EXECUTIVE SUMMARY
Unilever is a fully multinational corporation with operating companies and factories scattering all around the world, and manufacture foods, beverages, cleaning agents and and pers persona onall care care produc products ts.. Unil Unileve everr owns owns more more than than 400 brand brandss but its its 13 “billion-dollar brands” fall mostly into two categories: Food and Beverage, and Home and Personal Care. Unilever started its operation in Vietnam in 1995. Since then then,, Unile Unileve verr Viet Vietna nam m (UVN) (UVN) has has achi achieve eved d a stron strong g and rapi rapid d growt growth, h, and and managed to become the market leader in almost every sub-sector it has entered in spite of facing lots of harsh competition, especially in a country where investment is ample, rising not only domestic competitors but also attracting big foreign ones such as Nestle or PepsiCo. This paper, based on secondary research, is composed with the aim of presenting an overview of Unilever’s activities in Vietnam through the study of its current market, marketing environment, customers, competitors, and particularl particularlyy brand and SWOT analysis. We would mainly bring Comfort-the Comfort-the fabric softener into focus. In brief, some of its strength are secured financial background and reasona reasonable ble pricing pricing and high high adapta adaptabil bility ity.. It also also has weakne weaknesses sses such as probable misperception. And even though UVN has to face harsh competition and other threats that pose a hazard, it also can take advantages of opportunities like the dome domest stic ic marke markett havi having ng evol evolve ved d much. much. From From the the anal analysi ysis, s, we draw draw severa several l suggestions for the company’s promotion strategies such as keeping going with public campaigns.
COMPANY ANALYSIS Mission Statement Unilev Unilever er is a multi multinat nation ional al busine business ss that that owns owns many many of the world’ world’ss consume consumer r product brands in foods, beverage, cleaning agents and personal care products. Since the commencement of Unilever’s operation in Vietnam in 1995, Unilever Vietnam has successfully grown to become a leading-fast moving consumer goods company in the local market. Guided by the mission “To add vitality to life”, the company has diligently fulfilled its commitment to raising the quality of life for people everywhere through the
provision of its branded products and services. Every product line is originated and developed perfectly in tune with the overall mission. Knorr, for instance, the leader in Vietnam’s granule market with total share of more than 70%, originally founded on the belief that “Good food matters” since it adds untold pleasure to our lives. Or Comfort, which has been ranked the number 1 fabric conditioner in Vietnam with more than 55% of market share since 1999, lets people “Do the little extra thing for the one you love”. Or Lifebuoy, a market leader in every Asian market where it is sold, has made its goal clear is to provide affordable and accessible hygiene and health health solutions solutions for every person. person. Besides Besides working on its production production to provide the best for people, Unilever Vietnam is also actively involved in social activities to help raise the living standards and improving the well-being for Vietnamese people. It has contributed more than VND 200 billion to the society through a wide range of projects such as “P/S protects Vietnamese Smiles Program”, “For Bright Eyes of Children”, and “Pride of Ha Long”.
Company Objectives In accor accordan dance ce with with the the miss missio ion n stat statem ement ent,, the the comp compan any y sets sets up its its corpo corpora rate te objectives guiding the present and future development of the company over the next 12 months as follows: •
Win share and grow volume profitably across categories and countries.
•
Offer a broad portfolio of brands that appeal to consumers with different needs
and budgets. •
Leverage technology to create bigger, better innovation platforms that will be
rolled out faster to multiple markets. •
Enhance and broaden relationship with customers.
Brand analysis 1, Brand `s current performance
Brand is the most important component to create success for a company, so it’s necessary for marketers to realize the brand’s current performance in the market and from that developing appropriate marketing strategies for improvement by using product life-cycle (PLC) stages, a useful framework for describing how products and markets work. There
are five main stages namely Product Development, Introduction, Growth, Maturity and Decline. Product development and Introduction refer to the period of launching goods and services while Decline is when the company stops expanding and spending on the product and develop another new one instead. In the case of Comfort, it can be said that they are in the period of rapid market acceptance and sales growth (the growth stage). Carin Caring g for for your your clot clothe hess is impor importa tant nt as it allo allows ws you you look look good good and and feel feel good good.. Understanding this, in 1999 Market Leader of Unilever Viet Nam launched Comfort with the aim of making customers feel cared for everyday by bringing softness and longlasting lasting freshness freshness to their clothes .Immediately .Immediately,, Comfort Comfort has long been winning winning the love and loyalty of consumers with more than 55% market share and become the number one fabric conditioner in Vietnam. These are the evidences evidences to support support the fact that Unilever Viet Nam has been developing developing very good marketing strategies for their brand-Comfort. 2, Current marketing strategy for the brand
Unilever Company has been implementing the international marketing strategies in Viet Nam market following Marketing Mix 4Ps framework. 1, Place Comfort has been distributed over the country, with over 100,000 places, which makes a convenient access for customers and any suppliers. Nowada Nowadays, ys, when when the trans transpor portat tation ion becomes becomes more more advance advanced d with with differ different ent kinds kinds of vehicles, it is easier for Unilever Viet Nam to allocate the product to customers in different areas and regions.
2, Product
In terms of quality, Comfort not only delivers exceptional softness to clothes, but it also offers a variety of well-loved fragrances. Some of which are Lily, Huong Ban Mai, rose scent etc. Fragrance Angels are the icons for Comfort's long-lasting fragrances. With the desire to meet the changing needs of consumers, Comfort keeps innovating and introducing new products to the market. Not only offering softness and long-lasting freshness, but Comfort also introduces extra benefits of the products. Comfort White, the only fabrics conditioner endorsed by the Dermatology Institute of Vietnam that is safe for sensitive sensitive skin, is the best choice to protect the skin and make clothes very soft, soft, which is very suitable for baby’s clothes. Active Confident with tea tree oil extract protects the
clothes from malodor and keeps customers feeling fresh and active the whole day long. The latest innovation on the February 2006 is Comfort Thom Lau Huong Ban Mai (Blue Concentrate) with fragrance capsules which protect the perfume and only releases it during wearing. These innovations again reinforce the long-lasting benefit of Comfort Blue in the fabric conditioner market. 3, Promotion The main promotion strategy system of Comfort is “Above the Line”. Above-the-Line is the promotion activities for product on TV, magazines… to announce, persuade and remind remind custom customers ers about their their product products, s, especi especiall ally y at the beginn beginning ing of each or new produc productt launche launched d .Some .Some promot promotion ion progra programs ms are made most most often often on TV to make make customers to be aware of the product like Comfort wedding, Comfort big day, Comfort“ spring breeze”... Since March 2005, a unique and creative idea for advertising and activation has been introduced: fragrance angel. With the fragrance angel, the fragrance is symbolized by an imaginary character which visualizes very well how the fragrance of Comfort works on fabric. The image varies according to its purpose to illustrate the function and component of Comfort: Angel with tea leaf shield, Angel that hugs the fabric, Angel with school bag, Angel with the fan, Angel with sunglasses. The fragrance angel is the unique property of the Comfort brand in Vietnam. It has been loved and adored by many people, especially children. In November 2005 promotion, thousands of fragrance angel dolls have been given as unique and lovable souvenirs to consumers of Comfort. In additions, Unilever also held many programs at markets and supermarkets like “Kham pha 14 ngay thom lau” Campaign on 15/03/2006 “Thu thach 1 lan xa cua Comfort” on 14/04/2008 with the aspire of positioning the brand name as well as the product quality. Unilev Unilever er Vietna Vietnam m is also also well well recogni recognized zed for its active active contri contribut bution ionss to social social and community programs across Vietnam, which has helped to improve life for millions of people in Vietnam. In April 2005, Unilever Vietnam was honored by the President of the Stat Statee the the Seco Second nd Rank Rank Labor Labor Medal Medal for for its its excel excelle lent nt busi busine ness ss perf perfor orma mance nce and and contr contrib ibut utio ion n to the the soci socioo-ec econo onomi micc devel developm opment ent of Viet Vietnam nam,, bein being g one of the the first first multinati multinational onal companies awarded awarded with such honor by the State and Government Government of Vietnam. Due to these direct, on time and appropriate promotion campaigns, the brand nameComfort has been widely recognized in Vietnamese market, not only bringing benefits for Unilever Vietnam but creating a good brand image fro Comfort on consumers as well. 4, Price
Recognizing that 80% of Vietnamese consumers live in the countryside with low income, Unilever Viet Nam has been developing the price strategy, reducing the producing costs, charging appropriate price on consumers. The company has based on the small rural enterprises to find the local materials instead of importing. This helps the company reduce
the
producing
costs
and
pay
fewer
tariffs.
Furthermore, the company also distributes the producing places at three main factories, in the north, the middle and the south of Viet Nam to trim down transportation expenses and land cost. Unilever also follows the finance support policy, helping rural enterprises advance their equipments, transfer technology, hold the training programs, etc. With all actions the company has been doing, Unilever Viet Nam has demonstrated its talent of management in satisfying the needs and wants of customers and raising the market market share share of Comfort Comfort in a competit competitive ive environ environmen mentt
like like Vietname Vietnamese se
market market in
current years. COMPETITOR ANALYSIS
Compet Competiti ition on is inevit inevitabl ablee for every every busine business ss in every every market market.. It’s It’s appare apparent nt that that the compan company y must must cope cope with with numer numerou ouss power powerfu full and and rele relent ntle less ss compe competi tito tors rs such such as Bestfoods; Coca-Cola; Colgate-Palmolive; Kraft Foods, Inc.; L’Oreal; PepsiCo.; Nestlé S.A.; Procter & Gamble and the list continues to go on. Unilever has managed to become a leading company in almost every sub-sector it has entered despite harsh competition in Vietnam, a thriving market that not only raising domestic rivalries but also big and wellknown foreign ones. Though it has dominated with lots of products in different kinds, this analysis would take a case of Comfort in particular. In detergents industry, Comfort has become the pride of Unilever, maintaining its 1st position in Vietnam with more than 55% of market share since 1999. However, as soon as Comfort made its appearance known in the market, it has also begun its struggle against other competitors. The strongest one of all is Downy, the product of Proctor & Gamble group. Downy was launched right after Comfort was introduced to the market. It can be said that the number of campaigns and commercials ads poured into the two products products from two sides have been equally effective effective and attracted attention. attention. That might partly explain the market share between of the two has been in a tight match. Firstly, the
two products are produced by two both well-known companies, which can somewhat assure their their look in customers’ customers’ view. Then, the quality quality could also buy consumers consumers with their position as worldwide brands plus the diversification of the product lines gives customers numerous choices to choose. Also, advertisements of Downy and Comfort have have been been skil skillf lful ully ly cust custom omiz ized ed to attr attrac actt atte attent ntio ion n and and creat createe certa certain in value valuess to consumers. From the introduction stage up to now, customers have been exposed to a handful of adverti advertisem sements ents of both both compan companies ies.. When When Comfor Comfortt launche launchess Comfor Comfortt with with lasti lastingngfragrance, Downy immediately offers this kind as well. Comfort creates a beautiful image of a little angel protecting the fragrance of clothes to illustrate its Comfort FragranceAngel. Downy competes with Downy Incense Flowers, creating a demonstration through a flower flower field field always always presented presented in clothes. clothes. Comfort introduces Comfort 1-time; 1-time; Downy also also has Downy Downy 1-time 1-time;; Comfor Comfortt comes comes up with with Comfor Comfortt anti-m anti-mosq osquit uitoes oes,, Downy Downy provides Downy anti-bacteria. Both of them make campaigns to market for their product. About the price, Downy’s price is higher than Comfort’s one in general. In pack-shape, price for a pack of Downy is 2000VND, whilst a pack of Comfort costs 1500VND. In recent months, the battle battle has become fierce when Unilever Unilever has launched launched a promotion using using two eye-catch eye-catching ing charac character terss Andy and Lili Lili and seem seem to gain gain attrac attractio tion n from from consumers. From this commercial, Unilever gain the higher revenue. While Unilever invest so much on this commercial, P&G is still quite silent. Whether P&G is planning a state-of-the-art Downy ever with outstanding functions and best-ever components; or nurturing a win-away strategy? Time will give the answer and the rivalry between the two promises to be a prolonging harsh and unforgiving one. However, However, at this point, point, it appears that Comfort Comfort is gaining gaining the upper hand over Downy. The positioning of Comfort in Vietnam and its biggest competitor, Downy, can be illustrated through the following map: Quality
Comfort Downy
Price
A positioning map
SWOT ANALYSIS
In recent recent years, years, the compet competiti ition on among among consum consumpti ption on market marketss between between Vietna Vietnam m and foreign countries became so fierce, especially products originating from multi-national compan companie iess which which are are curre current ntly ly pres presen entt and domi domina nant nt Viet Vietna nam m mark market et.. Unil Unilev ever er Vietnam is one of the giants on the market of products and services, it has provided a large number of essential goods for daily consumption of Vietnam such as toothpaste, P / S, shampoo Sunsilk, Omo washing powder, etc. ... every year. This is not only a threat to domestic producers but also an example for them to learn about business marketing experience of a large multinational company with world-class like it.
It can be said that Unilever has a thoughtful and creative marketing strategy which makes it well-known to attract the most customers for the company's products. The company takes the advantage of their inherent strengths as well as promoting the opportunities from the market to bring huge revenue every year for the company. SWOT analysis below will show all about the strengths, weaknesses, opportunities as well as threats Unilever gets.
1. Strengths •
Unilev Unilever er Vietna Vietnam m has the suppor supportt from from global global Unilev Unilever; er; hence hence it has stron strong g
financial background. The visit of Mr. Paul Polman, CEO of Global Unilever, on 10th April 2009, again confirmed the potential of the Vietnamese market which is growing very fast, as well as the important role of Vietnam in the group of new markets and developing countries of the Unilever Group. •
An effective policy of attracting potentials: The strategy of the company is that
"Development through people”. Through their career days for students who are about to graduate of the prestigious universities, then the company will train them to become Administrators who set the light for the company's human resources. In addition, the company also sets up salary, benefits, and courses in Vietnam and abroad for staff to enhance their qualification. •
The situation of research and technological development of Unilever Vietnam has
always been focused and invested adequately. In particular, R & D works very effectively in the exploitation of traditional products such as shampoo Gleditsia, salt toothpaste. Besides, R&D shows its effectiveness in the modern products such as Comfort or Omo… Moder Modern n tech technol nolog ogy y inher inherit ited ed from from the the glob global al Unil Unileve everr is appl applie ied d quic quickl kly y and and is remarkably effective. Unilever makes customers surprised many times with much new technology. Recently, we see new Comfort, with a slogan “just move to be pure fragrant” with Andy and Lili. And how about Omo? The whirlwind-power Omo is the newest kind. •
The price is relatively acceptable, while the quality is as high as imported goods.
The target customers of Unilever are ranged from children to adults, from low class to high class. Hence, the price is quite suitable for everyone. •
The The staf stafff with with high high leve levell and knowl knowled edge ge focu focuss only only on the the miss missio ion n of the the
company, especially the company pays much attention to the relationship with the public. Unilever Unilever sets up itself itself a criterion criterion which is all the employees employees are the best. Therefore, Therefore, the staff has high ability to adapt with quick changes in the production line. 2. Weaknesses The key positions in the company are held by foreigners. The CEO of Unil ever Kugler. This may lead to the differences in the perception between Vietnam is Ralph Kugler
CEO and Vietnamese employees; which is the causes of conflicts.
•
There are some applications not being operated in Vietnam due to high cost, such
as the input for perfumes. Moreover, the company does not fully take advantage of abundant labor resources and capacity in Vietnam. •
As a company that originated in Europe, strategies to promote Unilever products
are not really suitable with Asian culture. 3. Opportunities •
The The poli policy cy of Viet Vietna nam m is also also to buil build d Viet Vietna nam' m'ss econ econom omy y as orie orient nted ed
indust industria rializ lizati ation, on, modern moderniza izatio tion, n, giving giving priori priority ty to attrac attracti ting ng foreig foreign n invest investmen ment, t, especially especially from transnatio transnational nal and multinatio multinational nal companies companies such as Unilever Unilever to increase increase the budget. •
Domestic market (wholesale, retail, goods circulation ...) have evolved much.
Also infrastructure in major cities, especially Ho Chi Minh City has been appropriate invested equally with other countries in the region. •
Vietnam is a country which is freely religious, so the distribution and advertising
of products is not limited. limited. In addition, Vietnam has a young population population structure structure and extende extended d family family models models (incl (includi uding ng grandpa grandparen rents, ts, uncle, uncle, etc ...), ...), which which create createss many many opportunities for Unilever because they are the target customers of the company. •
Vietnam is located in a relatively favorable position in the region with a long
coastline, many major ports, giving a chance to export goods when Unilever begins to focus on exporting in the near future. And, Unilever comes to Vietnam when the market of consumption in here is new, so it has more "land" to do business. 4. Threats •
Financial situation in Vietnam does not develop much, the stock market still
fragments, which reflects a bad signal for the development of the company. Additionally, telecommuni telecommunication cationss systems, systems, communicati communications, ons, telephone telephone charges, charges, postal and internet internet have very high high prices prices in compar compariso ison n with with other other countr countries ies in the world. world. Thus, Thus, it costs Unilever much when the company uses it as a way to approach customers and promote products. •
Comm Commer erci cial al Code Code also also makes makes many many disa disadv dvant antag ages es for for fore foreig ign n inve invest stor ors, s,
especially tariff policies and high tariffs levied on imported goods using as inputs for Unilever’s products such as some kinds of input for perfumes.
•
In the context context of consumption consumption markets, markets, there is also greater greater and greater greater demand,
many new companies "insert foot" in and will compete with Unilever. As we can see from the fact that Unilever has to put more and more names in its competitors list. From From SW SWOT OT analy analysis sis,, some some sugges suggesti tions ons are menti mentioned oned to help help Unilev Unilever er Vietnam continue to be the best brand for Vietnamese customers.
Strengths Long term brand Technology
Possible actions Continue developing marketing strategies, such as promotion programs, doing charity … to raise the company’s image and brand name n ame in the market Update Update advance advanced d and modern modern machin machinery ery technology all over the world
Weakness Control selling price
Cont Contro roll to stab stabil iliz izee pric price, e, set set the the more more suitable price for most customer segments.
Sale and maintenance service
Mana Manage ge,, trai train n and and moti motiva vate te ( rewa reward rd or punish)staffs Be able to use mobile repairing service
Opportunities Vietnamese customers Socio- cultural conditions Globalization
Do resear research ch about about demand demand of domest domestics ics and society to expand market for the company. Continue focusing on the public campaigns such such as "P/S, "P/S, protec protectt Vietna Vietnames mesee smile” smile” or “ Omo, white shirts for light future”…
Threats Bargaining power of customers Bargaining power of suppliers New entrant Rivalries Conclusion
Innova Innovate te continu continuous ously ly produc productt with with high high quality and suitable price for customers Look for domestic suppliers to make lower price and assemble actively.
To sum up, over 15-year of operating, Unilever now is a famous trademark in Vietnam with a very high growth rate in recent years. Many of its products have become familiar with Vietnamese Vietnamese consumers like P / S, Sunsilk, Sunsilk, Omo, Comfort, Comfort, etc ... In spite of facing lots of harsh competition not only exposed by domestic competitors but also big foreign ones, Unilever Vietnam has managed to become the market leader in almost every subsector sector it has entered. entered. Especi Especiall ally y the product product of Comfor Comfortt has become the number number one fabric fabric conditioner conditioner in Vietnam Vietnam thanks to its exceptional exceptional marketing marketing strategy based on 4Ps framework of UVN. Nevertheless, there are still some points that we suggest the company should improve to make them stronger. The first one is UVN should pay more attention in researching the Vietna Vietnam m consume consumerr market market especi especiall ally y Vietna Vietnames mesee cultur culturee to unders understan tand d more more about about Vietnamese people and from that easier to make satisfaction in their needs and wants. Secondl Secondly, y, it is very very import important ant for UVN to develo developin ping g new variou variouss market marketing ing mix strate strategie giess in differ different ent product productss and differ different ent people people with with the aim of best best satisf satisfyi ying ng consumers’ needs. It’s our belief that Unilever Vietnam would continue its dominant player status in the consumption market.