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BANKING ACADEMY, HANOI

BTEC HND IN BUSINESS (FINANCE)


ASSIGNMENT COVER SHEET

REGISTRATION NO.
UNIT TITLE
ASSIGNMENT TITLE
ASSIGNMENT NO
NAME OF ASSESSOR
SUBMISSION DEADLINE

Phm Th Khnh Huyn - Julie


(E) Julie
ITP
F05-090
Unit 4: Marketing Principles

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

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Assignment Received By:
Date:

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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

Merit grades awarded

M1

M2

M3

Distinction grades awarded

D1

D2

D3

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Internal
Verification
Rework

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Outcome

report on Gatorade in Vietnam


Evidence for
the criteria

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

Areas for improvement:

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

NAME: Doti Chee


(Oral feedback was also provided)
STUDENT SIGNATURE

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

report on Gatorade in Vietnam

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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report on Gatorade in Vietnam

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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report on Gatorade in Vietnam

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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1.1: Explanation of various elements of marketing process


1.1a: Elements of marketing process
When setting up the business, a firm has to identify customers needs and wants in
order to satisfy them when it brings products to the market. It makes a process called
marketing process which consists of four main stages:
Situation Analysis
Marketing Strategy
Marketing Mix Decision
Implementation and Control

1.1b: Situation Analysis


1.1b.1: Trends
Trends analysis consists of analysis of market, customers, and competition. It
helps company identify exactly what customers need and want, so that the
company will know what it need to produce to satisfy them.
1.1b.2: Internal Environment
Internal analysis is the process of evaluating factors, elements which affect
directly the company and its business activities such as stakeholders,
competitors, 7s, etc. It identifies companys strength and weaknesses to
evaluate how well the company can deal with them.
1.1b.3: External Environment
External environment consists of technological, economic, political, social
factors. The company needs to pay attention to all these factors in order to
identify its opportunities and threats in the market. Identifying opportunities
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and threats early will help firm catch the opportunities, avoid or defuse the
threats when they come.

1.1c: Marketing Strategy


1.1c.1: Generic Strategies
Generic strategies are strategies the company carries out to create and maintain
one profitable position in marketplace. They consist of three strategies:
Cost leadership: company produces product with low price to control the
market
Differentiate: company focuses on one target in order to create loyal customers
and avoid competition
Focus/Nicheing: company focuses on providing product to particular segments.
The company has to choose only one strategy to avoid being stuck in the
middle. However, in order to understand its competitive environment, the
company needs to analyze five forces, including bargaining power of suppliers,
bargaining power of consumers, threat of entry, competition from substitutes,
and competition between firms.
1.1c.2: Growth Strategies
Growth strategies consist of four options, which identify development target of
the company:
Market penetration: the company introduces existing product in existing
market
Market development: the company introduces existing product in new market
Product development: the company introduces new product in existing market
Diversification: the company introduce new product in new market.
1.1d: Marketing Mix Decision
The four main elements of marketing mix are product, place, price and promotion. It
provides a construction to distribute financial resources and workforce to use
effectively, so that company can achieve goals it set up

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1.1e: Implementation and control


After making marketing strategy, the company needs to implement it in order to
increase the effectiveness of that strategy. Besides implementing, the company also
needs to control its strategy to ensure that no mistake can happen, as well as it can
change if necessary.
There are some ways to implement strategy, according to Wheeler (2005):

Set aside a day a month


Set the stage with stakeholders
Doing experiment
Reward people who move forward often
There are many elements of marketing process, and company needs to take account of
all of them so that it can make a marketing strategy, which is clear, detailed and safe,
as well as implement and control it effectively

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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

Cost of seeking and

Products have flavors

Benefits are

developing new

and functions that no

higher than

flavors

other sport drink

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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cost
-

effectively
Improve
protection
level of

Price Policy

product
Increase

Benefits are

paid for distributors

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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2.1.3: Macro environment factor


2.1.3a: Political
Interest rate: impacts on price decision. Recently, banks cut both lending and
deposit rates to 15% instead of 25% and deploy some preferential credit
packages for firms (VietnamNews, 2012). Lower interest rate will decrease
interest payable, enables customers to purchase more which helps increase
business profit.
2.1.3b: Economical
Unemployment rate: Vietnams unemployment rate is 2.29%, 0.07%
increase compared to 2.22% in 2011 (ThanhNienNews, 2012). It affects
directly in price decision. An increase in unemployment rate causes
customers to reduce expenditure so that it will decrease business sales.
Inflation: Vietnams inflation rate is 6.9% over the first half of 2012
compared to 18.13% in 2011 (BusinessTimes, 2012). Decrease in inflation
means that price levels of products will decrease, as well as moneys
purchasing power, enables customers to purchase more.
2.1.3c: Social
Demographic trends of Viet Nam are changing. The number of elderly
people is rising rapidly because of a decrease in birth rate and death rate
(Anon, 2012). It will changes customers taste and preference, as well as
decrease the number of people in working age. More money has to be spent
on health insurance, health care, which causes customers to buy less Pepsis
Gatorade so that business sales are fallen.
2.1.3d: Technological
All facilities are equipped with newest technology and products meet world
quality standard, which enables company to increase productivity (PepsiCo,
2010). Also, the appearance of the Internet helps increase customers to buy
Pepsi products through advertising, home-shopping, online-shopping.
SWOT analysis
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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

2.2: Propose segmentation criteria to be used for products in different markets


2.2.1: Market Segmentation definition
Market Segmentation is the subdividing of a market into distinct subsets of
customers, where any subset may conceivably be selected as a target market to be
reached with a distinct marketing mix (BPP, 2010).
2.2.2: Proposal of one base for segmenting markets
This research only focuses on geographic base. Specifically, markets will be divided
into two segments, including Ha Noi and Ho Chi Minh City.
2.2.3: Benefits of geographic segmentation

Geographic segmentation is simple and clear so that every member of the company

can easily understand.


The danger of market changing over time is very small so that geographic

segmentation is easy to monitor.


Market expansion: when markets are segmented geographically, PepsiCo focuses on
developing two territories, and it is also easy for the company to expand to nearby
territories.

2.2.4: Evaluation segmentation based on criteria


Criteria
Accessibility

Consumer market
Communication: 90% people

Industrial market
Communication: PepsiCo

living in Ha Noi and Ho Chi

can promote Gatorade to

Minh City have television

resellers through fairs of

and computer accessed with

consumer

the Internet (Vietnamonline,

Therefore, PepsiCo can

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goods.

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2011). This enables PepsiCo
to

bring

Gatorade

to

customers through TV and

Measurability

meet resellers and sign

contracts
Distribution:
needs

PepsiCo

the Internet.
Distribution: through system

only

to

deliver

of supermarkets, groceries,

like Metro, BigC, etc.

stores, etc locating in these

Smaller ones rebuy from

Gatorade to big resellers

two territories.
big ones.
The number of sport centers Many new supermarkets appear
increases because Vietnamese care due to increase in demand from

Actionability

more about health.


the market.
Product: provide Vietnamese
Product:

resellers

customers

with

types

of

product with long expire

Gatorade

they

appreciate

date to help them not

such as flavor of lemon,

worry that Gatorade may

tropical storm
Price: must be reasonable

be spoiled.
Offer warranty service so

because of Vietnameses low

that resellers can easily

living standard
Place: PepsiCo needs

return Gatorade, which is


to

supply Gatorade to system of

out of date or spoiled.


Price: provide resellers

cities,

Gatorade at lower price

where

than real price to ensure

people often play sports such

resellers can make profit

resellers

in

especially

offer

two
place

as stadiums, football clubs


Promotion: Gatorade can
reach

customer

from it.
Place: to supermarkets,
PepsiCo can provide them

through
the

Gatorade directly, but to

Internet, hanging poster in

groceries, stores, Gatorade

supermarkets, groceries, etc.

is

advertising

on

TV,

provided

through

supermarkets.
Promotion: give reseller
free items with Gatorade

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logo posted on it such as

Substantiality

umbrellas, cloths, hats.


Population of Ha Noi and Ho Chi There are 70 supermarkets in Ho
Minh city is around 13.6 million Chi Minh city, 90 in Ha Noi and
(Vietnamonline, 2011). Besides, Viet thousands of groceries, stores.
Nam has young population. The This will lead to a large number
number of people who play sports is of Gatorade being supplied to
very large. This is a potential market resellers (F-event, 2009)
for PepsiCo to make profit.

2.2.5: Evaluation of market attractiveness

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

which may increase potential for sale growth.


Customer loyalty: PepsiCo has been around for many years, its brand is so popular
that people usually think about it when making purchase. Besides, there are a large
number of people playing sports regularly in Ha Noi and HCM city. These two

factors enable PepsiCo to attract more loyalty customers in this segment.


Competitive intensity: there are not many companies, which produce sport drink in
Viet Nam. The main competitor of PepsiCos Gatorade is Coca Colas PowerAde.
However, Coca Cola stood at disadvantageous position compared to PepsiCo in
Viet Nam because PepsiCos beverage is sweeter than Coca Colas and Vietnamese
people prefer sweet one. It is an advantage of PepsiCo, enables it to attract more
customers.

2.3: Choose a targeting strategy for a selected product / service


2.3.1: Target market and targeting strategy
Target market is a market or segment which company selected for special attention
by an organization (BPP, 2010).

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This research will focus on concentrated marketing. PepsiCo will concentrate on


producing Gatorade for big cities, including Ha Noi and Ho Chi Minh City. This
segments includes people who play sports regularly.
2.3.2: Advantages of concentrated marketing

Concentrated marketing enables PepsiCo meets customers needs and wants

specifically in one segment.


Using concentrated marketing, PepsiCos resources will focus on one segment and

will not be wasted.


Help Company save advertisement cost.

2.3.3: Evaluation targeting strategy based on criteria


Criteria

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

of employees and big turnover, Gatorade to resellers more easily


PepsiCo has enough resources to and save the delivery cost.

Degree of

meet all the needs of customers


Very high because customers are Quite low because resellers care

product

much

variability

changes, and always want to try product brings the highest profit

sensitive

with

new things.
Gatorades life-cycle

product much about which kind of

stage

for them
in To resellers, Gatorade is in

Vietnam now is introduction stage.

Products

Product: offer basic product

growth stage.

Product:

offer

to limit the variation of

features,

service

Gatorade in order not to

warranty so that resellers

confuse the customers.


Price: usually high to help

can

company recover

are out of date or spoiled


Price: maintain pricing
Place:
increase
the

development costs.
Place: focus on supplying
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easy

to

new
or
return

Gatorade bottles which

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life-cycle

middlemen like resellers

stage

with Gatorade to ensure

number of resellers
Promotion: PepsiCo can

customers will be easy to

attract

more

get it.
Promotion: build

through holding fairs of

customers awareness about

meet them.

consumer

resellers

products

to

Gatorade through
advertising its features,
uses, benefits, etc
Being under introduction stage, Quite stable because PepsiCo
Market

market variability is not stable now has a particular number of

variability

because customers are not still resellers signing contracts with


clear

about

Gatorade

and

its it.

Competitors

benefits.
There is now no company having Resellers care about profit so

marketing

marketing strategies, which focus that they will order products,

strategies

on target customers in Ha Noi and which

make

them

profit.

Ho Chi Minh city like PepsiCo in Therefore, beverage companies


Vietnam. This is an opportunity for focus
PepsiCo to control these segments.

on offer

them many

profitable products which makes


PepsiCo have many competitors

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

Organizational Buying Behaviour


Less potential buyers
Close and long-term relationship

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and sellers

between organizational buyers and

Less rational
Consumer buying/selling is less risky

sellers
More rational
Organizational buying/selling is more
risky
(Source: arifsari.net)

2.4.3: Different types of buying situations in buying process

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Consumer Buying Process

report on Gatorade in Vietnam

Organizational Buying Process

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PepsiCo

2.4.4: Different types of buying situation in buying process


2.4.4a: Customer buying process
There are three types of buying situation in customer buying process,
including low involvement purchases, high involvement, and limited problem
solving. This report will focus on two different types of situation, including
high involvement and low involvement, and their effect on marketing
activities

High involvement: Customers require a lot of information about Gatorade, so


that PepsiCo has to focus on providing them information. To do that, PepsiCo
can do marketing activities like publish catalogues, or brochures, so that

customers will have enough information about Gatorade.


Low involvement: Customers do not need much information. Instead of
publishing brochures, PepsiCo needs to focus on building customers
awareness of need. It can concentrate on product advertising activities to
attract people to buy Gatorade.

2.4.4b: Organizational buying process


There are three types of situation in organizational buying process, including
straight rebuy, modified rebuy, new task. This report will focus on two
different types of situation, including straight rebuy and modified rebuy, and
their effect on marketing activities

Straight rebuy: organization only needs two stages, including evaluation of

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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Julie F05A
Student ID: 090

PepsiCo

2.4.5: Factors affecting marketing activities


2.4.5a: Consumer buying behaviour

Reference groups: affects customers evaluation of alternatives and purchase


decision. Opinions of these groups are always appreciated because they have
more experience about it. Therefore, PepsiCo need to ensure that the
advertisement matches Gatorades real quality. If Gatorade does not have high

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.

2.4.5b: Organizational buying behaviour

Competitive development: The appearance of many domestic beverage companies

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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Julie F05A
Student ID: 090

PepsiCo

2.5.2: Positioning strategy


This report focus on proposing one new positioning strategy, which is Pay more for
more value proposition strategy. This strategy mentions two dimensions, including
price and flavor.
2.5.2: Perpetual mapping

Multi flavors
Gatorade

Number One

Low price

High price
Red Bull
Red Dragon

Vodik

Samurai

Limited flavors

2.5.3: Gaps in market


Almost beverage companies stand in quarter of low price and limited flavors. There
is no company in quarter of high price and limited flavors because there are no
customers who spend a lot of money buying products with limited choice in flavors.
Only one company stands in quarter of low price and multi-flavor. It is hard for
companies to choose this quarter because finding many flavors costs a lot of money,
but product is at low price, so that the profit will be very small. That profit is not
enough for research and developing flavors. This report will propose new
positioning for Gatorade, which is high price and multi-flavor. This quarter is
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Julie F05A
Student ID: 090

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

Gatorade is superior to other brands in providing vitamins and sodium.


Distinctive: Gatorade has a diversity of flavors, not only normal fruit flavor but also
new refreshing ones such as Frost Glacier Freeze, Frost Cascadade Crash, etc

(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

with high quality.


Profitable: Large young population leads to a large number of people playing sport
regularly. This enables PepsiCo to make profit from selling Gatorade.

2.5.5: Using 4Ps to influence new positioning

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

high which may cause a decrease in number of customer buying Gatorade.


Place: Selling Gatorade at place where there are many people playing sport such as
sport center, sport clubs to attract them. This will increase contact level between

Gatorade and customers.


Promotion: Using TV or Internet advertisements to promote the diversity of flavors.
Gatorade with a lot of flavor will be shown at the end of advertising video to
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Julie F05A
Student ID: 090

PepsiCo

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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Julie F05A
Student ID: 090

PepsiCo

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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Julie F05A
Student ID: 090

PepsiCo

VNO (2012), [Online], Available: http://www.vietnamonline.com/az/corporate-income-tax.html


[17th October 2012].
VNO (2012), [Online], Available: http://www.vietnamonline.com/az/ho-chi-minh-citypopulation.html [18th October 2012].

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