(Tiểu luận) final assignment optimal marketing channel system design for innisfree men facial cleanser

VIETNAM GENERAL CONFEDERATION OF LABOR
TON DUC THANG UNIVERSITY
FACULTY OF BUSINESS ADMINISTRATION

FINAL ASSIGNMENT
OPTIMAL MARKETING CHANNEL SYSTEM DESIGN
FOR INNISFREE MEN FACIAL CLEANSER

Lecturer: Phạm Văn Phát
Class: 03 (Saturday, Shift 2)
Group: IRON

HO CHI MINH CITY, 8 January 2022

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MEMBER LIST

NO

Full Name

ID
Number

Work List

Completion
Rate

 Chapter 2: Market
Overview
1

Vũ Nguyễn
Bình Giang

719H0027

 Chapter 4: Approaching
Needs And Problems

100%

 Present

2

Huỳnh Vĩnh
Xuân

719H0938

 Chapter 5 Maketing Mix
Problems And Suggestions
 Chapter 6: Current

Marketing Channel System
Of Innisfree
 Chapter
 Word formatting and
corrections
 Present

100%

 Chapter 2: Market
Overview
3

Nguyễn Hồng
Yến Nhi

719H0086

 Chapter 4: Approaching
Needs And Problems

100%

 Present

4

Nguyễn
Quỳnh Như

719H0890

 Chapter 7: Findings About
Channel System Of
Innisfree
 Word corrections
 Present

100%

 Chapter 3: Brand Key
5

Đinh Nguyễn
Anh Thư

719H0757

 Chapter 4: Approaching
Needs And Problems

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100%

 Doing the Word report file
 Present

6

Nguyễn Phi
Khánh

719H0780

 Chapter 8: Optimal
Marketing Channel System
Design Suggestions

100%

 Conclusion
 Present

7

Tống Minh
Toàn

719H0137

 Chapter 8: Optimal
Marketing Channel System
Design Suggestions

100%

 Conclusion
 Present

8

Lê Phạm
Thanh Huyền

719H0044

 Chapter 1: Amorepacific
Vietnam Company Limited
Introduction
 Doing the slide
 Present

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100%


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TABLE OF CONTENTS
CHAPTER 1 INTRODUCTION ................................................................................ 1
1.1 AmorePacific Vietnam Company Limited ...........................................................1

1.2 Innisfree .................................................................................................................2
1.3 Innisfree Forest For Men Cleansing Foam ...........................................................4
1.3.1 Innisfree Forest For Men Shaving & Cleansing Foam ......................................4
1.3.2 Innisfree Forest For Men Oil Control Cleansing Foam .....................................6
1.3.3 Innisfree Forest For Men Fresh Cleansing Foam...............................................6
CHAPTER 2 MARKET OVERVIEW ....................................................................... 8
2.1 The cosmetics and facial cleansers market in Vietnam ........................................8
2.2 Men's facial cleanser market in Vietnam ............................................................ 10
2.3 Male cleanser competitor analysis ......................................................................12
2.3.1 Lower price range competitors of Innisfree’s male facial cleanser .................12
2.3.2 Same price range competitors of Innisfree’s male facial cleanser ...................12
CHAPTER 3 BRAND KEY ..................................................................................... 14
3.1 Root strength: ......................................................................................................14
3.2 Competitive environment:...................................................................................15
3.3 Target customers .................................................................................................15
3.4 Insight ..................................................................................................................16
3.5 Benefit .................................................................................................................17
3.6 Values, beliefs and personality ...........................................................................18
3.7 Reasons to believe ...............................................................................................18
3.8 Discriminator .......................................................................................................18
3.9 Essence ................................................................................................................19

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CHAPTER 4 APPROACHING NEEDS AND PROBLEMS .................................. 20

4.1 Primary data ........................................................................................................20
4.2 Secondary data ....................................................................................................25
CHAPTER 5 MARKETING MIX PROBLEMS AND SUGGESTIONS ............... 29
5.1 Product ................................................................................................................29
5.2 5.2 Price ...............................................................................................................29
5.3 Promotion ............................................................................................................30
5.3.1 Digital marketing: ............................................................................................30
5.3.2 Communication: ...............................................................................................30
5.3.3 Promotion: ........................................................................................................31
5.4 Place ....................................................................................................................31
CHAPTER 6 CURRENT MARKETING CHANNEL SYSTEM OF INNISFREE 33
6.1 Distribution structure ..........................................................................................33
6.2 Marketing channel flows .....................................................................................34
CHAPTER 7 FINDINGS ABOUT CHANNEL SYSTEM OF INNISFREE .......... 37
7.1 Strengths ..............................................................................................................37
7.2 Weaknesses/ Problems ........................................................................................37
CHAPTER

8 OPTIMAL

MARKETING

CHANNEL

SYSTEM DESIGN

SUGGESTIONS ....................................................................................................... 39
8.1 Solutions to optimize the current system ............................................................39
8.2 New channel structure .........................................................................................40
8.2.1 Traditional distribution channel .......................................................................40

8.2.2 Electronic distribution channel: .......................................................................41
8.2.3 Optimal distribution channel ............................................................................42

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8.3 Limitations & caveats .........................................................................................44
CONCLUSION ......................................................................................................... 45
REFERENCES .......................................................................................................... 47

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TABLE OF IMAGES
Image 1-1: Innisfree logo ............................................................................................2
Image 1-2: Innisfree Forest For Men Cleansing Foam ...............................................4
Image 1-3: Innisfree Forest For Men Shaving & Cleansing Foam ............................. 5
Image 1-4: Innisfree Forest For Men Oil Control Cleansing Foam ............................6
Image 1-5: Innisfree Forest For Men Fresh Cleansing Foam .....................................7
Image 2-1: Online brand association ..........................................................................9
Image 2-2: Google Trend ..........................................................................................10
Image 2-3: Google Trend ..........................................................................................11

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TABLE OF TABLES
Table 3-1: Innisfree target customers ........................................................................15
Table 4-1: Survey questions ......................................................................................20
Table 8-1: Advantages and disadvantages of new distribution channel ...................42

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TABLE OF FIGURES
Figure 2-1 Popular skin care items..............................................................................8
Figure 2-2: Brand in use ..............................................................................................8
Figure 2-3 Favorite brands - skincare .........................................................................9
Figure 2-4: Survey conducted by Rakuten Insight....................................................11
Figure 3-1: Brand key model ....................................................................................14
Figure 4-1: How do you know Innisfree ...................................................................21
Figure 4-2: Why would you choose Innisfree? .........................................................21
Figure 4-3: How much money can you spend a month on skincare products? ........22
Figure 4-4: Are you satisfied with the cosmetics you are using? .............................22

Figure 4-5: Do you think the price is reasonable? ....................................................23
Figure 4-6: Where do you usually buy cosmetics? ...................................................23
Figure 4-7: Did you have any problems while buying? ............................................ 24
Figure 4-8: In addition to Innisfree, which brands will you buy? ............................24
Figure 4-9: Please describe Innisfree with one word ................................................ 25
Figure 4-10: Will you introduce Innisfree to your friends? ......................................25
Figure 4-11: Skincare frequency ...............................................................................26
Figure 4-12: Reasons not to skin care .......................................................................27
Figure 4-13: Information source ...............................................................................28
Figure 4-14: Popular purchase locations ................................................................... 28
Figure 6-1: Distribution structure.............................................................................. 33
Figure 6-2: Three levels of distribution channel .......................................................33
Figure 6-3: Innisfree marketing channels flow .........................................................35
Figure 8-1: Proposed distribution system .................................................................39
Figure 8-2: Popularity of cosmetics selling point .....................................................40
Figure 8-3: Traditional distribution channel .............................................................41
Figure 8-4: Higher usage of online shopping ............................................................42

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CHAPTER 1 INTRODUCTION
1.1 AmorePacific Vietnam Company Limited
Korea is one of the leading countries in the world in the beauty industry.
When it comes to Korean cosmetics, it is impossible not to mention AmorePacific,
which owns nearly 30 sub-brands in cosmetics, beauty, health care such as

Sulwhasoo, Hera, Laneige, IOPE, Innisfree, Etude, Mamamode, Happy Bath...
According to early 2018 estimates, with a domestic market share of up to 35.1%
and annual revenue of about $6 billion, AmorePacific is the oldest cosmetics
business and the largest in Korea. The media gave AmorePacific the nickname
"cosmetic giant".
To have growth today, AmorePacific has always been a pioneer in the
activities of the beauty industry. To serve the quality reform year by year, the
company soon opened its laboratory in August 1954. This is also the first cosmetic
laboratory in Korea.
AmorePacific has created its history for the beauty industry in Korea. During
the years of establishment and development, the "cosmetic giant" is always
committed to bringing new beauty values to customers worldwide. This is also a
guideline that helps the corporation constantly strive to pioneer product
improvement, bringing diverse beauty values to consumers.
Founded in 1945, AmorePacific increasingly asserts its position as Korean
beauty care "giant". In early 2017, based on 2016 financial revenue, AmorePacific
jumped from 12th place to 7th place in the Top 100 of Women's Wear Daily's
Beauty. Since 2007, AmorePacific has risen 13 locations in 10 years, with product
sales quadrupling and operating profit fivefold. This growth results from three
critical differentiating strategies: brand differentiation, commitment to innovation,
and market diversity.

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1.2 Innisfree

Image 1-1: Innisfree logo
Innisfree is a South Korean cosmetics brand owned and founded by the
largest skincare and Cosmetics Company named AmorePacific in 2000. Innisfree is
popular for its affordability and brand concept, which emphasizes healthy,
environmentally friendly, reasonably priced beauty products with ingredients
responsibly sourced from Jeju Island, South Korea.
With the tagline “Natural Benefits from JEJU Island”, Innisfree wants to
express the rich and beautiful nature of Jeju Island while pursuing healthy beauty.
It is established in 2000, Innisfree has proven to succeed with 1500 stores
spread across 15 countries. Not only is it famous for its outstanding quality product
lines, Innisfree also scores well with environmental protection when it has quietly
maintained its sustainable green color for the past 20 years.
Innisfree always cares deeply about each skin and is committed to conscious
beauty values. Innisfree is always interested in the typical home of the Earth and
represents the beauty of the environment and the natural ecosystem. They are taking

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action every day, not only working for customer skin, but they are also working to
bring sustainable beauty values to the environment.

Growing from nature, Innisfree also repays Mother Nature with the promise of:
 Keeping the environment green: contributing to reducing carbon emissions
into the environment.
 Natural ingredients: 70% natural extracts in skincare products.
 Charity: giving at least 1% of annual benefits to neighboring countries.
Innisfree's commitment to customers:
 Committed to natural ingredients of all products, always going in the direction
of developing skin health and beauty with natural ingredients
 Committed to ethics and brand reputation. The products have the best quality
and the right price.
 Always invest extensively in research and development in life in beauty.
 Realize an environmentally friendly green life to protect nature.
 Provide experience through five senses with the diversity of green nature.
Innisfree was officially present in Vietnam in October 2016 with the first store
in District 3, HCMC. From the first store, after nearly 5 years of accompanying the
Vietnamese beauty community, Innisfree now has 21 stores in six major cities: Ho
Chi Minh City, Hanoi, Da Nang, Hai Phong, Nha Trang, Binh Duong. The brand
receives support from a large number of young people and consumers who love
cosmetics nationwide.
In addition to connecting with users by opening many stores or launching
impressive product lines, Innisfree also attracts much attention from beauty followers
across Vietnam with global events performance. Not only that, Innisfree always
wishes to contribute more to social organizations, spread messages of love, and warm
the hearts of all underprivileged children in each country that Innisfree presents.
During the three years in Vietnam, Innisfree has accompanied the Heartbeat Vietnam
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Foundation (Heartbeat Vietnam), contributing 10% of the Holiday Limited Edition
Collection revenue and 100% of the income of the handmade set DIY, offering 24
free heart surgeries for children.
1.3 Innisfree Forest For Men Cleansing Foam

Image 1-2: Innisfree Forest For Men Cleansing Foam
Innisfree Forest For Men Cleansing Foam is a line of facial cleansers
manufactured by Innisfree specifically for men with three types of products with three
different functions. These product functions are all specific to common male facial
skin problems, so they are quite popular, including Innisfree Forest For Men Shaving
& Cleansing Foam, Innisfree Forest For Men Oil Control Cleansing Foam, and
Innisfree Forest For Men Fresh Cleansing Foam.
1.3.1 Innisfree Forest For Men Shaving & Cleansing Foam

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Image 1-3: Innisfree Forest For Men Shaving & Cleansing Foam
Innisfree Forest For Men Shaving & Cleansing Foam is a product specifically
for men, with a "2 in 1" function: both daily cleansing and can be used as an extremely

convenient shaving foam.
The product contains extracts of pine trees, cedar trees grown on Jeju Island,
containing Phytoncide compounds to help soothe skin and reduce any stress. At the
same time, the product also helps strengthen the skin's resistance to avoid the harmful
effects of external pollution.

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1.3.2 Innisfree Forest For Men Oil Control Cleansing Foam

Image 1-4: Innisfree Forest For Men Oil Control Cleansing Foam
Innisfree Forest For Men Oil Control Cleansing Foam exclusively for men,
oily skin extracted from pine trees, cedar trees are grown on Jeju Island of Korea has
the effect of cleaning dirt and impurities on the skin to bring smooth and soft skin,
and natural white.
With a creamy texture, easy to foam, while helping to control excess oil and
sebum on the skin, making men's skin firmer, stronger and smoother, Phytoncide
nutrients, from pine trees, trees Jeju Island's cedar and Tinospora help to relax the
skin and relieve stress. The ingredients are completely natural, benign, do not cause
skin irritation, and do not contain chemical ingredients such as mineral oil, parabens,
imidazolidinyl urea, raw materials of animal origin.
1.3.3 Innisfree Forest For Men Fresh Cleansing Foam

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Image 1-5: Innisfree Forest For Men Fresh Cleansing Foam
Innisfree Forest For Men Fresh Cleansing Foam with moisturizing Jeju
Phytoncide complex helps to protect men's skin optimally. Phytoncide nutrients
found in pine, cedar, and Tinospora trees typical of Jeju Island help men's skin
smooth, clean, and prevent acne.
With small particles of scrub, it helps to exfoliate dead skin cells to reveal
smoother, younger-looking skin. The product helps to deeply wash away dirt, sebum
accumulated inside the pores to help men's skin clear, reduce the possibility of
causing acne, the skin is smooth and bright.

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CHAPTER 2 MARKET OVERVIEW
2.1 The cosmetics and facial cleansers market in Vietnam

Figure 2-1 Popular skin care items
The most used brands are Nivea, Pond's, The Face Shop and Innisfree. In
particular, users with high income often prefer to use more high-end brands such as
The Face Shop, Innisfree, Vichy and Shiseido.

Figure 2-2: Brand in use
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As for skincare products, Innisfree is the most loved by high earners.

Figure 2-3 Favorite brands - skincare

Image 2-1: Online brand association
Innisfree is the brand that is rated as having the strongest online image. Then
came Pond's and The Face Shop.
Similarly, Shopee, Tiki and Lazada are the first three e-commerce names that
pop up when users remember an online cosmetic shopping platform.

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2.2 Men's facial cleanser market in Vietnam
Men's grooming products are very diverse and plentiful in the world today. In
recent years, Vietnamese men have approached the beauty trend; the old conception
of beauty is also fighting changing.
The demand for male beauty in Vietnam in recent years indicates men's
awareness of beauty products. The potential for grooming products for men in
Vietnam is huge.
The spread of J-POP and K-POP boys makes many men want to be like them,
these images become a phenomenon and grooming products are indispensable
products for men. As a result, the need to use grooming products has been constantly
growing in Vietnam. More and more customers need to buy those products, becoming
a new niche for businesses.
The beauty trend in general in Vietnam has recently been on the rise, especially
among men. They did not simply choose everyday bathing products but also wanted
more care from perfumes, deodorants, to lotions.

Image 2-2: Google Trend

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According to Google Trend (14/11/2021), the keyword “Male cleanser” (Sữa
rửa mặt cho nam) was most searched in Gia Lai, Da Nang, Dong Nai, Ho Chi Minh
and Binh Duong.

Image 2-3: Google Trend
The related queries for that keyword are “Acne treatment cleanser for male”,
“Cleanser for Oily skin Male”
In addition, for those who searched for that keyword, they also care about
topics like Cleanser, Face, Man, etc.

Figure 2-4: Survey conducted by Rakuten Insight
According to a survey conducted by Rakuten Insight in July 2021, 38 percent
of male Vietnamese respondents stated that they used Korean skincare products,

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followed by 22 percent of the respondents who claimed to use Japanese skincare
products. Most of the respondents felt that K-beauty products were more effective
and produced better results.
2.3 Male cleanser competitor analysis
Currently, the male cleanser market in Vietnam is having the presence of huge

players in the cosmetics industry such as Nivea Men, OXY, Men’s Biore and so many
other competitors.
2.3.1 Lower price range competitors of Innisfree’s male facial cleanser
Competitors of male facial cleansers at a lower price range than Innisfree
include OXY, Biore, Nivea men. The common points between these competitors are
the design and their slogan/tagline. These products have the same way of packaging
design - strong, manly, with a catchy phrase of deep clean, remove oil, anti-acne, or
multiple features. Some men still believe that skincare is only for women, so they are
afraid to buy products with colorful designs. Such designs hit the psyche of men; do
not like the color, like to clean excess oil, many uses.
In terms of price, the above competitors have low prices (45,000-70,000
VND). These products can be easily found in stores and supermarkets.
These cleansers focus on men who are not so knowledgeable about facial care.
They do not accept investing too much money in skincare products.
2.3.2 Same price range competitors of Innisfree’s male facial cleanser
Competitors of male facial cleansers at the same price range as Innisfree
include La Roche Posay, SVR, and Cerave. These are competitors in the same price
range. These facial cleanser brands have target customers who have a certain amount
of knowledge about facial care. At this price range, there are not only competitors
specializing in making face cleansers for men but also regular facial cleanser products
of other brands. Because with such a knowledge of skincare, they already know that,
not only men can use face washes for men, but also it is important that the ingredients

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of the cleanser are suitable for their facial skin. They understand that they can use
other common female cleansers as well.

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CHAPTER 3 BRAND KEY

Figure 3-1: Brand key model
3.1 Root strength:
The first “naturalist brand” in Korea, Innisfree's fundamental strength lies in
the fact that “natural beauty products”, “green cosmetics”, originated from Jeju Island
- known as the "pearl island" of Korea with fresh air, gentle sunshine, clean and
unpolluted water. These highlights are the root strength of Innisfree. The purpose of
sharing benefits from pure nature and towards true healthy beauty.
The original selection path brand in the five set of criteria did not offer: "No
recommended oils - no artificial colors - no animal ingredients - no quality parabens
- no ethanol"

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3.2 Competitive environment:
Innisfree competes with famous brands that also have products for men but at
higher prices than Innisfree such as Laneige, The Face Shop, and The Body Shop.
 The Face Shop: has more than 2300 stores in 29 countries
 The Body Shop: variety of products with more than 1200 in 2500
franchised stores in 61 countries
 Laneige: Famous brand with positioning for high-end customers
In terms of market penetration in Vietnam, where competitors position their
target customers as middle- and high-income people, Innisfree competes with these
brands and positions themselves as mid-range products.
3.3 Target customers
Table 3-1: Innisfree target customers
Geographic
Demographic
characteristics:

 Nations: Viet Nam
 Density: urban and big cities
 Age: 18 - 30
 Gender: Male








Psychographic

Income: average - good income from 5 million upward
Occupation: high school students, college students,
commuters, office workers
Race: Asian
Generation: Gen X, Millennials (Gen Y)
Nationality: Vietnamese
Social class: educated and middle class

 Personality: Diligent, multi-tasking, busy,
professional, well-groomed
 Behavioral segmentation: often exposed to
technology, doing jobs with a high degree of
internet use, they care about appearance
 Need and benefits: needs facial care and
appearance care. These customers are looking for
a product with good quality and a reliable brand.
Their facial cleanser needs are usually skincleansing, acne-fighting and skin-lightening
products.

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