“THE MARKETING STRATEGY TO HOLD STEADY THE NUMBER POSITION OF UNILEVER’’ In times of country industrialization and modernization and especially when Vietnam has officially become a member of World Trade Organization – WTO, the trade and commerce of goods & services have become more important and received more attention Consumers have wider variety of choices, more opportunities to find the most suitable products at reasonable prices OMO – a detergent brand of Unilever group has become popular among Vietnamese people It is also known that once the brand has successfully positioned itself in consumer’s minds, its next goal is to capture their hearts This is true when it comes to the case of OMO – the leading detergent brand in Vietnam market In modern society, detergent is a necessity product in every household The higher the living conditions are, the higher the needs for better product increase In my opinion, Omo has significantly met customers’ expectation about quality products It is not easy for a product to sustain its position in the market and obtain customer’s belief in its quality Nevertheless, Omo has managed to these things And now, Omo has well positioned its brand in the market and will in the future in both Vietnam and overseas markets The strength of the company - Support from Unilever global group, thus the company has strong finance - Effective talent-hunt strategy: the company’s view is “Development based on People” Through job fairs for would-be graduate of wellknown universities, the company has selected candidates for Management Trainee program, which will become key human resource for the company Besides, the company also has good remuneration and rewarding system and provides its employees with internal and abroad training courses, which help to improve the employee’s knowledge and skills - Unilever Vietnam has always put research and development (R&D) among its top priority and spent significant investment on that For a special instance, R&D is successful in discovering the tradition factor of shampoo e.g Gleditsia shampoo and toothpaste e.g salty tooth paste Advanced technology from global Unilever are quickly transferred and effectively applied - Reasonable price whereas the quality is high, not lower than imported products - Strong company culture, qualified employees who are highly dedicated to the company’s objectives Public relations are among the top priority of the company The weakness of the company - Recently, the company has cut its budget due to difficulties in world economy caused by 11-9 event - Key positions in the company are still taken by foreigners - There are certain technologies which cannot be applied in Vietnam due to high costs, thus the company has to import these technologies Consequently, the cost is high and the company does not utilize qualified and plentiful human resource in Vietnam - Unilever price is still high compared to Vietnamese people’s income, especially to those living in the rural area Opportunities from external environment - Vietnamese government’s strategies are to build an economy oriented by industrialization and modernization, in which calling for foreign investment, especially investment from multinational and global company e.g Unilever to increase government fund is a priority - Internal market (retail, wholesale, goods transfer) has developed dramatically Infrastructure at big cities, especially Ho Chi Minh City, has been invested properly, of which the investment level is the same as that of other countries in the region - In times of terrorism, disease, war, Vietnamese politic environment has been considered stable and ranked as one of the safest country in the Asia Pacific region, which makes investor more confident when considering investing in Vietnam - Vietnamese people’s awareness are quite high, especially those who live in the city The rate of those graduating from university and college is relatively high compared to that of other countries Moreover, Vietnam office workers are excellent in information technology, which brings a plentiful human resource for the company - Target customers of many products which Unilever are providing to the markets are the youth – X generation (those aged from 18 to 29 years old) This X generation is independent, open-minded and more confident than the previous generations They are those who make decisions for many things, including purchasing household goods - Vietnamese is quite open when it comes to religion Thus, the distribution and advertising of products are not binding by strict policies as in many other Asian countries - Vietnam has young population and extended families i.e including grandfather, grandmother, aunt, uncle accounts for the majority of the families in Vietnam These are among the target customers of Unilever - Vietnam is nestled at a good geography location in the area Vietnam has a long coastline with many big sea park, which make it convenient for goods exporting especially when Unilever might expand into exporting made-in-Vietnam goods to other countries in the near future - Unilever came to Vietnam when the household goods market was new, thus the company has great opportunities to its businesses Threats from external environment - Vietnam economy growth rate is low - Vietnam financial market has not fully developed The security market is still small and immature In addition, telecommunication infrastructure, Internet and telecommunication rate are one of the highest in the world Therefore, developing e-commerce is mostly impossible to Unilver even though the company has mentioned ecommerce as an approach to customers and another way to advertise its products in other developing countries - There are still many unfavorable articles for foreign investors in Commercial law, especially customs policy and high importing tax rate imposed on “luxury” products e.g body lotion, shower cream, which Unilever are selling - Vietnamese youth is also under much criticism from the society, especially the strict elder generation because of the playful and spoiled lifestyle There are opinions claiming that it is the transnational companies has brought the Western lifestyle, which is strange to Asian countries, especially Vietnam –a country which is still somehow influenced by the feudalism and rigid hierarchy mindset - With Vietnamese government’s policies toward population and birthcontrol, Vietnam will no longer be a country with young population in the next few decades, which is not a favorable factor for Unilever Besides, middle-class families (which is the majority in the proportion of Vietnamese families), the decision to buy a product, especially a high-end product is often taken into careful consideration Therefore, this customer group not consume high-end personal-care products as much as that of the SSWD group (SSWD – Single, Separated, Widowed, Divorced) in capitalism countries - Tropical, hot and humid climate is not suitable for those products originating from the mother company in Europe - The supply is bigger than demand in the market for household goods In addition, there are many new companies “sneaking” into the market As such, these factors creates a stiff competition for Unilever On the basis of strengths-weaknesses, opportunities-threats, Unilever has conducted the marketing mix in Vietnam market as the followings  Distribution Channel In 1995, when Unilever first entered Vietnam, they built a sales and distribution channel through out the country, which comprises of over 100,000 points Unilever applied a new strategy – retail direct sales, in which they hired direct salesman to introduce new products, deliver the goods and grant credit for next orders Retail shops were provided with free displaying cabinets and in return, their products would be displayed at catchy place in the retail shops In addition, the company also supported distributors with loan to buy transportation vehicles and organized training courses on sales & management skills  Products The company applied international standards for products sold in Vietnam market yet modified to make it suit with Vietnamese consumers They acquired well-known brand in Vietnam market i.e Viso detergent and P/S toothpaste After that, they improved the formula and redesigned the package to increase sales for these brands Besides, the company also did market research to earn a profound understanding of Vietnamese consumers so that they can “Vietnamize” their products In light of the importance of brand reputation, Unilever has paid special consideration to eradicate fake product, ensure consumers’s rights, protect intellectual property rights Unilever products are now sealed with Authenticproduct seal or Anti-fake-product logo These signals help customers to identify between fake and authentic products and give customers peace-ofmind when using Unilever products  Advertising Unilever has main streams in their advertising strategy, which are “Above the line” and “Below the line”  Pricing Being aware of the fact that 80% of Vietnamese consumers live in the rural area and earn a low income, Unilever listed cut-cost as one of its objectives to provide consumers with products at reasonable price The company relied on local small enterprises to seek for alternative material for imported ones, which helped reduced input purchasing cost as well as saved for importing tax Besides, the company also organized manufacturing, packaging center in the North, the Middle and the South to reduce transportation & warehouse costs Unilever also applied financial support programs for local enterprises so that these enterprises can invest in manufacturing equipment They organized training on manufacturing and management skills  Human Resource Together with business diversifying, Unilever Vietnam always treats human resource development as the crucial point for sustainable development, especially when the economy is moving toward a knowledge-based economy and biologic-based economy In order to fully understand Vietnamese consumers and develop a close-to-the-market system, Unilever has built a localized professional working team Unilever strongly focus on training courses for their employees It is Unilever’s belief that “development is based on people”, thus the company pay special attentions to employee benefits The company has always been willing to support their employees so that the employees can fulfill their jobs Currently, the Vietnamese management team has replaced key positions which used to be held by expats  Technology Technology transfer is carried out concurrently with the transfer of machines and formula systems as well as assurance of quality and formula analysis Unilever managers provide sufficient support to help producers increase efficiency, improve product quality and product lifecycle  Branding Overall, the time Omo has pursuit the new strategy is not long enough, yet their achievement can be considered to be successful They succeeded in opening their own pathway in Vietnam market as well as succeeded in improving brand value of a necessity household product There might be many other competitors applying Omo’s branding strategy in the future However, Omo has the advantage of being the pioneer in the market, and the first usually leaves a long-lasting impression in consumer’s minds With the abovementioned marketing strategies, Omo has been the favorite product of the majority of Vietnamese people over the last decade In the future, Unilever will launch many new and special products aiming that these products will continue to be the favorite ones of Vietnamese families Pricing strategies Omo used pricing strategy to penetrate into the market In the first years, Unilever kept the same price and constant quality whereas the price of other similar products went up due to the increase in the price of materials and petrol This strategy helped Omo dominate the market In 2002, the market witnessed the stiff competition in price of Omo and Tide The war started when P&G reduced the price for Tide detergent box of 400 gram from VND8,000 to VND6,000 In prompt response, Unilever reduced the price for Omo detergent box of 500 grams from VND7,500 to VND5,500 P&G continue to trigger the war by applying a new policy for agents The agents would get VND1,000 by displaying a box of Omo At the same time, Unilever increased the price by reducing the weight i.e at the same price of VND5,500, the consumers could buy only a Omo box of 400 grams instead a box of 500 grams as they used to Retail shops and supermarkets were flooded with Omo Tide price reduced 30% whereas Omo reduced 26% And it was the customers who firstly benefited from this competition After reducing the price to the floor level, they increased the price The war came to an end The price got back to the previous level Omo made itself a popular product among customer’s mind, thus they were willing to pay even though the price was a little higher Conclusion With these aforementioned marketing strategies, Omo has gradually and stably positioned its brand in consumer’s minds and takes the lead in Vietnam detergent market ... attentions to employee benefits The company has always been willing to support their employees so that the employees can fulfill their jobs Currently, the Vietnamese management team has replaced key positions... make it convenient for goods exporting especially when Unilever might expand into exporting made-in-Vietnam goods to other countries in the near future - Unilever came to Vietnam when the household... which Unilever are selling - Vietnamese youth is also under much criticism from the society, especially the strict elder generation because of the playful and spoiled lifestyle There are opinions