lOMoAR cPSD| 47028186 Vinamilk's Marketing Strategy Ng Thị Như Quỳnh K66KTNNE 6666447 lOMoAR cPSD| 47028186 1. Introduction
1.1.History of formation
Vinamilk, also known as Vietnam Dairy Products Joint Stock
Company, is one of the leading large units, specializing in
manufacturing and trading dairy products, in addition to related
equipment and machinery in Vietnam. Vietnam. Vinamilk was
officially established in August 1976, based on the takeover of 3 dairy
factories left by the old regime, including: -
Thong Nhat Dairy Factory (formerly known as Foremost ).
- Truong Tho Dairy Factory (formerly known as Cosuvina ). -
Dielac Powdered Milk Factory (formerly Nestle' powdered milk) ( Switzerland )
Experiencing many ups and downs in the development process, thanks
to Vinamilk's effective Marketing strategy, the brand has created
impressive achievements. Most notably, in 2017, the Group was
honored to be ranked among the 2000 largest enterprises in the world
by Forbes Global Magazine, and ranked among the top 10 most
effective enterprises in the region by Nikki Japan magazine. Asia in
2017. By 2018 , Forbes magazine also ranked the Vinamilk brand as
the number 1 brand, with the highest value in Vietnam.
1.2 .Development strategy
Vinamilk's Board of Directors determines a long-term strategic vision
to orient production and business activities. Continuing to maintain the
No. 1 position in the Vietnamese market and moving towards the goal
of becoming one of the Top 30 largest Dairy Companies in the world
in terms of revenue, Vinamilk determines a development strategy with
3 main pillars to be implemented, include:
1.2.1. Leading in highly applicable innovation
Focusing on the dairy industry and milk-related products, which is the
core business that creates the Vinamilk brand.
Continue to research and develop many new products with the purpose
of innovating, expanding and diversifying the product portfolio based lOMoAR cPSD| 47028186
on the tastes and needs of consumers; At the same time, it brings
consumers many rich and convenient experiences.
1.2.2. Strengthening the leading position in the dairy industry in Vietnam
Prioritize focusing on exploiting the domestic market with huge
development potential. Expand penetration and coverage of rural areas
with popular product lines, where growth potential is still huge. Promote
focus on the high-end product segment with lots of added value, especially
in urban areas. Continue to build a large and strong domestic distribution
system, increase market share and maintain Vinamilk's leading position in the market.
1.2.3. Becoming the dairy company that creates the most value in Southeast Asia
Ready for mergers and acquisitions (M&A) activities and expanding
strong cooperative relationships with partners in all three directions of
horizontal integration, vertical integration and combination.
Prioritize finding M&A opportunities with dairy companies in other
countries with the purpose of expanding markets and increasing sales.
Continue to penetrate new export markets with the strategy of converting
traditional goods export models to forms of deep cooperation with
distribution partners in new key markets.
1. 3 .Outstanding achievements
2021 is a milestone celebrating the 45th anniversary of the formation and
development of Vietnam's leading dairy brand. With wise strategies,
creative thinking, constant innovation and efforts, Vinamilk is honored to
receive noble awards and titles:
- Among the top 50 most valuable brands in Vietnam (voted by Forbes)
- Top 10 high quality Vietnamese goods
- Received the title of Labor Medal and Independence Medal
- Top 10 most valuable milk brands globally
- Top 3 most potential milk brands in the world's dairy industry
2. Vinamilk's STP marketing strategy lOMoAR cPSD| 47028186
2.1.Market segmentation
2.1.1. Market segmentation by age
- Age from 0 – 4 years old: This is the age that needs to be
supplemented with many nutrients and DHA for development, but
the digestive system is not really complete, so use specialized milk products for this age group.
- Age from 5 – 15 years old: This is the age of children and teenagers.
As children enter the development stage, they need to supplement
many nutrients from milk to develop height, brain and help with the
learning and training process. At the same time, this customer group
has relatively diverse product needs (good product quality,
nutritional value of the product, reasonable price, packaging
design...) and accounts for a large proportion. high.
- Age from 15 - under 25 years old: The age of a teenager. At the last
stage of development, there is still a need to supplement milk
substances but less. At this age, consumers are often autonomous in
their purchasing decisions and choose products that suit their youthful dynamism.
- Age over 25 years old: The age of adults, rarely use fresh milk but
instead use other nutritional products such as functional products good for bones, heart,...
2.1.2. Market segmentation by income
- Income under 5 million VND: Economic conditions are low,
consumers tend to buy truly necessary products.
- Income from 5 - 10 million VND: Have a better income, have the
ability to pay for higher nutritional needs, but do not happen
regularly and continuously, and there is a consideration of price of product.
- Income over 10 million VND: This is a relatively good income level,
capable of paying for the need to use milk regularly and
continuously, often tending to pay little attention to price but mainly
care about ingredients, quality and nutritional value.
2.1.3. Market segmentation by geographical area lOMoAR cPSD| 47028186
- Urban: The living standard of people here is high, updated with
information continuously and clearly, cares a lot about health and
necessary nutrition, and is willing to spend money for high needs in life.
- Rural: Average living standard, many people still consider spending
cautiously, pay less attention to health and necessary nutrition, and are
not ready to pay for high needs.
- Remote and mountainous areas: People's living and living conditions
are still relatively difficult, do not pay much attention to health and
necessary nutrition, and are not qualified to pay for high needs.
2.2 .Evaluate and select target market
2.2.1. Characteristics of Vietnam's dairy market
In recent years, the demand for milk in Vietnam has increased
significantly. According to Statistics, the demand for raw fresh milk
increased by about 61%, from 500 million liters (2010) to 805 million
liters (2015). Experts assess that the development potential of the dairy
market in Vietnam is still very large.
As a populous country with a high population growth rate of about
1.2%/year, the dairy market in Vietnam has great potential. GDP growth
rate is 6-8%/year, average income per capita increases 14.2%/year,
combined with the desire to improve people's health and stature. Vietnam
causes the demand for dairy products to always maintain a high growth
rate. In 2010, on average each Vietnamese person consumed about 15
liters of milk/year. It is forecast that by 2020, this number will nearly
double, up to 28 liters of milk/year/person.
2.2.2. Characteristics of Vinamilk milk market
In Vietnam, Vinamilk is known as a leading milk producer. The
company currently holds the majority of market shares in business
segments such as yogurt (90%), condensed milk (80%), liquid milk
(50%) and powdered milk (25% ). lOMoAR cPSD| 47028186
According to the latest data published by market research company
Nielsen, Vinamilk 100% fresh milk ranks first in both sales volume and
sales in the fresh milk brand segment. Holds nearly 50% of the liquid
milk market share. Revenue growth rate reached 31%.
3. Promotion of 4P model in Vinamilk's Marketing strategy 3.1. Advertisement
Vinamilk always focuses on and promotes constant creativity and
achieves quite a lot of success in advertising to increase its sales
revenue. Vinamilk has successfully entered the subconscious mind of
customers through advertising messages and images such as "100%
pure fresh milk", "3 glasses of milk a day", "dancing cows", "glasses
and padded shoes",... all appear in the image of a vibrant and unique cow.
Vinanmilk turned its disadvantage into an advantage, when the press
published loud news about fresh milk products with a very high
percentage of wheat flour, negatively affecting consumers' view of
fresh milk. It is in this situation that the message "100% pure fresh
milk" was born and has attracted and regained the trust of customers.
3.1.1. Regarding advertising media:
- Advertising on traditional channels: TV, newspapers,... - E-commerce channels:
Advertise on large websites with many daily visits.
Set up a separate page for the company to update the
situation and receive feedback from consumers.
3.1.2. Fairs and sales promotion programs
- Participate in fairs to promote company image.
- Trial programs at major supermarkets.
3.1.3. Community programs
- Participate in charity programs.
- Sponsoring study promotion and humanitarian funds - Give out free milk at schools or events. lOMoAR cPSD| 47028186
- Sponsoring television and sports programs. 3.2 .Promotion
3.2.1. Consumer promotions
- Free additional products (For example: Buy 2 boxes of 100% 180ml
sterilized milk and get 1 box of milk free).
- Free products for mothers and babies.
- Organize prize drawing programs.
- Promotions for loyal customers: have separate policies such as giving
gifts to loyal customers on birthdays, gift vouchers for purchases, loyalty cards, etc.
3.2.2. Promotion of intermediaries
- Increase the discount rate for intermediaries when importing large
quantities, or only selling exclusively Vinamilk brand milk.
- Donate product display shelves to intermediaries.
- Cooperate in advertising, allowing customers to try products at the intermediary's sales points. 3. 3 .Social
Besides advertising to maintain their image in the hearts of consumers, most
big brands must focus on demonstrating their social responsibility through
community activities. Vinamilk always has programs aimed at the community
and society such as: "6 million glasses of milk for poor Vietnamese children",
"Rise Vietnam" milk fund, "Nurturing young talents" scholarship fund. The
goal of the "Stand Tall Vietnam" program is to raise funds to contribute to
reducing malnutrition rates and increasing children's height through drinking milk daily.
There is also the program "1 million green trees fund for Vietnam" which
is a coordinated activity between the Vietnam Environment Administration
(VEA) and Vinamilk. This is an environmental-oriented activity by calling
on the community to participate in planting more trees for Vietnam. 3.4 .Personal offers lOMoAR cPSD| 47028186
Vinamilk has a large team of highly trained sales staff, with a clear
understanding of Vinamilk, customer psychology and, more
importantly, a professional working style and good communication
skills, always enthusiastic in working and ready to share any information with customers. 3.5 .Direct marketing
This is a direct communication method that most businesses are aiming
for, giving customers a feeling of care. Vinamilk always captures
information about all customer feedback to promptly provide solutions
and new strategies when faced with risks. On February 15, 2012,
Vietnam Dairy Products Joint Stock Company (Vinamilk) and Military
Telecommunications Group (Viettel) signed a cooperation agreement
to build and deploy online sales management software.
4. Advantages and disadvantages of Vinamilk's marketing strategy 4.1. Advantage
Vinamilk dominates the market thanks to focusing on advertising,
marketing and constantly innovating products and ensuring quality,
and being able to identify and understand consumer trends and tastes,
which helps the company focus on developing products. developed to
determine consumer-rated characteristics.
Diverse and strong product portfolio: Vinamilk provides a variety of
dairy products to serve many consumers. The sales team has experience
in analyzing and determining consumer tastes and trends, and regularly
approaches consumers at the point of sale. Good management
experience is proven by sustainable business performance.
Vinamilk is managed by an enthusiastic management team with extensive
experience in the industry. Professional skills can keep up with market changes. 4.2 .Disadvantages
Although fresh milk accounts for 70% - 90% of the products, because they
do not know how to exploit the brand, Vinamilk does not have a message lOMoAR cPSD| 47028186
to help consumers understand the difference between fresh milk and
reconstituted mill, fresh milk.
The current price of dairy products, compared to developed countries in
the world, is still quite high. This makes it difficult for some domestic
consumers to access these products