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Soft rain penetrates the Earth better than a storm

Having a comfortable and friendly lunch with Mr. Nguyen Duc Quang, an account supervisor of Biz-Eyes Public Relations, a whole new world of PR practices in reality was exposed.

This young man has nearly four years experiencing in PR industry and he is now working for Biz-Eyes Public Relations, one of five specialized companies belong to SQUARE Direct Communication Group that could be seen as an ideal one-stop shop for every brand. Besides their two biggest clients Samsung and Coca Cola, the agency is a trusted partner of various well-known brands such as Honda, Tiger, Colgate and Dutch Lady. They also have run many outstanding concerts and events in Vietnam like Sound Fest and Rock Storm.

Helping clients to get success in a new profitable market is always the desire of every PR team. Since many powerful existing players out there are trying to create barriers to prevent newcomers from being developed in the market, the dream seems not easy to become true (Pehrsson 2009). Discussing three strategies of Bryce and Dyer (2007) and their combinations that help to crack new markets in Vietnam, Mr. Quang agreed those are very helpful, but besides entry barriers, other external factors such as Vietnamese cultures can also hinder new ventures. To clarify, he took a campaign done by his agency named Aivayta that promote Real Leaf of Coca Cola in the Vietnamese ready-to-drink (RTD) tea market. Although the campaign applied a combination of Leverage existing assets and Reconfigure value chains, the outcome was not so glorious as Real Leaf still lags behind other leading players such as Zero Degree green tea and Dr. Thanh. “Aivayta did create a great viral buzz, but it wasn’t effective in increasing sales,” stated Mr. Quang, then he points out some reasons that negatively affected the campaign.

At the first view, Coca Cola is an international giant with great reputation and possesses huge experiences in the beverage field. To produce Real Leaf, they leverage their partner Nestea’s brand recognition, know-how in design and manufacturing of RTD tea products. For those reasons, the agency hopefully expected to help this big client create a big pump that gain considerable potential customers from the market share leaders. But since the “Vietnamese people use Vietnamese products” campaign has been spread out, the number of customers perceiving Vietnamese brands as good as foreign brands increases up to 58% (TNS 2011). “This could be good news for us as the Vietnamese, but not for us as an agency working for an international brand,” he laughed. “In fact, this caused a big obstacle for Real Leaf to enter the Vietnam market and compete with other local products.”

On the other hand, his agency added more value by creating the Tea Master as a representative for Real Leaf and letting him get caught in various public places. As a result, the campaign provoked curiosity among the public and soon became a hot topic on social media channels. The product did differ from those of incumbents the way delivering value to customers. Unfortunately, “the Vietnamese’s buying behaviors are mostly conservative”, as 65% of them would try new brands but then still stick to their favorite (Nielsen 2010). “Most of the Vietnamese tend to assume their consuming products are already the best so that it is tough for us to make our client’s brand become the top of mind,” he claims. Furthermore, since inflation has been recently growing, consumer confidence faced uncertainty in purchasing decisions that they are unwilling to buy and try unnecessary or new items (Nielsen 2011). As a result, even though the campaign has been successful in reconfiguring value chains, during this phase, it is difficult for Real Leaf to break through the RTD tea market in Vietnam.

The last strategy that was not applied in the case is establishing a niches. To explain, Vietnamese people are becoming more conscious about personal health that lead to higher demands of natural and healthy drinks rather than RTD tea (Cimigo 2010). Therefore, the magnitude of market share in the RTD tea industry is being lessened. If Real Leaf aims to fringe segments, they probably could not gain the expected sales.

“Also, creating niches for Real Leaf means only attract to some customers, isn’t it a too humble strategy for the world’s top brand like Coke?.”

Apparently, the barriers of this campaign were not entirely coming from the incumbents but the Vietnamese cultures and contexts. “In this case, it would be better if we executed a continuous strategy with more events and increase frequency in approaching the target public through media channels.” Mr. Quang advised. “Yep… soft rain penetrates the Earth better than a storm, especially when foreign brands enter a new market.” More importantly, as 90% of Vietnamese people would open to products having better quality even it is more expensive (TNS 2011), he believes the campaign could be run more effectively if there were more efforts and improvements that fit to the Vietnamese’s characteristics. “Along with the strategies, focusing on the product’s quality and flavors suitable for Vietnamese customers are also important tasks to attract more customers,” he assured.

After all, to help the client enter a new market, besides considering client’s advantages to select the right strategies, Mr. Quang suggests a client manager should carefully research and match the client’s and the market’s cultures, especially when they are foreign companies, to make customers more familiar to the brand and then gradually gain them from existing players in the long run. “A client manager should have deep understanding of marketing and media options to recommend clients the best strategy for their business, and also be able to give them helpful advice whenever there comes a problem,” he states. “If the campaign brings out positive results, we can become their trusted partner and the agency-client relationship will be strongly enhanced.”

Mr. Quang has provided many valuable experiences for freshmen in PR industry as well as students who will be working as a client manager in the future.

Word count: 1000

References

Bryce, DJ & Dyer, JH 2007, ‘Strategies to crack well-guarded markets’, Harvard Business Review, pp. 84-92.

Cimigo 2010, Understanding Vietnamese consumers’ healthy choice, Cimigo, viewed 31 August 2012.

Nielsen 2010, Vietnam Grocery Report, The Nielsen Company, viewed 29 August 2012.

Nielsen 2011, Vietnam Grocery Report, The Nielsen Company, viewed 30 August 2012.

Pehrsson, A 2009, ‘Barriers to entry and market strategy: a literature review and a proposed model’, European Business Review, vol. 21, no. 1, pp. 64-77.

TNS 2011, Too Franchise or not too Franchise?, TNS, viewed 31 August 2012.

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2 thoughts on “Soft rain penetrates the Earth better than a storm

  1. Interesting insight that not all big international clients can penetrate the VN market successfully. A good case study to give a counter story to all those positive ‘strategic plans’. I wonder what Mr. Quang and his team have in store for this brand in the near future? What would you recommend to them based on your understanding of client management theories?

    Good use of market research info to weave into your interview Vi, however just be mindful to select new/ updated information especially if the product you are talking about just recently launched. 2010 info maybe ‘outdated’. Also it would also be good to give a little discussion about Bryce & Dyer’s ideas as the general reading public of this blog may not be familiar with it. ~Mel C

    • Hi Mel,
      I considered if those info reported in 2010 were outdated but unconsciously I put myself as the Vietnamese customer and thought that those perceptions and practices are still existing until now. That’s why I still used them.

      Ahh.. one more thing. Because during writing this article, I assumed that readers are all Client Management course’s participants as they must have known about these theories, so that I did not discuss too much on Bryce & Dyer’s strategies but focus on the interviewee’s story. I’m soo sorry about that!!

      Anyway, thanks Mel for suggesting me how to write a better article! 🙂

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