Đề tài The Marketing Strategy of Hung Long Jsc

anned and partially unplanned. See strategy dynamics. Chapter 2 The Marketing Strategy of Hung Long Jsc 1. An introduction to Hung Long Jsc. 1.1 The company in general. Hung Long Jsc was founded on August 2003 with the staring point of a small company and few worker at the head office make production of food. After over 6 years of establishment, Hung Long Jsc opened 2 branches in Ha Noi: 482 Tran Khat Tran,157 Thai Ha and a network of distributiors around the country. There are about 100 skillful and experienced staff working, they are almost from 20 to 35 years old. Since its establishment,Hung Long Jsc has operated in various fields: Karaoke, LCD, Plasma TV, Home theater, camera, etc. Early 1999,Service Center and technical Informatics Future was established.It also opened a new sales representative office for selling Califonia’s products.Today Hung Long Jsc has developed rapidly,becoming one of the leader in the field of information technology n Vietnam in particular and in the word in general . Hung Long Jsc can meet the demands of valuable customers with a large orders. Hung Long Jsc has more than 2,000 samples of TV LCD, 1,000 samples of hometheater and 2,500 samples of products with diffierent types, styles, designs from well-known companys; meet the needs for daily usage of customers. Company’s product sand services Products: Hung Long Jsc is one of the leading companies in Vietnam in the field of distribution of information products to customers, agents, as well as to users directly. Products information technology company provides include: - Computer brand Future: Creating a brand name computers with high quality, suitable weather conditions in Vietnam, price benefits for customers. - The computer components: Supply of accessories, spare parts left, and peripherals for high-quality systems integration: Processor, Mainboard, HDD, video card, printer, speakers .. ... - The network device: a distribution agent for the manufacturer of the world leading reputation in the field of network - Product Server and Desktop, Notebook of the world's largest airline HP, IBM, Dell .... product quality and comply with the provisions of the manufacturer. - The software packaging, software management ...... Services: March 1 Warranty, maintenance network - Equipment for inspection, warranty, maintenance of adequate and modern, dedicated professional working style -Technical documentation of products provide complete - Spare parts and components replaced always meet customer needs - Plan and perform warranty repair, replacement new or leaving the cluster components each March 2 training and consulting for computer rental - In parallel with providing customers the information technology infrastructure is modern, Hung Long Company is ready to cooperate with partners and customers to design consultant selection designed to build applications . - The information system, built on the basis of traditional services (LAN, WAN) is provided in Hung Long Company always promote efficiency, security and durability - Issues of implementation, installation of operating equipment to conduct the training, technology transfer in the company's sales are Hung Long proceed in earnest, to meet the needs and trust customer. - Services computer rental for workshops, training and technology transfer: Hung Long has been deployed for a thorough machine rental amount to hundreds of machines is always ready to serve customers. Company’s Organization Board of Directors Deputy General Director General Director Deputy General Director Quality Acceptance Department Tectnical Department Trading Department Financial & Accounting Department Planning Department Board of Directors Hung Long Jsc’s Board of Directors includes a Director General and 2 Deputy Directors General. Director General: Leading the company’s board of management is the Director General who is responsible for managing the use of capital, human and other resources. Two Deputy Directors General: These pepole provide assistance to the Director General. They would sometimes act on behalf of the Director General in his absence. One of them is responsible for the trading, planning, financiak and accouting matters and the other is in charge of technical and research anddevelopment aspects in the company. The departments There are five departments, each of which is responsible for a certain part of the company’s activities. Trading department: this department helps the Board of Directors with trading activities. These include organizing both domestic and international bussiness. The trading department is also responsible for: Doing marketing researches on products. Promoting the company’s products through advertisements. Holding negotiations and getting contracts for the company. Organizing distribution channel for the company’s products. Planning department: this department is in charge of marketing plans on importing, material providing and preceding the contracts. Organizing the sales of products is another main task of the department. Financial and Accounting department: this department deals with all financial and accounting matters. Another main function id to manage the use of capital to the right purpose, right policies and regulations, and to assist business activities. Technical department: this department is in charge of technical and technological matters. The staff of this department also works closely with the factories to do researching and applying the modern equipment and technical advance to themanufacturing and processing. This department for the purpose of the company’s business development tales all the adjustments or improvement to the technology. Quality assurrance department: this department takes control over the quality of the products. This is for the purpose of assuring that all the products will meet customers’ requirements. The organizational chart has resulted in good performance and operation. There have been good assessments on the company structure: it shows to be in charge of particular activities and they would be able to precede their fuction reasonably, which results in avoidance of overlappong and cumbersome. This helps the company to be able to take the internal and external advantages; to apply modern and advantanced technology to bring the best fruits to the whole company’s efforts. 1.3.3. Company trading results Table 2.1: Hung Long Jsc’s trading results in recent. 2004 2005 2006 2007 Total sales 2.527 3.035 5.783 8.579 Net profit 295 350 527 950 Source: Hung Long Jsc’s finalcial reports. Unit: million VND. 2.The marketing strategy of Hung Long Jsc SWOT analysis of Hung Long Jsc As mentioned in the previous parts, Hung Long Jsc has been trading in a lot of products such as TV LCD, Plasma TV, Home theater, Karaoke, etc., but with the limited time, this report focuses on the marketing strategy that Hung Long Jsc has used while dealing in TV LCD only. As well as external opportunities and threats that Hung Long Jsc faces while trading in TV LCD will be identified for the understanding of HungLong Jsc’s marketing strategy. Table 2.2: SWOT analysis of Hung Long Jsc Good quality Competitive price Good busiess relation with partners Customers’ loyalty Viet Hai Ltd’s corporate culture Better market growth Limited capital Small size and small market share Not enough techniqual staff Lack of diversification in product quality Poor promotion activities. Growing black market Firce competition 2.2 Strengths The first strength of Hung Long Jsc is that its TV LCD are of good quality. Hung Long Jsc’s TV LCD are imported from of famous companies in the world such as Samsung (Korea), LG (Korea), Sony (Japan) and Shap (Japan). These are famous brands in the world market and Vietnamese consumers highly appreciate them. Hung Long Jsc has never had any complaint about the product quality. The second strength is that Hung Long Jsc has been offering very competitive prices for its TV LCD. Hung Long Jsc has been a distributor for these firms since its early day (Samsung, LG, Sony and Shap), and although there are a lots of other companies are acting as dictributors for them, Hung Long Jsc has a certain advantage: Hung Long Jsc has always kept its prices as compeitive as possible. Its prices are among the lowest for TV LCD, usally between 7% and 10% lower than its competitors. The third strength of Hung Long Jsc is the good relation with its business pertners Hung Long Jsc has maintained it coporation with the above mentioned business suppliers for many years and has always been highly valued by them. This an advantage for Hung Long Jsc. Every years, its technical staff are offered technical traning by the foreign experts from Hung Long Jsc’s suppliers. Many if these staff also have chance to go abroad to get training. Moreover, when there is a technical problem at Hung Long Jsc, it immediately receives assistance from its partners. The forth strength of Hung Long Jsc is its customers’ loyalty. As mentioned above, beside good quality, competitive prices, and good business relation with its partners, Hung Long Jsc’s customers’ has contributed a lot of the company’s success. The after sales services of the Hung Long Jsc has been developing and improving rapidly over the years. This hepls the firm to keep in touch with the old customers. And by words of mouth, these people have brought new customers for the company. In addition, Hung Long Jsc frequently holds customer meetings in which cutomers would have chances to express or Hung Long Jsc their thinking about the company products and services, this anables the company to get market research information to built up its reputation and customers’ loyalty. The last strength is the coporate culture of Hung Long Jsc. Employees of Hung Long Jsc are infused with an open, value-based coporate cuture. The cornerstones of the company’s values are: Staff satisfaction Respect for the individual Achievement Continuous learning Hung Long Jsc’s management seeks to internalize these values through debates and discussions among teams. Its annual strategy meetings, plays an important role in this process. The meeting focuses on brainstorming about technological and life-style trends and discussing strategic priorities of Hung Long Jsc in the market. Weaknesses Besides, there are many weaknesses in Hung Long Jsc .Firstly, limited amount of capital is posing a difficulty for Hung Long Jsc. The company’s capital has’t been expanded much since its establishment. Mr Hai, the Managing Director of Hung Long Jsc, said: “we have an advantage in comparison with our opponents in terms of customer’s loyalty and agood image and reputation, but now we have a problem of capital that thinking is weakening our compeititveness”. The main source for its capital has been contributions of his family and Hung Long Jsc has had a lot of difficulties in finding other sources of capital. With regards to investment capital from banks, Vietnamese banks are shotage of investment capital, because of the lack of long-term deposits, which in turn due to the regulated interest rate and low reputation of the banking system. As a consequence, it is normally hard to get long-term ones. This mismatch of maturity causes many problems to Vietnamese companies including Hung Long Jsc. Secondly, Hung Long Jsc’size and market share have been small. The shortage of capital is main cause of the company’s modest size and market share. Up to now, Hung Long Jsc has had only 4 branches dealing in TV LCD . As a result, its market share is among the lowest in the market for TV LCD in Vietnam. This is a major weakness for Hung Long Jsc, and the company has to be determined to overcome this if it is to be successful in the future. Thirdly, another weakness of Hung Long Jsc is its lack of the technical staff. Although the current technical staff of Hung Long Jsc are qualified for its technical word, but they are so few in terms of quantity. The company’s customers has never complained about Hung Long Jsc’s product quality or the quality of the maintenance work that its staff have done, but has complained about the late reply and maintenance service of the company. The reason for this is the company’s not enough technical staff. This is also one factor resulting in the low market share of Hung Long Jsc. Fourthly, lack of diversification in product quality of also a weakness for Hung Long Jsc. Hung Long Jsc has always been concentrating in high quality TV LCD such as imports from Toshiba, Sony, Shap… companies. These products have high quality but are too luxurious for a large proportion of Vietnamese customers. Besides these famous brands, Hung Long Jsc should deal in some lower quality ones, which are also less exprensive such as products from Samsung, LG, BenQ etc. by this way, Hung Long Jsc can attract low and middle-income consumers. Lastly, Hung Long Jsc has had rather poor marketing and promotion practices. Marketing and promotion pratices of Vietnamese enterprises are poorly and insufficiently performed. Promotion is limited to market research. In addition, the organization of trade fairs and collecting information with such important tasks as export consultation, trademark formation and the provision of market information have not effectively been undertaken. Additionally, just like many of Hung Long Jsc’s competitors, it also has its own web site in oder to develop their images and advertising their main products. However, most of those web sites are not attractive enough and the information about their businesses is not sufficient enough to appeal to customers. Opportunities The only opportunity for Hung Long Jsc is that can have a better market growth in the near future. There are two reasons for this. Firstly, the market in Vietnam for TV LCD is growing rapidly because there are more customers for this item. As Vietnam people’s income has increased in recent years, more people can affort TV LCD. This is no longer a luxurious item for a lot of people living in the city. Secondly, Hung Long Jsc is now considering expanding, as it is looking for more sources of capital. Some employees in Hung Long Jsc are thinking of investing in the company by buying its shares. Threats Despite the impressive performance so far, Hung Long Jsc is facing a host of challenges. The first barrier is black market pressure. The flourish of black market is posing a threat for TV LCD importers, in general, and for Hung Long Jsc in particular. Presently, China is the biggest supplier of black market TV LCD in Vietnam. The second barrier is that Hung Long Jsc is facing an unprecedented level of competition from both exsting competitors and new entrants. Thanks to the remarkable growth of Vietnam TV LCD recently, Vietnam id becoming a battlefied for TV LCD manufactures and importers. There are more and more TV LCD manufactures in Vietnam. These are either joint-venture companies or 100% foreign owned ones. The qualities of their products are improves and their prices are much more competitive than the imported ones that Hung Long Jsc is selling. 3. Hung Long Jsc -marketing mix Product Famous international firms as products, which fundamentally provide its custommers various benefits, make TV LCD of Hung Long Jsc. These are core benefit generic product, experted product and augment product. The core benefit of Hung Long Jsc is used of product-which the target customer finds. The generic product is the basic characteristic about product, which was described by color, trademark, and the package of product. Each of the products of Hung Long Jsc has a separate trademark and color. Besides, Hung Long Jsc has always tried to diversify its range of TV LCD. Initially, Hung Long Jsc only sold 2 famous brands that are Sony (Japanese), Panasonic (Japanese). Then recently it has expanded and started to sell 2 other brands: Samsung (Korea) and LG (Korea). This is helped to increase the number of customers of Hung Long Jsc. Morover, the quality of Hung Long Jsc’s TV LCD has been maintained over the years. There has been no complaint from the consumers about their products. The company’s two-year guarantee priod is also satisfactory to consumers. Price The first strategy that Hung Long Jsc adopts is low price strategy as most of Vietnamese TV LCD users are price-sensitive buyers. The prices of Hung Long Jsc’s TV LCD range from 5,900,000 VND to 80,000,000 VND depending on each model. This policy of pricing is much more attractive to customers as Hung Long Jsc’ prices normally are among the lowest for TV LCD’. The second strategy that is applied by Hung Long Jsc’s for air conditioner is price competition. Hung Long Jsc authorized dealers indeed offer the retailers who sell Hung Long Jsc’s two-way TV LCD a huge commission compared to those of its competitors. As a result, the price of Hung Long Jsc’s TV LCD sold by these retailers may be cheaper as some of them may want to satifice thei commission per two-way to get profits from selling a big amount. It is the price competition between Hung Long Jsc retailers that benefits customers. The last strategy that Hung Long Jsc to use is in the fourth of this year it launched a lever air conditioner at inexpressive price. This kind of product is for low and middle-income people in Vietnam. The company belives that cheaper price of two-way TV LCD and lower installation and maintenance cost of air conditioner are the two key elements to increase the sales of Hung Long Jsc’s TV LCD in Ha Noi. Place A good distributing policy hepls business activities safer, increasing the connection in business, decreasing compatition and marketing the circulation of goods more quickly and efficiently. In the domestic market Hung Long Jsc has good relations with its partners so they help Hung Long Jsc very much in the distribution. They help Hung Long Jsc win over other rivals even in the fiercest competition. TV LCD retailers are said to gain much benefit when committing to sell the new Samsung set. The company not only supplies its two ways to these retailers, but also supports them in terms of outlet decoration, staff training and marketing activities. Besides, each retailer will get a juicy bonus if a TV LCD is sold. Hung Long Jsc offers an intensive support for any retail that is located in business centers of the cities and provinces across nation. On the contrary, the company would offer the shop owner much more benefit such as free shop-sign and decoretion and a greater commission if the seling volume is reached at a high level. This always try their best to market as many TV LCD as ways is sold out much more than competitors. Promotion Promotion is the aspect of marketing concerned with increasing sales. Marketing must be considered on marking production decesion, and promotion must be considered in the overall marketing process. Promotion attempts to persuade and influence the customer’s attitude in various ways. Hung Long Jsc has used some ways to advertise its product such as abvertisements on television, internet, newspaper, magazine…. However, they abvertisements are not very effient. Hung Long Jsc uses two strategies promotion that is pulling strategy and pushing strategy to each of target customer as illustrated in the following figures. Pulling strategy Factory Wholesaler Retailer Customer Hung Long Jsc uses this strategy to make the customers have an idea and believe in product and buy the products of Hung Long Jsc. Figure: Pushing strategy Factory Wholesaler Retailer Customer Pushing strategy aims at company and branch office dividing the price for advertising and discounted price. Hung Long Jsc uses this strategy because there are many branches in company. Chapter 3: Some Recommendations to Improve Hung Long Jsc’s Marketing Strategy 2.1. Recommendations to Hung Long Jsc. Global marketing strategy is not about standardizing the marketing process on a global basic. Although every element of the marketing process – product design, product and brand name, packaging, pricing, advertising strategy and execution, promotion, and distribution – may be a candidate for standardization, standardization is just one part of a global marketing strategy. Consequently, striking the right balance between standardization and localization greatly contribute to Hung Long Jsc’s success. Hung Long Jsc has developed a combination of standardization and localization of marketing programs to match Vietnamese market. But to further promote the sales of TV LCD by Hung Long Jsc, the following are recommended to the company. Marketing * Daily newspaper * Prind A/D * Advertising TVC Doing events : * Display area out of Hung Long Jsc * Light & Sound Welcome standee at first * Promotion standee Gift * Gift free * PG (PG uniform) PG uniform on site * MC * Display samples * Promoters * Promotional gift * Entertainment fee * Setting & operating * Record PSI & follow-up Avaiable ２０% ７０% ５% ０ ５% 20゜ eye line: 150cm Difficult Easy Avaiable Difficult 185cm 100　90　80　70　60　50　40　30　20　10　0　cm Display Product: ●Women: 140cm ●Man :150cm 3.2.1. Improving the company’s marketing mix The company needs to build up an good marketing mix for the current marketing strategy, which bases on the four elements: Product: improving the quality and divertifying categories of products is the core of product element in the marketing mix. As discussed above, the market for TV LCD in Vietnam is becoming more sophiticated with a variety if different demands. The small portion of the market usually set high requirements for the trend-catching and material-selecting criteria of the imported TV LCD. Others are low and middle-income earners who require a lower quality. Temporarily, the company should consider siversifying its product range as the most important element in its strategy. Price: high price has always been the disadvantage in competition. Although Hung Long Jsc’s prices have been considered reasonable for some brands over the few years, keeping this low level is a quite difficult task for the company. In a addition, as Hung Long Jsc is thinking of expanding its product range with higher and also lower quality products, maintaining competitive prices is not easy. This is really a joy to the company’s success in the future. Place: a good distributing policy helps business activities safer, increasing the connection in business, decreasing competiton and making the circulation of goods more quickly and efficiently. Due to the characteristics of Hung Long Jsc’s activities, there are three ways for the company to make futher improvement to its ditribution performance. Firstly, improve Hung Long Jsc’s distribution users in the shortest period of time. The second alternative is to open more branches. Hung Long Jsc’s current branches are in big cities, so it advisable for the company to set up new in small towns, where people’s incomes have been improving and can afford TV LCD. The last alternative, which should be used in the long term and considered to be the best, that is to establish a network of representative offices throughout the country. Promotion: this is one of the weaknesses of Hung Long Jsc. For the purpose of sakes growth, the company should invest more in promotion activities. This is a method not only to increase sale but also to build the company’s image. The measures to build the company’s image will be discussed in the next section. 3.2.2. Building the company’s image It is said that advertising is a business art. Hung Long Jsc’s weakness is efficiency of promotion is not good. The reason is Hung Long Jsc has not applied tools of promoting policy. It might be an advertising on TV, on the radio in rush hours. The strength of advertising on TV help viewers can see both images and sounds, colors. Furthermore, the expenses of advertising on TV is broadcasted many timers per dat. Besides, almost the households belong to every class in sosiety have TV and watch favorite program on TV in their free time. The effect of this type of advertising is wide. Today is a era of IT and modern means of communication. Internet has played an important role in social activities and in the economy. The enterprise can introduce it to other companies over the word. Signing the contract with Ministry of Thailand motivated Hung Long Jsc’s to export in order to increase foreign curreny, expands global market. In my opinion, Hung Long Jsc needs to build their webside which has global function. Webside is a modern media and widely used on over the world particularly in developed and developing countries. Customers can find comfortable and convenient to search information if the company they are considering on internet. Partners can eas