SGS. Marketing Principles Asm 3 - brand used PNJ PDF

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Don't remember the total but got DI. Marketing Principles Asm 3 . Very detailed assignment. Lecturer was hard yet grade is ok...

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TABLE OF CONTENTS I.INTRODUCTION....................................................................................................................................3 II.

SWOT ANALYSIS..............................................................................................................................3

III. TARGET CONSUMER.....................................................................................................................4 IV. DIFFERENTIATION AND POSITIONING......................................................................................4 1.

Differentiation:................................................................................................................................4

2.

Positioning:.....................................................................................................................................5

V.

CURRENT 4PS PERFORMANCE..................................................................................................5 1.

Product............................................................................................................................................5

2.

Price................................................................................................................................................6

3.

Place...............................................................................................................................................6

4.

Promotion...........................................................................................................................................6 5.

How 4Ps work together?..............................................................................................................7

VI. MARKETING OBJECTIVE...............................................................................................................7 VII. MARKETING RECOMMENDATIONS............................................................................................7 1.

Launching new brand....................................................................................................................7

2.

Increase social media engagement:...........................................................................................7

VIII. REFERENCES..................................................................................................................................9 IX. APPENDIX.......................................................................................................................................11

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I. INTRODUCTION Founded on 28th April 1988, PNJ stands for Phu Nhuan Jewelry Joint Stock Company by Cao Thi Ngoc Dung from a district store, until now PNJ has risen to be the 21st in the top 50 Most Valuable Brands in 2020 of Forbes Vietnam (PNJ 2020). With the vision “to become a leading jewelry manufacturer and retailer in Asia, sustaining its No. 1 position in the middle and high-end jewelry market share in Vietnam”, PNJ has affirmed its position in the domestic and international market (PNJ 2020). The main business activities include testing diamonds and gemstones, producing and trading jewelry of gold, silver, precious stones, souvenirs; trading watches, and buying gold bars. According to VNDirect, PNJ accounts for the largest market share in the jewelry segment in Vietnam (35.8% in the third quarter of 2020) (Bao Vy 2020). This assignment will focus on the jewelry segment of the Vietnamese retail market, which accounts for 80% of the company’s sales revenue, and build a marketing plan for Valentine’s day. II. SWOT ANALYSIS 1. Strength: - Good economic growth improves per capita income (Bao Ngoc 2020) → Positively impacting demand for jewelry products. - PNJ receives the most prestigious award of JNA Awards, which is regarded as the Oscars of the jewelry industry. → PNJ can effectively enhance its image and attract consumers’ attention through press releases. → Prove that PNJ is a strong brand name with a sustainable development → Gain customers’ trust. - Owning 340 stores nationwide, PNJ can easily reach customers and capture market share. - PNJ has 2 factories, one of which is the largest jewelry factory in Vietnam with annual productivity of up to 4 million products. They use modern technology from Europe and have a team of skilled jewelers. → PNJ can ensure the supply of its stores, especially enough potential for ambitious targets. → Shorten the stages to launch new products. (PNJ 2020). → PNJ can serve their customers with the best and modernist quality. 2. Weakness: - The sales are difficult to forecast because production may bear many risks. - PNJ imports raw materials, machinery, and equipment for production from abroad. → The pressure from the suppliers is huge. 3. Opportunities: - “Vietnam’s rising middle and upper class” (BMI n.d.), which means people now have a higher quality of life and would enjoy more. → These groups are the target customer of PNJ, meaning that they are increasing in the number of potential customers. (VCBS 2019) - If the Covid-19 pandemic outbreak again, PNJ can: + Take advantage and access premises with convenient locations with reasonable rents to serve the opening of stores when the market recovered (Thanh Long 2020). 3

+ Increase market share since small businesses cannot resist. - Valentine people would buy gifts for each other and themselves. → PNJ can increase sales. 4. Threats: - The covid-19 outbreak lasted longer than expected in the world which can pose threats to the gold price. - If the pandemic breaks out again in Vietnam, this could be a threat to jewelry retail sales (VCBS 2020). In that case, jewelry for Valentine’s gift would not be the first thing people think of. Hence, people can turn to other competitors because of cheaper prices. III. TARGET CONSUMER PNJ has successfully targeted 2 segments: Demographic and Psychographic. Having subbrands with different targets of customers, PNJ has implemented a differentiated marketing strategy. PNJ Silver is a mid-end brand, focusing on the youth in the middle class aged 15-25 with modernity, fashion, and style. The brand builds an image of a modern young girl, wanting to change herself to stand out, seduce and shine bright. Unlike PNJ Silver, Style by PNJ also targets the middle-class young customers, who require innovation, style, and transformation of jewelry and accessories to express their personality. PNJ Gold is mostly gold jewelry and gemstone, targeting the middle to lower-upper class, aged 25-45. These products show a sophisticated, elegant, and luxurious design. IV. DIFFERENTIATION AND POSITIONING 1. Differentiation: a. People differentiation: Staff is trained to be professional in manners and knowledgeable about the product. With PNJ, it is crucial to be friendly with customers, giving customers confidence about what is best. This helps the company gain prestige and position in the market. (PNJ 2018) b. Product differentiation: With diverse designs, high aesthetic value, outstanding quality, the company's products not only contribute to the honor of beauty but also to promote the quintessence of the country, and Vietnamese people to international friends. c. Image differentiation The logo looks quite simple, but it brings many profound meanings of prosperity, luck, and sustainability for the brand.

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2.

Positioning: Company name

Followers

Jewelry 24K (VND)

SJC

94.309

55.150.000

Bao tin Minh Chau Doji

144.257

55.200.000

607.267

55.350.000

PNJ

943.704

54.750.000

Realizing that Vietnam has a young market with a golden population, PNJ does the best on social media to attract customers. Currently, PNJ’s followers on the Facebook page are approximately 10, 6.5, and 1.5 times more than SJC, Bao tin Minh Chau and Doji respectively. To target the middle class effectively, PNJ also offers an affordable price but still ensure quality among the competitors. This equates to the value proposition of “More for Less”. V. CURRENT 4PS PERFORMANCE 1. Product a. Type of product – consumer shopping product Obviously that people do not purchase jewelry frequently. Consumers also spend their time and effort making comparisons of choices for the best purchased, since the price is not low. b. 3 levels of product Core value: Customers are satisfied with their beauty demands, being honored with self-worth, simultaneously it is the affirmation of the PNJ jewelry brand as “bringing customers pride with sophisticated and outstanding quality products”. Actual product: PNJ has become a national brand name and has received many prestigious awards (Thien Ha 2020). Besides improving designs to keep up with international fashion trends, the design team is also equipped with modern software, allowing for more sophisticated product designs. Augmented product: Customers might be provided with a warranty in a period of time, and free lifetime cleaning. Additionally, PNJ has 4-hour delivery and it also has member cards for attracting customers. (PNJ n.d.) c. Product life cycle: At the end of the growth stage, starting the maturity stage On one hand, in 2020, due to the covid-19 outbreak, the net revenue of PNJ decrease slightly by 0.4% compared to the same period in 2019 (VCBS 2020). On the other hand, monthly sales of 2020 (Appendix A) show that PNJ is on its growth back thanks to promotion activity and release new brand. (VNDirect 2020) So it is likely that if PNJ has good strategies for Valentine, the sales could recover and even exceed the peak of sales in 2019. d. Multibrands strategy:

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PNJ has sub-brands such as Style by PNJ, PNJ silver, PNJ Gold. With this strategy, PNJ can effectively capture market share and increase brand shares. 2. Price a. Pricing approach: PNJ is using value-based pricing as the price of gold jewelry products changes according to the price of gold in the market. A product is calculated by the amount of gold in the product multiplied by the price of gold during the day. b. Pricing strategy PNJ is using market-skimming pricing while setting high initial prices (Appendix B). The products are superior in quality and image, therefore attracting the customer is not a big deal. Product line pricing: Each of the group customer targeting, PNJ would have a different price level. PNJ uses a psychological strategy while setting the price ending with an odd number. It is more difficult for customers to evaluate the prices and makes the prices look much more affordable. PNJ is also applying promotional pricing in form of weekly sales to create buying excitement and urgency. 3. Place a. Multi-channel: From the manufacture, products are packaged, on one hand, can be delivered to PNJ’s retail stores and reach the customers. On the other hand, through online platforms, the product can be directly distributed to customers. b. Selective distribution: PNJ has 340 retail stores nationwide mostly located in big cities, which is far ahead in comparison with the competitors. Also, here people have a much higher demand than in other provinces. c. Channel organization: Obviously that PNJ is using a Corporate Vertical marketing network since the successive stages of production and distribution are under the control of the company, there is no intermediary. 4. Promotion PNJ uses the combination of push and pull strategy. They push to create customer demand through developing new products such as those of Tet collection and offering these products in stores; then pull customers towards these products through advertising and promotion deals. Promotion mix tools - Adverting: PNJ is advertising not only online, through social media platforms and webpages, emails, but also offline, through the banners on the streets. For instance, under PNJ’s sponsorship, the MV 'I'm treasure’ for promoting Style by PNJ appeared rising rappers with a large fanbase such as TLinh, MCK, and Chau Bui achieved 24000000 views on youtube. (Bao Vy 2020) By this way, the brand can reach a large audience to build brand awareness - Sales promotion: PNJ is currently run a sales promotion up to 30% off and 50% for different product lines. - Public relationship: PNJ is promoting their Tet collection with a goodwill:

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Buying their product is donating money to people with difficult circumstances to have a happy lunar year. (PNJ n.d.) 5. How 4Ps work together? Thanks to the pricing strategies and broad promotion both online and offline, PNJ’s products can reach potential customers of all ages. When the products are accepted, customers can, on one hand, buy them through online platforms and receive the products within 4 hours, on the other hand, go to the nearest store. There, customers can have the best visual of the product and receive advice for the best purchase from the consultants. VI. MARKETING OBJECTIVE According to Phu Hung Securities (2020), PNJ expects the retail revenue for 2021 would be about 11 billion VND. The marketing plan will last for 3 months so PNJ should achieve 20% of that sales revenue. According to statistics from Passport in 2019, PNJ account for 6.7% of the brand share, which is 6% and 6.2% more than Doji and SJC respectively (Euromonitor 2020). Despite this leading, on this Valentine’s day, I expect PNJ could increase it to 7.1%, so the brand can sustainably be the top 1 and mitigate the impact of a foreseen threaten of covid19. PNJ has 945.373 followers on Facebook but there is only 1 post with the highest interactions of 8300. Therefore, PNJ should invest in social media content to reach approximately 20000 interactions and over a million followers for an effective pull strategy. VII. MARKETING RECOMMENDATIONS 1. Launching new brand Since self-love is the key to true love, I recommend PNJ to have a new brand in the name of “Shine for yourself” for Valentine's Day. Each of the products would have its own name with the meaning and the message that the brand wants to convey. Since this brand is to target middleclass customers aged 15-45 this would be ideal to combine the image of PNJ Gold and PNJ Silver. 2. Increase social media engagement: As we cannot know whether the Covid 19 can break out again or not, so boosting e-commerce would be an ideal solution for keeping sales revenue. Because 68.7% of the Vietnamese population is now using Facebook, it would be one of the ideal platforms to do the promotions for building brand image, interacting, and attracting customers. (NapoleonCat 2020) Firstly, as the successful case of Neptune with “Hieu de yeu thuong” (Hoang Tram 2017), PNJ can also create a video about a controversial topic: Respect or Control. In a relationship, the 2 should always ask for permission before doing something. That is to respect each other. What is your opinion about this? Secondly, using KOLS such as Huong Giang Idol, Giang ơi, Tran Thanh, Sunhyun, Trang Ha to post the opinions on their Facebook and boost netizens to give opinions. This method does not only make the content more attractive but also improve engagement for achieving the marketing objective. Lastly, PNJ can create a video with the content to express the changing of the controversy into self-love and self-awareness, using Giang Ơi. As Giang Ơi is a well-known influencer of lifestyle 7

among Vietnamese netizens, also has an admirable marriage life, she would be an ideal one to convey the message: When one person tries to control the other all the time, it is a sign of insecurity and lack of self-confidence and wider, self-love. To not become a toxic relationship, we should love ourselves first and show respect for each other in another way: that is to support them to shine in their own way. After that, make an album of pictures for display artwork. And for boosting more sales and coverage of the promotion, PNJ can offer 5% sale off with each share and hashtags. Besides, PNJ can create a contest to mix and match the accessories and then award those products to the winner.

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VIII.

REFERENCES

1. Bảo Ngọc 2020, ‘Việt Nam thuộc nhóm tăng trưởng kinh tế cao nhất thế giới’, Tuoitreonline, 27 December, viewed 9 January 2021, 2. Bảo Vy 2020, ‘PNJ, khó khăn lớn nhất đã qua?’, BrandsVietnam, viewed 11 January 2021, 3. BMI n.d., Market Report: Vietnam, BMI, market report,...