research report cocacola

8/2/2019 Research Report COCACOLA

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National Economics University

Advanced Educational Program

Research Report

Research title: The effects of marketing mix of Coca-

cola corporation in Vietnamese market

Teacher: Pham Thi Thanh Thuy, Ph.D

Student:Nguyen Van Quan

Nguyen Huu Hung

Ngo Hung Son

Class: Advanced Finance 51A


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Introduction

I, Background

1.History of Coca-cola Corporation

Coca-cola was established in 1886. Since then, it has been winning the

attention of thousands of consumers all over the world by its top refreshment

brands. They operate in more than 200 countries, have more than 3000

products, and own 4 of the worlds top 5 nonalcoholic outstanding beverage

brands. It not only becomes a symbol of the United States but also an

important image in many countries with the plan on refreshing the markets,

diversifying workplaces, protecting our environment and strengthening

public communications.

To operating areas, Coca-cola covers the 5 ones, including South America,

Latin America, Europe, Asia, and Africa. In Asia, Coca-cola penetrates

China, India, Japan, Philippines, Viet Nam, etc.

Many brands have been created in the markets with high profile

creativeness, such as:


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2.History of Vietnamese Coca-cola Corporation

Introduced in 1960 and came back in 1994 after the abolition of the U.S

trading sanction:

1960: Coca-cola Corporation was first introduced in Viet Nam.

February, 1994: Coca-cola Corporation came back to Viet Nam and

continued the long-run operation

August, 1995: bilateral Trading agreement between Dong Duong coca-cola

and Vinafimex company was made with the office in the North.

September, 1995: Another trading agreement between Chuong Duong

company and coca-cola was made

March, 2004: Coca-cola was transferred to Saco

There are 3 Vietnamese coca-cola companies responsible for canning: Ha

Tay- Da Nang- Ho Chi Minh city

January, 1998: One more corporation appeared in Coca-cola Non Nuoc.

Thats the final decision on cooperating activity of Dong Duong coca-cola

company, carried out by the cooperation with Da Nang sweet beverage

company.

October, 1998: all corporations belong to Dong Duong coca-cola company.

June, 2001: All coca-cola companies integrated into just one company under

the administration of Vietnamese Coca-cola Corporation

3. Product highlights:

Coca-cola is the world's favorite drink and considered the most valuable

brand, and the most recognizable word across as well. Coca-Cola has really

dominating heritage. From a humble beginning in1886, it is now the flagship

brand of the largest manufacturer, marketer and distributor of non-alcoholic

beverages in the world. In India, Coca-Cola was the leading soft-drink


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till 1977 when governments policies necessitated its departure. Coca-Cola

made its return to the country in 1993 and made significant investments to

ensure that the beverage is available to more' and more people, even in the

remote and inaccessible parts of the nation.

II. Research objectives:

We carry out this painstaking research in order to clarify the reason why

coca-cola can sustain such strong position in this market segment, given the

fact that Pepsi entered Vietnamese market some months before, and this

segment has been very competitive with the presence of many other rivals.

We rely heavily on the principle of 4 Ps model: Promotion, Price, Product,

Place.

III. Research question:

Our group is going to make a research on The marketing mix of Coca-cola

in Vietnamese market. The main research question addressed is By which

ways Coca-cola can sustain the dominant market shares against other

contributors of sweet beverage, especially Pepsi, the arch-rival of Coca-

cola.

More specifically, we will go into details by breaking down the marketing

mix into 4 main sections: product marketing, contribution marketing,

promotion and public relation

IV. Research Hypothesis:

As our first perception before the research, we did mention some

hypotheses, from which we can compare to the findings after the whole

process ending at the data processing point. They are:

People tend to choose their sweet beverages matching with their tastes

People tend to choose the sweet beverage whose price level is reasonable


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People tend to choose the sweet beverage which pop up as frequent

advertisements

V. Literature Review:

Coca Cola was established in 1886, and through all tough, taxing times and

competition, is still one of the first class refreshment brands today. They

own 4 of the worlds top 5 nonalcoholic sparkling beverage brands, they

operate in more than 200 countries, they serve nearly 1.6 billion consumers a

day, and they have more than 3,000 products. (Coca Cola Company, 2009).

What are the reasons for the fact that coca-cola has been perceived and

applied in the right way to reach such upgrade status, and start using social

media? Just some words, simply because theyre smart. Their Coca-Cola

mission is to refresh the world, to inspire moments of optimism, and to

create value and make a difference. The orientation may be cemented into

the umbrella goal towards customers, which is to help the customers favor

their moments in life. If not anything else, the steps that Coke has taken this

past year should have given them many moments of optimism.

In case study presented by Adam Brown of Coca-Cola, he stated, back in

the day you would have heard me say, our home page isnt just coke.com,

its google.com now its google.com, technorati.com,

facebook.com. He also expressed in his presentation that Coca-Colas

strategy is to Review, Record, Respond, and Redirect. (Brown, 2009)

From the very beginning and promising revolution, Coca-Cola has done an

amazing job at not only reaching out to the new media era audience, but

also the people who followed them in the past. Coca-Cola has created an

official blog called Coca-Cola Conversations which is written and updated

by a man by the name of Phil Mooney, who has served as the


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historian/archivist for Coca-Cola for the last 30 years. One interesting point

is that the small blog contains a wide variety of topics, differing from our

role in pop culture to brand history to Coke collectibles. (Mooney, 2009). It

reaches out to a wide variety of target audiences, and encourages people to

write back and give their input, something Coke probably couldnt have

gotten this far without.

Besides a blog, Coke also has an individual Twitter page for each product, a

Linked In profile, a Facebook Fan page, and their personal widget,

CokeTag. CokeTag was released because they believe that connecting

people and giving them a way to share what matters is one of the many

things that helps define The Coke Side of Life. (CokeTag, 2009).

The Facebook fan page was created by two users who liked Coke. What

started as a fan page for fun, turned out to be the largest product fan page on

Facebook. Coca Cola, instead of taking over the page and making it their

own, rewarded the fans by bringing them to Atlanta and giving them a tour

of the Coke facility. The fan page remains theirs, but now they have the

blessing and help of Coca Cola. By empowering the fans to keep their fan

page, Coke ensures a passionate page owner. The Coca Cola marketing

team was also smart enough to realize that letting others know what

happened here would work in their favor. The fan page creators were told to

make a video of the history behind the fan page, and how Coke had reached

out to them and rewarded them for this. (Balwani, 2009)

Part of the Action Plan for Harnessing the Power of the New Rules states

that you should define your organizations goals first, then based on the goals

decide whether or not you want to provide the content for free and without

registration. It is also stated that you should write for your audience using

examples and stories, and of course make it interesting, according to Scott,


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2007. Throughout this year, Coke has done an amazing job of launching

new items, keeping a close eye on their followers, rewarding those that give

them press, and continuing on based on their target audiences reactions.

Coke has made this new media campaign come full circle, and they dont

seem to be anywhere near done yet.

VI.Methodology:

We highly appreciate the effectiveness of our research. In addition, we

always face time and energy constraints. Those are the reasons why we didchoose the survey approach in which we came directly to each class at the

National Economics University to spread out our survey questions sheet and

got the primary data after just some minutes. The result is very positive. 150

advanced students did give us the raw data over experience with Coca-cola.

The next step is done quickly and accurately with the useful help of SPSS

1.5 software to approach those data about the final information, marking a

successful data processing.

VII. Structure:

Our research report will be closely looked at in a structured expression.

1. Introduction

i. Background

ii. Research objectivesiii. Research questions

iv. Research hypotheses

v. Literature review

vi. Methodology


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2. Major findings

3. Conclusions and recommendations

4. Appendix

5. Reference

6. Teachers comments

Major findings

Product policiesa. Product quality

In our survey we asked consumer about how they feel about the Coca-Colaproducts quality and we received the answers categorized in 4 satisfactionlevels: absolutely, quite, rarely, not at all.From the bar chart we can see that almost a half of all people interviewedsay that they like Coca-Cola product quality. On the other hand, 30% of

people interviewed express that Coca-Cola gives them the absolute

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51

10.8 9

0

10

20

30

40

50

60

absolutely quite rarely not at all



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satisfaction with its quality. In summary, we have 80% of peopleinterviewed says that they like or very like Coca-Cola quality, it meansCoca-Cola is able to provide almost all people with the best satisfactoryquality, and it is successful in becoming familiar with peoples daily

purchasing habit. Coca-Cola commits to operate in long term in Vietnamand always provide people with the best quality products.

b. Product diversification

Fully acknowledging that it cannot survive in the market with only oneproduct, Coca-Cola has developed many products. It does not only operatein drink market comprising canned water, fizzy drink. It has created many

types of drink with different labels to satisfy the diversifying need ofconsumers. It increases the product mix to diversify the risk.

The examples of this practice are Coca-Cola, Fanta, Sprite, Minute MaidItnot only focuses on the fizzy drinks but also on the other fruit drinks,energy-heightening drinks ( Samurai ),fruit powder( Sunfill ) andsupplements many new flavors to its traditional products to accommodatefor the tastes and liking of Vietnamese people like Fanta lemon, Fantastrawberry, Soda lemon, v.v...This action helps Coca-Cola to compete with

rival companies, increase brand loyalties and create many new opportunitiesfor penetrating the market.

In a particular type of product, Coca-Cola also creates many versions. Forexample with the Coca-Cola drink, it creates classic Coca-Cola, diet cokewith low sugar for people who want lower-calorie drink, vanilla coke, cherrycoke.

Coca-Cola commits to operate in long term in Vietnam and always renovatesto satisfy the high need of a dynamic and potential market like Vietnam.


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The products of Coca-cola in Vietnam market:

Coca-Cola glass bottle,can and plastic bottleFanta orange - glass bottle,can and plastic bottle

Fanta strawberry - glass bottle,can and plastic bottle

Fanta fruit - glass bottle,can and plastic bottle

Sprite - glass bottle,can and plastic bottleDiet Coke - canSchweppes Tonic - glass bottle, canSchweppes Soda lemon - glass bottle, can and plastic bottle

Crush Sarsi - glass bottle, can

Canned Drink Joy bottle PET 500 ml and 1500 ml

Tonic Drink Samurai - glass bottle, can and powder

Sunfill orange fruit powderSunfill pineapple- fruit powder

With regard to the effect of Coca-Cola products diversification, in oursurvey we asked consumer about how they feel about the Coca-Cola


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products diversification and we received the answers categorized in 4satisfaction levels: excessive, just enough, lack diversification. The result isshown in the pie chart below.

From the chart, we collect the data about how people feel about thediversification of Coca-Cola products, with three levels to categorize:excessive, just enough, lack diversification. The result is surprising. The

biggest part of people (54.9%) says that it is just enough to satisfy theirneed, while almost 30% says that it is excessive. Adding up these numberstogether we have about 85% of people feel Coca-Cola is able to supply themwhat they expect. This proves that Coca-Cola has developed a large enough

product mix to satisfy consumers need. However, there is 15,2% of peopleinterviewed says that Coca-Cola lacks diversification. The reason for this isthat these people expect more than what Coca-Cola supplies or maybe theyget bored with drinking the same types of Coca-Cola products all the time

because Coca-Cola has become the biggest supplier in market for drinks.

c. Trade mark


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Coca-cola has developed its trade mark to be the most prominent trade markin market for canned drink, which is the dynamic band. A long time ago,

people are used to see the red dynamic brand appearing in Coca-Colaproduct. It is eye-catching enough to create an impression in consumers. Inour survey, we ask consumer about: Do you think that the styles and brandsof Coca-Cola are eye-catching enough? The result is that 80.3 % of peopleinterviewed says they are very attractive and easily to be recognized.This proves that Coca-Cola has succeed in incorporate the impression in

people. It helps Coca-Cola to retain its consumers and making a bigcomparative advantage to other opponents.

d. Packaging

Most of Coca-cola product use can, bottle to contain and protect its content.It uses can to identify the brand, list the ingredients, specify features anddifferentiates its product from competing products. Can and bottle make iteasy to design label to promote product and influence consumers perceptionand buying behavior. For example in special occasion like Worldcup, Coca-Cola used the colorful bubble images with the slogan Worldcup 2010-South Africa. Only by using can and bottle, Coca-Cola can adjust its

products appearance to some special occasions.

Can and bottle are also convenient for consumers to use because it fit withthe size of hand. Because consumers are constantly seeking products that areeasy to handle, open, close, and retailers prefer packages that are easily toship, store and stock on shelves, Coca-Cola chooses can, plastic bottle,

package of 6 cans or 24 cans to commercialize its products.Last but not least, can and bottle are of great help to recycling. One of themost important packaging issues today is comparability with the


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environment .Recently Coca-Cola has just developed a new breakthrough inpackaging with the product plant bottle( bottle made of vegetation) Thisproduct is made of the mixture of oil and 30% vegetation substances,making it recycled.Moreover, Coca-Cola has also used style modification in order to helpconsumer use its products more conveniently. Some examples of Coca-Colaare can 330ml,bottle 1.5l,package 330ml(24 cans /package),it also presentsthe bottle 390ml which is dedicate and convenient in order to satisfydifferent need of different consumers.

Coca-Cola also presents a unique Fanta fun bottle.This is a young and unique style bringing Fanta theseduction and fashion. The new bottle creates thedynamic and young style of Fanta, which is thefeature of youth of Vietnam. Especially, the bodyof the bottle is designated to the most optimal level


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to help consumer feel convenient to handle. The effort of Coca-Cola is tobring Vietnamese people, especially Youth the chance to enjoy the styleswhich are not only funny, attractive but also convenient and outstanding

e. Labelling

Each design logo of Coca-Cola has the flexible creation which is suitable forappearing in advertisement, t-shirt and hat, and creates a perfect marketingeffect of Coca-Cola. It has just received the platinum award for the bestdesignation model in summer 2009, this is the best award for the mostunique and beautiful designation model. By creating the model, Coca-Colahas proven to be in the first position in designing the style and label forcanned drinkCoca-Cola always renews its label with catching images in order to bring

consumers the freshness in its product. Recently Coca-Cola has run acampaign called happiness factory in Vietnam market. This is a centralcampaign of Coca-Cola in 2010.In this campaign, it launched a series of

products with the image happiness factory.

In the special holidays, for example Tet holiday,Coca-Cola uses the swift images appearing in its labels. For example,

packages 24 cans, Fanta, Sprite (it is the first time it uses the Tet label for


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Fanta and Sprite), couple bottle and package of 6 can Coca-Cola 330ml allhave the Tet labels.Especially in the World cup 2010, Coca-Cola used the colorful bubblesimages in its product to adhere to that event. Taking advantage of the spiritof Worldcup, Coca-Cola makes people feel like they are drinking the flavorof the worlds biggest football festival.

Price policies.a. Penetration pricing

In our survey we ask consumer about how they feel about the price ofCoca-Cola and the result is shown in the graph above.From the graph, we can see that almost 70% of people interviewed repliesthat the Coca-Cola product price is quite reasonable, while 13% of people

say the price is very cheap. Combining these two figures together we havemore than 80% of people have the ability to buy Coca-Cola products withoutany hesitation. However, there is also 20% of people interviewed says thatCoca-Cola products price are too expensive. The reason behind that is thatthese people are poor and they think Coca-Cola products are luxury drinksor these people expect to get more utilities when they pay money to buyCoca-Cola products.

20%

67%

13%

level of satisfaction with coca-cola product's price

too expensive

quite reasonable

cheap


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In summary, Coca-Cola is able to reach mass market by chargingappropriately low prices in accordance with Vietnamese purchasing powerso that anyone could buy Coca-Cola products. By doing this way, Coca-Colahas penetrated Vietnam market easily and become the familiar brand withmany people. The low price is designated to capture a large share of asubstantial market .The gain from capturing the mass market outweighs theloss prom low price , as a result Coca-Cola receive a big profit each year.For example, the price 6000VND/can for the classic Coca-Cola is suitablewith Vietnamese consumer. The product orange juice Minute maid Teppyhas appeared in the supermarkets and stores all around Vietnam with the

price 5000 VND for the traditional bottle, 6000 VND for the plastic bottlePET 330ml and 15000 VND for the plastic bottle PET 1l.Basing on thesedata we can see most of the middle-class people are able to buy Coca-Cola

products.

b. Value-based pricing

Coca-Cola charges the price of its products based on the value thatconsumers feel that it would be. It does not base on the cost of producing its

products instead it starts with consumer, considers the competition and thendetermines the appropriate price.The basic reason is that Coca-Cola is customer driven, seeking to understandthe attributes customers want in the goods they buy and the value of that

bundle of attributes to customers. However, Coca-Cola has also manycompetitors in market, so it must consider the value of alternatives.

Therefore, the price of product Coca-Cola set at a level that seems to thecustomer to be good price compared with the prices of other options.The real value of a can of Coca-Cola which comprises both the water andcan is only 800 VND but the price of a can is 6000 VND. The price 6000VND is charged based on the cost of marketing and distribution, thecompetitors offering price and the attributes that consumers place on Coca-Cola products. By marketing- mix strategies, Coca-Cola builds its price that

people percept it reasonable, finally consumers will accept these prices andtake it for granted. Although the price far outweighs the cost of producing,

the price 6000VND/can is also suitable with Vietnamese consumers. Fromthis data we can see how big profit Coca-Cola earns each year and howsuccessful its marketing mix is.

c. Discount pricing


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Coca-Cola also uses the discount pricing for the consumer buying the bigamount of products, and paying before the due date. It will adjust the pricein two following ways. Coca-Cola will grant cash discount for those who

pay immediately for the products they buy.On the other hand, Coca-Cola will grant the additional amount of product forthose who buy a large amount of products. These policies are intended toencourage customers loyalty.Coca-Cola uses functional discount for its distribution channelintermediaries. The wholesaler or retailers, perform a service or function forthe Coca-Cola, they will be compensated by typically percentage discountfrom based price. Coca-Cola has built its monopoly agent networks byattractive and preferential policies, creating a good bond between thecompany and its agents. According to these policies, these agents are not

allowed to sell competitors products.In return, the licensed agent are benefited from the policy buy 5 award1.These agents will be discount 300 VND for each can sold.

d. Price lining

Coca-Cola also charges the price of its product by product classification,what we call in marketing price lining. With each product, it will offerdifferent types with different prices in order to satisfy the diversifying need

of consumers. By doing this way, Coca-Cola is able to reach several marketsegments and the consumers will be offered a wider variety of products ateach established price. For consumers, the question of price may be quitesimple: all they have to do is to find a suitable type of product with the bestaffordable price.These products are different from each other by the sizes, features, and takedifferent form. For example the prices of fizzy Coca-Cola are:

Can 330ml 6800VND

Plastic bottle 390 8000VND

Plastic bottle PET 1,5l 14000VND


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e. Status quo price

Nowadays the price of Coca-Cola is higher than the same type product, butthe difference between these prices is not so much. We can see theinformation of updated price table between Coca-Cola and its biggestopponent Pepsi

Coca Pepsi

Can 330 ml 6.800 6.500

Bottle Pet 1.5 l 14.000 13.500

Box(24cans/box)

145.000 140.000

By charging the price near to the price of its opponent, Coca-Cola hasapplied the status quo price strategy. The strategy allows Coca-Cola tomaintain its market share and be able to react timely to opponents action.In summary, Coca-Cola is able to reach mass market by multiple price

policies but the most important one is the policy of charging appropriatelylow prices in accordance with Vietnamese purchasing power so that anyonecould buy Coca-Cola products. By doing this way, Coca-Cola has penetratedVietnam market easily and become the familiar brand with many people


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Distribution Network

In the process of doing a survey, we have asked customers the question doyou find hard when finding a place to buy Coca-Cola product? as shown as

above. And the answers of people interviewed do not make us surprise. Mostof the customers said that they could easily find the products of Coco-Cola(up to 91% of people interviewed). 5.6% said that they met some difficulties.Otherwise, only 3.4% said that it is very hard to buy the products of Coca-Cola. These data above has proven that Coca-Cola has succeeded in having adistribution products network wide enough to meet the demand ofVietnamese customers. Therefore, in this part, we will continue to show youhow the Distribution Products Network of Coca-Cola affects its customers.

Distribution Products Network

The beverage products of Coca-Cola are produced at the three bottling plantsof Coca-Cola Beverages Vietnam located in Ho Chi Minh City, Hanoi, andDa Nang. In 2001, the Vietnam government agreed to allow three bottling

plants merge together into one, in which the bottling plants of Coca-Cola


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Beverages Vietnam (CCBV) in Ho Chi Minh City plays a central role andmanages the two others. The two bottling plants in Hanoi and Da Nangoperate as two branches of Coca-Cola Beverages Vietnam Company innorthern and central areas. The advantage of having the three manufacturing

plants spreading in the three northern, central, and southern areas hasenabled Coca-Cola to expand the distribution products network in all areas,offer enough products for agents in these areas. With regard to beverage

products, the distribution network is very important, so throughout thedevelopment process in Vietnam, Coca-Cola has always paid a specialattention to how to develop an intensive distribution products network. Inreality, after seventeen years in Vietnam, Coca-Cola has proven that it hassucceeded in having an intensive distribution products network. Nowadays,you can easily catch the beverage products of Coca-Cola in almosteverywhere. You can catch it in restaurants, cafe shops, tea shops,

supermarkets, etc. This success can be explained by its four mainintermediary channels. There are retailer, merchant wholesaler, agents, and

brokers; in which retailer is the most important one. Hence, in order tolengthen its own success, Coca-Cola still continues to expand its distribution

products network through agents, cafe shops, tea shops, restaurants, etc. andattract agents by increasing support activities for them such as support


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decorating stores, financial assistance, v.v

A special feature of Coca-Cola distribution channel in Vietnam is the use of

sale force pushing small handcart to sell in crowed streets and to approach to

the narrowest alleys. The sale force using hand cart of Coca-Cola sell a coca

bottle with only 4000 VND while in the restaurant it is 10000 VND.

Obviously, Coca-Cola does not put their expectation in revenue of each coca

bottle but the main reason is to market the taste to customer and make its

trade mark appearing in everywhere. This is a unique method in capturing

the market share of Coca-Cola because the selling by handcart is one of

familiar images in the lives of Vietnamese people. Even in the streets kiosks

you can easily see the Coca-Cola products, which is attributable to the ever


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wide distribution network of Coca-Cola.


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Promotion Marketing

As you see from the chart above, almost people interviewed said thatthey are impressed by the Coca-Colas advertisements, in which 9.5% of

people interviewed are strongly impressed by these advertisements. On theother hand, only 30% of people interviewed said that they are rarely affected

by these advertisements, in which 9.2% are not affected at all. From thesedata, we can conclude that Coca-Cola has been successful in its promotionmarketing policies.Therefore, in this part, we will continue to find out how

the promotion marketing policies of Coca-Cola affect its customers. Thereare four reasons that explain why Coca-Cola has succeeded in its promotionmarketing policies such as advertising, public relation, sale promotion, and

personal selling. Thus, the following parts will take closer looks at thesereasons.

a. Advertising


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One of the most important secrets that create the success of Coca-Colais advertising activities. Everyone knows that the quality and taste of Coca-Cola has not changed for more than 100 years. The great thing of Coca-Colais the advertising activities, which has built a famous brand for thiscompany. Coca-Cola is one of the few companies that spend a substantialamount of money which is equivalent to the cost of production to polish

brand since it was established. Besides, the confidence of Coca-Cola is oneof the factors that make this famous brand today, which is expressed clearlyin their advertising slogan. The advertising slogan are " The great nationaltemperance beverage" (1906), " Six million a day" (1925), " The only thinglike Coca-Cola is Coca-Cola itself" (1942), " What you want is a Coke"(1952), Look for the real things ( 1974), " Coke is it!" (1982), " AlwaysCoca-Cola" (1993), Open Happiness (2009), and Twist The Cap ToRefreshment ( 2010) have demonstrated the ambition and confidence of

this brand.

Coca Cola has always invested in advertising strategy for its beverage

products. In retailing stores and supermarkets, Coca Cola sells its

products where the customers can easily find, just in front of corridor,

or other eye-catching places. To get this priority, Coca-Cola has to

pay huge amount of money. It always sets a priority for advertising its

products to customers through television, newspapers, newspaper,

magazine, radio, outdoor media (bus stop shelter, sport arena, etc.),

internet, and games. According to media & market research company

TNS Vietnam, in 2008, Coca-Cola Beverages Vietnam Company has

spent about U.S. $ 1.5 million for advertising its products on

television and in newspapers in Vietnam. This is not a small amount

of money and Coca-Cola Vietnam was not regretted to pay for its

advertising activities.
http://en.wikipedia.org/wiki/Open_Happinesshttp://en.wikipedia.org/wiki/Open_Happiness


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The Coca-Colas advertisements are very impressive and attract theattention of many people, with unique, creative ideas as Coca-Cola

advertising clip with Mr BRRRRRRRrrrr, with Happiness Factory, or

with the idea about the way celebrating a victory of famous football

stars with background music Waving Flag, the official song of World

Cup 2010.

b. Public Relation

Coca-Cola Beverages Vietnam Company regularly organizes useful andmeaningful activities for customers, especially for youth. These activitieshave created an innovative, creative, dynamic, optimistic, happy, andfascinating image for Coca-Cola in customers eye. Moreover, theseactivities have made Coca-Cola become more familiar with consumers bysurprising and creative activities.

Happiness Factory campaign: showing the inner world of a bottle of

Coca-Cola which is so lively and passionate. All these are deployed

under a lot of creative and fun activities. On this occasion, Coca-Cola

has also spent nearly a million trial beverage products for consumers

in big cities such as Hanoi, Ho Chi Minh City and Can Tho.


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"Sing with Coca-Cola" an opportunity for the young people to sing:

This activity is one of the series of activities of the campaign, "Drink

is BRRRR" that is being deployed nationwide contest by Coca-

Cola."BRRRR-KOOL SUMMER" contest was held to encourage the

spirit that is always ebullient and dynamic in young people, and to

impulsethe life that is always filled with joy and delight. Coca-Cola

would like to bring a fresh feeling which is completely new, unique

and different from any previous experience for consumers.

Coca-Cola also organizes the campaign "There are always delicious

dishes with Coca-Cola": to popularize the culture of Vietnam through

many fun activities including television program cuisine

competition". Meal is an occasion for people to gather, chat and enjoy

delicious food together. A delicious meal with a fun atmosphere

always contributes to increase the close friendship between family

members, friends, colleagues, etc. Thus, Coca-Cola has organized the

campaign "There are always delicious dishes with Coca-Cola" to

popularize and enrich the cuisine culture of Vietnam as well as to

show the way how to enjoy the dishes harmoniously.

Coca-Cola has sponsored the real and exciting television program "

cuisine competition": telecasting every Sunday at 9 am on channel

HTV9 starting on 18/10, replaying every Saturday at 10:20 on


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channel HN1 and at 20:30 Friday, 10:30 Saturdays on channel HTV3.

This program is not only an entertaining program, but also a program

supplying food knowledge for customers. It helps you to widen your

knowledge to choose foods that are good for your health, learn how to

cook your favourite dishes, as well as have interesting moments withfriends.

Coca-Cola also builds a specialized food site with useful information

on channel 14 at: http://duataiamthuc.kenh14.vn/: Here, young people

can register and update information about the cuisine competition"

program with Coca-Cola, answer the questions to win weekly prizes

and share delicious dishes, the specialties of each region together with

friends. On this occasion, Coca-Cola also spends 300,000 free trial

samples at restaurants in two cities, Hanoi and HCM City.

The program "who will you share the best? Having Coca-Cola for

person you love at New Year ": sending thousands of good wishes to

people all over the country. Especially, New Year Coca-Cola

Program will spend 233,420,000 dong corresponding to 46,684 love

wishes you sent to relatives or friends during the program to support

for Clean Water Community Programs. With this meaningfulprogram, customers Coca-Cola not only is shared love with relatives

or friends, but also makes a contribution to the community.


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c. Sale Promotion

In order to have such successes of Coca-Cola in Vietnam marketnowadays, the marketing managers of Coca-Cola have really succeeded in

using their communications tools. Understanding psychology of theirconsumers, Coca-Cola does not forget that promotion activity is still one ofthe best tools to popularize the images of its products to consumers. Coca-Cola Vietnam has just started a promotion program all over the country forthe youth, "Uncork a bottle - Win the prizes." The difference of this programwith other promotions is that the prizes are usually given teams rather thanan individual. And, with the teams, you can easily separate the joy with yourfriends rather than take it for yourself. This spirit is shown by ways to win:

join the lids of bottles or cans to win the prizes that young people love.When customers use the beverage bottles or cans which are manufactured by

Coca-Cola Vietnam such as Coca-Cola, Fanta Orange, Sprite, Samurai,Thums Up, they will have a chance to win the attractive prizes like PiaggioLXV 125, mobile phone Sony Ericsson W700i, T-shirts, clocks, etc. Theawards are not merely objects but also as a way for young people to showtheir personality and style to enjoy their lives. The young people when using

bottles or cans of Coca-Cola products will have the lids which contains ahalf of the prize. If customers join two lids which have the correspondingsymbols, they will win the prize. Therefore, the chances for win will behigher if a group of customers which are from two people or more join

together to coordinate and collect this luck information. Using promotion notonly helps company's sales to increase, but also shows the value that Coca-Cola gives its customers. This is a powerful communication tool that notonly Coca-Cola but also other companies use as a way to grow its market


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share.

d. Personal Selling

Building a brand is so difficult, but maintaining it is more difficult. So,in order to maintain a successful brand over hundreds years, Coca-Cola hadsuitable policies in enhancing interaction with customers so as to developlong term satisfaction of customers. Besides the promotions for seniorcustomers, Coca-Cola has also known that the level of satisfaction of itscustomers also depends a lot on the attitude of its sale force. For this reason,Coca-Cola has decided to establish courses which train its sale force how tocommunicate with customers. After passing these courses, the sale force of

Coca-Cola has received certificates which confirm that they have passedthose courses. Thus, through these courses, the sale force of Coca-Cola hasalready known the way of how to satisfy its customers. Therefore, onceagain, Coca-Cola has demonstrated that it always put customers in the firstorder in its marketing strategy. This explains the reason why Coca-Cola hassustained a strong market share not only in Vietnam but also in many partsin the world.

Conclusions and Recommendations

The final words of more than 100 advanced students at the National

Economics University have been put on the table and analyzed so as to

create the more professional outlook on the comparison between the pre-

research perceptions and the one after such powerful, and useful carrying-

out. We can see that with the first hypothesis People tend to choose their


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sweet beverages matching with their tastes is totally rational, because we

have 80% of people interviewed says that they like or very like Coca-Cola

quality, leading us to the reasoning that Coca-Cola is able to provide almost

all people with the best satisfactory quality, and it is successful in becoming

familiar with peoples daily purchasing habit. The second prime perception

People tend to choose the sweet beverage whose price level is reasonable

is also on the right track with the absolute nod of the statistics, in which 70%

of people interviewed replies that the Coca-Cola product price is quite

reasonable, while 13% of people says the price is very cheap. Combining

these two figures together we have more than 80% of people have no

hesitation in buying Coca-Cola products. From the very fist sight into this

competitive edge, we could make such right reasoning because we consider

the normal price level of coca-cola varieties: The product orange juice

Minute maid Teppy has appeared in the supermarkets and stores all around

Vietnam with the price 5000 VND for the traditional bottle, 6000 VND for

the plastic bottle PET 330ml and 15000 VND for the plastic bottle PET 1l.

After this two times that we can shape big smile on our faces, we have to put

out feet back to the ground with the strong shake-up in the third hypothesis,

which states that People tend to choose the sweet beverage which pop up as

frequent advertisements. In fact, 9.5% of people interviewed are strongly

impressed by these advertisements. On the other hand, only 30% of people

interviewed said that they are rarely affected by these advertisements, in

which 9.2% are not affected at all. Although this is still not convincing

evidence that makes us believe in the inverse belief, there are many things

ahead that need doing in order to make the promotion, or in other words,

advertisements edge much more sharpened, together with other Ps to make a

real difference.


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Therefore, Coca-colas sustainable market shares are explained under four

angles: the first one is penetration pricing, in which Coca-cola charges quite

reasonable price even when their varieties are of quite good and good

quality. However, when the market shares in Vietnamese market have

reached their own target, one possibility may be a small fluctuation in the

price level in the rising direction. The second factor is all about quite good

quality. The new and better thing is always welcomed, so that coca-cola will

try their best to diversify and better their quality, adding some more lusters

to their potential sons. The first two seem to be quite convincing facts that

help explain why coca-cola sustain such unbeatable samurais power in

Vietnamese market, it will become much more convincing with the next two

additional factors, that are wide distribution network and products

diversification. While wide distribution network helps coca-cola reach out to

all the corners of the market, products diversification brings about various

choices of what are the customers best interest.

As economic students, we all perceive that any foreign companies or

organizations that invest into Vietnamese markets will never want to take

their bucks back to their pocket, because a lot of economists admit that

Vietnam is and will be a potential destination for all the ambitious

investors. Coca-cola is no exception. They will try their best to survive in

such competitive market. However, all long-term plans should be drafted

into genuine actions by setting up more specific and attainable short-term

ones. Some recommendations from us should be the followings: Price

reduction, wider distribution, more noticeable advertisements, and more

diverse products. With the fist one, coca-cola shouldnt follow strictly their

penetration pricing, because, nowadays, more and more soft companies are

established in Vietnam, making this segment much more competitive. If


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coca-cola regard their market shares as being big enough to raise the price

level, its the most terrible mistake anyone could have ever made. Taking

that action, as a result, their revenue will reduce with no brakes. One

explanation may be the greatness of price elasticity of demand for sweet

beverages of Vietnamese picky customers. However, Coca-cola shouldnt

reduce their price level too much, because they are still a soft drink giant in

the world with the long-listed table of achievements in the past. To the two

next edges that coca-cola should pay attention to is the wider distribution

and more diverse products. No one can deny the fact that, with a product,

especially a soft drink with no significant difference compared with other

parallels, the wider and the more diverse, the better they are. In addition,

coca-cola should take advertisements strategy as its top priority, because it

is the noise from promotion planning that help the potential customers know

the newly- produced products from the manufacturers. Its also the noise that

makes the second round of production more efficient and perfect, regarding

the on-a-change requirements of the customers. With that noise, Coca-cola

not only capture such current sustainable market shares, but also a strong

ones in the near future, given the constraints that more and more entries are

present. Taking into consideration these four reasoning, together with their

own experiences and their would-be ventures, Coca-cola can become an

unbeatable giant in soft drink or sweet beverage market segments, not only

in Viet Nam, but over the world as well.


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Appendix

20%

67%

13%

level of satisfaction with coca -cola product's price

too expensive

quite reasonable

cheap


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22%

63%

15%

Were the prices of coca-cola products in theascendancy over your consumption?

They are unaffordable, so Imust find other cheaper

beverages

Sometimes, I think they are

expensive, but, times often, I

think it is appropriately

charged.

They are cheap, and I have nohesitation in buying coca-cola

products

Level of satisfaction with Coca-cola products quality

29.2

51

10.8 9

0

10

20

30

40

50

60




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Has the diversification of coca-cola products met your demand?

80%

20%

Do you think that the styles and brands ofcoca-cola are eye-catching enough?

they really stands out and are easily recognized

they make no difference from other beverage

products


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41%

13%

31%

13%

2%

how often do coca-cola branches support bigevents?

They often appear in big events and stronglysupport these events

They often appear in big events but dontsupport these events.

Sometimes, they appear in big events and

become the main supporters of theseeventsSometimes, they appear in big events, butsupport nothing

They never appear in big events


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WHAT SHOULD COCA-COLA DO TO INCREASE ITS SALE?

35.60%

21.20%

14.40%

28.80%

reducing price

increasingadvertisement

widening sellingplaces

diversifying product


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