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REGISTRATION NO.
UNIT TITLE
ASSIGNMENT TITLE
ASSIGNMENT NO
NAME OF ASSESSOR
SUBMISSION DEADLINE
Gatorade in Vietnam
1 of 2
Ms. Doti Chee
November 19th 2012
I, Phm Th Khnh Huyn - Julie hereby confirm that this assignment is my own work and not copied or
plagiarized from any source. I have referenced the sources from which information is obtained by me for
this assignment.
________________________________
_________________________
Signature
Date
Page 1 of 30
Julie F05A
Student ID: 090
Unit Outcomes
Outcome
Evidence for
the criteria
Assessors
decision
Feedback
First
attempt
Understan
d the
concept
and
process of
marketing
LO1
Be able to
use the
concepts
of
segmentati
on,
targeting
and
positioning
LO2
Explain the
various
elements of the
marketing
process
Evaluate the
benefits and
costs of a
marketing
orientation for a
selected
organisation
1.1
1.2
Show macro
and micro
environmental
factors which
influence
marketing
decisions
Propose
segmentation
criteria to be
used for
products in
different
markets
2.1
2.2
Choose a
targeting
strategy for a
selected
product /
service
2.3
Demonstrate
how buyer
behaviour
affects
marketing
activities in
different buying
situations
2.4
Propose new
positioning for a
selected
product/service
2.5
M1
M2
M3
D1
D2
D3
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Internal
Verification
Rework
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Student ID: 090
Outcome
Feedback
Assessors
decision
First
attempt
Internal
Verification
Rework
Assignment
( ) Well-structured; Reference is done properly / is not done properly /should be done (if any)
Overall, youve passed / referraloutcomes
To achieve a pass, you must meet all the requirements defined in the assessment criteria.
To achieve a merit, you must identify and apply strategies to find appropriate solutions and
appropriate methods/techniques as well as to present and communicate appropriate findings.
To achieve a distinction, you must use critical reflection to evaluate own work and justify
valid conclusions as well as to take responsibility for managing and organizing activities
ASSESSOR SIGNATURE
DATE
11 / 2012
DATE
NAME :..............................................................................
FOR INTERNAL USE ONLY
VERIFIED
YES
NO
DATE
: ...........................................................
VERIFIED BY : ...........................................................
NAME
: ...........................................................
A REPORT ON GATORADE IN VIETNAM
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Julie F05A
Student ID: 090
Prepared for
Lecturer Ms.Doti Chee
Unit 1: Marketing Principles
Banking Academy, Hanoi
BTEC HND in business (Finance)
Prepared by:
Phm Th Khnh Huyn - Julie
Registration No: F05-090. Class: F05A
No of words: 4196
Submission Date: 19th November
Table of contents
Table of contents...................................................................................................4
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Executive Summary...............................................................................................6
Introduction.........................................................................................................8
1.1: Explanation of various elements of marketing process............................................9
1.1a: Elements of marketing process.....................................................................9
1.1b: Situation Analysis....................................................................................9
1.1c: Marketing Strategy.................................................................................10
1.1d: Marketing Mix Decision..........................................................................11
1.1e: Implementation and control.......................................................................11
1.2: Evaluation of costs and benefits of one marketing orientation for a selected organization..12
1.2a: Identification of marketing orientation............................................................12
1.2b: Evaluation of costs and benefits....................................................................12
2.1: Explanation of micro and macro environmental factors, which influence marketing
decisions...........................................................................................................14
2.1.1: Brief introduction of micro and macro marketing environment.............................14
2.1.2: Micro environmental factors........................................................................14
2.1.2a: Stakeholders.......................................................................................14
2.1.2b: 7S....................................................................................................14
2.1.2c: Competition:.......................................................................................15
2.1.2d: Porters Five Forces..............................................................................15
2.1.3: Macro environment factor..........................................................................16
2.1.3a: Political.............................................................................................16
2.1.3b: Economical........................................................................................16
2.1.3c: Social...............................................................................................16
2.1.3d: Technological.....................................................................................16
2.2: Propose segmentation criteria to be used for products in different markets....................17
2.2.1: Market Segmentation definition...................................................................17
2.2.2: Proposal of one base for segmenting markets...................................................17
2.2.3: Benefits of geographic segmentation.............................................................17
2.2.4: Evaluation segmentation based on criteria.......................................................17
2.2.5: Evaluation of market attractiveness...............................................................19
2.3: Choose a targeting strategy for a selected product / service.......................................20
2.3.1: Target market and targeting strategy..............................................................20
2.3.2: Advantages of concentrated marketing...........................................................20
2.3.3: Evaluation targeting strategy based on criteria..................................................20
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2.4: Demonstrate how buyer behaviour affects marketing activities in different buying situations
.......................................................................................................................22
2.4.1: Buyer Behaviour......................................................................................22
2.4.2: Difference between Consumer and Organizational buying behaviour.....................22
2.4.3: Different types of buying situations in buying process........................................22
2.4.4: Different types of buying situation in buying process.........................................23
2.4.4a: Customer buying process.......................................................................23
2.4.4b: Organizational buying process.................................................................24
2.4.5: Factors affecting marketing activities.............................................................24
2.4.5a: Consumer buying behaviour...................................................................24
2.4.5b: Organizational buying behaviour.............................................................25
2.5: Propose new positioning for a selected product/service............................................25
2.5.1: Positioning and repositioning......................................................................25
2.5.2: Positioning strategy..................................................................................25
2.5.2: Perpetual mapping....................................................................................25
2.5.3: Gaps in market........................................................................................26
2.5.4: Evaluation of criteria.................................................................................26
2.5.5: Using 4Ps to influence new positioning..........................................................27
Conclusion........................................................................................................28
References........................................................................................................29
Executive Summary
Vietnams economy has been developing rapidly since 2006 when Vietnam became a member of
WTO. Thanks to positive trading policy of Government, Vietnam has attracted more and more
foreign investors. In company with the development of economy, Vietnameses living standard
is also improved significantly. Demand of goods and services increases and becomes more
diversified. PepsiCo is one of the most popular beverage companies in the world operating in
nearly 200 countries with more than 185,000 employees in total. Despite establishing in Vietnam
for a long time, recently PepsiCo has launched its sport drink Gatorade. Therefore, it is very
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Julie F05A
Student ID: 090
important for PepsiCo to make a unique and specific marketing strategy to attract customers.
This report analyzes characteristics of Vietnam market combining with advantages of Gatorade
to find out whether Vietnam is potential market for Gatorade. This report recommends that
PepsiCo continue to invest to develop Gatorade in Vietnam
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Introduction
PepsiCo has been around for many years in Vietnam but Gatorade has not. Certainly, launching
Gatorade in new market like Vietnam will cause PepsiCo many problems. It cannot be denied
that Vietnam is a potential market with large population. However, Vietnamese customers are
very fastidious about purchasing.
The purpose of this report is to investigate and analyze marketing process, as well as propose
market segmentation, strategy, and positioning which is suitable with consumer market and
industrial market in Vietnam. The scope of this report consists of:
Research on various elements of marketing process
Analyze costs and benefits of marketing orientation
Scan and analyze internal and external environmental factors in Vietnam
Research and propose the best market segmentation and marketing strategy
Research on consumer and organizational buying behavior
Propose new positioning for Gatorade
This report is based on information from books, articles, websites and some former researches
about Gatorade
Despite specific investigation and analysis, this report still has some limitation. Firstly, the
academic knowledge about marketing is limited, so that analysis may not be close. Secondly,
Gatorade has been just launched in Vietnam, so that information about it is not much.
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Julie F05A
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1.2: Evaluation of costs and benefits of one marketing orientation for a selected
organization
1.2a: Identification of marketing orientation
Production concept: customers will appreciate products which are marketed widely
with reasonable price. Manufacturers who follow this concept have to focus on
improving productivity and expanding production scale.
Product concept: customer will appreciate products at the highest quality and newest
features. Manufacturers who follow this concept have to focus on producing and
improving products of high quality
Selling concept: customers will not purchase products with a large number if
company does not take any action. Therefore, manufacturers have to focus on selling
and promoting.
Marketing concept: company attract customers only when it is aware of what
customers need and want
Societal Marketing concept: firm does not only provide customers satisfaction, but
also maintain or improve human welfare.
1.2b: Evaluation of costs and benefits.
PepsiCo is now operating in marketing concept for the brand Gatorade in Viet Nam.
Each year, PepsiCo spent nearly 3 billion dollar for marketing activities (PepsiCo,
2012). PepsiCo makes decision after determining customers needs and wants. That
is why all of product can meet real customer needs (Scenario, 2012).
Marketing
Costs
Benefits
Opinion
Concept
R&D
Benefits are
developing new
higher than
flavors
costs
company can
Delivery and
Cost of
delivering
Storage facility
warehousing
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produce
- Fulfill
Benefits are
costumer
higher than
orders
costs
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effectively
Improve
protection
level of
Price Policy
product
Increase
Benefits are
market
higher than
and retailers
coverage
Distribute
costs
Percentage of profit
more
intensively to
support
Branding
Logo and
graphic design
Advertising
customers
Increase
market share
Have a
Benefits are
higher than
costs
particular
cost
number of
loyal
Social
Responsibility
-
consumers
Maximize
Benefits are
courses for
profit for
higher than
employees
Pay for
investors
Improve level
costs
Training
investors more
of workforce
profits
skills
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2.1: Explanation of micro and macro environmental factors, which influence marketing
decisions.
2.1.1: Brief introduction of micro and macro marketing environment
Microenvironment: consists of internal elements, which directly affect all activities of
a firms business, including stakeholders, competition, 7S and Porters Five Forces.
Macro environment: consists of much larger elements external to a firm, including
political, economical, social and technological factors.
2.1.2: Micro environmental factors
2.1.2a: Stakeholders
Employees: Viet Nams total labor force is over 44 million people. This
abundant and inexpensive workforce helps production decision save
employment cost and expand marketing activities (NationMaster, 2010)
Consumers: Vietnamese personal income per year is from $600 to $1500 for
workers, $1800 to $4200 for office workers (VNO, 2012). With low living
standard like this, Vietnamese people prefer products with cheap price. It
affects price setting of firm.
Government: Corporate income tax in 2011 reduced from 28% to 25% but
still high (VNO, 2012). Tax affect directly on price decision. High tax leads
to high input cost so that product price will be high. Customers will buy less
product which makes business sales fall
2.1.2b: 7S
Skills: PepsiCo now has more than 1200 Vietnamese employees led by fullexperienced leadership. It helps transmit information effectively and clearly,
improve productivity (PepsiCo, 2011)
Strategy: PepsiCos strategy is focusing on environmental sustainability and
benefiting to society (PepsiCo, 2012). To do that, all activities, including
marketing decisions have to be related to environmental sustainability
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2.1.2c: Competition:
The biggest competitor of PepsiCos Gatorade is Coca Colas PowerAde.
Competition affects directly product price. Company often changes price
strategy to capture attention of customer when competitor sets price lower
than it does. It leads to a decrease in business profit.
2.1.2d: Porters Five Forces
Bargaining power of customers: It affects product price when they have
many choices to purchase because there are many beverage companies.
Because PepsiCo determines customers needs and wants before making
decision (PepsiCo, 2012), and it does not have too many competitors which
produce sport drink like Gatorade in Viet Nam. Hence, buyers power is low,
company has chance to get more profit.
Competition between firms: Company usually reduce product price lower
than its competitors to attract more customers. Keeping going that will
reduce its profit. The leading competitor of PepsiCos Gatorade is Coca
Colas PowerAde. The target market of these two products is the same.
Therefore, PepsiCo has to make differentiation by producing new Gatorade
with new flavor, and focus on marketing to appeal to customers
SWOT analysis
Strengths
Strong brand name
Abundant and
inexpensive workforce
Large number of loyal
customers
High product quality
Low buyer power
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Weaknesses
Low customer
knowledge
Strong competitors
Small scale selling
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Opportunities
Increase population
Lower corporate taxes
Lower inflation
Lower interest rate
New distribution channel
Threats
Changing social trends
Changing population age
Increase unemployment
Geographic segmentation is simple and clear so that every member of the company
Consumer market
Communication: 90% people
Industrial market
Communication: PepsiCo
consumer
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goods.
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bring
Gatorade
to
Measurability
contracts
Distribution:
needs
PepsiCo
the Internet.
Distribution: through system
only
to
deliver
of supermarkets, groceries,
two territories.
big ones.
The number of sport centers Many new supermarkets appear
increases because Vietnamese care due to increase in demand from
Actionability
resellers
customers
with
types
of
Gatorade
they
appreciate
tropical storm
Price: must be reasonable
be spoiled.
Offer warranty service so
living standard
Place: PepsiCo needs
cities,
where
resellers
in
especially
offer
two
place
customer
from it.
Place: to supermarkets,
PepsiCo can provide them
through
the
is
advertising
on
TV,
provided
through
supermarkets.
Promotion: give reseller
free items with Gatorade
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Substantiality
Market size: Population in Ha Noi and Ho Chi Minh City is 13.6 million which
accounts for 15% overall population in Viet Nam. The size of this segment is large
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Consumer Market
Industrial Market
PepsiCo now has around 12,000 PepsiCo has 2 big factories in
Vietnamese employees with profit Southern and Northern, which
of over $100 million in 2011 (Pepsi are close to Ha Noi and Ho Chi
Company
Vietnam, 2011). With large number Minh city. This helps distribute
resources
Degree of
product
much
variability
changes, and always want to try product brings the highest profit
sensitive
with
new things.
Gatorades life-cycle
stage
for them
in To resellers, Gatorade is in
Products
growth stage.
Product:
offer
features,
service
can
company recover
development costs.
Place: focus on supplying
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easy
to
new
or
return
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life-cycle
stage
number of resellers
Promotion: PepsiCo can
attract
more
get it.
Promotion: build
meet them.
consumer
resellers
products
to
Gatorade through
advertising its features,
uses, benefits, etc
Being under introduction stage, Quite stable because PepsiCo
Market
variability
about
Gatorade
and
its it.
Competitors
benefits.
There is now no company having Resellers care about profit so
marketing
strategies
make
them
profit.
on offer
them many
2.4: Demonstrate how buyer behaviour affects marketing activities in different buying
situations
2.4.1: Buyer Behaviour
Buyer behaviour is the decision-making processes of buyers in purchasing and using
goods and services (Dictionary Business, 2010)
2.4.2: Difference between Consumer and Organizational buying behaviour
Consumer Buying Behaviour
More potential buyers
Less close relationship between buyers
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and sellers
Less rational
Consumer buying/selling is less risky
sellers
More rational
Organizational buying/selling is more
risky
(Source: arifsari.net)
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PepsiCo
product relative to specification, and evaluation the product and supplier performance. It
is important for PepsiCo to conduct marketing activities to make resellers order Gatorade
frequently. It can focus on advertising and keep its good image with resellers by
delivering them on time with high quality products, as well as offer them some service or
discount.
Modified rebuy: Besides two stages like straight rebuy, this situation may have
other stages in buying process. PepsiCo need to do research about taste of people in each
area to anticipate buying power of resellers by doing surveys.
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PepsiCo
quality or benefits like in advertisement, customers will lose their trust in it.
Motive: It affects customers need recognition. PepsiCo need to do product
advertisement to attract customer. When customers feel thirsty, the company
show them advertisement in which there are people drinking Gatorade to
reduce thirst. This will give customers desire of buying Gatorade.
Perception: affects directly stage of post purchase behaviour in form of
customers expectation. If Gatorades characteristics meet his expectation,
he will be satisfied, and continue to buy Gatorade. Marketers can have some
activities to minimize the number of customers who are not satisfied. They
can make instruction documents, which are easy to understand, or publish
magazines of the company to promote their latest products.
makes PepsiCo have to focus more on marketing activities to maintain existing resellers,
and attract new ones. It can provide them extra items on which Gatorade logo is posted
such as umbrellas, chairs, tables, etc.
2.5: Propose new positioning for a selected product/service
2.5.1: Positioning and repositioning
Positioning is the act of designing the companys offer and image so that it offers a
distinct and valued place in the target customers mind (BPP, 2010)
Repositioning is the major change in positioning for the brand/product
(MarketSegmentationStudyGuide, n.d.)
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PepsiCo
Multi flavors
Gatorade
Number One
Low price
High price
Red Bull
Red Dragon
Vodik
Samurai
Limited flavors
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PepsiCo
completely empty, and Gatorade will have no competitor in this sector. Moreover,
this sector is much more profitable than others.
2.5.4: Evaluation of criteria
Important: The most two popular product lines PepsiCo offers its customers are
Gatorade G and G2 with 17 different flavors (PepsiCo, 2011). Despite having
different flavors, PepsiCo ensures that all kinds of Gatorade to have the same quality
and benefits such as rehydration level, amount of vitamins and sodium, etc.
Superior: Gatorade has vitamin and sodium content which is much higher than other
sport drink. That helps customers rehydrate faster and better. This demonstrates that
(PepsiCo, 2011).
Pre-emptive: Gatorade is number one sport drink about flavor diversity. It has so
both fruit flavors and non-fruit flavors. This makes it hard for other company to copy
because Gatorade uses natural flavors, which take a lot of research and time to
develop.
Affordable: Despite standing out from same product from competitors, the price of
Gatorade is reasonable with many people because they often think high price goes
Price: Price should maintain or increase a little bit. This will stabilize customers
mind because decreasing price makes them think that Gatorades quality is no longer
Julie F05A
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introduce customer flavors Gatorade has. This will make customers curious about
Gatorades flavors.
Product: Producing Gatorade with flavors Vietnamese prefer and introduce new ones
for them to try. This ensures Gatorade to be appreciated and diversify Vietnameses
taste.
Conclusion
This report has identified and analyzed various elements of marketing process, as well as
proposed market segmentation, strategy and positioning for Gatorade in Vietnam. I believe that
after investigation, Gatorade can compete with other sport drinks from many companies and
develop in Vietnam. This report will be better next time because of lack of information and
sources about Gatorade in Vietnam.
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References
Business Times (2012), 27th June, [Online], Available: http://businesstimes.com.vn/inflationrate-decreases-but-worries-have-not-been-eased/ [17th October 2012].
Market Segmentation Study Guide, [Online], Available:
http://www.segmentationstudyguide.com/understanding-repositioning/repositioning/ [14
November 2012].
Nation Master (2012), [Online], Available: http://www.nationmaster.com/country/vmvietnam/lab-labor [17th October 2012].
PepsiCo (2012), [Online], Available: pepsico.com [2012].
Thanh Nien News (2012), 1st July, [Online], Available:
http://www.thanhniennews.com/index/pages/20120701-vietnam-jobless-rate-increases-to2.29pct.aspx [17th October 2012].
Velo, S. (2011) Live Strong, 28th March, [Online], Available:
http://www.livestrong.com/article/176398-powerade-vs-gatorade/ [18th October 2012].
Viet Nam News (2012), 8th October, [Online], Available:
http://vietnamnews.vnagency.com.vn/Economy/231094/banks-urged-to-help-firms.html
[17th October 2012].
VNO (2012), [Online], Available: http://www.vietnamonline.com/az/recruiting-labour.html [17th
October 2012].
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