Improving the marketing strategy of duc giang detergent and chemical joint stock company in the period of 2018 – 2023

ĐẠI HỌC QUỐC GIA HÀ NỘI
KHOA QUẢN TRỊ VÀ KINH DOANH
---------------------

TRẦN XUÂN LINH

IMPROVING THE MARKETING STRATEGY OF DUC GIANG
DETERGENT AND CHEMICALS COMPANY IN THE PERIOD
OF 2018 – 2023
HOÀN THIỆN CHIẾN LƯỢC MARKETING CHO CÔNG TY CỔ
PHẦN BỘT GIẶT VÀ HÓA CHẤT ĐỨC GIANG GIAI ĐOẠN
2018 – 2023

LUẬN VĂN THẠC SĨ QUẢN TRỊ KINH DOANH

HÀ NỘI - 2019


ĐẠI HỌC QUỐC GIA HÀ NỘI
KHOA QUẢN TRỊ VÀ KINH DOANH
---------------------

TRẦN XUÂN LINH

IMPROVING THE MARKETING STRATEGY OF DUC GIANG
DETERGENT AND CHEMICALS COMPANY IN THE PERIOD
OF 2018 – 2023
HOÀN THIỆN CHIẾN LƯỢC MARKETING CHO CÔNG TY CỔ
PHẦN BỘT GIẶT VÀ HÓA CHẤT ĐỨC GIANG GIAI ĐOẠN
2018 – 2023
Chuyên ngành: Quản trị kinh doanh

Mã số: 60 34 01 02
LUẬN VĂN THẠC SĨ QUẢN TRỊ KINH DOANH

NGƯỜI HƯỚNG DẪN KHOA HỌC : TS. PHẠM VĂN HỒNG

HÀ NỘI - 2019


DECLARATION
The author confirms that the research outcome in the thesis is the result of
author’s independent work during study and research period and it is not yet published in
other’s research and article.
The other’s research result and documentation (extraction, table, figure, formula,
and other document) used in the thesis are cited properly and the permission (if required) is
given.
The author is responsible in front of the Thesis Assessment Committee, Hanoi
School of Business and Management, and the laws for above-mentioned declaration.
Date…………………………..

I


ACKNOWLEDGEMENTS
I would like to express my deep gratitude to the teachers at the Faculty of Business
Administration, Hanoi National University for imparting valuable knowledge for nearly
two years. This knowledge does not only help me complete the thesis but also be very
useful for my work in the future.
I would like to send sincerely thank the teacher, Dr. Pham Van Hong, who
enthusiastically instructed me during the completion of this thesis.
I also would like to thank all colleagues, friends ... for supporting and providing

useful information so that i can complete my thesis.
During the course of thesis, mistakes are unavoidable due to limited knowledge,
lack of experience and time. Therefore, I would like to receive comments from teachers to
make this essay more complete and practical.
Sincerely,
Ha Noi, October 25, 2018
Tran Xuan Linh

II


CONTENTS
INTRODUCTION ................................................................................................................. 1
1. Rationale ........................................................................................................................ 1
2. Literature review ............................................................................................................ 1
3. Aims of research ............................................................................................................ 4
4. Objects of research ......................................................................................................... 4
5. Scope of research ........................................................................................................... 4
6. Research methodology ................................................................................................... 5
7. Thesis structure .............................................................................................................. 5
CHAPTER 1: THEORY ON MARKETING STRATEGY .................................................. 6
1.1 OVERVIEW OF STRATEGY .................................................................................... 6
1.1.1 Concept of strategy................................................................................................ 6
1.1.2 General competition strategy ................................................................................ 6
1.1.3 Competitive advantage .......................................................................................... 7
1.1.4 Building Competitive Advantage Through Strategies .......................................... 7
1.2 OVERVIEW OF MARKETING STRATEGY ........................................................... 8
1.2.1 Concept, Nature, Role, Objective of Marketing Strategy ..................................... 8
1.2.2 Factors affecting marketing activities of enterprises and Analysys of Marketing
environment .................................................................................................................. 10

1.2.3 Target market and product positioning ............................................................... 18
1.3 MARKETING STRATEGIES .................................................................................. 22
1.3.1 Product strategy ................................................................................................... 23
1.3.2 Price strategy ....................................................................................................... 26
1.3.3 Place strategy....................................................................................................... 27
1.3.4 Promotion strategy .............................................................................................. 31
CHAPTER 2: CURRENT STATUS OF MARKETING STRATEGY OF THE
COMPANY ......................................................................................................................... 36
2.1 OVERVIEW AND MAIN BUSINESS RESULTS OF DUC GIANG COMPANY 36
2.1.1 Overview ............................................................................................................. 36
2.1.2 Main business results .......................................................................................... 39
2.2 ANALYZE CURRENT MARKETING ENVIRONMENT OF THE COMPANY .. 42
2.2.1 Macro environment ............................................................................................. 42
2.2.2 Industry environment. ......................................................................................... 45
III


2.2.3 Micro environment .............................................................................................. 48
2.2.4 Target market and Product positioning ............................................................... 52
2.3 ANALASIS OF STRENGTH, WEAKNESS, OPPORTUNITIES, THREATS ....... 54
2.3.1 Strengths, Weakness, Opportunities, Threats...................................................... 54
2.3.2 Building strategy from SWOT matrix ................................................................. 56
2.4 CURRENT MARKETING STRATEGY OF COMPANY ....................................... 60
2.4.1 Assessment about current marketing strategy of company ................................. 60
2.4.2 Product strategy ................................................................................................... 59
2.4.3 Price strategy ....................................................................................................... 62
2.4.4 Place strategy....................................................................................................... 63
2.4.5 Promotion strategy .............................................................................................. 63
CHAPTER 3: SOLUTIONS TO IMPROVE THE MARKETING STRATEGY OF DUC
GIANG DETERGENT AND CHEMICAL JSC ................................................................. 65

3.1 DEVELOPMENT ORIENTATION AND GOALS OF THE COMPANY FROM
2018 TO 2023 .................................................................................................................. 65
3.2 SOLUTIONS TO IMPROVE MARKETING STRATEGY OF THE COMPANY . 65
3.2.1 Solutions about Product ...................................................................................... 65
3.2.2 Solutions about Price ........................................................................................... 67
3.2.3 Solutions about Place .......................................................................................... 68
3.2.4 Solutions about Promotion .................................................................................. 69
CONCLUSION ................................................................................................................... 71
LIMITATION AND IMPLICATION

…………………………………………………..71

REFERENCE .................................................................................................................... 722
APPENDIX ....................................................................................................................... 724

IV


LIST OF TABLE
Table 1: Products with output......................................................................................... 36
Table 2: Situation of Business Activities ....................................................................... 37
Table 3 : Product volume ............................................................................................... 38
Table 4: Overall finance status ....................................................................................... 39
Table 5: Inflation rate ..................................................................................................... 41
Table 6: Balance of trade ................................................................................................ 43
Table 7: GDP growth rate ............................................................................................... 43
Table 8: Urban and rural population .............................................................................. 46
Table 9: Finance performance ........................................................................................ 48
LIST OF FIGURE
Figure 1: Strategic model of Marketing Mix .................................................................. 22

Figure 2: Direct distribution channel scheme ................................................................. 29
Figure 3: Indirect distribution channel scheme .............................................................. 29
Figure 4: Company Organizational Chart ...................................................................... 36
Figure 5: Technological Model ...................................................................................... 51
Figure 6: Three level distribution channel ...................................................................... 61
Figure 7: Vertical marketing system model ................................................................... 68
LIST OF ABBREVIATION
CPI:

Consumer Price Index

DGC: Duc Giang Detergent and Chemical Joint Stock Company
FTA: Free Trade Agreements
GDP: Gross Domestic Product
GSO: General Statistic Office
QC:

Quality control

WTO: World Trade Organization

V


INTRODUCTION
1. Rationale
Building a marketing strategy is a very important task of every business to achieve
the most effective three goals of profit, position and safety.
In a fiercely competitive market economy, an enterprise wants to survive and
develop, it must mobilize all resources, must know how to manage all factors to achieve

the set objectives. Through the marketing strategy, enterprises can promote their internal
strengths to aim to attractive opportunities in the market and thus help businesses improve
business efficiency; enhance competitiveness in the process of opening up and liberalizing
the economy. The role of marketing is not new anymore, but how to do it effectively is the
concern of the management.
Moreover, with the development of information technology and the industrial 4.0
revolution, consumers will have easy access to information on all products, prices, quality
of services ... will affect very much to business efficiency. Therefore, effective marketing
strategy becomes more urgent.
Duc Giang Detergent and Chemical Joint Stock Company was established in 1963.
In more than 50 years of development and growth, the company has developed strategies
to adapt and promote its strengths. Marketing activities are noticed and implemented and
bring about high economic efficiency, contributing to increase business scale, promote
consumption, increase sales and profit. However, the implementation of marketing
activities are lack of synchronism, not scientific, often subjective, which is one of the
reasons for reducing the business efficiency and competitiveness of the company. .
In the face of that situation and after spending time for learning, researching the
status of the company's marketing strategy and learning knowledge, I would like to
contribute a small part to the overall interest of the company through the Master's thesis.
"Develop Marketing Strategy for Duc Giang Detergent and Chemicals JSC in 2018-2023".
2. Literature review
Master Thesis: Completing marketing strategy for Vinamilk dairy products Author: Team 4-QC - 2008:
Target of this thesis is to increase sales and expand the market for dairy products.
Since the company has no clear, specific marketing strategy. Therefore, there should be a
reliable marketing orientation.
The thesis uses methodology of Collecting and analyzing existing documents
1


Result: The author provides the basis of marketing theory and marketing strategy in

the enterprise. Based on this theoretical basis, the author presents the current business
situation and analysis of the company's current marketing strategy. The author also
analyzes strengths, weaknesses, opportunities and Threads in the SWOT model. From
there, the author proposes a solution to improve the marketing strategy for the company.
In the solution to improve the marketing strategy for the company, the author
focuses on improving the quality and improvement of products such as design and
packaging: the company should pay attention to the quality as well as packaging design to
look good, suitable for all subjects, color courteous, sharp images
Focus on diversifying products and quality products to meet the increasing demand
of consumers. Investing in new products has the characteristics that products are not
available in the market.
Prices must be consistent, so that businesses and consumers can cooperate for a
long time.
The author also made some suggestions to develop the policy of promotion such as
advertising, discount…
Master Thesis: Improving marketing strategy at Vu Que Rubber Company - Author
Nguyen Thi Luu - 2008.
Target of this master thesis: As a company manufacturing tires and tubes,
marketing strategy is very meaningful to the company. If marketing plan is created that
focus on the business objectives, stick to the market, coordinate with other functional
strategies and perform marketing activities in line with that strategy, then surely the
company will expand and occupy the market; generate great revenue and profits.
Method: Collect, analyze existing documents.
Result: The author provides a theoretical basis for the marketing strategy of the
business to create a premise to evaluate and analyze the current status of marketing
activities of the company. The author has made a number of solutions to recomend the
current marketing strategy. Details as below:
Firstly, solutions to improve the content of the marketing strategy (completing the
objectives, completing the planning process, improving the target market).
Secondly, solutions for Marketing - Mix: product solutions; price solution; Place

solution; Promotion Solutions.
Thirdly, Solutions to complete marketing strategy: organizational apparatus;
Leader; Budget;
2


Master thesis: Solutions to improve marketing strategy for Sony Bravia LCD TVs
by 2010 - Author Tran Mai An - 2007:
Target of the thesis: Being aware of LCD TVs will be the hottest product in the
world of imaging equipment and a new trend of the Vietnamese television market, Sony
Vietnam has launched a new line of Bravia LCD TV with deciding that this will be the
company's strategic product line, replacing the bulb TV line. However, because Bravia
LCD TV is only at the beginning of its life cycle, the LCD market in Vietnam is only in its
infancy, so it is necessary to take a look at the overall marketing environment for Bravia
LCD TV product of the company. From there, find out solutions to complete marketing
strategy, helping to improve he business efficiency of this strategic product line.
The author used two method for implementing the thesis. That is: collecting,
analyzing existing documents and Interview 300 people in person based on the
questionnaire
Results: The author provides a theoretical basis for marketing strategies. Present the
current marketing situation of the company. From that analysis to propose some solutions
to improve marketing strategy for Bravia LCD TVs by Sony Vietnam until 2010.
Specifics: solutions for market: demand forecast; Research on customers and Solutions for
marketing mix strategies: Products; Price; Place, Promotion.
Master thesis: Completing marketing mix of packaging products at Starprint
Vietnam Co., Ltd - Author Vo Thi Hien - 2012
Target of the thesis: The increase of competitors in the industry, to compete market
share for more and more aggressive and diversified demand about taste customers.
However, if want to develop the right marketing and long-term development, there must be
a comprehensive marketing strategy to be a guideline for all activities.

Recognizing the importance of using Marketing Mix, the author has researched to
improve the marketing mix of packaging products in his company hoping to help the
company improve business performance.
Methods: Collection, comparison, analysis of existing documents.
Result: The author provides a theoretical basis for Marketing Mix; Point out the
realities of Marketing Mix at Starprint Vietnam. From that, analyzed and proposed some
solutions to improve marketing Mix in the company. Details of solutions as below:
Firstly, finalizing the product strategy: Forecasting, checking and correcting quality
problems; improve production processes; promoting internal strength to increase
competitiveness...
3


Secondly, complete price strategy: find good materials, reasonable price,
Thirdly,

completing

the

distribution

strategy:

expanding

branches

and

representative offices; warehouse building
The last, improving the Promotion Strategy: Improving the Department of Business
and Marketing, increasing operating budget.
Master thesis: Building Marketing Strategy for Pepsi product of PepsiCo Viet Nam
- Author: Group 4-QC3 - 2010:
Objective of the thesis: The level of competition is increasing in order to expand
the market share, to dominate the market, to sell products which are a strategic issue, a
problem of survival, development or demolition that enterprises are searching. Therefore,
the author develops marketing strategy for Pepsi product of PepsiCo Vietnam in order to
improve the efficiency of its business.
Method: Collect, analyze existing documents
Results: The author provides a theoretical basis for marketing strategies; Point out
the actual marketing strategy of Pepsi products in 2010. From that, develop marketing
strategy for products in 2011.
Conclusion: The above works have studied many areas and come up with various
solutions based on the materials as well as methods used for research. However, there is no
research on marketing strategy for Duc Giang Detergent and Chemicals Company.
3. Aims of research
Based on evaluation of the status and analysis of the marketing strategy of the
detergent division at Duc Giang Detergent and Chemicals Joint Stock Company, from this
point of view, I propose new marketing strategies, implementation solutions and control
marketing strategy for Duc Giang detergent in the period 2018-2023.
4. Objects of research
Master thesis studies all marketing activities of the company such as product
marketing, price marketing, distribution channel marketing and media marketing; from
that, apply to build a marketing strategy for Detegent industry of Duc Giang Detergent and
Chemicals JSC.
5. Scope of research
Duc Giang Detergent and Chemicals Company has many products such as cleaning
products (detergent, fabric softener, dishwashing liquid), pure chemicals (Nitric acid,

sulfuric acid, phosphoric acid ...), Industrial chemicals ... But in the thesis just study the
current business situation and marketing strategy in period of 2013-2017 as well as
4


building the marketing strategy for the period of 2018-2023 and vision to 2025 for Duc
Giang detergent.
6. Research methodology
 Collect, analyze existing documents: These documents include data on
production activities, business ... of the company. Articles, magazines related to
the macro situation, industry information...
 Interview with experts, some staffs, employees.
7. Thesis structure

5


CHAPTER 1: THEORY ON MARKETING STRATEGY
1.1 OVERVIEW OF STRATEGY
1.1.1 Concept of strategy
Strategies are fighting tactics and defeating opponents in a battle
A strategy is a comprehensive program of action that addresses the underlying
goals of a given organization.
According to Alfred Chardler: "The strategy involves defining basic, long-term
goals, and choosing the right course of action for achieving the goal."
According to William.J.Glueck: "The strategy is a unified, comprehensive plan
designed to ensure that the basic goals of the business are realized.
1.1.2 General competition strategy
According to Doctor Tran Minh Dao (2006), there are two strategies: Lowest cost
and Product differentiantion. Specific as below:

Lowest cost strategy:
Enterprises want to create and maintain the lowest cost in the industry or market to
create competitive advantage of the business is about price. With the lowest cost strategy,
businesses use price as the main competitive factor. Businesses will set prices low to be
competitive. Prices will tend to decrease by market size, businesses gain benefits by
increasing scale. However, it is not possible to decrease linearly because customers will
tend to wait for a discount and thus reduce their purchasing power.
In this strategy, technology is used as a price support factor, not used as a
competitive advantage.
Product differentiation strategy:
Implementing this strategy is to make the company's products / services different
and more attractive than competitors' products and services (in terms of form, features,
durability, quality, service, brand image…). Dedicated products / services must create a
clear impression and keep the competitive edge, limit price competition, and compete only
on the level. Use specialized technology as competitive advantage. In addition, the
company needs to have a research and development process, the ability to provide high
quality products, effective marketing and sales to ensure that customers can feel the
difference and the benefits it brings.
The strategy focuses on one segment of the market

6


This strategy focuses on a group of buyers, a segment of the industry or a
geographic market. Focusing on the market or product goes in two different directions: one
is product - the customer centralization: the product must look at the customer to design
accordingly. Second is customer – product focus: customers must follow the product with a
look at "a monument." When go in this direction, company can not franchise because it
will reduce the value of the product. Businesses have to accept the narrow market.
1.1.3 Competitive advantage

Competitive advantage is the strength of this business compared to other
businesses, thereby enhancing the competitiveness of enterprises. Customers choose to buy
something that always compares the cost and benefits. A business has a competitive
advantage when its profitability is greater than that of the industry average.
When looking for competitive advantage, businesses must compare with their
competitors to see where they are strong. Competitive advantage must come from the
ability of the business that the competitors do not have, so difficult to imitate. In the case
where an enterprise does not have the capability to excel in comparison with its
competitors, it must select the key factors which different from these of competition.
Some types of competitive advantage such as:
Product quality of the business outperforms competitors;
Product price is lower than that of competitors; the product is different;
Service of business better than that of rival;
Management ability creates products that are cheaper, better and more stable;
Better business brand.
1.1.4 Building Competitive Advantage Through Strategies
Competitive strategies must be based on sources of competitive advantage to
succeed. Each company can create a competitive advantage if it takes reasonable steps to
gain top position in attracting customers compared to competitors. The steps or protocols
that each company implements may vary, for example, to produce the highest quality
product, providing the best customer service, producing at the lowest cost, concentrating
resources and market segments, or gaps in the market. No matter what company chooses to
create competitive advantage, it is essential to let customers feel superior value than what
the competitors offer.
Businesses will strive consistently to build competitive advantage through an
infinite array of strategies. Competitive strategies are designed to exploit the value chain
and the forces that create competitive advantage. As such, each company will try to build
7

its own specific strategies in line with the strengths and weaknesses analysis, the value it
can provide, the external environment and customer needs. . Enterprises can choose the
basic approach to create competitive advantage such as: lowest cost strategy; Product
differentiation strategies or strategies focus on one segment of the market. Each strategy in
these strategies is a consistent result of the company's choice of product, market and
differentiation possibilities. These choices also affect each other.
1.2 OVERVIEW OF MARKETING STRATEGY
1.2.1 Concept, Nature, Role, Objective of Marketing Strategy
1.2.1.1 Concept
According to Philip Kotler and Kevin Lane Keller (2012):
Marketing strategies are the way businesses do to achieve their marketing
objectives and often involve 4P (includes product, price, place, promotion). Details as
below:
Product: General policies on product branding, positioning, cancellation, repair,
addition, design, packaging...
Place: General channel policy and customer service.
Price: The general pricing policy should be followed for each product group for
each market segment.
Promotion (or Communication): General policy on communication, customer
contact activities such as: advertising, team, sales, promotion, community relations, fairs,
customer service center, internet...
1.2.1.2 Nature
Based on customer
Without customers, Enterprises will not have the object to serve, so it does not
work. "The customer is the basis of every strategy to implement the strategy of the
business."
For marketing strategies truly based on customers, marketers need to segment the market
in two ways:
Option 1: Segmentation by purpose is based on customer's purpose of using
services and products.

Option 2: Segmentation according to the ability to meet customers comes from the
ability of enterprises to limit resources compared to the market requirements.
Customers are the basis of every strategy, so that marketing strategy is really based on
customers. When developing marketing strategies, businesses must segment the market.
8


Based on the business
Any business has its strengths or weaknesses compared to other businesses,
businesses need to fully exploit their strengths and look straight at the limitations.
Maximize the advantages of your business to make a difference.
Based on competitors
Compare the capabilities of business with competitors to find the advantage, then
find out the specific strategies for the elements of marketing mix.
1.2.1.3 Role
Between producers and consumers there is a big gap that is the market. To reduce
that gap, Enterprises need to access the market.
Enterprises need to master five factors:
First factor: Sales can be reduced because of competition, inefficient distribution...
Second factor: Once the peak is reached in the region, industry, the growth rate of
the business will slowdown and the diversification of the product will be needed.
Third factor: The fast-moving market requires enterprises to have a lot of strength
in market research, which is to quickly understand the changes in the purchasing decision
process and especially the decision of the enterprise regarding the new activities for more
effective.
Fourth factor: Under the pressure of competition from other companies, the
marketing structure must be more complete.
Fifth fator: Due to the influence of inflation, the cost of advertising, sales
promotion and after-sales services are increasing... In these cases, marketing is checked
and adjusted so that the use of such costs is more efficient and effective.

Marketing decides and coordinates the connection between the business activities
of the enterprises and the market. Ensure the business operation of enterprise will go in the
direction of the market, know the market, take needs and expectations of customers as the
firm foundation for all business decisions. The marketing strategy outlines the major
aspects of an enterprise's marketing activities. Marketing is the foundation for the
development of functional strategies: production strategy, finance...
1.2.1.4 Objective
The objectives of the marketing strategy are to show the basic indicators:
consumption output, turnover, market share ... which marketing strategy needs to be
achieved and determined based on:
Firstly, business objectives of the business.
9


Secondly, results from environmental analysis.
Thirdly, marketing capabilities and resources.
1.2.2

Factors affecting marketing activities of enterprises and Analysys of
Marketing environment

1.2.2.1 Factors affecting marketing activities of enterprises
Marketing activities of any business are affected by many factors, which form the
business environment of an enterprise. The environment is approached under the
perspective of Marketing as a marketing environment.
Marketing environment is a combination of all the factors, the forces inside and
outside the enterprise have a positive or negative impact on the operation or decision of the
Marketing department in the enterprise to the ability to set up or maintain a businesscustomer relationship.
The changes of the marketing environment have a profound and powerful impact
on businesses. Including good and bad effects on business. The environment has not only

changes, gradual changes and easy detection and forecasting, but it also has potential
changes, even shocks.
Thus, the Marketing environment creates both favorable opportunities and
pressures and threats for all businesses. Basically, they must use marketing research tools
and marketing systems to monitor, capture and handle marketing decisions in order to
adapt to changes from the environment.
Marketing environment is a collection of micro marketing environment and macro
marketing environment. Micro Marketing environment includes factors that are closely
related to the business and it affects the ability of the business to serve customers. These
are the internal factors of the company, marketing channels, customer markets,
competitors, suppliers, intermediaries, ... these factors directly affect the operation of the
business and businesses also have a certain influence on these factors.
The macro marketing environment includes elements and forces of a large social
nature, they have an impact on the entire micro-marketing environment and marketing
decisions of businesses. The macro marketing environment brings together all the factors
that businesses cannot control and change. This is the origin of opportunities and risks for
businesses. Those factors are elements of demographics, economics, nature, technology,
technology, political politics, ethics and social culture, etc.
1.2.2.2 Analyze external environment
According to Doctor Nguyen Minh Tuan (2006):
10


Marketing environment is understood as a combination of internal and external
factors that directly or indirectly affect the marketing or business activities of the
enterprises.
The marketing environment of each organization can be divided into two levels:
The firstly, the macro environment consists of factors outside the organization that
shape and affect the micro-environment, creating opportunities and threats to
organizations.

The macro environment consists of the following key elements: economic environment,
natural environment, technological environment, political-legal environment and sociocultural environment.
Secondly, Micro-environment: including the resources of the company itself (such
as human resources, financial capacity, research and development, production, marketing)
and the industry environment such as competitors, customers, suppliers, intermediaries,
and the public.
Marketing environment is often complicated and fluctuate, with the special
characteristics. Complexity: The maketing environment consists of many factors and each
element consists of many different effects. Therefore, when analyzing the environment, the
marketing manager must pay attention to the factors that directly and indirectly influence.
With variability, the Markeing environment can develop in four forms as following: Stable
and unchanging; stable with seasonal fluctuations or cycles; Slow-moving changes have
been confirmed; Fast changes with unpredictable directions.
Thus, the business performance of the enterprises and marketing results achieved is
dependent on the ability of the manager to develop and coordinate the appropriate
marketing mix. Businesses that control the changes of the environment, see changes in the
environment with new marketing opportunities and quickly adapt to the changing
environment will be successful. On the contrary, those businesses that do not consider
change are opportunities, disregard or resist changes, maintain strategy, organizational
structure, working order in isolation from changes in the environment, it will be
ineffective.
Marketing managers need to monitor and analyze environmental changes, to be
able to test and adjust their marketing strategies to match the resources of the business and
respond to the new challenges and opportunities in the market.
The economic environment: The market needs purchasing power and the public,
the current purchasing power of an economy depends on the current income, the price, the
11


amount of money saved, the need and ability to borrow money. Marketers must closely

monitor the main trends in income and consumer spending patterns.
Firstly, changes in income: The changing trend of income affects the purchasing
power of the market. If average incomes of consumers increase as a result of a number of
factors, such as the number of jobs created, the average wage increases, the amount of
money that consumers spend on shopping will increase. Business organizations will have
the opportunity to achieve higher sales.
For various reasons such as unemployment, rising income taxes, inflation ... real
incomes of consumers can be reduced. As the total amount of money spent on shopping
decreases, some goods such as cars, villas, or trips abroad will be out of customer’s reach.
Under inflation conditions, consumers tend to buy durable, high value items or items they
expect to be able to increase price to protect their value for money.
The average income of Vietnamese people in recent years has increased. The
Vietnamese market has seen the demand for high quality items and better services as
customers are able to pay for them.
In addition to the average income, marketers also need to pay attention to the
distribution of income in society. In each society, the upper classes, the middle classes and
the lower classes each have different ways of shopping such as the upper classes prefer
shopping for luxury products, the middle class often buy Products that have the potential to
lead a better life, the low-income classes should primarily purchase essential items for life
such as clothing and food.
Secondly, savings, debt, ability to borrow money: Consumer spending is affected
by savings, debt and the ability to borrow money. Marketers must carefully monitor all
fluctuations not only in income but also in cost of living, savings interest rates and the
ability to borrow money. The volatility of these factors can have a huge impact on the
purchasing power of consumers, especially for products that are highly sensitive to income
and price.
Natural Environment: Inclusion of natural resources that are considered as essential
inputs for the operation of the business and has certain effects on the marketing activities
of the business. Some trends of the natural environment have a great impact on the
marketing activities of a business as follows:

Firstly, raw material shortages: infinite natural resources, renewablels finite
resources and non-renewablels finite resources. When natural resources are used to
deplete, especially non-renewable finite resources such as coal, oil, etc., the producers who
12


need these materials will have to deal with increasing of the cost of raw materials.
Therefore, companies need to invest in research to find opportunities to use new
substitutes, reduce the level of raw materials needed, reuse and recycle wastes of the
materials in use.
There are some resources like air, water… also faces exhaustion. Some types of
resources, such as forests, food can be used extensively. Marketers need to assess the
impact of this shortfall on the cost of items when switching to other materials.
Secondly, energy costs increase: in recent years, energy costs have large
fluctuations. The increase in the cost of energy use has a major impact on the cost of
production in some industries and therefore produces higher prices. Manufacturers should
therefore keep an eye out for major fluctuations in oil and energy prices to control their
costs.
Thirdly, the level of pollution increases: The activity of some industries produces
waste that destroys the quality of the natural environment. Enterprises create products or
solutions to control this situation.
Fourthly, Changing the Role of Government in Environmental Protection:
Governments have different concerns and efforts in protecting the environment. There are
countries that pursue environmental enhancement as developed countries, but many poor
countries do not much because of the lack of funds.
Technological environment: Technology is an important force in human life. The
technology environment includes forces that affect new technology, create new products,
and new opportunities. The emergence of new technology or new technological
innovations can have important long-term consequences that marketers can never predict.
As new technologies create new markets and new opportunities, marketers must

follow the trends of technological development to exploit these opportunities. The trends
are:
Firstly, the acceleration of technological change: Some researchers have made the
assumption that most of the products we consume today that are impossible to find 30 year
ago. Nowadays, thanks to new ideas, new products appear quickly to change the
appearance of products. The acceleration of technology makes the life cycle of the product
shorter.
Secondly, the budget for research and development: of countries tends to increase,
making government-funded research done at research institutes and universities become
the source of ideas about new products and services for manufacturers.
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Thirdly, more and more new technologies such as biotechnology, materials science,
robotics, medicine are emerging. The introduction of new technologies will create
revolution in the products and production process of the manufacturers. It also makes the
consumer satisfy a need with different products.
Fourthly, regulations of governments about technological changes is the tighter and
tighter: Technological change can have negative consequences for consumers, so it faces
public opposition. Recently, the state has intensified the inspection and supervision of
counterfeit goods and poor quality goods to protect the interests of consumers. Marketers
also need to master these regulations when needed and launch new products.
Marketers need to understand that the technological environment is always
changing and if they master new technology, they can better satisfy the needs of
consumers.
Political and legal environment: Marketing decisions are strongly influenced by
developments in the political environment. The factors of this environment include: laws,
the direction of economic development of the government...
Some political trends to note:
Firstly, it is more and more laws regulating business operations of businesses such

as business law, bankruptcy law, commercial law. It is the job of the marketers to master
the laws that govern competition, protect consumers and protect the interests of society.
Businesses need to build a system of ethical standards to provide guidance for their
marketing.
Secondly, the formation of public interest groups and organizations: in the past
decades, the number and strength of public interest groups has increased dramatically.
These groups have lobbied government officials and put pressure on business executives to
pay more attention to the interests of consumers.
New laws and the growing number of pressure groups have forced many companies
to set up legal departments and also refrain from more marketing activities. Marketers also
need to clarify their plans to the legal department to avoid adverse reactions to the
company.
In Vietnam today, the Consumers' Association has conducted activities to control
enterprises, protect the health of consumers. Therefore, the marketing decisions of the
business must take into account the limits of business ethics to protect the interests of
consumers.

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Socio-cultural environment: Culture is understood as a system of values, concepts,
beliefs, traditions and norms of a person or group of people. The society in which people
grew up has formed their beliefs, values and norms. Culture has a decisive influence on
how consumers value products and how they behave.
Marketers should pay attention to some of the main trends of the socio-cultural
environment:
Firstly, core cultural values are very sustainable: marketers have the opportunity to
change the customer's secondary values and have little chance of changing core values.
Secondly, each culture should include cultural branches. Each society contains
several branches of culture, ie different groups share the values that arise from experience

and certain living conditions. Consumers of different cultural backgrounds have different
desires and behaviors. Thus, marketers can choose the culture branch standard to segment
the market and select the target market.
Thirdly, the change of values arises: cultural values arise more easily than the core
cultural values. The main cultural values of society are also expressed through their
perceptions of themselves and others, of social and social institutions. Marketers need to
take these differences into account in order to produce the right marketing program for
each type of customer.
Fourthly, the changes of Vietnamese society in recent years: the industrialization
process that has been taking place in Vietnam has led to great changes in society. These
are: the process of rural urbanization; the decline of traditional communities and societies;
the diverse development of religious and religious forms ... These changes create a lot of
business opportunities for businesses. Marketers need to capture changes in society in
order to exploit new opportunities and adjust their activities in time.
1.2.2.3 Analyze industry environment
Suppliers: Are organizations or individuals providing the materials the company
needs for the production of products and services.
The development of suppliers seriously affected marketing activities. Marketing
managers need to monitor closely supply ability, material scarcity, and demand for price
increasing of suppliers. Employee’s strikes and other events can increase costs in the short
run and harm the ability of the company to meet the needs of its customers in the long run.
Marketing managers need to monitor closely the trend of price changes with the
company's key inputs. Increasing the cost of supply can put pressure on the company to
increase its selling price and thus sales may be affected.
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Marketing intermediary: Organizations that help the company promote, sell and
deliver products to end users.
Marketing intermediaries includes: traders, carriers, marketing agents and financial

intermediaries.
Traders are organizations that participate in the distribution channel, helping the
company find the final consumer or sell to the end consumer. Traders include wholesalers
and retailers. Manufacturers need to use wholesalers or retailers to sell their products
because they perform important consumption functions at a lower cost than producers do
themselves. It's not easy to choose a trade partner and work together with them. Companies
need to pay attention to maintaining and developing relationships with traders when their
consumption ability of their product or destiny depends on them.
Carriers: These Companies help manufacturers keep and ship products from their
locations to the destination of the end consumer. Storage companies store and preserve
products before they are shipped to the following destinations. The company needs to
choose the best way to stockpile and ship the product, balancing between factors such as
cost, speed and safety.
Marketing Service Agents: These are marketing research companies, advertising
agencies, marketing consultants, media companies that help companies choose and
introduce their products into right market. When the company decides one or more of these
agents, the company needs to select them carefully because they are innovative in the
quality and price of the services they perform very differently. Companies need to review
regularly the performance of these dealers to replace them as needed.
Financial intermediaries include banks, credit bureaus, insurance companies, and
other organizations that help the company conduct financial transactions or insurance
against the risks associated with buying and selling product. The ability to carry out
marketing plans is highly dependent on the increasing of cost of credit loans, the limitation
of credit supply, or both. For this reason, the company needs to develop close relationships
with key financial institutions.
Customers: In order to best satisfy the customers, each company needs to study
carefully the needs of its customers. The customer market of the company consists of many
different types. The main types are: Consumers, Manufacturers, Intermediaries,
Government, International. As follows:
Consumers: Individuals or households purchase products and services for personal

consumption.
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Manufacturers are organizations that purchase products and services that serve the
organization's purpose, such as for their production.
Trade intermediaries are organizations that buy products and services for the
purpose of reselling and making a profit.
Government: government agencies purchase products and services to produce
public services or transfer products and services to others who need them.
International: are overseas buyers including consumers, manufacturers, traders and
governments.
Each type of market has unique characteristics of the needs that the company must
carefully study and design the appropriate marketing program.
Competitors: Each company faces many competitors. Marketing perspectives show
that to be successful, a company can not only be interested in satisfying its customers'
needs but also better than its competitors. So marketers do not just have to adapt to the
needs of their target customers, they also have to adapt to the strategy of the competitor
who is serving the same target customers.
Each company needs to identify and understand its competitors so that it can design
effective competition strategies. Each company needs to assess its size and position in the
industry relative to the size and position of its competitors. Large companies dominate the
industry using strategies that smaller companies can not pursue. Big companies need to
have specific strategies to bring success. Small companies develop strategies that allow
them to achieve higher return on investment than big companies. In short, companies need
to develop marketing strategies to achieve the best competitive advantages on the market.
The Public: The marketing environment of the company also includes the different
public, interested or influenced to the ability of the organization to achieve: Finance,
media, government, local, internal. As follows:
The Finance: Influence the company's ability to raise capital. Banks, hedge funds,

shareholders are the main financial players of the company. Each company needs to build a
good impression with these organizations.
The media: The media are organizations or individuals who perform the
communication such as newspapers and television.
Government: Government agencies or government officials
Local public: is the public where the company is located as another company or
community organization.
The internal public: are the workers, the managers.
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Companies need to prepare marketing plans for their major publics as well as for
their clients. If a company wants to have a positive response from a public, it needs to
design and propose an attractive enough procedure to produce the desired response.
1.2.2.4 Micro-environment
Functional structure of a company usually has departments such as: Accountingfinance; production, human resources, marketing department, R & D department, etc.
These departments have their own goals for the job function. The preparation of marketing
plans and programs is assigned to the marketing department. The marketing department in
the company want to get a high consensus for marketing plan. They must pay attention to
the duties of the departments and get their support to implement smoothly. Specific as
follows:
The support of the Finance and Accounting Department will ensure timely and sufficient
supply of funds for successfully implementing marketing plans and carefully monitoring of
revenue and expense, to help marketing department to assess situation and prospect of
marketing objectives. The support of Human Resources to get personel to implement the
marketing plan. The support of R & D department to solve problem regarding issues of
designing technique and to create products that meet the market's requirements. The
support of the production department will ensure the quantity and quality of products
produced according to the market demand.
Every problem in the relationship between the marketing department and other

departments of the company will threaten the success of marketing decisions.
Marketing: will advance the process of forecasting, setting and satisfying the
desired needs of consumers for the product or service. The marketing department will
perform functions such as customer analysis, purchasing, sales, product and service
planning, pricing, distribution, market research, and opportunity analysis. Understanding
these functions will help strategists identify and assess the strengths and weaknesses of
marketing activities.
Production: production is the activity of the business associated with the creation of
the product. The process of production is the process of transforming inputs into
commodities. This is one of the major activities of the business and therefore has a strong
influence on the ability of the business to achieve its stated goals. When considering the
production process, it is important to pay attention to the following factors: production
process, machine capacity, equipment, inventory, labor force utilization and product
quality.
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