Marketing Plan for Magnum in Vietnam
Marketing can be defined as “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” (American Marketing Association Board of Director) Base on this definition, Marketing is the set of activities and processes with the purpose that: satisfy the customers, clients, partners and society. In general, it can be said that marketing is the process that combine all company activities to satisfy the customers and, in the end, get profit from customer’s satisfaction. 2. Element in marketing process:
Marketing process includes five elements: analysis situation, marketing strategy, marketing mix decision and implementation and control. Analysis situation is first step in marketing process. In this step, company has to collect information, data and figure to understand internal and external environment. Based on the result of the analysis, company can predict the trend of market and compute that whether its ability can adapt with the market or not.
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In order to carry out this step, the company can do three analyses below: PESTEL analysis: Political, Economic, Social, Technology, Ecological and Legal are five macro-economic factors.
They are very important for company to evaluate the market and decide whether it can develop strongly in this market or not. SWOT analysis: This method helps company identify its strong and weakness, also the opportunity and thread. Understand these things can make company developing more stable and limit the risk. It can use the strong to limit the thread and the opportunity to improve the Strong and remove weakness. The meaning of the SWOT analysis can be described in the idiom “He who sees through life and death will meet most success” 5C analysis: 5 C means: company, customers, competitors, collaborators and Climate.
In these things, “company” helps the firms understand the internal environment, and 4 other help it understand the external environment. All of three analysis methods will help company understand the situation to create the suitable strategy in marketing plan to get achievement. The second step in marketing process is marketing strategy. Of course, after finish situation analysis, company has to make strategy decision in marketing base on the analysis result. In this step, company has to identify the requirement of market and choose the suitable strategy to run business.
It has to do the segmentation, the target market selection, the positioning the product and the proposition to the target market. In next step, the firm has to design tactical plan to achieve the purpose. It will make decision for the marketing mix. It includes: 4 P: Price – Place of distribution – Production – Promotion. When these things are completed, company will go to the final step: implement and controlling. Because the demand of market can change quickly, company has to monitor all the changes of market to have the change in marketing mix to adapt with the market and create the competitive advantage with competitor.
Marketing process II. Marketing orientation: 1. Definition: Marketing orientation is a company philosophy aim to meet the needs and wants of customers. There are five type of marketing orientation: * Product orientation * Production orientation * Market Orientation * Sales Orientation * Social Orientation a. Product orientation: Product orientation is one of the marketing concepts, which focus on the product innovation to satisfy demand of customers. b. Production orientation: This kind of orientation focuses to the quantity of product.
It existed in 1950s – the development period of industry in Europe and American. At this period, the firms make massive products to decrease the cost and product with huge quantity. The firms do not care about whether its product can meet the needs or not. This philosophy is popular in that period because it is the time which has many inventions and people have huge demand for something new and strange. The clear example for this philosophy is Ford. It produced many car in that time with just only color – black and it has many successes with this orientation.
Today, this philosophy is no longer popular, but still exist in some industry that produce common product such as toothpick, CDs or DVD. c. Sales Orientation: The next orientation is sales orientation. This philosophy is applied when the company uses aggressive sales. They believe that they will make more sales and more profit when they use aggressive sales method. With these kinds of company, they will focus on promotion product and train the aggressive sales force, which helps them carry out the sale method. The good example for this philosophy should be insurance company.
The disadvantage of this philosophy, same as production orientation, is that it does not focus to the customer’s requirement. It just tries to sales product as much as possible. d. Societal orientation: Societal orientation is the marketing concept that provides the long-term benefit for customers and shows its responsibility with social. The products of these companies have same features such as good for health, no harm environment and creating the long-term benefit for customers. They advertise the product through the charity activities. e. Market orientation:
The last philosophy, also the main philosophy that is applied to Kinh Do Corporation, is market orientation. This orientation focuses on the customer’s needs and wants. The company produces product, which can satisfy the customer and use the customer’s satisfaction to create the profit. The benefit and cost of market orientation of Kinh Do Corporation will be discussed more in next part. 2. Evaluation cost and benefit of Market orientation in Kinh Do Corporation: As the assignment mentioned above, Market Orientation focuses on the customer’s needs and wants and the company will get profit base on the customer’s satisfaction.
The relationship between customer’s satisfaction and company’s profit is shown in the chart below: As the chart shows, when the firm applies the marketing orientation, it will identify the demand of customers. After that, the firm will use the data from marketing department, and connect all the activities of company to carry out the plan, which has the purpose that satisfies the customer. When the customers are satisfied, they will create many benefits for the company, not only money, but also helps company advertise free with the word of mouth method.
Kinh Do Corporation applies the marketing orientation, so it also gets the benefit from customers’ satisfaction. a. Benefits from Market orientation: The first benefit for Kinh Do when applying Market Orientation is: advertising free because of the word of mouth. With the suitable marketing plan, Kinh Do can satisfy the customers and improve the relationship between customers and company. With focus on the demand of customers, Kinh Do can improve the level of customer, from customer satisfaction to customer retention and customer loyalty.
After getting success to satisfy customers, customers will loyal with Kinh Do’s product and will buy it again. Besides, they will recommend to other people about Kinh Do’s product and so, Kinh Do will have more and more customers. That is the benefit when Kinh Do wants to launch Magnum ice cream. With the huge amount of loyalty customers and retening customers, Kinh Do can easily introduce new product to the market because the loyalty customers and retention customers willing welcoming and buying any product of Kinh Do, as long as it still satisfies their demand.
The second benefit is that decreasing the price sensitive. This is very important when Kinh Do wants to sell magnum in Vietnam, because Magnum ice cream is premium product, so it has higher price compare with the domestic ice cream. However, with customer loyalty and customer retention, they will not care about the price of product. If it is suitable with their payment ability, they will buy and support for this product. Last but not least, Kinh Do also can receive the long-term profit from market philosophy.
When Kinh Do can satisfy the customers and keep their loyalty, Kinh Do will gain a huge market share and so, create the stable consumption network for its product. After getting profit from customers satisfaction, Kinh Do can also use the profit to invest for new technology or new plan to expand the business and create the competitive advantage with its competitors. Launching Magnum ice cream is one of the important strategies of Kinh Do to get the market share in premium ice cream market.
Finally, we can see the different between Kinh Do and Vinamilk- the two biggest food, drink and beverage companies in Vietnam. Vinamilk applies the societal orientation. It advertises its product through some charity programs such as dairy budget for children in Vietnam. The market share of Ki Do – the ice cream brand name of Kinh do- is about 45,8%, equal double the market share of Vinamilk (about 20,8%). It can be seen that market orientation creates more benefit and stronger competitive advantage than other orientation. III. Effect of buyer behavior IV. Positioning: