review

Chapter 3: Analysis of current communication strategy of Celano

Chapter 4: Recommendations

CHAPTER II: LITERATURE REVIEW

To understand about marketing communications we follow three theories of Kotler,

Keller and Amstrong about Marketing communication mix, Integrated Marketing

Communications, and the Communication Process Models In additional, we refer some

knowledge from Ukehajdaraj and MSG Experts about Brand Awareness

“Marketing communications are the means by which firms attempt to inform, persuade, and remind consumers – directly or indirectly – about the products and brands they sell”, (Kotler and Keller, 2012) It presents all information about the company, the brand and the product from the beginning to the end It creates the conversation between consumers and product It also conveys the message which brand would like to say with other people People get familiar with product through marketing communication

Marketing communications also work for consumers when they show how and why a product is used, by whom, where and when Consumers can learn who makes the product and what the company and brand stand for, and they can get an incentive for trial or use

“Marketing communications allow companies to link their brands to other people, places, events, brands, experiences, feelings and things They can contribute to brand equity – by establishing the brand in memory and creating a brand image – as well as drive sales and even affect shareholder value” (Kotler and Keller, 2012)

The marketing communication mix refers to specific methods which help to promote product, brand and company to target audiences According to Kotler and Keller (2012), there are eight major models of communication:

1 Advertising: Any paid form of nonperson presentation and promotion of ideas,

goods or services by an identified sponsor via print media, broadcast media, network media, electronic media and display media

2 Sales promotion: a variety of short-term incentives to encourage trial or purchase of

a product or service

3 Events and experiences: Company-sponsored activities and programs designed to

create daily or special brand-related interactions with consumers

4 Public relations and publicity: a variety of programs directed internally to

employees of the company or externally to consumers, other firms, the government, and media to promote or protect a company’s image or its individual product communications

5 Direct marketing: use of mail, telephone, fax, email, or Internet to communicate

directly with or solicit response or dialogue from specific customers and prospects

6 Interactive marketing: online activities and programs designed to engage customers

or prospects and directly or indirectly raise awareness, improve image, or elicit sales

of products and services

7 Word-of-mouth marketing: people-to-people oral, written or electronic

communications that related to the merits or experiences of purchasing or using products or services

8 Personal selling: face-to-face interaction with one or more prospective purchases for

the purpose of making presentations, answering questions, and procuring orders The product’s styling and price, the shape and color of the package, the salesperson’s manner and dress, the store decoration, the company’s stationery – all communicate something to buyers

Day by day, everything is changing People and technologies are changing, too In this digital age, consumers communicate with others and receive information from many sources on their own Especially young people have much powerful since they are growing

up with the wireless age It leads to marketing strategies changing The new marketing communications model is needed to adapt the changing It is Integrated Marketing Communication Kotler and Amstrong (2012) mentioned that “advertisers are now adding a broad selection more-specialized and highly targeted media to reach smaller customers segments with more-personalized, interactive messages Companies are doing less broadcasting and more narrowcasting”

Consumers face tons of commercial messages from variety sources If conflicting messages come from different sources, they cannot distinguish Therefore, they are easily confused company images, brand positions and customer relationships Integrated Marketing Communications ensures that all forms of communications and messages are carefully linked together when delivering to target audience It brings together all the company’s messages under one campaign to promote a single, clear and consistent positioning statement

Although Integrated Marketing Communications requires a lot of effort it delivers many benefits It can create competitive advantage, boost sales and profits, while saving money, time and stress Integrated Marketing Communications wraps communications around customers and helps them move through the various stages of the buying process The organization simultaneously consolidates its image, develops a dialogue and nurtures its relationship with customers

Kotler and Amstrong (2012) present a communication model with nine elements Sender and Receiver are represents the major parties in a communication Major communication tools are message and media Four represents major communication functions: encoding, decoding, response and feedback The last element in the system is noise

Figure 2.1 - The communication process

(Adapted from Kotler and Amstrong, 2012)

Senders must understand very well what audiences they want to reach and what response they expect to receive They must be good at encoding messages so that target audiences can decode messages like they want They must convey the message through media that can reach target audiences Besides that, they must develop feedback channels to evaluate the responses

COMMUNICATION

2.5.1 Identifying target audience

This is the first step of process Target audiences are potential buyers, current users, deciders, influencers They may be individuals, groups, particular public or the general public Marketers must know who they are so that you can decide on what to communicate, how to communicate, when, where and who will communicate the company’s message

2.5.2 Determine Communication Objectives

Companies must find out at what stage of buyer-readiness their consumers are presently in Therefore, they can design a plan to move the target audience towards a favorable stage The six stages that consumers normally go through before buying a product

are – awareness, knowledge, liking, preference, conviction and purchase

motive purchase Moral appeals are directed to the audience's sense of what is right and proper”, ( Kotler and Amstrong, 2012)

b) Message Structure

Kotler and Amstrong (2012) introduced three kinds of it The first is whether to draw

a conclusion or leave it to the audience The second is whether to present the strongest arguments first or last The last issue is whether to present a one-sided argument or two-sided argument

c) Message Format

The message format needs to be strong In each category of channel, communicators must decide suitable presentations which are eye-catching, distinctive format and impressive sounds and voices Thus consumers can recognize and recall the brands

d) Message Source

Message should be delivered by attractive or prominent sources It can achieve higher attention and recall However, picking the wrong spokesperson can lead to the bad and misunderstanding image

2.5.4 Select channels

Communications channels may be personal communications channels and non personal (mass) communications channels

a) Personal communications channels “let two or more people communicate

face-to-face or person-to-audience through a phone, surface mail, or email They derive their effectiveness from individualized presentation and feedback and include direct and interactive marketing, word-of-mouth marketing, and personal selling”, (Kotler and Keller, 2012)

Influence of this channel is really powerful Buying attitude are easily affected someone's recommendation In additional, when message is sending through many people, the content might be changed a little bit differently Because of digital age, people communicate faster People share negative information even faster than the positive one Thus, in this channel, company should be more careful with the message (content, structure and format) before spreading it Reaching the right people is a key

b) Nonpersonal (mass) communication channels “are directed to more than one

person and include advertising, sales promotion, events and experiences, and public

relations”, (Kotler Keller, 2012) They create or reinforce the buyers' leaning towards product purchase

c) Integration of communication channels Personal communications have more

impact than mass communication, but mass media channel might stimulate personal communications “People interact primarily within their own social groups and acquire ideas from opinion leaders in their group Through mass communication directed specifically to opinion leaders, they can carry on message to others”, Kotler and Keller (2012)

- Objective-and-task method: developing the promotion budget by:

(1) Defining specific promotion objectives

(2) Determining the task needed to achieve these objectives

(3) Estimating the costs of performing these tasks The sum of these costs is the proposed promotion budget

2.5.6 Decide on media mix

Each company have different marketing strategies wherein they use several promotional tools like advertising, sales promotion, public relations and publicity, events and experiences, direct and interactive marketing, word-of-mouth marketing, personal selling Each tool has its own advantage and costs involved Furthermore, types of product market, buyer-readiness stage and product life-cycle stage need to be consider Therefore it

is important for marketer to choose the right marketing communications mix also called as promotion mix

2.6.1 What is a brand?

Ukehajdaraj (2015) mentioned the definition of brand from David Ogilvy:

“The intangible sum of a product’s attributes: its name, packaging, and price, its history, its reputation, and the way it’s advertised.”

However Ukehajdaraj (2015) prefered another definition from Jeff Bezos, the founder of Amazon:

“Your brand is what people say about you when you’re not in the room”

2.6.2 What is brand awareness?

Management Study Guide Experts gave the knowldege about Brand awareness: “It is the probability that consumers are familiar about the life and availability of the product

Brand awareness includes both brand recognition as well as brand recall Brand recognition is the ability of consumer to recognize prior knowledge of brand when they are asked questions about that brand or when they are shown that specific brand, i.e., the consumers can clearly differentiate the brand as having being earlier noticed or heard

While brand recall is the potential of customer to recover a brand from his memory when given the product class/category, needs satisfied by that category or buying scenario as

Building brand awareness is the process to build the relationship with customer It is from the beginning people see your product, know, have the full information, remember, recognize, buy it and in the end they re-oder it and recall the brand

Summary: With on knowledge of academic theories that was mentioned above, we had a general view of a communication strategy and brand awareness Therefore, we base on these theories to evaluate how Celano’s campaigns execute

CHAPTER III: ANALYSIS OF CURRENT

COMMUNICATION STRATEGY OF CELANO

In this chapter, first we provide market outlook of ice cream to describe the whole picture of Celano’s position as well as competitive landscape at the present and prospects in futute Then, we deeply analyze about product and marketing communication strategy through two main campains: Lap 2015– Leaking a prize 2015 and Color of Celano Last but not least, we proceed a survey to figure out customer’s attitude toward Celano’s campaigns

to identify current situation

Euromonitor International (2015) also gave the issue about channels Key distribution channel was independent small grocers over the review period However, modern channels such as supermarkets and hypermarkets were noticed a better performance due to the increasing trend of shopping in modern channels, especially in big cities

3.1.2 Competitive landscape

Kinh Do Corp maintained its leading position in ice cream and frozen desserts with

36% and 37% value shares respectively in 2014 and 2015, Euromonitor International

(2015) Besides its strong brands, its nationwide distribution network and a wide range of products in ice cream are other competitive advantages of company As Euromonitor