Marketing Strategy for Soft Drink Product in Vietnam Market Chiến lược quảng bá nước giải khát tại thị trường Việt Nam Doing exercises and playing sports are very important in people’s daily life. Most of the sports players choose suitable products to refill their energy such as chocolate, milk, various types of medication and last but not least, energy drinks. A number of sports players become loyal to certain brands energy drink due to its instant effect and thirstquenching flavor. Some, however, argue that they strongly avoid using energy drink because it contains an unhealthy amount of sugar, caffeine and multiple kinds of artificial colorings. This research aims to find effective means to change their mind about energy beverage and to educate people that not all energy products are unhealthy for your body.
BUSINESS RESEARCH RESEARCH PROJECT PROPOSAL Word count (excluding list of references, 3577 and appendix) You must keep a photocopy or electronic copy of your assignment Student declaration I certify that the attached assignment is my own work Materials drawn from other sources have been acknowledged according to course-specific requirements for referencing I certify that this assessment item has not been submitted previously for academic credit in this or any other course I certify that I have not given a copy or have shown a copy of this assessment item to another student enrolled in the course I acknowledge that the assessor of this assignment may, for the purpose of assessing this assignment: Reproduce this assessment item and provide a copy to another member of the Department of English; and/or Communicate a copy of this assessment item to a plagiarism checking service (which may then retain a copy of the item on its database for the purpose of future plagiarism checking) Submit the assessment item to other forms of plagiarism checking I certify that any electronic version of this assessment item that I have submitted is identical to its paper version Signature of student (Please sign here after printing): Date: BUSINESS RESEARCH RESEARCH PROJECT PROPOSAL ASSIGNMENT ASSESSMENT SHEET: Diagnostic for the reflection A Outstanding B Very Good C Satisfactory D Needs further attention (minor flaws or errors) E Unsatisfactory (major flaws or errors) QUALITIES 5 5 5 Use of references and referencing style Structural composition of proposal Comprehension of the readings Mechanics of writing Coherence of presentation and quality of argument Reflectiveness Total TuLoHoNa: The Report - 1 Abstract Doing exercises and playing sports are very important in people’s daily life Most of the sports players choose suitable products to refill their energy such as chocolate, milk, various types of medication and last but not least, energy drinks A number of sports players become loyal to certain brands energy drink due to its instant effect and thirst-quenching flavor Some, however, argue that they strongly avoid using energy drink because it contains an unhealthy amount of sugar, caffeine and multiple kinds of artificial colorings This research aims to find effective means to change their mind about energy beverage and to educate people that not all energy products are unhealthy for your body Nowadays, energy drink is believed to be more than a fulfilling energy beverage Almost all beverage companies place great emphasis customer’s health, needs and wants, so that they can include more healthy elements that could improve health, such as Taurine, Inositol, Nicotinamide, Trimethylxanthine, glucosamine, along with various kind of vitamins, etc Meanwhile, the manufacturers are trying to reduce as much as they could the usage of artificial chemical like sugar, artificial colorings, caffeine, etc They constantly try to make modifications, no matter how trivial or grand, in order to make the energy drinks truly “healthy” However, there are people who are misguided into believing that energy drink is a kind of clinically proven treatment with medicinal properties, hence TuLoHoNa: The Report - they use the energy drinks on a regular basis at an alarming rate It is known that substance abuse of any kind could lead to health deterioration and; if not used with moderation and carefulness, death In other words, even though energy drink is made from various kind of natural materials, it is recommended to be used for suitable situations; such as after playing sports, falling asleep, feeling exhausted while working or doing exercises, etc Besides, some of energy drinks brands provide B12 vitamin, which is vital for metabolism, the formation of red blood cells and the maintenance of the central nervous systems such as the brain and spinal cord However, if this kind of vitamin is overused for a prolonged period of time, antibodies may appear to counteract with B12, causing cancer TuLoHoNa: The Report - Introduction 2.1/Company background TuLoHoNa is a latest energy drink manufactured by TuLoHoNa Inc TuLoHoNa can not only quench one’s thirst, but also revitalize the consumers, strengthen the muscles, bones, and joints, and keep the body well hydrated A clear favorite among athletes and sport players’ refreshment choices, TuLoHoNa is increasingly becoming more and more popular, and is viewing Vietnam as the next potential marketplace TuLoHoNa specializes in highpowered, electrolytes and Vitamin supplemented beverages that help replenish water, minerals and strength 2.2/Problems TuLoHoNa is a new face in beverage market in general and in energy dink market in particular Besides, TuLoHoNa has to face many challenges and difficulties; such as customers preferences, suppliers, marketing campaign and competitors For example, in Asia, especially in Vietnam, there are multiple large competitors like Redbull, Number 1, Sting, etc All of these companies have already had effective marketing campaigns to become the superior brands in the mind of customers In addition, the customers have become more healthconscious, being critical in their daily intake TuLoHoNa: The Report - Literature Review 3.1/Market overview Nowadays, people place more importance on their health life, as well as on the food and beverage that they use every day to replenish the lost energy and substances In Vietnam, the energy drink market is on the steady raise, owing to the Vietnamese people nowadays are more committed to various kinds of sports and fitness However, there are many energy drink brands that have dominated this market for a prolonged period such as Sting, Number 1, Redbull, etc., maintaining their alpha position in the market For example: Redbull has appeared in Vietnam for over 10 years; Sting from PepsiCo is seen not only as an energy drink but also as a first choice soft drink among teenager and adults in Vietnam Beside the quality of the products, marketing campaign also plays the key role in entering the market, and this is one of the most important things to familiarize TuLoHoNa with the people while competing with other brands 3.2/In-depth Analysis According to Vietnam supply chain (2013), the beverage industry “was supported by foreign investment and the catch-up development of the domestic manufacturers” (p 4) This report also mentioned that “Thanks to the growing health conscious of Vietnamese people and demand for more convenient in today’s busier lifestyles, soft drinks with health benefits saw a remarkable growth, such as RTD (ready to drink) tea, energy drinks and fruit/vegetable juice Consumers also have concerns about food safety and the hygiene of TuLoHoNa: The Report - unpackaged drinks Thus, products like bottled water, as a daily necessity, enjoyed good performance since it has more benefits of convenience and cleanliness than common tap water.” The report also stated “Among other beverages, soft drinks enjoyed the highest value growth rate of 12.4% in 2013 and the strongest CAGR of 12.2% over 2010 to 2013 It was also the only category that recorded double-digit growth of 15.9% in 2013 and CAGR of 17% over 2010 to 2013 in terms of sales volume.” (p 16) Also from the same report, PepsiCo was the market leader in the local soft drinks with 25.5% market share, followed closely by Tan Hiep Phat with 22.7% in energy drinks market PepsiCo was dominating the market, along with carbonated drink manufacturers like 7-up, Revive and Mountain Dew Besides, URC Vietnam and Coca Cola account for 13.3% and 10.5% respectively of market share (Figure A) VP Bank Securities’ Vietnam Food & Beverage Industry (2014) claimed that “In 2013, soft drinks reported 2.4 billion liters consumption, equivalent to VND36.2 trillion (USD1.7 billion).” (p 40) Besides, the report also viewed Tan Hiep Phat, Pepsi and URC Vietnam as the main competitors Another point mentioned in this report is that the Ready-to-drink (RTD) tea accounted for nearly 60% of the soft drinks, while carbonates and energy drinks accounted for 16% and 3%, respectively (Figure B) Based on the report of Business Monitor’s Vietnam Food and Drink (2013), it was stated that “Per capita consumption of soft drinks in Vietnam is low but growing The soft drinks sector is dominated by multinationals The TuLoHoNa: The Report - Coca-Cola Company and PepsiCo, which jointly command an estimated 88% share of the market PepsiCo opened its new US$45mn manufacturing plant in southern Dong Nai Province in March 2012 The plant has a capacity of 180mn liters a year and will produce carbonated and non-carbonated drinks including Pepsi, 7up, Mirinda, Twister, Sting and Aquafina.” The report also claimed “The major focus of the multinationals is on carbonated soft beverages, with small local drinks firms producing other types of drinks and fighting it out for the remaining market share The largest of the other players is Saigon Beverages Joint Stock Company (Tribeco), with an approximate 6% market share.” (p 63) According to Nielsen, it claimed that “When looking deeper into seven super “Fast Moving Consumer Goods” (FMCG) categories: beverage (including beer), food, milk base, household care, personal care, cigarettes and baby care; beverage continues to contribute the biggest to total FMCG sales with 39% in Q1’2016 quarters in a row, beverage still has a healthy growth Beverage has peaked up in Q1’ 2016, with 10% growth – the highest increase over the past years, mainly led by volume increase (+8.1%)”, stressing the importance of the Vietnam beverage industry (“FMCG GROWTH REMAINS POSITIVE IN THE FRIST QUARTER OF 2016, HOWEVER THE MARKET STILL SHOWS VULNERABILITY”, 2016, p.1) Effects of Commercial Energy Drink Consumption on Athletic Performance and Body Composition (Stephanie L Ballard PharmD, BCPS, Jennifer J Wellborn-Kim PharmD, BCPS & Kevin A Clauson PharmD) stated that energy drink can benefit “for speed endurance testing with high-intensity TuLoHoNa: The Report - exercise” (p.110), “stimulate metabolism” (p.111), “low risk of adverse effects” (p.115), pointing out the advantages of consuming energy drinks, despite being contrary to the popular belief According to Top ten energy drinks benefits, energy drinks, “despite the bad press”, offer multiple benefits, highlighted by “more energy”, “additional supplement” and followed by “faster recovery after exercises” 3.3/Personal Viewpoint: Based on all these research and reports, Vietnamese customers are now more health-conscious than before As of the moment this report is written, Vietnamese people now choose the products carefully to ensure their health Besides, as mentioned above, there are many existing beverage companies that manufacture energy drink products in this market and they have become the obvious choice among the consumers However, most of them have difficulties establishing their own personality due to the oversaturated market Furthermore, most of the energy drink in the market today could lead to dire consequences if misused or abused This is not only a big challenge but also a big chance to change the customers’ view of energy drinks based on different aspects, to prove that not all energy beverage contains nothing nutritional beside sugar and chemical substances 3.4/Report Although TuLoHoNa is a newcomer in this playground, it has already made recognizable effort to distinguishing itself among its competitors TuLoHoNa contains no artificial sweetener nor caffeine, instead, the true energy TuLoHoNa: The Report - 44 Q3: I don’t trust you enough to change my favorite But who knows, maybe someday I will Q4: Maybe add a little less sourness, and more gas Interviewee 33 Q1: I think it was…boring Nothing special Just like other brands Q2: Uhm, could have been sweeter Price’s alright, not too high Q3: Yeah, I don’t have a particular type, so anything new is okay for me Q4: Add more flavor like orange or strawberries Interviewee 34 Q1: I hate commercials It’s a waste of time I don’t think much of it Q2: Uhm, okay I guess Price could have been cheaper, but it’s reasonable Q3: No, definitely not I rarely change my favorite Q4: More sweetness, less gas Maybe lower the price a little bit? Interviewee 35 Q1: Uh huh, I love the ads Really colorful Pepsi may have a new competitor to worry about Q2: Uhm, I was disappointed Could have been better than I expected Q3: No, not a chance Q4: Probably remove all the herbal smell Interviewee 36 Q1: Just okay, I didn’t pay too much attention to ads Q2: Uhm…okay Better than I expected, barely Price is okay as well TuLoHoNa: The Report - 45 Q3: Yeah, let’s give this one a chance Q4: I’d love cherries flavor Interviewee 37 Q1: Oh yeah It was funny Maybe you guys should make more of something like that That will attract the customers better Q2: Well, that just blew my mind! Price is okay Q3: Yeah, why not? Q4: Nope, no recommendation Interviewee 38 Q1: I didn’t feel anything particular special about it You guys are new, inexperienced, you’ll probably won’t be able to compete with Coke Q2: Just normal Price and taste Nothing special Q3: No Not a chance Q4: I don’t know It just feels like there’s something missing Interviewee 39 Q1: It was a funny ads But you’ll have to be more creative to compete with them Q2: I’ll say: it’s quite pleasant Price’s a little too high, though Q3: If you have more flavor and lower price, sure I will Q4: Lower the price and invent more flavors Interviewee 40 Q1: I just heard of you guys last month Not really interested in ads or commercial TuLoHoNa: The Report - 46 Q2: Just like normal energy drink Price? Cheaper than I thought Q3: No way Not in a thousand years Q4: Try adding fruit jelly Interviewee 41 Q1: Though your ads were short, they’re memorable That’s what great companies can Q2: Oh boy This is too sour! Price is okay, though Q3: I’m not sure I think I can give you a week’s trial Q4: Please decrease the sourness FIELD TRIP PICTURES TuLoHoNa: The Report - 47 Location: Ho Chi Minh City Labor Culture Palace: 55B Nguyen Thi Minh Khai Street, Ben Thanh Ward, District TuLoHoNa: The Report - 48 TuLoHoNa: The Report - 49 Location: Ho Chi Minh City Labor Culture Palace: 55B Nguyen Thi Minh Khai Street, Ben Thanh Ward, District TuLoHoNa: The Report - 50 Location: Ho Chi Minh City Labor Culture Palace: 55B Nguyen Thi Minh Khai Street, Ben Thanh Ward, District TuLoHoNa: The Report - 51 TuLoHoNa: The Report - 52 TuLoHoNa: The Report - 53 Location: Ho Chi Minh City Labor Culture Palace: 55B Nguyen Thi Minh Khai Street, Ben Thanh Ward, District TuLoHoNa: The Report - 54 Location: Lam Thinh C1 mini football field: 72 Nguyen Van Yen, District Tan Phu Location: Masteri Thao Dien outdoor field: 159 Ha Noi Freeway, Thao Dien Ward, District TuLoHoNa: The Report - 55 Location: Hoa Lu Stadium: 2 Dinh Tien Hoang Street, Da Kao Ward, District 1 TuLoHoNa: The Report - 56 Location: Sai Gon University’s Sports Complex: Nguyen Trai Street, Ward 3, District Location: Lam Son Sports Center: 320 Tran Binh Trong Street, District TuLoHoNa: The Report - 57 TuLoHoNa: The Report - 58 Location: Binh Thanh Sports Center: Phan Dang Luu Street, Binh Thanh District ... mentioned in this report is that the Ready-to -drink (RTD) tea accounted for nearly 60% of the soft drinks, while carbonates and energy drinks accounted for 16% and 3%, respectively (Figure B) Based... provide info for product Answer the questions asked by the interviewer provide customer insight Consume a small amount of sample product review of the product Perform sport tasks for observation... - 30 minutes for the questionnaires, 10 for the interview, for the sample, and 15 for the observation What are the risk and benefit? Benefit: make practical suggestions for the product modification