Report Marketing (Assignment 1)

This report is made to recommend an overall best practice of marketing approach to successfully launch these exciting new products in Vietnam. Hence, it covers the market for “Beef Jerky”, “Lettuce and Broccoli Chips” as well as a limited number of areas. By using my business skill, creativity and knowledge about marketing, I hope to help promote these new product lines of Vina Mit Ltd. Company to targeted group of customers, commercial users and client businesses within international marketplace in general and national market in Vietnam in particular. Based on that, this report contains the standard practice of Marketing Professionals including explanation of some basic concepts in the first part and its applications and practical analysis on Vina Mit Ltd. Company in the second part of the report as a reference for people who are concerned about this field.

BANKING ACADEMY, HANOI

BTEC HND IN BUSINESS (FINANCE)

ASSIGNMENT COVER SHEET

NAME OF STUDENT

REGISTRATION NO

ASSIGNMENT TITLE Vinamit Marketing Processes

_

Signature Date

FOR OFFICIAL USE (Course Administrator)

Unit Outcomes

Outcome Evidence for the

Assessor’s decision Verification Internal

a

Identify the main characteristics of

a marketing oriented organisation

b

Explain the various elements

of the marketing concept

c

Identify and assess the benefits and costs of a marketing approach

a

Propose segmentation criteria to be used for two products in different markets

b

Outline the factors which influence the choice of targeting strategy

c

Outcome Evidence for the

Assessor’s decision Verification Internal

Explain how buyer behaviour affects marketing activities in two different buying situations

d

Comments by Assessor - Common Skills

A B C D E F G

Assignment

( ) Well-structured; Reference is done properly / should be done (if any)

Overall, you’ve

Areas for improvement:

ASSESSOR SIGNATURE DATE / /

NAME:

(Oral feedback was also provided)

STUDENT SIGNATURE DATE / /

Prepared by Student ID:

Class:

No of words (Excluding executive summary, introduction, conclusion,

recommendations, appendix and references)

EXECUTIVE SUMMARY

Nowadays, more companies adopt a clearer vision of the direction to take their brands andchallenge marketing convention through innovation, advertising or some other aspects ofmarketing Furthermore, they are intention of adopting different approaches to marketing thatfocuses on stretching limited resources, staying in close contact with customers and creatingmore satisfying solutions to customers’ needs Facing with harder and harder economicchallenges, businesses have to make more and more effort in getting a non-stop development inevery aspect especially marketing which is known as an increasingly vital ingredient for businesssuccess

Taking the responsibilities of marketing executive, I have to bring a professional approach tomarketing activities and launch the new products of “Beef Jerky” and “Lettuce and BroccoliChips” for Vina Mit Ltd Known as the leading company in Co-operating with farmers todevelop Agriculture Industry through supports like scientific studies, seeds and plants, moderntechnology and training, Vina Mit always ensures stable and year-round resources for demandthanks to their Total Complete Supply Chains On the other hand, they would have to deal withvarious difficulties in launching these new products so that they still can maintain theirachievement for their total complete supply chains with new suppliers, process and technology.That is why understanding the needs of customers is only the first step before deciding whetherthe products could be launched and how they would be introduced

Therefore, this report is made to recommend an overall best practice of marketing approach tosuccessfully launch these exciting new products in Vietnam Hence, it covers the market for

“Beef Jerky”, “Lettuce and Broccoli Chips” as well as a limited number of areas By using mybusiness skill, creativity and knowledge about marketing, I hope to help promote these newproduct lines of Vina Mit Ltd Company to targeted group of customers, commercial users andclient businesses within international marketplace in general and national market in Vietnam inparticular. Based on that, this report contains the standard practice of Marketing Professionalsincluding explanation of some basic concepts in the first part and its applications and practicalanalysis on Vina Mit Ltd Company in the second part of the report as a reference for people whoare concerned about this field

TABLE OF CONTENTS

Contents Page

Cover sheet……… 1

Title page……… 4

Executive Summary……… 5

Table of contents……… 6

List of figures……… 8

Introduction 1a Comparison of the various definition of marketing……… ……… 9

1b The main characteristics of a marketing oriented organization for Vinamit 1b.1 Marketing oriented organization………

1b.2 Company’s commitment………

1b.3 Company Led activities (7P’s)………

1b.4 Profitability………

10 10 11 12 1c The various elements of the marketing concept 1c.1 Marketing philosophies……….………

1c.2 Elements of marketing philosophies…….………

12 13 1d The benefits and costs of using marketing approach to do business in Vietnam 1d.1 Quality issues and their implication for customer relationship………

1d.2 Costs and Benefits of Marketing approach………

16 17 2a The macro and micro environmental factors in Vinamit which might influence Vinamit’s marketing decisions 2a.1 Micro environment………

2a.2 Macro environment………

2a.2.1 PEST factors………

2a.2.2 Competitive environment………

18 18 19 21 2b The methods the markets for the products (‘beef jerky’ and ‘lettuce and broccoli chips’) may be segmented and the benefits/limitations of each method 2b.1 Definition of segmentation………

2b.2 Bases of segmentation………

2b.3 Targeting………

2b.4 Positioning………

22 23 25 26 2c Factors influencing the choice of the targeting strategies for the company’s products 2c.1 Market coverage strategies………

2c.2 Factors influence choice of targeting strategies………

27 28

2c.2.1 Attractiveness of a marketing segment………

2c.2.2 Suitability of market segment to Vinamit………

2c.2.3 Company resources………

2c.2.4 Product’s life-cycle stage………

28 29 29 30 2d Explain how buyer behavior for the products might affect the Vinamit’s marketing actiities in the two markets 2d.1 Comparing consumer buying behavior and organizational buying behavior………

2d.2 The process of consumer buying behavior………

2d.3 Factors influencing consumer buying behavior………

2d.4 The Process of organizational buying behavior………

2d.5 Factor influencing organizational buying behavior………

2d.5.1 Environmental factor………

2d.5.2 Organizational factor………

2d.5.3 Interpersonal factor………

2d.5.4 Individual factor………

30 30 31 32 32 33 34 35 35 Conclusion……… 36

Recommendation……… 37

Reference……… 38

LIST OF FIGURES

Figure 2 Elements of marketing concept

13

Figure 4 Strengths and weaknesses of Vinamit in term of micro environmental factors

Figure 7 Specific segmentation for beef jerky and lettuce and broccoli chips of Vinamit 25

Figure 8 Benefits and limitations of bases of segmentation

Figure 13 Comparing consumer buying behaviour and organizational buying behaviour 30

INTRODUCTION

There are many ways to understand about marketing According to the Chartered Institute of

Marketing (CIM), marketing is defined as 'the management process responsible for identifying,

anticipating and satisfying customer requirements profitably'

CIM’s definition is quite brief and all-encompassing and it mentions about marketing’s function

as a management process focusing on marketing objectives Based on that marketing’s duty is toidentify the needs and wants of the customer and to try to deliver benefits that will enhance oradd to the customers’ lifestyle and then get the satisfaction of these needs result in a healthyturnover.

Besides, Philip Kotler defines marketing as 'satisfying needs and wants through an exchange

process'.

Instead of referring to management process, Philip Kotler concentrates on exchange processwhich represents exchange of value through transactions between customers and suppliers Themore satisfied they feel, the greater benefit suppliers get then the more transactions are made

Moreover, “marketing is the activity, set of institutions, and processes for creating,

communicating, delivering, and exchanging offerings that have value for customers, clients, partners, and society at large” — The American Marketing Association Board of Directors

The definition which is also as comprehensive and concise as CIM’s but it focuses on

encompassing the product development, marketing communications, pricing, and strategicaspects of marketing

Another definition of marketing is that “marketing is the process by which companies create customer interest in products or services It generates the strategy that underlies sales techniques, business communication, and business development It is an integrated process through which companies build strong customer relationships and create value for their customers and for themselves” — Wikipedia

This definition is so focused on both the strategic and functional aspects of marketing, butespecially that it’s so customer-focused referring to customer target in marketing

Each of the definition above mentions about different aspects of marketing but in conclusion,marketing is a process from analysis to action It is strategy development, then logical andthought-out tactical implementation and finally to reach customer satisfaction and to increaseprofit

1b.1 Marketing Oriented Organization

Marketing Oriented Organization means a business carries out towards the satisfaction of theircustomers The decisions taken are based around information about customers’ needs and wants,rather than what the business thinks is right for the customer

Vinamit aims to be a connection between farmers and consumers Their highest objective theywant to reach is when their customers use their products not only for the products’ quality andthe favor of Vietnam but also for a more active life Understanding about the needs ofVietnamese people for fresh and nutritional products, Vinamit is the pioneer in dried fruit field togive products which contain a part of Vietnamese tradition with the typicality of tropical fruitsand particular favor of Vinamit which is also considered as spice for modern life and a fast food

of Vietnam

1b.2 Company’s commitment

Besides, Vinamit’s vision is also to aim to Vietnamese customers which is ‘Vinamit want to become the leading company in providing products being good for health in Vietnam and raise the values of Vietnam’s agricultural products to world’ Following this, Vinamit wants to

bring products that are good for Vietnamese people’s health and to make Vietnam’s agriculturalproducts recognized in the world Therefore, all of their objectives reach to Vietnam’s values andVietnamese people Based on that, customers factor is their most important focus of the company

‘Sustainable development is built on the platform of values chain from origin to crest, and managed by the decentralized organization with high responsibility and pride of nation’ alsomakes particular meaning and values With their value chain from origin to crest, they cancontrol and manage their supply as well as the quality of the products in order to meet their aim

in the vision to bring healthy products for Vietnamese people Moreover, they make use of thestrengths of Vietnam to apply to their products to recognize the Vietnamese value

1b.3 Company Led activities (7P’s)

However, Vinamit has not yet provided an efficient marketing mix As far as Company Led

Activities are concerned, they contain 7P: People, Product, Price, Place, Promotion, Physical

evidence, Process Applying people on Vinamit, with above 1000 employees, the managers as

well as other employees of the company do not make a particular image which represents for thecompany, its symbol in their customers and even their company’s desired culture However, thecompany got the loyalty of their employees which is a motivating factor for management team togive convenient strategies for Vinamit

The company had a particular concern about their product when they invested in production

lines including an evaporation drying system with the modern sublimation technology fromGermany, Japan and Taiwan Furthermore, Vinamit’s products are also various including friedjack-fruit, fried banana, fried batata, fried taro and so on As a result, Vinamit’s products quicklywin customers in Vietnam and abroad with a growth rate of 30% to 50% year on year

Being the first business in dried fruit field in Vietnam, but price strategy is not Vinamit’s main

strategies On the other hand, price strategy is not a long-run method for the company to getcreditability and loyalty of customers, so this term is not their competitive advantage in themarket

Furthermore, with their place in Binh Duong which is one of key economic areas and the top of

provincial competitive index (PCI) of Vietnam during 3 years (2008-2010), Vinamit hasadvantages from this competitive environment The company also has three cold storages toreceive raw materials in Buon Me Thuot, Tay Nguyen and Dong Nai as well as 20 branches inregions of Vietnam so that it is easy for them with their distribution channel and method.Nowadays, the biggest supermarket system like Metro,Maximart, Big-C, Co-op, Hapro buy theproducts of Vinamit and this is a good condition for the customers of Vinamit to get to theproducts

Vinamit’s promotion strategies are invested in a small scale by buying their products at fairs or

participating in social activities, so they do not make a great impression in customers to

memorize Furthermore, their physical evidence is not good enough At their website, the

pictures are all really lively and meaningful with the images of fresh fruits with farmers but there

is not music and limit of information Their performance is nice and modern with a lot ofinformation arranged scientifically but it is not often updated Also, their display is tidy and

smart in the supermarket Their process is more convenient with their modern vacuum dried

technology

1b.4 Profitability

On the other hand, Vinamit gets a good financial performance when their total annual sales

volume is US$2.5 Million - US$5 Million In Vietnam market, Vinamit reached 90% in share ofconsumption while 60% of total Vinamit products was exported to Asean, China, Taiwan,Hongkong, Japan and other markets in the Europe and Northern America Based on the maincharacteristics of marketing that Vinamit is applying, it can be concluded that Vinamit is anoriented-marketing organization

1c.1 Marketing philosophies

There are five marketing philosophies including production concept, product concept, selling concept, marketing concept and societal marketing

Production concept is to focus on production efficiency and bringing down prices What they

are concerned about is whether they can produce products to achieve a reduction in costs andimproved production so that consumers favor products that are available and highly affordable

Another marketing philosophy is product concept which focuses mostly on how to make the

products best but little on promotional effort Therefore, the product era holds that consumers favor products that offer the most quality, performance, and innovative features, not customers’ needs

Besides, firms could use selling concept which is little about products’ needs but is to beat the

competition to the sales Hence, companies have to use marketing techniques to decrease theirinventories and also carry out well-trained and motivated sales force to sell their products, soeffective selling and promotion are the major drivers to success

Marketing concept which concentrates on achieving organizational goals based on meeting the

needs, wants and demands of target markets and delivering the desired satisfactions more

effectively than competitors do Therefore, companies could get a profit by successfullysatisfying customers

Figure 1.The marketing concept and selling concept contrasted

Societal marketing concept focuses on bringing benefit to society Based on that, this concept

has as similar characteristics as marketing concept but with the added provision that there will be

a curtailment on harmful activities to society and generation of customer satisfaction with run societal well-being to achieve company’s goals and responsibilities

long-1c.2 Elements of marketing philosophies

A company could use one of the marketing philosophies but nowadays, companies orient to be interested in customers’ needs and satisfaction for the long-run development Vinamit does not stay out of this trend which appreciates finding right products for customers but not finding right customers for products This is also the context of marketing concept as below

Human needs which are states of felt

deprivation consist of basic physical needs for food, clothing, warmth, and safety; social needs for belonging and affection; and individual needs for knowledge and self-expression These needs were not invented by

marketers; they are a basic part of the human makeup

Wants are the form people’s needs take when they are shaped by culture and individual

personality (A Vietnamese needs food but wants rice, meat and vegetable) Wants are shaped by

one's society and are described in terms of objects that will satisfy needs

People have almost unlimited wants but limited resources, so they want to choose products thatprovide the most value and satisfaction for their money When backed by buying power, wants

become demands Consumers view products with benefits and choose products that are worth

for their money Fried chips of KFC mean fast food for people all over world and enjoyed withfried chicken and high fat content, while chips of Vinamit are full of Vietnamese taste, goodnutrition as fresh fruit and could be brought easily to anywhere Given their wants and resources,people demand products with the benefits that add up to the most satisfaction

Organizations understand customers’ needs, wants and demands by conducting customerresearch or analyzing customer inquiry However, Vinamit has not yet done any activities likethat Instead, they merely had their behavior principles about satisfying customers and this is alsotheir core value for all the people of Vinamit at all level stay closer to customers

When a company understands about their customers' needs, they satisfy them by their productsand service A product is anything that can be offered to a market to satisfy a need or want The

concept of product is not limited to physical objects but anything capable of satisfying a need can

be called a product On the other hand services are activities or benefits offered for sale that are

essentially intangible and do not result in the ownership of anything

Many organizations misunderstand to care more about the specific products they offer than to the

products’ benefits They may suffer from "marketing myopia" which is about focusing only on

existing wants but losing sight of underlying customer needs Therefore, they may easy to gettroubles if a new product comes along that serves the customer's need better or less expensively

The customer with the same need will want the new product.

Vinamit provides fried fruits for the needs of soft foods like chips in picnics or friendlycongregations Known as the first enterprise in fried fruits in Vietnam, Vinamit’s vision is tobecome the leading company in providing products being good for health in Vietnam and raisethe values of Vietnam’s agricultural products to world

Consumers have many choices in a broad array of products and services that might satisfy agiven need but they choose for their perceptions of the value that products and services deliver.

Based on that, customer value is the benefits that customers may gain from owning and using a

product compared to the cost of obtaining it Applying on Vinamit, a customer of Vinamit cangain many benefits which are obviously preserving the fruits’ original taste, color and aroma.They also get other values with contribution to the development of agricultural Vietnameseproducts This is considered as a good condition for customers to choose Vinamit instead ofchips of other companies like Green highland International Co., Ltd or Quynhanh LimitedCompany

Also, customer satisfaction is achieved by the process of delivering value relative to buyer’s

expectations with the product’s perceived performance When customers satisfy, they willduplicate buying and tell others about their good experiences with the product, so company’spurpose is to match customer expectations with their performance An essential factor leading to

customer satisfaction is quality which influences directly on product performance Hence,

quality begins with customer needs and ends with customer satisfaction Nowadays, more andmore organizations adopt total quality management (TQM) programs to improve the quality oftheir products, services and marketing processes To affirm the product quality for theircustomers’ comfort, Vinamit has applied quality management system with ISO 9001:2000standard and HACCP certificate in production and business for years However, theseachievements only make it better for customers’ wants, demands and product quality, thecustomer satisfaction is partly identified by Vinamit’ dominance in the domestic market with 90percent market share and that is an evidence for its own value

After understanding about customers’ needs and wants, companies give strategies to meet them

through means of satisfaction including exchange Exchange is the act of obtaining a desired

object from someone by offering something is return Following that, there is equality between

two parties and this process is really followed by transaction which is marketing’s unit of

measurement consisting of trade of values Transaction usually involves a respond to the offers

of target audience and paying money for the company’s response Therefore, transaction is a part

of relationships which are built with valued customers, distributors, dealers and suppliers.

Looking more deeply at marketing, it is no longer to maximize the profit from each individual

transaction but it is turning to build mutually beneficial relationships with customers and otherstakeholders

The concepts of exchange and relationship lead to the concept of a market which is the set of

actual and potential buyers of a product and then these buyers share a particular need or wantthat is satisfied through exchanges and relationships The size of a market depends on thenumber of people who exhibit the need, have resources to engage in exchange, and are willing tooffer these resources in exchange for what they want

As far as ‘exchange’, ‘transaction’ and ‘relationship’ are concerned, Vinamit did not step up orfocus strongly, so consumers only remember Vinamit for its product quality and its objective inimproving agricultural Vietnamese products Hence, Vinamit should concentrate more oncustomer service system

I choose marketing concept on Vinamit because this is an important factor that could makesignificant changes about the company’s image and position in customers leading to long-termgood relationships for the development of company Moreover, this field is not the strengths ofVinamit, so it is necessary to review and analyze its marketing concept to point out solutions andanswers to improve and make it become the strength of Vinamit

1d.1 Quality Issues and their implication for customer relationships

The Vinamit products have specialty of tropical fruits with excellent characteristics such as nocholesterol, low oil and sugar content, numerous fibrous matter, fresh taste and natural color.This makes the favor of many Vietnamese people as well as the interest of other consumers allover the world

All the products are produced and packaged based on many international quality managementstandards The first one they are recognized with BVQI (Bureau Veritas Quality International) –

a top organization in the world which certifies international quality of Bureau Veritas They alsogot HACCP (Hazard Analysis Critical Control Point) which is used in the food industry toidentify potential food safety hazards, so that key actions can be taken to reduce or eliminate therisk of the hazards being realized

With these recognitions, Vinamit wants to show their implication to their customer relationshipwhich focuses on the quality of their products that have a great influence on their customers’health Providing products with good quality, Vinamit aims to make a long-term relationshipwith their customers with concentrating on consumers’ health and also customers’ reliability andloyalty with a good impression about high quality products of Vinamit

1d.2 Costs and benefits of marketing approach

According to marketing approach which has been chosen, there are eight different functionswhich have separate benefits and costs on the business Below is detail:

anytime

Vinamit’s suppliers’ life

more familiar to customers

 Reach large numbers of people on a national or regionallevel in a short period of time

 Meet needs of market atanytime

future development

products’ competitive level with others in term

Vinamit’s cash budget

capital

get profits

in the new field

Figure 3 Benefits and costs of marketing approach

2a.1 Micro environment

Being an oriented organization, Vinamit was influenced by both micro and macro environment.The first factor could be concerned is micro environment including all sectors which impactdirectly on Vinamit and its activities Below are the strengths and weaknesses of Vinamit interms of micro environment

Key elements of

Stakeholders

and experience in marketing management and business

employees

suppliers when Vinamit considers farmers

as their friends and partners

does not stay close to customers

in Vinamit do not make a good community to represent image and culture of Vinamit

Distributive network

almost all large supermarkets, retailers and wholesalers in Vietnam

supermarkets in the world, even in mart supermarket system

agencies and retailers all over Vietnam

yet capitalized every means to have more competitive advantages such as home shopping or free delivery

Competition

fruit field in Vietnam

 Being the first company in Vietnam to apply the vacuum drying processing technology

 Have significant contributions to society

Vinamit, Mc Donald or KFC which also buy chipsare already recognized in brand name and quality in the world

in promotion