Marketing Planning

Task 1
Marketing Plan
_OHUI _

After two years of economic downturn, the world is now expecting positive changes to
come. The following is a written statement of marketing plan for a newly developed in
the Vietnam market in the next three years. Main goal for that time is OHUI enlarging its
market in Vietnam. How will OHUI reach that goal? – it is the question that this
marketing plan is going to answer.

Product background
OHUI is a premium, luxury cosmetic mannufactured by LG Debon. OHUI includes four
different types of product – skincare, make up, body care and for men. OHUI promotes
the beauty of modern people by bringing together the principles of the cosmos and
nature and modern science and technology. It is a phytoscience-based cosmetic
designed to be most optimally suited to women through many years of R&D efforts to
develop phytotherapies using the phytosubtances that are most beneficial to the skin
and for aesthetics and to verify the efficacy and benefits of rare plants used for centuries
as remedies in the Eastern and Western worlds.
OHUI, an attractive, prestigious cosmetic, is quickly becoming a global brand offering the
greatest beauty and satisfaction to women around the world through its luxury brand
image of true premium beauty.

5
 Marketing Planning

Some items of the Active Care

• The need to be innovative

Though how large an organization is, it must innovate in manufacturing process,
management, new product, service, market etc to meet customers demand and to
compete with business rivals. The most important aim of being innovative is to ensure
organization survival and success in a changing world.

• Techniques used for developing products

6
 Marketing Planning

Think that the product that we are going to spread it out is the Active Care that includes
eight items and still spread out those existing. To develop a new product, firstly, we need
to have an overview about strengths, weaknesses, opportunities and threats of the
business. To get this, we can apply SWOT analysis for our product – OHUI as follow.

Strenghts:
In the year of 2000s, market share for cosmetic in Vietnam was large because women
was limited in beautifying at that time; and Vietnam market was new for big cosmetic
brands to involve in. Seeing a potential market in Vietnam, DeBon became one of the
cosmetic brands which took part in Vietnam market earliest. Until now, though DeBon
have to share the market with many well-known brands like Shiseido, L’Oreal, Lacôme
etc, they still have their own position in cosmetic market, even being on top 3 of the
luxury cosmetic with Shiseido and Vichy in Vietnam. On March 2003, DeBon launched
their new skin care brand – OHUI, which is appreciated positively by customers because
of its high quality, sexy smell, nice design etc. Moreover, OHUI provides good taking
care services for their customers such as free massage, giving professional advices in
beautifying and taking care of skin.

Weaknesses:
The biggest weakness of OHUI is that its price is very high. It makes the customer flinch
to buy products before they use it. That means potential customers of OHUI is limitative
in high income women while almost Vietnamese women has low income.

Opportunities:
Vietnamese women now conscious of preserving their beauty because of many reasons
such as being confident when they meet working partners, keeping their husbands not to
go out with more younger girls, etc. Hence, they can spend a lot of money and time in
lasting their younger perfomance. Making up, cosmetic surgery are popular ways to
beautify now, however, middle-aged women in Vietnam prefer taking care of skin by
using skin care products which do not waste their time much.
Besides that, the economic is on the way of rehalibitating, I think at such this time, when
most of the businesses are restoring, we can take this opportunity to control the market
fastly by dumping goods, promoting marketing etc.

7
 Marketing Planning

Threats:
Besides OHUI, there is Vichy which is also a well-known skincare brand in Vietnam. The
main rival of OHUI is Vichy. Vichy’s strong points are that their price, common design
are more familiar to most of Vietnamese women than OHUI.

After applying SWOT analysis to have the whole view about the business, to dump new
product or renewed product, we can use the process of New Product Development in
overview.

NPD process

8
 Marketing Planning

This technique includes 8 steps that help us to figure out the answer for going ahead or
abandoning product.
1. Idea generation: Is the particular idea worth considering?
For the Active Care, the answer is Yes because it meets both the customer’s demand for
new helpful product and the company’s demand for controlling market by dumping new
product.
2. Idea screening: Is the product idea compatible with company objectives, strategies
and resources?
Yes. This new product meets the objectives, strategies and resources of the company.
Moreover, the company have totally abilities to manufacturer this one.
3. Concept development: Is there a good concept for the product that consumers say
they would try?
Yes. In fact, all of the OHUI product have the belief of customers for its quality to try.
4. Marketing strategy development: Is there a cost effective, affordable marketing
strategy?
Yes. The maximum price of this product is below 1millionVND. That is a reasonable
price for such a top quality product.
5. Business analysis: Does product meet profit goals?
Yes.
6. Product development: Is the product sound technically and commercially?
Yes. The product has met all the riquirements of this step: engineering tests, consumer
preference tests, branding, packaging.
7. Market testing: Have product sales met our expectations?
Yes.
8. Commercialisation: Are product sales meeting our expectations?
Yes.
When all the answer is Yes that means this product properly spreads out over the
market.

In addition, we can use Ansoff’s product-market growth matrix which describes a

combination of a firm’s activities in current and new market, with existing and new
products. This is a short-hand term for the products that company sells and the markets
it sells them to.

9
 Marketing Planning

Ansoff’s matrix

We can also use a poisitioning map to log the positions of our company or college and
its key competitors.

10
 Marketing Planning

Finally, we can use the product life cycle which help us to recognise distinct stages in a
product’s sales history.
The product life cycle

11
 Marketing Planning

• Recommendations for pricing, distributing and communicating that

product or service.
Pricing, distributing and communicating are the elements of the extended marketing mix
which is the set of controllable vairiables and their levels that the firm uses to influence
the target market.

Pricing
Though almost of Vietnamese customer complain of the high price of OHUI’s product, in
my opinion, these price is reasonable. Firstly, the quality in OHUI’ products cannot be
denied. The product with high quality but their price is fluctuated around 1-3millions VND
is acceptable. Moreover, one product can be used during 1 - 1.5 years, that means the
customer just spend about maximum 10.000 VND per day for lasting their young
perfomance. However, OHUI should reduce their price a little bit lower to avoid huge
distance in price with Vichy, their main rival. Besides that, OHUI’s consultants should
provide these information for new customer in order they are not surprised of such a
high price product.

Distributing
At this time, LG has not built any factories in Vietnam, hence, they have to use
distribution channels to sale products. The type of distribution channel in Vietnam is
indirect distribution. The disadvantage of this one is that it is passive in the sense that
they rely on consumers to make the first approach by entering the relevant retail outlet.
As quickly as posible, I think, LG should construct a factory in Vietnam as Shiseido has
done.

Communicating
About the communicating, OHUI uses effectively personal selling that the oral
presentations of the goods or services, or to create goodwill to improve the prospects of
sales in the future. Because the potential customer of OHUI is middle class and above
so they do not use media much for advertising. I think that they should change it to make
more customer know about them.

• Measures to monitor and review marketing perfomance

12
 Marketing Planning

To ensure that the established marketing plan will be performed as proposed, senior
managerment cannot just leave it to their inferiors to finish off the work by putting the
plan into effect. She or he must follow closely steps by steps in the marketing plan, have
an overview of the whole marketing plan, predict the problems that the marketing plan
could meet and prepare solutions for these. Moreover, she or he must assign the job to
staffs, encourage them and ensure that all the deadlines have been met or are going to
meet. To do all those things, senior manager should use the marketing control process.

The marketing control process

There is no planning without control. Marketing control is the process of monitoring the
proposed plans as they proceed and adjusting where necessary. If an objective states
where you want to be and the plan sets out a road map to your destination, then control
tells you if you are on the right route or if you have arrived at your destination.

1
Marketing objectives

4 2
Corrections and Perfomance
alterations standards

3
Compare results
against standards

Marketing control process

Control involves measurement, evaluation, and monitoring. Resources are scarce and
costly so it is important to control marketing plans. Control involves setting standards.
The marketing manager will than compare actual progress against the standards.

13
 Marketing Planning

Corrective action (if any) is then taken. If corrective action is taken, an investigation will
also need to be undertaken to establish precisely why the difference occurred.

Task 2:
As the ethical issues in marketing are now turned to be an emerging topic for any
marketing practitioner. The following is a short report compiling our findings about ethical
issues in Vietnam market.

• Different organizations’ responses to ethics in marketing

Honda Vietnam
To avoid environment pollution, Honda applies new technology in protecting
environment system both inside and outside the factory. They train their employees to
know how to reduce harmful activities to environment. Besides that, since 2001, Honda
awarded environmental management according to ISO 14001. They apply these ISO
14001 system totally in product process with garbage disposal system, and improve
energy using effect. Moreover, they use air filter system to keep the inside factory
environment always be as clear as possible.

The closed incinerator system of Honda

14
 Marketing Planning

FPT Telecom
With the policy guilines consider employees as main factor in company’s success or not,
FPT Telecom try their best to concern about consolidating and expanding their staffs,
take care and encourage them in both work and daily life. Hence, employees who work
in FPT Telecom can promote their ability as much as possible. Moreover, FPT treat their
employees as the more they contribute to the success of the company. It is fairly to
compete with your colleages there but do not impact the company’s interest.

• Ethical issues
Based on the 7Ps in marketing mix, we can divide ethical issues into product issues,
promotion issues, pricing issues, place issues, people issues, process issues and
physical issues.

Product issues:
Product issues usually relate to safety, quality and value and frequently occur when the
business does not provide adequate information to the customer. This may range from
omission of uncomfortable facts in product literature, to deliberate deception.

Promotion issues:
Ethical considerations are particularly relevant to promotional practices. Advertising and
personal selling are areas in which the temptation to select, exaggerate, slant, conceal,
distort and falsify information is potentially very great indeed.

Pricing issues:
There are several pricing practices that have attracted criticism:
- Active collusion (price fixing) among suppliers to fix prices.
- Predatory pricing is an issue when newcomers attempt to break into a market.
Established suppliers utilise their cash reserves and economies of scale to sell at prices
the newcomer cannot match and still make a profit.
- Failure to disclose the full price associated with a purchase has been rightly cricticised
as unethical.

Place issues:

15
 Marketing Planning

Where long and complex distribution channels are used, there is potential for disputes
and conflicts of interest. Even when relationships of trust have been built up over long
periods of time, business pressures can lead to hard decisions and a perception by
distributors that they have been treated unfairly. Here are some examples of conduct by
manufacturers that distributors could reasonably complain of.
- Requiring high levels of stock holding
- Manipulating price structures to the detriment of distributors
- Ending distribution agreements at short notice
- Dealing direct with end users

People issues:
People issues cover those ethical issues arising around the employer-employee
relationship, such as the rights and duties owed between employer and employee.
- Discrimination on the bases of age, gender, race, religion, disabilities, weight and
attractiveness
- Affecting the privacy of the employee: workplace surveillance, drug testing.
- The fairness of the employment contract and the balance of power between employer
and employee
- Occupational safety and health

Process issues:
This area of business ethics usually deals with the duties of a company to ensure that
production processes do not cause harm. Some of the more acute dilemmas in this area
arise out of the fact that there is usually a degree of danger in any product or production
process and it is difficulty to define a degree of permissibility, or the degree of
permissibility may depend on the changing state of preventative technologies or
changing social perceptions of acceptable risk.
- Ethical relations between the company and the environment
- Product testing ethics (animal testing etc)
- Ethical problems arising out of new technologies

Physical issues:
Knowledge and skills are valuable but not easily “ownable” as objects. Nor is it obvious
who has the greater rights to an idea: the company who trained the employee, or the

16
 Marketing Planning

employee themselves? The country in which the plant grew, or the company which
discovered and developed the plant’s medicinal potential? As a result, attempts to assert
ownership and ethical disputes over ownership arise.
- Patent infringement, copyright infringement, trademark infringement
- Misuse of the intellectual property systems to stifle copetition
- Business intelligence and industrial espionage

• Describe the implication of ethical issues on the marketing mix for your

client company
About the LG H&H code of ethics, they share and believe in two key corporate principles
“Creating value for customers” and “Respecting human dignity”. Based on these
principles and in the spirit of their Managerment Charter, they strive to promote self-
governing management and its accompanying responsibilties. It is their intention to
uphold the principle of free market economy, which embodies the spirit of fair
competition. They are committed to attaining their goal of becoming a global leader, and
as such they will continuously pursue mutual benefits for their stakeholders on the basis
of trust and cooperation. LG is committed to act uprightly and make value judgments in
accordance to the code of ethics as follow.

Responsibilities and obligations to customers

They highly regard the opinions of their customers in the belief that they form the very
basics of their business. They seek to secure unconditional trust from their customers by
continuously providing them practical values. They are always truthful to their customers,
and are bound to keep their promises.

Fair competition
They uphold the principle of the free market economic system. Therefore we pursue free
competition and earn their customers’ trust through top quality products and services.
They compete fairly and capably with their competitors, but do not intrude upon their
interests, or exploit their weaknesses. They conduct their domestic and overseas
business activities in strict accordance with local laws and regulations, and with respect
for local business customs.

Fair transactions

17
 Marketing Planning

They offer equal opportunities to all qualified companies seeking to become their
business partners. All applicants are registered and selected in a rational manner
following a fair and objective evaluation process.
All business transactions are conducted under equitable circumstances. The terms and
procedures of the transaction are to be sufficiently dicussed between parties involved.
The use of prominence in position to execute an unjust transaction is forbidden.
Information required for a transaction is exchanged through appropriate procedures in a
timely manner. Transaction results are evaluated on a regular basis where
complementary measures are mutually taken.
They support the long-term growth of their dealers and vendors by enhancing their
competitiveness through technological and managerial assistance. They share the
profits dirived from business innovations. They pursue cooperation with their dealers and
venders in a mutual effort to promote a healthy trading environment and maintain a fair
trading system.

Basic ethics for employees

LG employees faithfully accomplish their duties in compliance with the visions and
policies of the company. Assigned duties are carried out in the best possible and fairest
manner while observing relevant laws and regulations. Moreover, they exert themselves
in enhancing work efficiency through open communication and cooperation with
colleagues and related departments. LG employees carry out their duties based on
honesty and fairness, seeking to foster a soung business culture. They also avoid any
individual behaviors or relationships that are in conflict with company interests.
LG treats each employee with trust and affection and places a high value on individual
human dignity. They offers equal opportunities to all its employees based on their
abilities and talents. They also makes the utmost efforts to promote a working
evironment conducive to creative thinking and autonomous behaviours.

Responsiblities to society and country:

LG conducts its business with respect to the social values at home and abroad. They
promote their business expansions based on stable corporate growth. LG protects its
stockholders’ interests by earning healthy profits through effective management. LG
contributes to national and social development through job creation, tax payment, and

18
 Marketing Planning

promotion of cultural and welfare programs. They strive to prevent environmental

pollution and employ all measures necessary to conserve precious natural resources.

With these incessantly endeavors, LG has taken many awards such as:
1986 – Awarded the quality management Grand Prize
1994 – Selected as the model company for environmental management
1995 – Awarded facility management prize
1996 – Awarded the presidential prize on international environment day
and so on.
Hence, if LG has plan to construct factories in Vietnam, they would be able to satisfy the
Vietnames code of ethics.

Reference:
http://www.lgcare.com
http://www.marketingteacher.com
http://www.google.com.vn
http://www.en.wikipedia.com

19