The application of Internet marketing in Vietnam status & solution

VIETNAM NATIONAL UNIVERSITY,
HANOI SCHOOL OF BUSINESS

NGUYEN VUONG PHUONG AN

THE APPLICATION OF INTERNET MARKETING IN
VIETNAM
STATUS & SOLUTION
Major: Business Administration
Code: 60 34 05
MASTER OF BUSINESS ADMINISTRATION THESIS
Supervisor: Dr. NGUYEN THI PHI NGA
Hanoi – 2010
vi
CONTENTS

Page
INTRODUCTION 1
CHAPTER 1: OVERVIEW INTERNET MARKETING 4
1.1. THE CONCEPT OF INTERNET MARKETING 4
1.1.1 Marketing concept 4
1.1.2 Internet concept 10
1.1.3 Concept of Electronic marketing and Internet marketing 12
1.1.4. Some of the different characteristics between E-marketing,
Internet marketing and traditional marketing 14
1.2. ACTIVITIES OF INTERNET MARKETING 16
1.2.1. The Internet produce 16
1.2.2 The channel of Internet direct distribution 18
1.2.3 Price and control of price by Internet 19
1.2.4. Integrated Marketing Communication 20
1.2.5 Customer Relationship Management 21

1.3. THE ROLE OF MARKETING VIA INTERNET 23
1.3.1. For the customer 23
1.3.2. For the society 23
1.3.3. For business activities 25
1.4. THE INTERNET MARKETING ACTIVITIES IN OTHER
COMPANIES IN THE WORLD 28
Chapter 2. STATUS OF INTERNET MARKETING IMPLICATION IN
VIET NAM 30
2.1. CONDITIONS OF INTERNET MARKETING IMPLICATION IN
VIETNAM 30
2.1.1. Conditions of infrastructure 30
vii
2.1.2. Human resource conditions 31
2.1.3. Awareness conditions 32
2.2. INTERNET MARKETING ACTIVITIES IN VIET NAM 33
2.2.1 Situation of Internet marketing application in Vietnam 33
2.2.1.1. Website establishment 33
2.2.1.2. Online advertisement 35
2.2.1.3. E-mail marketing 38
2.2.1.4. Marketing by searching engine 40
2.2.1.5 Marketing by “virtual society” 43
2.2.1.6. PR on Internet 46
2.2.1.7. Viral marketing 47
2.2.2. Assessment of Internet marketing in Vietnam 48
2.2.2.1. Some of the results achieved through Internet marketing
activities in Viet Nam 48
2.2.2.2. Some shortcomings of Internet marketing in Vietnam 54
CHAPTER 3. SOLUTIONS TO THE EFFICIENT DEVELOPMENT
OF INTERNET MARKETING IN VIET NAM 61
3.1. DIRECTION TO THE DEVELOPMENT FOR INTERNET

MARKETING IN VIET NAM 61
3.1.1. Direction for the State 61
3.1.2. Direction to the development of Internet marketing 63
3.1.2.1. Training improvement in E – Commerce and Internet
marketing 65
3.1.2.2. Extensive use of online advertisement 66
3.1.2.3. Increase PR activities to establish trademark 67
3.1.2.4. Internet marketing engines 67
viii
3.2. SOLUTIONS TO THE EFFICIENT DEVELOPMENT OF INTERNET
MARKETING IN VIET NAM 68
3.2.1. Solutions at the governmental level 68
3.2.1.1 Developing of legal infrastructure 68
3.2.1.2. Developing infrastructure technology 69
3.2.1.3. Training and educating, popularization of E-Commerce 71
3.2.1.4 Improving a safe system of internet 73
3.2.1.5. Co-operating actively in international E - Commerce and
Internet marketing area 73
3.2.2. Solutions at the business enterprises level 75
3.2.2.1. Changing perceptions about the Internet Marketing and
Marketing 75
3.2.2.2. Internet Marketing planning 76
3.2.2.3. Internet Marketing plan budgeting 79
3.2.2.4. Internet Marketing Training 79
3.2.2.5. Internet Marketing engines application 80
CONCLUSION 88
APENDIX 89

ix
LIST OF TABLE MAP AND IMAGE

Map 1.1: Planning business strategies 25







Image 2.1: Leading search engine in the world 41

Image 2.2: Vietnamworks’ website 49

Image 2.3: Hapro’s website 54






Table 1.1: Customer care supplying channel 22

Table 1.2: The number of people using internet throughout the world 24

Table 2.1: State of development of internet in Vietnam 30

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LIST OF ABBREVIATIONS






















VNNIC
Viet Nam Internet Network Information Center
www
World wide web
AMA
American marketing association

B2B
Business to Business
B2C
Business to Customer
B2G
Business to Government
PDA
Personal Digital Assistant
PR
Public Relationship
SWOT
Strengthen, Weakness, Opportunities, Threaten
TCP/IP
Internet Protocol Suite
VCCI
Vietnam Chamber of Commerce and Industries

1
INTRODUCTION
1. The necessary of the research
According to Viet Nam Internet Network Information Center (VNNIC)
statistics, the number of Internet users in Vietnam in 2007 was 18.5 million
equivalents to 22% of the population and the number of Internet subscribers
had reached 5.2 millions subscribers; 20-25% of the 150,000 businesses in the
nation have its own website. These statistics indicate the Internet’s significant
development in Vietnam as well as enterprises’ perceptions about the
advantages of the Internet. Internet does not only criminate distant time but
also makes the traditional business activities become more effectively as well
as create more opportunities in business.
The Marketing concept has just been known in Vietnam since the late

1990s. Although many Vietnamese enterprises have not been accustomed to
the new marketing knowledge with the booming of Internet, they saw the
extremely interesting variation of this activity. Internet marketing is not only
the great advantages but also the exciting challenges to many companies
because Internet has its characteristics that are different from traditional
business. Therefore it is not suitable to apply traditional Marketing methods to
Internet.
Although 20-25% of Vietnamese enterprises have websites, most of
them are simple such as establishing website to give information
monotonously or advertising on Internet… The general marketing knowledge
and Internet marketing methods are not known widely and deeply in Vietnam.
Therefore, researching in Internet marketing systematically in Vietnam is
really important.

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2. Literature Review
Marketing activities in general and Internet marketing in particular
have been researched by many economic experts such as Philip Kotler, Judy
Strauss, Dave Chaffey, etc. In Vietnam, the issue of Marketing was taught in
the universities for about 10 years ago. Though the knowledge of Internet
marketing activities are new, many research have been conducted on it as
scientific research project. For example, the ministerial research “Solutions to
apply e-Marketing for exporter’s enterprises in Vietnam” was implemented
by Dr. Pham Thu Huong in 2007
3. The Objects and scope of the research
The research concentrates on the Internet marketing activities in small
and medium-sized businesses to shown the strength as well as the
shortcomings of these activities. Thus we can propose the solutions and
requirements to make the Marketing system more suitable for Vietnam
enterprises.

For the curent research’s scope, it only focus on the period of 5 years
recently when Internet is exploded and the E - Commerce’s appearance
creates the necessary of Internet marketing activities in small and medium-
enterprises in Vietnam.
4. Research Questions:
- How is the situation of internet marketing in Vietnamese Enterprises?
Are there any problems in that situation?
- How is the trend of internet marketing applications in companies in
the world?
- What are the solutions to enhance the effecient of internet marketing
application in Vietnam in coming years?
5. The Research methodology
This research combines differentt methods which are the following:
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Second data using: Because it’s a new matter in Vietnam so the author
applied this method to learn the theories and the realities of Internet marketing
application in the enterprises so we could have an overview of Internet
marketing development.
Data analysis: The statistic data will help us consider the Internet
marketing development to have more accurate predictions so we can
recommend more effective solutions.
6. The structure of the research
This research was constructed into 3 chapters:
Chapter 1: OVERVIEW OF INTERNET MARKETING
Chapter 2: STATUS OF INTERNET MARKETING APPLICATION IN
VIET NAM
Chapter 3: SOLUTIONS TO THE EFFICIENT DEVELEOPMENT OF
INTERNET MARKETING IN VIET NAM

4

CHAPTER 1: OVERVIEW INTERNET MARKETING

1.1. THE CONCEPT OF INTERNET MARKETING
The break-out of internet have created many great changes in every
aspect of life and have lead to many excellent things that have never been
created before. Moreover, many new concepts which are related to Internet
have appeared such as: E- Marketing, Internet Marketing, marketing online…
So what is Internet? What are Marketing and the new concepts was born from
a combination between internet and Marketing?
In this part, we will bring out the meaning of Internet concept,
marketing concept. Then we will consider them in the relationship with new
concepts like Internet marketing, E-marketing to find out the differences.
1.1.1 Marketing concept
There are many different notions of marketing. Marketing is a process
of organizing sales force to sell the company’s products. Marketing is a
process of advertising and selling. Marketing is the activity of learning about
and satisfy the market’s need. Marketing is doing market, researching market
to satisfy it. In this research, the author followed this definition: marketing is
socioeconomic structures which organization and individuals use to meet their
needs and wishes fully by a process of exchanging products on the market.
According to Philip Kotler, Marketing is a process of managing that
has social characteristics. Therefore individuals and teams have what they
need and want by the activity of creating, selling and exchanging the products
that are valuable for other people.
This Marketing concept is based on the core concepts: need, want and
demand, product, value, expense and satisfaction, exchange, transaction and
relationship, marketplace, marketing and marketers.
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Need, want and demand: Marketing began with human needs and their
real wishes. People need food, air, water, clothes and safe place to survive.

Moreover, people want to relax, to study and come in for many other services.
They also like models and trademarks of the basic service commodities.
It is necessary to distinguish the need, want and demand concepts.
Need is a status when they feel lacking of a basic satisfaction. For
example, people need food, clothes, accommodation, safety, property,
appreciation to survive. These needs are not created by society or
marketers. They have existed as a part of the body and by oneself of that
person.
Want is a longing for specific things to satisfy the deeper need. An
American need for food and wish to have hamburger, need for clothes and
wish to have Pierre Cardin, need for appreciation and wish to have a
Mercedes automobile. In another society, these needs are met fully by other
ways: The Australian aboriginal satisfy their hungry feeling by penguins;
demand for clothing as well as clothes by a loin-cloth, appreciation by a
necklace. Human needs are not so many but their wants are much more.
Human wants always develop. They are formed by the forces and social
forces such church, school, family and enterprises
Demand is a wish to have the specific products that are supported by
ability and readiness to buy them. The want becomes demand when
purchasing power supports. Many people wish to have a Mercedes
automobile but only a few of them have the ability and ready to buy it.
Therefore, companies not only determine the quantity of people who want to
buy their products but also quantify how many of them are ready and afford
the car.
These different characteristics bring out the critical ideas of the people
who accuse marketing of “creating demand” or “those who do marketing lure
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people to buy what they don’t want”. Marketers do not create demand.
Demand existed before marketing activity appearance. With other social
influences, marketers have effect on what they want. However they don’t

create the demand on social status. They have the effects on demand by
making appropriate, attractive and popular products.
Product: People satisfy their demand by commodities and services.
Product term is understood as the consist of commodities and services. We
define product as anything that can be sold to satisfy someone’s demand or
wish. The significance of buying product is not only to own them but the
operation and service that they bring to the human. We buy an automobile
because we want to see it all day. We buy it because it provides transport
service. We buy a kitchen not to watch it but to use it. The kitchen is a useful
mean to insure our meals. Services are determined by many things such as:
human beings, place, activities, organization and ideas. If we feel sad, we can
go to see hilarious films, join singles club or agree with different ideas.
Therefore, we use product term to refer to material products, service products
and other means that can satisfy a demand or a wish. Sometimes, we use
many other terms instead of product, commodities, demand or resources.
Cost value and satisfaction: In many products that can satisfy a
certain demand, how does the customer choose? Suppose a person must go 3
miles to their office. There are some products can satisfy this demand: roller-
skating, bicycle, motorbike, car, taxi and bus. The plan for this ability to
create a product selection. Suppose he wants to meet some other demands on
the way to work such as: safety, convenience, speed, economical. We call it
as demand set. Each product can satisfy each different human’s need. Bicycle
is slower, not safer but more economical. However, he must decide which
product will meet fully all his needs.
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The main concept is the value to the customer. He will evaluate the
product’s usefulness that satisfies his demand set. He can categorize products
from the most useful one to the least. Value is the customer’s evaluation of
the product’s function that can meet his needs fully.
We can ask him to imagine an ideal product that he would considers

most. He may answer that the ideal one will take him to his office fast, safe
and will cost him nothing. In this situation the reality value of each product
will depend on how it approaches to the ideal product.
Suppose he is concerned most about speed and convenience. If he can
use any products freely, we can predict that he’ll choose an automobile. But
this will lead to a matter: the car costs much more than a bicycle so he will
have to give up other things to purchase it. Therefore he will consider the
value and price of the product before buying it. He’ll choose the product that
can create the highest value on one dollar.
Nowadays, Customers behavior researchers remove the limitation of
many economic hypotheses about the customer’s evaluation and election.
Exchange, transaction and relationships: Human having needs or
wishes and labeling products have not shown all marketing’s meanings.
Marketing will appear when people decide to satisfy their demand and wish
by exchanging. Exchange is one of many ways to have products. Therefore,
marketing originated in this way.
Exchange is an action receiving a product from someone by giving him
something. Exchange is a decisive concept which creates the foundation for
marketing. Exchange will happen in these conditions:
- There are at least two participants.
- Each participant must have something that can be valuable to the other.
- Each participant has the transaction and changing abilities.
- Each participant has the right to accept or refuse the other’s proposals.
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- Each participant believes that they want to transact with the other.
If there are five these conditions, there will be exchange potentiality.
Exchanging is done or not depends on participants compromises that
have mutual advantages (or at least not harmful). Thus, exchange is
considered as the activity of creating value, which means exchange often
brings about more advantages for two sides than previous.

Transaction requires one thing: there are at least two or three values,
compromised - condition, compromised - time, and compromised - place.
Normally there is a law system supporting and forcing participants to put their
commitments into effect faithfully. Transaction leads to contradiction easily
because of the misunderstanding or deliberation. If there were no law of
contract, participants would not believe in each other, hence, they would all
have disadvantages.
Enterprises monitor their transaction and classify them as line of
business, price, location and other events. Sales analysis is the analyzing sales
origination according to products, customers and areas of sales.
According to the most popular understanding, marketers are looking for
the way to create the other side’s reaction. An enterprise wants it to be
purchased. A politic candidate wants it to be voted for him. Churches want it
to be embraced the faith. Social activity groups want it to be the approval of
their ideas. Marketing includes the activities conducted to create the desired
response to an object from the public and their goals.
To ensure that the exchange goes smoothly, marketers must analyze
what each participant will give and receive. Simple transaction situations can
be displayed by a file that include two participants, their wishes and their
invitation to circulate mutually.
Now we can realize the nature of the transaction Marketing. Marketing
transaction is part of a larger idea than relationship marketing, those who do
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marketing wisely are trying to build long term relationships, reliability,
mutual benefit with large customers, the distributor, dealer and suppliers. This
work is done by promising and ensuring high quality, good service and
competitive price for the other. Moreover, this is done better by setting up
relationships that tie together in socioeconomic and technical fields with
partners. Marketing relationship will reduce costs and time of transaction and
the best case the transaction will be moved from negotiated into the work

routine
The final result of relationship marketing is to form a unique asset of
the company, known as network marketing. It includes company, suppliers
and customers that the company has set up believable relationship with.
Marketing is tending to change from trying maximum profits in each service
into increasing maximum mutual advantageous relationships. The rule is
setting up good relationships. Then the transaction will have advantages.
Market: Market involves all present and potential customers who have the
same need or specific wish. They are ready and able to take part in
exchanging to satisfy their demand.
So the market size depends on some people who have demand and care
resources. They are ready to exchange their resources for what they want.
Business people use the term market to refer to different customer
groups. They talk about market demand (such as daily food market), market
products (footwear market), market demographics (such as the youth market)
and geographical markets (eg. market Vietnam). They also widen this concept
to mention that the groups which are not customers such as voter market,
labor market, donation market.
Marketing is the human activities to be done in relationship with
market. Marketing include the research activities to make potential demand
into reality in order to satisfy human needs and wants.
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If one side finds exchange ways more actively than the other, we will
call the first party as marketer and the second one, a potential customer.
Marketer is the person who looks for resources from others and is ready to
give something in exchange. Marketer finds the others reaction to buy or sell
something. Otherwise, marketer is buyer or seller. Suppose, there are some
people want to buy an attractive house that has recently been completed. So
these buyers are marketers. In this case the two sides also find the way to
exchange actively; we call them as marketeers, which are called mutual

marketing.
In the normal situation, marketer is a market service company, the final
user faces to competitors. The company and its competitors send the similar
products and messages to the final user directly to or marketing intermass
mediary statutes (middle-men and trade promoters). Their relative
effectiveness is influenced by the suppliers as well as the corresponding
forces of the environment (demographic, economic, facility, technical,
political legal and social / cultural).
After researching carefully these above concepts, they repeat the
marketing concepts like this: Marketing is socioeconomic structures that are
used by organizations and individuals to satisfy their needs and demands by a
process of exchanging products on the market.
1.1.2. Internet concept
Precursor of Internet is ARPANET. The Agency project management
research and development under (America) Department of Defense ARPA
link four first places in May 7/1968 include: Stanford research institute,
California University, Los Angeles, Utah general university and California
University, Santa Barbara. They are the first wide area network (WAN).
Internet term appeared firstly in the early 1974. At that time the net was
called ARPANET. In 1983, TCP/IP protocol was considered formerly as
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American military standard. All the computer connecting with ARPANET
must used this new standard.
Milestones of the Internet were established in the mid-1980s when the
organization U.S. NSF National Science Foundation established networks to
link this large computer centers together called NSFNET. Many enterprises
changed from ARPANET into NSFNET. After about 20 years, ARPANET
became less effective and was stopped in the 1990.
The forming of the spine net of NSFNET and the other areas’ net
created a beneficial environment for the Internet development. In 1995, NSF

became a research net but Internet still developed. With the open connection,
Internet has become the biggest net in the world. It appears in every trade as
well as politic, military, educational, cultural, socioeconomic… and other
areas. Since then, Internet services haven’t stopped growing and created a
new period: Internet Electronic Trade epoch.
So what is Internet? According to Wikipedia - the world's largest
encyclopedia open book, Internet is a global information system that can be
accessed publicly involving computers’ connected nets together. This system
transmits information by packet switching based on a network protocol that
was standardized. (IP protocol)
Because of the involvement of thousands of enterprises’ computers as
well as institutes, university, individuals and global governments, Internet
supplies huge information and services. In addition, Internet provides many
beneficial services for the users. Several of these are Electronic mail (e-mail),
chat, search engine, trade and transaction services, educational and medical
services, as well as online learning and teleprocessing.
Huge information sources are attached to correlative services that are
webs system and other document in WWW (World Wide Web).

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1.1.3. Concept of Electronic marketing and Internet marketing
Coinciding with Internet applications break out and many other mass
media in every aspect of life, people starts to research its applications for
marketing. Internet and mass media can be used to support these marketing
purposes:
Identifying- Internet and mass media can be used to identify customers
demands
Anticipating- Internet supplies an information channel so that
customers will know more detail about products and can make buying-
decision easily.

Satisfying: The success key to Internet Marketing is satisfying
customers by websites convenience and their appearance as well as contents.
Together with Internet and mass media in marketing, Electronic
Marketing (e- marketing) and Internet marketing have been created. We will
consider some typical concepts of E-marketing and Internet marketing.
E - Marketing concept:
According to Philip Kotler, E- marketing is the activity of making plans
for products, price, distribution, promotion, services, ideas to satisfy demands
of organization and individuals by electronic means and internet.
Or: “E-Marketing involves all activities that satisfy customers’ demand
and wishes by Internet and Electronic media (According to Joel Reedy,
Shauna Shullo, Kenneth Zimmerman).
Or a more specific definition of e-Marketing by Dave Chaffey, who is
the author of ‘E - marketing excellent’, ‘ Total Email Marketing’, ‘ Internet
Marketing’: E- Marketing is the application of internet and electronic means
(web, email, file, multimedia, PDA…) to the marketing activities to get the
aims of the organization and continue to have relationships with customers.
They are conducted by getting to know more about the customers
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(information, behavior, value, loyalty…), promoting to the purposes and
service on Internet to satisfy customers’ demand.
All of the above E-marketing concepts can show the most basic point
of E-marketing:
Environment: Marketing in new environment which is Internet and
electronic information media.
Media: Internet and the other electronic media such as: mobile phone,
digital signal device, cable and satellite.
Internet marketing concept:
When we consider the E-marketing concepts, we realize that Internet
plays a very important part in E- marketing. So what is Internet Marketing?

Let us consider this following concept that belongs to Ghosh Shilkhar and
Toby Bloomburg who are in American Marketing Association (AMA):
Internet marketing is an area which carries out business activities that connect
closely to products transportation current from the manufactures to consumers
based on Internet information technology application
According to Ghosh Shikhar and Toby Bloomburg’s concept of the
Internet marketing we realized the Internet marketing’s environment and
media are more limited than E-marketing. Internet marketing only involves
Marketing activities that are conducted on Internet. However, great
development of information technology has made the digital media such as
mobile phone connect to Internet. Therefore the line between E-marketing
and Internet marketing is so light that they can become one.
Beside, we come to the definition of E – Commerce. E – Commerce are
all activities of buying or selling of goods & services through electronic
means.
E-commerce can be divided into:
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• E-tailing or "virtual storefronts" on Web sites with online catalogs,
sometimes gathered into a "virtual mall"
• The gathering and use of demographic data through Web contacts
• Electronic Data Interchange (EDI), the business-to-business exchange
of data
• E-mail and fax and their use as media for reaching prospects and
established customers (for example, with newsletters)
• Business-to-business buying and selling
• The security of business transactions

Naturally, E-marketing and Internet marketing are not different from
traditional marketing. They are the activity of exchanging information,
determining demand and making 4Ps plans for products, creating, conducting

and examining to get the aims of organizations and individuals.
1.1.4. Some of the different characteristics between E-marketing, Internet
marketing and traditional marketing
Due to the large difference in method of conducting the Electronic
Marketing and Internet Marketing we can easily see the comparison with the
traditional marketing of speed, operation time, scope of activities, products.
Speed: Service produce information that comes to the market more
quickly so the customers can access them easily.
Transaction was conducted quickly and with some special commodities
such as digital goods, delivery and payment is made almost immediately.
Transaction speed is higher so feedback from customer is more quickly.
Activity time is continuous and uninterrupted: Conducting
marketing on Internet can get rid of some disadvantages about labor.
However, the normal marketing programs that have not used the internet
cannot develop to a high frequency 24/24. However it is great for the Internet
Marketing activities. Internet marketing can operate continuously, anytime,
anywhere, 24 hours a day, 7 days a week. There is no limited-time. Products
or services orders can be satisfied everywhere, at any time. Therefore, Internet
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marketing is much more beneficial than traditional marketing because it can
make good use of time and take advantage of business opportunities.
Space: Global scale is not dependent on space: Internet marketing can
penetrate everywhere. Through Internet, Vietnamese enterprises can advertise
their products to American, Japanese, Australian customers, EU, …at highest
speed and the least amount of time.
Internet marketing overcomes all of the geographic challenges. It
allows enterprises to take advantages of global markets. These Internet
marketing’s characteristics include some challenges to enterprises. When the
distance between the geographical market area has become increasingly faint,
the evaluation of environmental factors and competition becomes more

complicated and difficult. Competitive environment is severed in every nation
and will become more severed in the international scale. Therefore enterprises
must have the lucid decisions and Marketing plans.
Product variation: Introducing products and services in virtual stores
is nearly perfect. Customers can do shopping at home with their computer
connected with internet as doing in real stores. Computer virtual stores, art
virtual galleries, online stores… are becoming more interesting and lively. We
can list many websites of the successful virtual stores. Some of them are
www.amazon.com(a bookstore that sells every book for every customer in the
world). It is now trying to become the biggest on – the - web retailer. Another
is www. Dell.com which supplies technology solutions satisfying customers
demands.
Decreasing the cultural, law, economic difference: Because of the
Electronic trade and electronic signature and the electronic transaction law,
there are less differences in business law in electronic environment.
Moreover, Internet environment is global; the customer’s cultural differences
are reduced.
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Removing the difficulties in intermediary transactions and in traditional
marketing, commodities come from many intermediary distributors to the
consumers. The difficulties in this way are enterprises which have no direct
relationships with the consumers, so the feedback is not exact and full.
Therefore, enterprises’ reactions to market’s changing are not timely. In
addition, they must share profits with intermediary…. However, Internet
marketing and E-marketing can remove this shortcomings. Enterprise and
customer can transact directly, quickly and easily through websites, email and
forum.

1.2. ACTIVITIES OF INTERNET MARKETING
1.2.1. The Internet produce

Online product policy is not very different from traditional marketing
about the contents and concepts. Development of the online products is to
provide values for services and commodities produce on internet basement.
Thus, the most important content is creating satisfactory value for online
customers. The analyzing process about Internet marketing application shows
that customers will be satisfied of the benefits that are provided by companies
on Internet such as: online purchasing that can supply visible commodities but
it doesn’t need sales places. Another is searching engine like Google or
Yahoo! However, similar to traditional marketing, when we research
products as one of marketing-mix system, we need consider these things:
About product’s characteristics: it’s one of the most important contents
because the characteristics will decide the core value of the product as well as
supplement service on market. It’s not the same as visible produce. Online
produces care for invisible benefits that consumers care like: information
instance, information security and convenience. They are the core values that
each online products or services targets. For example, Yahoo! searching
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engine supplies users website list that relates to cared contents. So the
appearance of websites satisfied invisible customers value such as the fast and
exact of information which are economical. The selection of the core value in
the process of deciding online product is the basement for designing and
creating product contents, services of the aimed customers.
About trademark: in the decision of the online produce trademark there
are fully identifying parts as traditional marketing such as: logo, name, icon,
etc…However, the most important thing in the decision of the online produce
trademark is using identical name on Internet with the visible product system
or independent domain. Domain is understood as the website’s address. It’s
the only characteristic to distinguish in the process of searching and differing
trademark from others. Usually, domain has 4 parts:
• http:// format data search

• www showing the exploitation sources
• Domain name: showing company’s name on Internet such as Yahoo! or
Dantri.
• Com, com.vn, org, gov are structure part of the domain that show the
domain’s origination or its type. For example: ‘com.vn’ means Vietnamese
web. ‘Com.uk’ is a web originating in UK. ‘Gov’ shows governmental web.
‘org’ shows nongovernmental.
Making a domain name must follow some certain rules that are similar
to trademark to make it memorable and convenient for searching. A full
domain includes: . It means the Dell company’s
website in Vietnam. Dell is a multinational company so it has different
websites such as in Singapore.
About support services: the process of supporting customers is
conducted together with process of supplying services and promoting after
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sales. The development of support services creates more value for customers
when they search online products. For example: support service system for
customers of the www.amazon.com are very interested and cares in the
information of their customers. Most information about customers, the
number of Web surfing and content information generally find their servers
are maintained and continue to update for customers on the next search. The
development support service for customer is considered as one of the
important basement for the process of developing strategies that are different
from the others companies supplying products online same areas.
1.2.2 The channel of Internet direct distribution
The development of online distribution is affected much by information
technology. Members of online distributors are divided in visible distributor’s
channel: manufactures intermediaries and buyers. However, the length, the
activities and the role of each member of the channel are different. Commonly
there are four channel models in online business:

Firstly, Content Sponsorship: Applied to the enterprises that trade in
information services and advertisement such as Google, Yahoo!, MSN…
Electronic newspaper is the same. These channels are short and direct to the
customers
Secondly, Direct Selling: Applied to online market for the customers
organizing B2B (business to business) and arising on individual online market
B2C (business to customer). Customers order, pay and transact online through
a website or port transaction. These channels are applied to the enterprises
that trade in software, digital music or other visible services which don’t
require deliver and inventory level… They short channel model concluding
two members in the channel.
Thirdly, Infomediary: is popular in researching online market and
information sponsorship area. Through intermediate information, customers
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are organized. Enterprises want to get know more about objective group will
order intermediary to searching information with some criteria. The results of
process of exchanging information are information from online researching.
To the big-sized businesses with independent information unit they can carry
out models with interior resources to get the information exactly and fully in a
specific research. It’s evaluated as one of the most important Internet
marketing’s contribution to development of marketing system.
Fourthly, Intermediaries: It is shown as commodity transaction port,
auction service (E-bay) or manufacturer’s representative…. It is often applied
to tourism, hotel, and flight ticket sales. In addition Online Retailing is
growing quickly with two types of goods which are visible commodities and
digital services. Usually company’s website uses this model to change
consuming habits and develop a new distribution system. However, this
model in Vietnam is facing up with many difficulties such as: law systems are
not completed; technical infrastructure doesn’t ensure digital transactions
(online payment, digital signature, large amount of data download.)

Selection of online distribution depends greatly on enterprises
characteristics, commodity and service characteristics as well as enterprise’s
market orientation. Therefore, making decision on online distribution should
be considered when enterprise decides on its products that have the best
distribution.
1.2.3 Price and control of price by Internet
Price in traditional marketing is the only system that makes profits in
cash and is often determined by manufacturers. However price in E-marketing
and Internet marketing is price transparency. It means both of buyers and
sellers can refer to other competitive prices that are advertised online to make
a suitable compromise. According to this viewpoint decision on strategies of
online price is developed in this way: