Group 3-marketing principle PDF

Preview

Summary

Just for reference...

Description

Situation Analysis Report DR. THANH HERBAL TEA TAN HIEP PHAT GROUP

MKTG1205 Group4-Team3 Members: Yeelim Kim (s3811128) Nhi (s Linh (s To Gia Bao (s3804700) Pham Minh Tuan (s3804688)

TABLE OF CONTENTS 1. Situation analysis 1.1. Company description 1.2. Product description 2. Marketing environment 2.1. Micro environment 2.1.1. Suppliers 2.1.2. Customers 2.1.3. Marketing intermediaries 2.1.4. Competitors 2.1.5. Company 2.2. Macro environment 2.2.1. Economic forces 2.2.2. Cultural forces 2.2.3. Political/ Legal forces 3. SWOT analysis 4. STDP 5. Conclusion 6. References 7. Appendice 1. Situation Analysis: 1.1. Company description: Tea has been loved by a lot of Vietnamese even until now, but as its form of RTD Tea which makes consumers feel free to have tea anytime and wherever they want. Tan Hiep Phat Group which all of Dr.Thanh’s family members are responsible for is the overwhelmingly enormous beverage corporation in Vietnam. Even though competition in RTD Tea is getting fiercer, they are still holding their leading position. It has been offering us a wide spectrum of different types of beverages to satisfy customers since 1994. Dr.Thanh, CEO and Founder of THP Group, showed us their humbleness making their yeast and sugar in the old days. And, Today, the leader of the RTD Tea is putting their efforts into providing us much healthier beverages, following current trends in the soft drinks market. 1.2. Product description: In 2009, a new RTD herbal tea brand called Dr. Thanh was launched which was challenging for Thanh himself, the CEO of THP Group, to name it with his name. Since the value of his name directly depends on the brand’s success, it was a tough decision. When it came out first, it caught little kids’ eye the most all over in Vietnam. It was the result of THP’s effective TV commercial targeting comparatively broad generations on screens. THP Group’s one of the national brands approximately takes up to 4 percent of the Brand shares of RTD Tea. It has been designed for healing consumers’ stressed out inner body in today’s busy life. Honeysuckle, chrysanthemum, monk fruit, and liquorice are the part of herbal essence contained in the drink, and it makes customers feel clean and detoxifies their bodies as well. Surprisingly, Dr. Thanh Herbal Tea is placed in the public’s mind as the one they would like to have when they are on holiday and overeat. THP Group offers a sugarfree diet version which is a tempting option especially for girls who are sensitive with being overweight or for people who are health-conscious. Furthermore, consumers get more choices with different types of packagings and sizes. Dr. Thanh Herbal Tea can be served in PET bottles which are taking the major position of packaging in soft drinks in general, glass

1

bottles, Tetra Pak cartons. These are all in different sizes respectively and some of them are promoted as a gift on special occasion such as Lunar new year in Vietnam. 2. Marketing Environment: 2.1. Micro Environment: 2.1.1. Suppliers: Because Tan Hiep Phat is a bid and reputable company in Vietnam, there are many companies want to be a partner with Tan Hiep Phat as a supplier such as Security Center Omnicast™ video system, AutoVu automatic license plate recognition (ALPR) cameras, Alpha group provides Grundfos pump which is an integrated beverage plants system. So in July 2018, Tan Hiep Phat applied a website for companies who want to be suppliers of Tan Hiep Phat (https://supplier.thp.com.vn/). Through this website, the future suppliers can directly and easily contact with Tan Hiep Phat and this website likes a fair playing field. Moreover, there are many clear instructions for the future suppliers and their information is kept in secret. 2.1.2. Customers: According to the CEO of Tan Hiep Phat- Mr. Thanh, customers are a core factor directly contributing to the company’s success today. Moreover, they are motivations for the company to always change, improve quality and better service. And customers of Tan Hiep Phat are mainly: - Individuals, households: who buy for themselves or buy as gifts to present others to tight relationship, especially in Tet holiday in Vietnam, which has accounted for the highest proportion in customer of Tan Hiep Phat. - The system of wholesale and retail distribution: supermarkets, hotels, convenience stores and groceries and Dr. Thanh is available in a lot of places because this is served in 63 provinces of Vietnam. - International market: which is a demanding market. However Dr. Thanh and Tan Hiep Phat’s products have distributed to 16 countries from China to Canada and they are mainly resold by some big e-commerce channels such as: Alibaba.com in China, etc. 2.1.3. Marketing Intermediaries: a. Resellers: Tan Hiep Phat has served customers in Vietnam’s 63 provinces and 16 foreign countries, so that this company needs big system of distribution. Tan Hiep Phat has succeeded to deal with resellers (wholesale and retailers) such as supermarkets (Big C, Mega Market,...), hotels (Sheraton,...), convenience stores (Vinmart+,Family mart, Minishop,...), grocery and e-commerce channels (Alibaba.com,...) in international markets. b. Marketing service agencies: When every new product of Tan Hiep Phat launched and Dr. Thanh is not an exception, this company paid much attention in marketing plan to advertise their new products and they used a variety of marketing channels such as social media (Youtube, Facebook,...), advertisements on TV (HTC channel, even government channels VTV, VTC,...), and they spent a great amount of money hiring models, celebrities and Miss Vietnam to make a belief that Dr. Thanh symbolize for beauty, if we drink Dr. Thanh, we will be more beautiful. 2.1.4. Competitors: - Direct Competitors: (milk) tea shops, URC Vietnam Co.ltd, Suntory Pepsico Vietnam Beverage, Lipton international. - Indirect Competitors: According to Passport, while ‘RTD tea grows by 6% in off-trade volume and 6% off-trade current value in 2018’, ‘bottled water records 14% growth in off-

2

trade volume and 16% in off-trade current value.’(Passport 2019)(‘Bottled Water in Vietnam’ 2019). The gap between their growths is quite big, therefore, their forecasts in five years are remarkably different. Recently, customers are getting more health-conscious. So they more likely to choose a bottle of water rather than RTD which contains excessive amount of sugar. Due to a shift in customer behaviour, demanding healthier options, companies such as La Vie JV Co and Suntory PepsiCo Vietnam Beverage Co Ltd can be strong competitors. 2.1.5. Company: Made up “Nguoi THP yeu” contest happened on the 18th of Vietnamese Family Day 28/6/2001-28/6/2019 to deliver the core value of family and create positive work environment for workers within the company. 2.2. Macro environment: 2.2.1. Economic forces: The first time Dr. Thanh Herbal Tea was launched in Vietnam market is 2008 which is the time the world suffered global economic crisis, especially in September 2008 and Vietnam is not an exception because Vietnam was taking step by step in the process of international economic integration. However, this is also a chance for new brands, new products like Dr. Thanh because when financial crisis happened, which affected both old and new companies, brands, products and which also helped new brands by reducing competition of market and creating a fair market, fair chances for everyone. After 1 year Dr. Thanh was launched, the result was that the brand share of Dr. Thanh Herbal Tea increased.

Figure 1: Brand Share of Dr. Thanh (RTD Tea) in Vietnam (2009-2013) (% unit) 2.2.2. Cultural forces: In Vietnam, Tet holiday, Vietnamese Lunar New Year, is one of the biggest national holidays. They celebrate it magnificently, eating and drinking since having bountiful food is the way they celebrate Tet holiday (VietVisionTravel n.d.). Most of the foods they eat during are greasy. So, they end up losing appetite with their tired inner body. For this reason, they usually seek for soft drinks for relieving inner stress. It’s such a common custom found in Vietnam that they prepare soft drinks as a present for their family, friends and business partners. Hence, THP can sell their products in a huge volume such as a box with Tet holiday design. According to Vietnam News, ‘The sales over the three month period of Tet contribute 28 percent of annual carbonated soft drink sales.’(Vietnam News 2015, para. 4). 2.2.3. Political/Legal forces: In many countries, the governments already have been restricting people to consume less sugary drinks due to the highly increasing rate of obesity and overweight adults. There are various health problems which are caused by the consumption of sugary drinks such as weight gain, obesity, and cardiovascular disease(Customs News 2017). The Jakarta Post reported that there was the rapidest increase of obese people in Vietnam among Southeast Asian countries between 2010 and 2014 (Jakarta Post 2019). Due to the health issues, The Ministry of Finance of Vietnam proposed that they are considering to impose a ‘Special Consumption Tax’ on soft drinks including Tea up to at least 10% to 20% from 2019 (Customs News 2017). With this, they encourage Vietnamese people to consume healthy drinks rather than the sugary. 3. SWOT analysis:

3

3.1. Strength: The strengths of THP Group are recognized with manifold gas free brands across Vietnam: Dr Thanh, Number One, Zero Degrees, etc. Especially, Zero Degrees Green Tea and Dr Thanh Herbal Tea are claimed to be the healthful products for consumer’s health and have good taste. The objective of THP Group is to produce many products within soft drink category with “international quality standard” as THP Group states. a. Health: According to this corporation, Dr Thanh is produced by using Aseptic environment, with artificial preservatives and flavourings free and contain nine different natural herbs such as “honeysuckle, chrysanthemum, monk fruit and liquorice”(THP group, DR. THANH HERBAL TEA). Dr Thanh delivers consumer values that is good for inner health and eliminate toxins from the body. That turns it to become one of the most healthy RTD Tea maker in beverage market in Vietnam. b. Competitor: THP Group has more advantages over competitors that they have “huge financial capability, wide distribution network and dynamic marketing activities.” Therefore, THP Group was able to maintain the leading position in the market in 2018. (Passport RTD Tea in Vietnam, Mar 2019). EVIDENCE c. Technology: In additional, with strong finance, THP Group owns a modern production line with modern technologies to raise product quality and merchandise packaging in PET bottle, recycled glass bottle, and Tetra Park paper box that has made THP different from other competitors in the country. d. Advertising: To reach out more Vietnamese consumers, THP Group also focuses on advertising on the internet, television, and even in cinema. Knowing the consumer needs, with the powerful marketing source, THP Group’s products are being well known among its customers. For example, knowing how young adults love milk tea, THP’s new brand Macchiato Milk Tea No Temperature - Tasty and hard approaches young community by sponsoring the reality television series The Face Vietnam 2018 which recently has got attention from young viewers in the country with its new drink Macchiato Milk Tea. 3.2. Weaknesses: a. Hygiene: The fly in the bottle scandal in 2015 as an example of the weakness of THP Group. It shows that THP testing and checking process was not very tight that flies can sneak into sealed bottles. This caused thousand of people called to boycott products of this company, leading the suffering damage worth at least 2 trillion VND. Therefore, at that time, THP Group lost consumer trust that might impacts immensely on its brand survival. As a result of this careless quality checking procedure/manufacturing process, in both figures below, represent THP Group company sales of soft drinks decreased dramatically at 3.1% by 2016 that means the company performance was lower compared to market and much lower compared to competitors. In early 2016, THP lost the leading position RTD firm in to country to URC, according to VN Express.

4

Figure 2: THP’s sale in soft drinks (2009-2013) and Market (2009-2018)

Figure 3: THP’s Performance

Figure 4: THP’s and Competitors’s (2014-2018) 3.3. Opportunities We are going to the third letter (O) which is opportunities. With rapid development in diverse fields recently, THP Group may have many chances to expand their brand and business. Besides that, these advantages would help them to take the lead in the RTD Tea market. We have researched and analysed facts and figures to find out several opportunities for THP Group as : social trendings, demographic, data of consumption, economic and tourism development and high technology. According to EuroSphere, the most health-conscious consumers in Southeast Asia is Vietnamese, which will activate producers to provide healthier products such as fruit juices and herbal teas, namely Dr Thanh Herbal Tea of THP Group. With this trend, they could strongly release new products and boost up their available product to offer directly to consumer’s demand. In addition, by 2030, the urban population is predicted to grow up to 44.3 million people that is of 43% of the total population in Vietnam. That would help THP Group specifically define the area which is aimed to provide their product mostly and achieve the best sales as much as possible. In addition, in keeping with Vietnamnet, Millennials is representing 35 percent of total Vietnam’s population. This generation prefer soft drinks and RTD drinks than others, therefore it is obvious that THP Group certainly could aim for this target. As a result, volume sales of soft drinks and RTD teas got 2.3 billion litres in 2015 and is predicted to reach 3.3 billion litres by 2020,

5

referring to EuroSphere’s Vietnam beverage report. This shows the increase of sales along with the increase of Vietnam’s population, especially Millennials and give THP Group a bright data of the consumption for the next move in the market. 3.4. Threats Moving on, the final letter stands for threats. As reported by Customsnews,Special Consumption Tax may be affect soft drinks or RTD teas/coffee, which is announced by the Ministry of Finance in 2017. In details, these products are expected to be composed a 10% tax rate from 2019 and maybe a second plan with 20% tax rate from 2019 to consult broadly. 4. STDP: 4.1. Segmentation: Segment

Adults

Young adults (who are in relationship)

Demographic

Psychographic

Behavioural

Age between 30-39

Occasion: Vietnamese consume Dr Thanh herbal tea a lot, in a huge volume, on Tet holiday for themselves and as a present for their acquaintances.

Age between 20-29

Occasion: Vietnamese consume Dr Thanh herbal tea a lot, in a huge volume, on Tet holiday. If they’re in a relationship, they visit their lover’s house with Dr.Thanh as a present. There are young adults who take care of their acquaintances well.

Young adults (Achievers) (VALS n.d.)

Age between 20-29

Young adults Fry lovers

Age between 20-29

When they eat fries including all types of oily foods, they feel greasy and have Dr.Thanh since it’s got detoxifying function.

Adults Fry lovers

Age between 30-39

When they eat fries including all types of oily foods, they feel greasy and have Dr.Thanh since it’s got detoxifying function.

Young adults Spicy food lovers

Age between 20-29

When they eat spicy food which makes you uncomfortable inside, Dr.Thanh has function for relieving inner body.

Adults Spicy food lovers

Age between 30-39

When they eat spicy food which makes you uncomfortable inside, Dr.Thanh has function for relieving inner body.

Young girls on a diet

Age between 20-29

Besides Dr.Thanh herbal tea has detoxifying function, it also offers another option of a sugar-

6

free diet version to consumers who wants to keep fit. It’s found on THP’s advertisement on media, showing Huyen My, Miss Vietnam, drinking Dr. Thanh sugar-free diet version.

People who are stressed from work

Occupation: As it’s urbanising rapidly, Vietnamese are more likely to be stressed out from their work. For someone who are office workers, they especially require refreshments for circulation. Dr. Thanh has been designed for relaxing people who’re tired in today’s busy life.

4.2. Targeting: Tan Hiep Phat has been using Differentiated Marketing Strategy for Dr. Thanh. They divided into various segments to serve each type of customer, which based on customer’s psychographic characteristics. Firstly, after observing customer’s personality, Tan Hiep Phat produced Dr. Thanh with some different containers such as plastic bottles for convenience stores, glass bottles for luxurious hotels, restaurants. Different bottles of Dr. Thanh symbolize for different classes. Secondly, Tan Hiep Phat produced Dr. Thanh with two versions: sugar and sugar-free. The sugar Dr. Thanh mainly focuses on young adults, kids, or active people because sweet can whet their appetite and recover their energy after working. The sugar-free one is the favourite style of older people, or girls, because they think that the less sugar they consume, the healthier they are. Tan Hiep Phat tried to satisfy customer‘s specific wants. -> THP used Vietnamese culture very well on its product, Dr. Thanh. On Tet holiday, Vietnamese consume huge amount of beverages. Adults who have to prepare presents for their family and friends, and young adults who visit their lover’s house are targeted with its Tet-ish packaging. Also, the foods for Tet holiday, in general, are oily and this makes people feel uncomfortable inside. Besides this, after having spicy foods or drinking alcohol, it’s recommended to have Dr.Thanh herbal Tea. This is because that it has a special function which relieves sensitive inner body with a refreshment. This shows that Dr.Thanh quenches many different types of consumers’ thirst with its function. Nowadays, Vietnamese are getting more and more health conscious, so they’re making healthier choices. Hence, THP offers its customers a special option with a sugar-free Dr. Thanh diet version. It satisfies young girls’ needs who are on a diet. They can drink Dr. Thanh herbal tea without any concerns of the amount of sugar contained. Lastly, Dr. Thanh has also got a detoxifying function which is found by female office workers. They work sitting and working in one place for the whole day. Due to this, they struggle with their circulation and a trophedema. 4.3. Differentiation:

7

In Vietnam, the human’s health is more concerned. To keep this trend, Dr. Thanh Herbal Tea more focus on their healthy content and their distinctive technology to produce Dr. Thanh which is good for our health. The content of quality: the materials used to produce Dr. Thanh are extracted from natural herbal ingredients which help us to cool and purify our body. This is a good way to affect customer’s curiosity and their acceptance. The Aseptic technology: beyond the beverage, Dr. Thanh is produced with the distinctive technology to keep Dr. Thanh as natural as they can, which help to promote our health . ->As an increase of Vietnamese’ interest on their health, a change started to emerge on the beverage market. Hence, THP also got to focus more on Dr.Thanh’s materials. It does not only contain herbal tea, but also nine different types of herbal concentrates which are considered to be healthy and natural. In addition, its bottle packaging is remarkable compared to other RTD Teas. This is due to THP’s intention of reminding Vietnamese traditional palace with the bottle in red and gold, so that people feel get special treatment. Although, RTD Tea has been considered as a healthy drin...