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RMIT International University Vietnam

Bachelor of Commerce Program
ASSIGNMENT COVER PAGE
Your assessment will not be accepted unless all fields below are completed
Subject Code: BUSM2371
Subject Name: Business Enterprise 2
Location where you study: RMIT Vietnam – Saigon South Campus
Title of Assignment: Work-In-Progress
File(s) Submitted BE2_G2_ICEBERG_WiP.doc
Student name: Nguyen Thuy Trang s3160865

Le Thi Anh Thu s3160794
Dao Cong Duy s3153660
Ha Tran Phuong Ngoc s3142619
Le Thi Tuong Vi s3131818
Learning Facilitator in charge: Mr. Peter Tran
Assignment due date: 29 August, 2008
Date of Submission: 29 August, 2008
Late Submission Approval NA
Number of pages including this one: (Please 56

number your pages like this: page 1 of 7, page
2 of 7, etc)
Word Count: 9,300

(Main Content)
Page 1 of 56
EXECUTIVE SUMMARY
Yakult Honsha Co., Ltd was established in Japan in 1930. Their core product is Yakult
Probiotics fermented milk which was proved to help people’s health and wellness, as well as
nice complexion and a slim form. Yakult entered Vietnam in 2006 (Yakult Vietnam) and they
have just made their sales since June 2008.
Up to now, the business operations do not live up to expectation due to their incompetent
marketing and promotional activities. As a consequence, this report was composed to analyze
Yakult Vietnam’s current situation, and recommend feasible marketing strategies to help them
increase their sales in Ho Chi Minh City market in particular.
The marketing plan was composed of 8 main parts. The first one Company information
described Yakult Vietnam’s history as well as their operations. With the mission statement
focusing on people’s health and happiness based on expertise in life sciences and
microbiological researches, they have set such ambitious business objectives as 30% market
share in HCMC by the end of the first year and the profit after tax rate up to 15%. Their business
strategies were differentiation in product and services (with high quality and Japanese-technique
and helpful Yakult Ladies squads).
The second part was Market research & analysis concerning detailed discussion of the market
Yakult operates in. This included knowledge about their opportunities, targeted segmentation,
main competitors with their specific products and customers, and a SWOT analysis to
summarize all the achieved information. Significant findings were: Vietnamese households spent
their majority on food and beverage consumption, the country’s population would maintain its
youthfulness until 2020, and the average income levels were projected to rise unstopped from
2002 to 2009. In addition, the fact that Yakult was facing harsh competitiveness from many
rivals, e.g. Vinamilk, Dutch Lady and Campina who had vast customer backgrounds was also a
noticeable point.
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The next section discussed Yakult’s production strategies. First, regarding the quality and brand
name, their products were recognized all over the world. With billions of friendly Probiotics
bacteria, they were proved to balance human’s digestive system, enhance immunity and reduce
remarkable amount of toxics. In addition, their packaged bottles were handy, convenient and
recognized, making it an outstanding point to the customers. However, the design was too simple
and unattractive, which might be a drawback in such an appearance-oriented market as Vietnam.
Regarding the price, Yakult Vietnam applied ‘value-based’ skimming pricing strategy on the
basis of hi-tech equipment and innovative technology from Japan. Moreover, we also planned to
offer quantity discounts and geographic pricing to boost the sales result. Two positioning maps
comparing Yakult’s price and quality and convenience with other brands were also come up with
to confirm our skimming method.
Most importantly, this marketing plan proposed the detailed promotional strategies helping
Yakult enhance their profit. We used 3 methods altogether: marketing, promotion and
sponsorship. Our intended marketing channels included HTV7, HTV9, The Gioi Phu Nu and
Tiep Thi Gia Dinh Megazine, and VnExpress website. We would also offer price packs and
coupons on the occasion of holidays to attract purchase, as well as sponsorship on Suc Song Moi
and charity programs to raise our brand awareness. The overall budget for this campaign during
the first year was VND 1,992 million.
The next section, Customer strategies described how we went through Marketing & stimuli,
Buyers’ black box and Buyers’ response steps to reach the consumers. This included some
cultural and social factors, personal perceptions, psychological and social class backgrounds to
decide what consumers buy. In addition, the distribution services that we offered also affected
our sales. Currently, we had retail stores and partner supermarkets all over the city, and in the
future we would expand our Yakult Lady squad to larger than just Phu Nhuan District and
Dist.11 at this moment.
The last part offered detailed figures of our projected sales and profits in the effect of this
marketing campaign. Some assumptions were also defined clearly for the readers to understand
the worksheet.
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1. INTRODUCTION .................................................................................................... 06
2. COMPANY INFORMATION ................................................................................. 06
2.1 Company background information........................................................................ 06
2.2 Mission statement ................................................................................................. 07
2.3 Business objectives............................................................................................... 07
2.4 Business strategies................................................................................................ 08
2.5 Company structure................................................................................................ 08
2.6 Management team ................................................................................................ 09
2.7 Departmental communication ............................................................................... 10
3. MARKET RESEARCH & ANALYSIS .................................................................. 10
3.1 Industry overview ................................................................................................. 10
3.2 Market opportunities............................................................................................. 11
3.3 Income growth...................................................................................................... 12
3.4 Market segmentation ............................................................................................ 14
3.5 Competitors.......................................................................................................... 17
3.6 Competitors’ products .......................................................................................... 19
3.7 Competitors’ customers ........................................................................................ 22
3.8 SWOT analysis..................................................................................................... 24
4. PRODUCT STRATEGIES ...................................................................................... 25
4.1 Product attributes.................................................................................................. 25
4.2 Branding............................................................................................................... 26
4.3 Product classification............................................................................................ 27
4.4 Product levels ....................................................................................................... 27
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4.5 Packaging ............................................................................................................. 27

5. PRICING STRATEGIES ........................................................................................ 28
5.1 Overall pricing strategies ...................................................................................... 28
5.2 Pricing in detail .................................................................................................... 30
5.3 Positioning maps .................................................................................................. 32
6. PROMOTION STRATEGIES................................................................................. 34
6.1 Objectives ............................................................................................................ 34
6.2 Advertising........................................................................................................... 34
6.3 Sales promotion.................................................................................................... 40
6.4 Sponsorships ........................................................................................................ 40
6.5 Promotion mix budget .......................................................................................... 41
7. CUSTOMER STRATEGIES ................................................................................... 42
7.1 Customer behaviors .............................................................................................. 42
7.2 Characteristics affecting customer behavior .......................................................... 43
8. DISTRIBUTION STRATEGIES............................................................................. 47
8.1 Distribution channels ............................................................................................ 47
8.2 Warehouses .......................................................................................................... 48
9. SALES & FINANCIAL FORECASTS.................................................................... 48
10. CONCLUSION......................................................................................................... 50
11. REFERENCE ........................................................................................................... 50
12. APPENDIX............................................................................................................... 53
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1. INTRODUCTION
Yakult Honsha Co., Ltd originated from Japan in 1930. Their core activity is producing
Probiotics fermented milk proven to be extremely good for health and wellness. Yakult entered
Vietnam in 2006 under the name Yakult Vietnam and they have made their first sales in this
June. Currently, the company’s sales in Ho Chi Minh City particularly is not good; that’s why
this marketing plan comes in place with the hope that Yakult Vietnam will gain bright success in
the next year to come.
The marketing plan includes 8 major parts:

 Company information
 Market research & analysis
 Product strategies
 Pricing strategies
 Promotion strategies
 Customer strategies
 Distribution strategies
 Sales & financial forecasts
2. COMPANY INFORMATION
2.1 Company background information

Yakult Honsha Co., Ltd was found by Dr. Minoru Shirota in 1930. Dr. Minoru Shirota was
driven by the passion of creating an affordable way for maintaining people’s health and wellness
as at that time Japan was not wealthy and malnutrition and infectious diseases led to the death of
a lot of children
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Yakult fermented milk drink was first introduced in Japan market in 1935 and was considered as
the world’s first Probiotics drink. It is known as a preventive medicine which is aimed at the
prevention rather than the cure of the diseases (Yakult Japan, 2008).
Currently, Yakult is sold in 31 countries over the world and approximately 21 million people
drink Yakult everyday. Yakult Vietnam Co., Ltd, which is the joint venture of Yakult Honsha
and Danone Group of France, was established in June of 2006. The initial sales of Yakult were
in Ho Chi Minh City market in September 2008 and the product was imported from Yakult
Indonesia at that time (Yakult Japan, 2007). Currently Yakult Vietnam’s factory in Vietnam-
Singapore Industrial Park is in operation with the capacity of 73,000 bottles per day and that will
increase to 865,000 bottles per day when the demand increase (Writer, 2008).
Product Name Yakult

Package 65ml / 5 bottle packs of polystyrene containers
Planned Retail Price 18,500 Vietnamese dong / 5 bottle pack
Start of Sales September 2007
Sales Area Ho Chi Minh, Vietnam
Sales Channel Home delivery sales by Yakult Ladies and store
sales in supermarkets and other retail locations
(Yakult Japan, 2007)
2.2 Mission statement

"To contribute to the health and happiness of people around the world through the pursuit of
excellence in life sciences in general and our expertise in microbiological research in
particular."
2.3 Business objectives

Yakult Vietnam business objectives included:
 Increase Vietnamese customer awareness about healthy drink, especially about the drinks
that contain beneficial bacteria. Healthy drinks is a new trend in beverage market with
many products such as green tea, ginseng drink but there is not any product that focuses
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on a specific health benefits. Yakult will focus on strengthening the digestive system
which is a vital part in creating a healthy body.
 With the speed up of marketing activities plus the image of high quality Japan product,
Yakult expect to obtain 30% market share of fermented milk drink market after 1 year.
 The profit after tax rate is 15% out of $9 million sales within a year.
 Increase in sales volume is expected to be 40% each year since year 2.
 The Return on Investment of this marketing plan is around 50%.
2.4 Business strategies

In order to achieve the objectives, differentiation strategy will be used. Firstly is the
differentiation in physical product. Being the first Probiotics milk drink in the world and
a product from Japan which Vietnamese customers have a good perception. Second thing
is the differentiation in service. Yakult Lady is an important part in Yakult’s sales
channel. In order to obtain a stable sales growth, it is critical that the customer understand
and experience the health benefits that Yakult product brings to them. Therefore, Yakult
Ladies not only do home delivery but also communicate directly with customers to
provide them necessary support and information about the product’s benefits.
As stated above, one of Yakult’s business objectives is to increase customer awareness.

Therefore, Yakult pays attention to strengthening marketing activities to convey its image
and messages to customers. Moreover, promotional activities will be used to increase the
demand.
Besides that, Yakult Vietnam aims to increase the approachability to customers and
product availability by widening distribution network and expand Yakult Lady service to
more parts in the city.
2.5 Company structure

The structure of Yakult Honsha which is the parent company in Japan is a corporation. It was
incorporated on 9 April 1955 (Yakult Japan, 2008).
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Yakult in Vietnam is the joint venture between Yakult Honsha and Groupe Danone of France.
Groupe Danone is the biggest shareholder of Yakult Honsha with 20% ownership. The joint
venture in Vietnam is their second overseas cooperation after the first one in India in 2007 which
is Yakult Danone India Pvt. Ltd (Masaki, 2006). In Yakult Vietnam Co., Ltd. Yakult Honsha
holds 80% of ownership and the other 20% is owned by Groupe Danone. This cooperation of the
two global leaders in Probiotics product (Yakult) and dairy product (Groupe Danone) would
bring a lot of benefits and is its competitive advantage in terms of experience, knowledge and
skills.
2.6 Management Team
MICHIO KASHIWAYA
General Manager
Marketing Finance Human Production

Resources
Mr. Michio Kashiwaya – General Manager of Yakult Vietnam Co., Ltd used to be Vice Manager
and also worked in Marketing Department of Yakult Indonesia. Therefore, he has a lot of
experience and understanding about the corporation. Moreover, as a joint venture between
Yakult Honsha and Groupe Danone of France, the management team is the combination of
talented people of two corporations who have valuable knowledge in beverage industry,
especially dairy product.
As a member of Yakult Corporation, Yakult Vietnam is also driven by Shirota-ism which is the
gathering of ideas and desires of the founder, Dr. Minoru Shirota.
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Figure 1: Shirota-ism Principles

Source: Yakult Australia, 2007
Shirota-ism is considered to be one of three sources of strengths of Yakult and as the foundation
of Yakult’s business. It has effect on management team’s decision making and also how the
company operates.
2.7 Departmental communication

The departments in Yakult Vietnam are connected by an intranet in which information is shared
and employee can access the internal sources to find their needed information. Internal numbers
are also available so that the communication between the departments is fast and effective.
Meetings of each department are held weekly and if there are more tasks or sudden events extra
meetings will be held.
3. MARKET RESEARCH & ANALYSIS

3.1 Industry overview
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VND 14,000
VND 12,000
VND 10,000
Bill. dongs
VND 8,000
VND 6,000
VND 4,000
VND 2,000
VND 0
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005
Year
Figure 2: Industrial output value for manufacture of food products and beverages (1995 – 2005)
Source: General Statistics Office, 2006
Overall, the manufacturing output for food and beverage industry in Vietnam has increased
continuously from 1995 to 2005. As the economic is growing, it expected to grow steadily in the
next five years. In addition, according to Euromonitor International (2005), food and beverage
spending is held biggest proportional (around 23%) in Vietnamese household expenditure
(Appendix 1). Thus, this industry is very potential to enter in for Yakult.
For fermented milk drink in Ho Chi Minh City, there are four companies that have introduced
this type of healthy drink: Probi (Vinamilk), Betagen (Campina), Yakulk. Thus, the market type
for this product is oligopoly which is price sensitive. In this market, price war should be avoided.
Instead, the market share and sales can be gained as creating differentiation such as high quality,
premium service and customers’ loyalty.
3.2 Market opportunities

This plan is for marketing Yakult products in Ho Chi Minh City. Thus, the analysis will focus
mainly on the economic situation, consumers’ behaviors and lifestyle of citizens that live in Ho
Chi Minh City
Young population of Vietnam:
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Source: Euromonitor International from National Statistics

Figure 3: Vietnam population pyramid (1980 – 2000)
and estimate for Vietnam population pyramid (2010 – 2020)
Source: Euromoniter International, 2008
There is significant bulge among those between 15 to 25 years old in 2010 and 25 to 30 years old
in 2020. In general, even though the population of infant is steadily dropping, Vietnam still
young population until 2020. Thus, young population would be the right decision for Yakult to
focus on.
Income growth:
Rising in standard of living would be the first reason that creates the opportunity for products’
characteristics that offer healthy living such as Yakult.
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Figure 4: Income growth (2002 – 2006)

and estimate of income growth (2007 – 2009) in Ha Noi & Ho Chi Minh city
Source: AC Nielsen Omnibus
As the statistic shows the income level has raised continuously from 2002 to 2009 in Ha Noi and
Ho Chi Minh City. There are 4 levels of income (per month) that has been showed in the study:
 Less than VND 2 million: Upper lower (unskilled labors)
 VND 2 – 4 million: Working class
 VND 4 – 7 million: Middle class (average-paid white and blue collars)
 VND 7+ million: Upper class (career oriented professionals, considered to have high
income and wealth)
The study indicated the middle class and upper class were estimated to in crease to 94% of total
population in 2009. Therefore, it generates the prospective economic situation in geographic
region (Ho Chi Minh City) that Yakult targets its products to.
Significant rise in health concern:

Citizens now pay more attention about their health as it is critical factor to achieve happy life.
As the Vietnamese wisdom “health is gold” or “strong spirit in a healthy body”, people try to
apply healthy living therapies such as nutrition meal and regular exercise. For example, in the
morning there are always crowds in the parks and gyms. Moreover, suggestions about healthy
and nutrition meals are broadcasted more and more regularly on the TV. As Yakult products are
considered as a treatment of digestive diseases, a method of cancer prevention and boosting the
immunity system, they have a high successful rate to convince consumers to purchase.
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3.3 Market segmentation

As the standard of living rises, the physiological and safety needs (Maslow model) are already
satisfied. Currently, most citizens in Ho Chi Minh City are in level three of Maslow model
which is sense of love and belonging:
Figure 5: Maslow’s hierarchy of needs

Source: McShane Travaglione, 2002
In this level, people seek and give care, as well as long for the feeling of love and beloved.
Determining the level of needs is critical because based on it, the massage and image of Yakult
will be built. In general, Yakult will build its image that protects human health, brings joy and
happiness for Vietnamese families.
In the first three years, there are two target segmentations:
Young ladies (18-30 years old)

This is the main target segment of Yakult. In this segment, young ladies are the most concerned
about their beauty to be confident when communicating and performing social activities. With
the benefits of delighting the skin, they would consider Yakult product as safe way to improve
their complexion and to be good looking. Besides, they can use Yakult to benefits their health
and prevent obesity.
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Figure 6: Population pyramid of Vietnam in year 2007

As the statistic numbers state, the females from 18 to 30 years old occupy about 16.19% the total
population (Appendix 2). This will be the potential segment combined with the children segment
from 1 to 5 years old.
Figure 7: Fertility rate for the Vietnam from 1/4/2006 to 31/3/2007

The figure has showed that most women gave birth at the age of 20-24 and 25 to 29. As the
regulation in Vietnam, each family must have maximum 2 children. The trend from 2006 to
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2007 was most woman were likely to give birth the first time at 20-24 years old and probably
wait for around 3-4 years (depending on each household situation, e.g. finance) to have the
second baby. Hence, it is a good idea to make Yakult suitable to both mothers and children.
When mothers do the shopping, they would consider Yakult as healthy milk and purchase the
product for themselves as well as their beloved babies. It is more effective at cost-saving: the
advertising campaign will send the message to the main market segment (young lady 18-30 years
old). Consequently, the children segmentation which is 15.33% of total population would be
reached as well. This is particularly true for Ho Chi Minh City as the total fertility rate (TFR) in
urban areas is 1.7 children per household (General Statistics Office, 2007) and 95 women per
thousands would have babies between 20 and 24 years old and 130 women per thousands would
have babies between 25 and 29 years old (see Appendix 3).
Children (1-12 years old)

The population pyramid (General Statistics Office, 2007) indicates that Vietnam has large,
young & growing population. Therefore, it is very potential for Yakult to focus not only on
children from 1 to 5 years old but also from 5 to 12 years old. The first reason is the age of 1-12
years is an important period for children as they experience both rapid mental and physical
growth.
Second, in the childhood, most kids suffer from constipation (Webtretho, 2007). Yakult products
would be the right treatment for their digestive diseases. Parents, who want to prevent or cure
their illness, will purchase the products. At the moment, the traditional yogurt is served to kids
as desserts to support their digestive systems. It is believed that once having healthy digestive
systems, kids are likely to observe nutrition from the meals effectively and boost their immunity
systems significantly. As a result, they can grow well and avoid diseases. Since Vietnamese
perception towards Japanese products is high quality; there is high propensity that Yakult will be
purchased as parents trust that their kids’ health will be well-protected with high quality
products.
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3.4 Competitors
Vinamilk
Vinamilk is the dominant brand in Vietnam that sells products made from milk. The website
http://just-food.com (2008) stated that they achieved 29.5% profit (VND 812 billion ~ $49.23
million) and 27.5% increase in sales (VND 4.77 trillion) for seven months from January 2008 to
July 2008. It is very prospective for Vinamilk as they have achieved 71.2% of its full-year goal
just after half of the year. Even though Vietnam has joined WTO leading to floods of imported
goods, Vinamilk still maintain their market leader position and even increase the market share.
Its strategic plan is to improve supply chain management, potentially the quality of raw material
sources via direct investment, and use it as a vital competitive tool to control price (BMI
Industry Insights – Food & Drink – Asia, 2008).
For instance, they also have the wide and effective distribution channel including 183
distributors and 94,000 retailers in Vietnam (Vietnam branding, 2008).
Effective marketing plan is one of the keys leading to the success of Vinamilk. According to
Binh (2008), Vinamilk is the third company in the first half of 2008 that has spent enormous
budget with nearly $6.5 million or 73% higher than the amount they spent in the first half of
2007 for advertising campaigns via TNS Media Vietnam.
Recently, it has introduced a very effective advertising campaign. At the beginning of the year,
the regular advertisements were been broadcasted on TV which were very cute, funny and
attractive, especially to children. It included the “cows” which are funny and healthy.
The slogan of “100% fresh milk” is easy to remember by the harmony song “100%”. It is noticed
that kids love funny music and likely to sing or even dance with the song. Consequently, parents
notice the brand name and Vinamilk are successful to build good image of their products.
Previously, there was tolerant news about Vinamilk that cheap powder milk has been used
instead of fresh milk. It damaged the image of Vinamilk and also many negative feedbacks. The
new advertising campaign has changed the situation and boosted up their sales as well as profit.
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Currently, Vinamilk marketing department spent a lot of effort and budget for this campaign. For
example, every day there is the advertisement show on HTV7 of Vinamilk with the main
messages: “Drinking milk is the way to support poor children”. Not only television but also
newspaper, magazines, poster, big pictures (at the bus stop) are used to maximize the aspect of
marketing campaign. It claimed that Vinamilk registered in the highest growth in advertising
spending, are going to invest $2 million to further promote and reposition its roast and instant
coffee brand Moment in Vietnam (Binh, 2008).
Overall, it is worth for Vinamilk to spend tremendous amount of money as they have been
successful in re-building their reputation and image. With around 200 product lines (Phuc,
2005), Vinamilk has been the largest and most powerful company in daily product industry in
Vietnam. When their Probi – Vinamilk fermented milk – drink was launched into the market, it
is expected to have high successful rate as having popular brand name as well as customer
loyalty. In short, Vinamilk is considered to be giant local competitor that has the products line
compete with Yakult in both direct (Probi) and indirect (yogurt) substitute.
Dutch-lady
The international corporation: Dutch Firm Friesland Foods has placed its manufacturers in
Vietnam and introduce their product under brand name: Dutch Lady. According to Binh (2008),
Ductch Lady is the fifth company that has spent money for their advertising campaign. The
company use “mother and children” to build image for its brand. The advertising of Dutch Lady
is quite strong as regarding to the level 3 of Maslow model: Sense of love and belonging. For
instance, Dutch Lady has used some promotion campaign such as “Thanks mom” or “Let’s love”
to give the warm feeling for families members. They also targeted mothers and mothers who
made the buying decision. Most of the TV ads emphasize the importance of mothers’ role in
their kids’ life and how kids appreciate the love and care from their mothers. Overall, Dutch
Lady always tries to increase their market share by spending a lot of money on advertising.
Besides, they tend to stand in the second position after Vinamilk. For example, Van (2008) has
stated that in the powder milk market, Vinamilk maintains the top position with 13.8% shares,
followed by Dutch Lady (11.3%), Nutrition (5%), and Nestle (4.4%)
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Campina
Betagen is the product line that belongs to multinational company – Campina. It is the largest
dairy company in Germany and Europe and currently extending to Asia and operating in
ingredients for professional and industrial customers’ world wide (PR Newswire Europe, 2008).
Even though it has been famous in some regions, this brand name is still new to Vietnamese
market and most consumers are not aware of this brand name.
According to Phuc (2005), Campina is the strategic partner of Vinamilk as both of them have the
strength for hygiene and qualified manufacturer standard and good reputation. Nghi (2005) has
stated that the strategic plan for 30 years between Campina and Vinamilk is estimated about 4
million USD, in which each partner will invest 50% of the budget.
3.5 Competitors’ products

3.5.1 Direct
Volume per
Brand name Product Quantity Price
quantity
Campina Betagen 4 115 ml 16 600
Vinamilk Probi 4 65 ml 17 000
Yakult Yakult 4 65 ml 18 500
Figure 8: Price of Yakult and direct competitors Product
Source: Co-op Mart Dam Sen
Currently, Yakult has two direct competitors that have the same type of products – fermented
milk drink:
Probi – Vinamilk
Figure 9: The design of Probi package
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While the others brand name used red color to attract customers. Probi of Vinamilk has applied
the opposite color which is blue. The package color brings the fresh feeling and also
differentiates itself from others brand name when placing on the selves of distributors or
retailers.
For this product line, Vinamilk has used the beautiful lady with the Pro-bi bottle inside for their
advertisement. Their slogan of “healthy inside, beautiful outside” has targeted female teenagers
from 15 to 25 years old. As the Vinamilk spent money to advertising for this product line in
newspaper, magazines, poster, and radio and sometimes on the TV. Customers are aware of this
product and there is high successful rate to launch this product to the market
Betagen – Campina
The product package is quite similar to Yakult, which is in red color. However, the cover at the
top of bottle is covered in Blue color, differs from the silver color that Yakult currently uses. In
addition, the bottle volume is bigger (115 ml) than other competitors (65ml). The price is also
cheaper such as VN 400 per log compared to Probi and VND 1,900 per log compared to Yakult
price. Thus, Betagen has applied low-cost strategy for their products.
As they hardly spent money for any advertising campaign, consumers are not aware of this brand
name. However, as the appearance is quite similar, consumers tend to mistake Betagen, instead
of Yakult. Moreover, as the marketing campaign of Yakult is not effective enough, consumers
are not motivated to buy the products. The first option probably is Probi from Vinamilk, and if
they prefer to purchase foreign brand, Betagen might be the choice as it is cheaper than Yakult
and consumers perceived that they have the same quality.
Design of Yakult product Design Betagen product
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3.5.2 Indirect
Volume per Price
Brand name Product Quantity Flavor
quantity (VND)
Plain yogurt 100 ml 14000
Yogurt 4 Fruit juice
100ml 18000
calcium-plus
Vinamilk Susu (Kid) –
6 chocolate 110ml 15200
Drinking yogurt
Susu (Kid) Yogurt 4 strawberry 80 ml 10000
Drinking yogurt 4 Green Tea 180 ml 17600
4 strawberry 110ml 11400
Strawberry
Yomost
Dutch Lady 4 Orange 180 ml 17400
Cocktail
Drinking yogurt 4 Green Tea 180 ml 16400
Figure 10: Price of Yakult and indirect competitors Product
Source: Co-op Mart Dam Sen
Yogurt:
One of indirect competitors to Yakult is traditional Yogurt which has been familiar and used
daily in most household in Vietnam. The competitive advantages customers’ loyalty (as the
products are used for a long period of time), and variety of flavor available such as strawberry,
calcium plus, mango, fruit juice, etc.
In most kindergartens and school, yogurt is often served as the dessert for kids after taking the
naps. It is considered to be healthy drink that is important to include it in kids’ daily meal.
Drinking yogurt:
Several years ago, Yomost (Dutch Lady) has boosted up their sales by focusing on its promotion
and advertising program. They has raised the campaign named “the feeling is very Yomost”,
which is favored by many teens. Hence, Yomost has created strong consumers loyalty and good
perception in customers mind. However, the products seem to be on the mature stage. Thus
Dutch Lady has launched new product: Drinking yogurt (green tea) in order to attract customers.
Vinamilk has also launched the same type product: drinking yogurt green tea. Those products
targeted female teenagers from 15 to 25 years old. It leads to tough competition in the daily
products such as yogurt for this segmentation. Thus, Yakult would target the different market
segment which is young lady (18-30 years old).
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3.6 Competitors’ customers

3.6.1 Business customers
As the requirement of Yakult products is to be well-preserved in 0-50C, the major business
customers will be popular distributors and retailers that are well-equipped for this type of
products.
Coop-mart
This is dominant supermarket in Ho Chi Minh City at the moment as having some competitive
advantages such as good reputation, great customers’ loyalty, and large service network with 15
shopping centers in Ho Chi Minh City (Appendix 4). There are frequent giant numbers of
customers shopped at their network in the weekend. Thus, to build brand awareness effectively,
Yakult need to run the promotion campaign mainly in this supermarket.
Big C
Big C is belongs to Casino Corporation – one of the top Europe retailers – with more than 9,000
stores all over the world. In Vietnam, they have organized the great stores with more than 50,000
types of products, particularly daily products. Their marketing strategy is low-cost as usually
offering discount/ coupons to generate sales and create customers loyalty. In Ho Chi Minh city,
currently they have 3 shopping centre which located in Phu Nhuan, Binh Tan and District 10
(Big C, 2008). Placing the products in those stores would support to improve distribution
channel of Yakult.
3.6.2 Final consumers

To get the others customers, it is critical to understand the buyers’ behavior first. The above is
the study of AC Neilson about most urban family behavior in Vietnam:
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Figure 11: Most Vietnamese urban family behavior

Source: AC Nielsen
It showed that in most urban family, mothers and grandmas usually make the decision for
purchasing food and beverage such as daily products. Since Yakult is in this type, it is worth
putting effort to get attention from those people. The main messages will be Yakult is right
choice for them to take care of the family. In addition, they often shop before 8:00 AM in the
morning. Thus it is important to make sure that the stock always available in distributors and
retails in the morning around that hour; and also in the weekend.
In addition, the product brand is from Japan should be emphasized as the good Vietnam
preference about Japanese products.
By introducing Yakult Lady Service, Yakult is able to lower the price and make their products
competitive in the market by cutting the expenses used for wholesalers and retailers. There are
two ways Yakult has placed the price VND 18,500/ bulk (5 bottles) if purchased via
intermediaries (such as super market, retailed store) and VND 17,500/ bulk (5 bottlers) if
distributed directly to home (Sanhdieu, 2008). It is value-added for consumers when purchasing
in bulk they can enjoy the low price and do not have to go shopping.
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PRODUCER WHOLESALERS RETAILERS CONSUMERS
Figure 12: Yakult Lady service that restructure the market structure
3.7 SWOT analysis

In short, Yakult has the following internal and external factors:
Strength:
 Yakult is famous global brand name
 Strong differentiation as providing Yakult Lady Service: home distribution
 Use the most advanced biologic technology and unique production method
 Professional and experienced management team
Weaknesses:
 Currently, brand awareness for Yakult in Vietnam is not achieved yet
 The package design cannot be changed as the policy from headquarter
Opportunity:
 Rise in health concern
 Good preference from Vietnamese about Yakult products
 Living standard is increasing
Threat:
 High inflation in Vietnam: it is expected to stay over 6.0% between 2007 and
2010, causing a drag on incomes and slowing down consumers spending
(Euromonitor International, 2007) (Appendix 5)
 Threat from local giant: Vinamilk and their strategic partner: Campina
 Potential entrants
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 As Yakult Lady is used to deliver products at home with lower retailed price in
the market, it might increase the cost as the fuel price rise. Consequently, Yakult
might experience loss if it cannot control the delivery expense.
4. PRODUCT STRATEGY
4.1 Product attributes

Quality:
 Performance quality:
- The quality of Yakult has been recognized over the world
- The product is made with Japan technology
 Conformance quality:
The consistency of Yakult is ensured over the world. The production of Yakult in Vietnam is not
an exception. It is operated to ensure that the taste, the quality of Yakult in Vietnam is the same
as Yakult from anywhere in the world. Moreover, it has a quality control system to bring
consistently high quality product to Vietnamese customers.
Features:
There are billions of Probiotics (friendly) bacteria contained in a single bottle of Yakult.
Drinking Yakult is helpful in preventing the growth of bad bacteria. Yakult also has a lot more
benefits such as:
 Balance the digestive system
 Enhance immunity to prevent infectious diseases
 Increase the amount of "good bacteria" in digestive system
 Reduce toxins in our body
(Yakult USA)
Design:
Yakult’s bottle is small with 7cm height and 4cm width. In Vietnam Yakult comes in a pack
of 5 bottles (while that is 7 in some countries which represents for 7 days in a week), each
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bottle is 65 ml. The bottle is sealed with a red foil on top to keep the milk fresh. Yakult
bottle’s design is consistent over the world. On both the bottles and the outer wrap, red is the
only color that is used.
However, other brands of fermented milk drink also use the similar bottle design and two
brands among direct competitors use red as their main color. Therefore currently the role of
design elements in customer recognition is not quite high.
4.2 Branding
The name Yakult comes from the word “jahurto” in Esperanto which means yogurt. Esperanto
was intended to be a form of international communication and the name Yakult was given for the
product because it was expected to be a universal drink (Yakult USA).
Yakult brand and messages are expected to appear consistently in every point of contact with the
customer so that whenever the customers see or think about the name Yakult they have the
perception of its high quality and healthy benefits.
Yakult tries to spread its image as wide as possible to create a strong identity. Attention is not
only paid to the product design but also other direct and indirect means to approach the
customers. Yakult ladies’ uniform and delivery vehicle or delivery trucks of Yakult would be
designed with Yakult’s identity such as logo, color and so on.
The official website of Yakult will spend a large portion to provide customer useful information.
For instances:
 Providing useful knowledge about digestive system and stress on how it can affect the
whole body’s health
 Providing access to more detailed information of Yakult (or Probioticss)’s benefits to
health.
 Lifestyle advice for a healthy digestive system
 Personal health plan which include healthy diet and recipes
 Effective exercises, specifically the ones that are helpful for the digestive system.
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In short it is expected to strongly increase customers’ awareness about the importance of

digestive system and how Yakult can contribute to enhance its strength. Besides that, it shows
Yakult’s personal attention and care to customers.
4.3 Products classification

Yakult is consumer product because it is bought by final consumers and it is for personal
consumption. In specific, Yakult is convenience product for the following reasons:
 It is bought frequently and immediately
 The consumers’ comparison between different producers is not too high
 The seller place the product in many locations to increase product availability
(Armstrong and Kotler, 2005)
4.4 Product levels

Core benefit - A type of healthy drink
Actual product - Popular brand name in the world – Pioneer in Probioticss
milk drink
- High quality level
- Enhance immunity and digestive system
- Portable and convenient bottle design
Augmented product - Home-delivery by Yakult Ladies
- Provide customer with sufficient information and advice
(Armstrong and Kotler 2005)
4.5 Packaging
Primary package:
The bottle is handy, convenient and is recognized over the world. The bottle is made using
polystyrene. Polystyrene is recyclable; it is resistant to both acid and alkaline conditions. The cap
is made using high quality aluminum foil (Yakult USA).
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The bottle seems to be very small but there is a reason. Since Yakult is not thirst-quencher, the
customer is recommended to take one to two bottles everyday. The little 65ml bottle is
considered as an ideal volume that customers can consume per day.
Secondary package:
The bottles are wrapped in a cellophane cover with red print on. On the right side there is a
stamp-shaped which stated Yakult is high quality product from Japan and it was sold since 1935.
At the back of the outer wrap, there is general information about the benefits of Yakult and its
Nutrition Facts.
In general, Yakult’s package performs the following functions:

 Provide product information
 Provide organization’s identity
 Convenience of storage, display and usage
 Inform brand value
 Environmentally friendly
However, the packaging is not attractive enough. In order to enhance customer recognition
through packaging, changes are going to be made. The bottle design cannot be changed because
it is consistent globally. Therefore the outer wrap is going to be adjusted to make it more
attractive to customer. The outer wrap will still use the red color which is the identified color of
Yakult and it will be made from special paper in order to maintain Yakult’s environmentally
friendly image.
5. PRICING STRATEGY:
5.1 Overall pricing stragies:
5.1.1 Factors to consider when setting prices:
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Yakult’s pricing decision is influenced by both internal and external factors.
a. Internal factors:
Marketing objective: the company has recently set product quality leadership, which
means it differentiates quality with other competitors, as its marketing objective. In
other words, it will set quite high price to match with its high-quality products.
Marketing mix strategy: other marketing mix element including product design,
distribution and promotion will be coordinated with pricing strategy to emphasize total
value concept.
Cost: In near future, the company is going to raise the plant capacity to 865 000 bottles
per day. That means it is able to achieve economics of scale. Hence, variable costs of
production are also lower.
b. External factors:
Type of market:
In fact, Yakult is in oligopoly market with few sellers who are sensitive to each other’s
pricing/marketing strategies. However, with high barriers to entry and Yakult’s distinct
healthy product, it is still competitive, even in case of that the company set high price.
Economic condition:
Inflation: Vietnam has encountered a significantly increased inflation rate.
Customers’ perceptions of price and value: in food and beverage industry, especially in
healthy dairy product market as Yakult, customers usually care about the quality rather
than prices.
5.1.2 General Pricing Approach:
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Figure 13: Value-based Pricing Process

Source: Armstrong G. & Kotler P., 2005 pp.303
Yakult uses Value-based pricing as their main approach. In other words, the key for the
company to pricing is to focus on buyer’s perception in stead of its cost. Pricing for Yakult
Probiotics fermented milk begins with analyzing consumer needs and value perceptions, and
the price is set to match consumers’ perceived value. For instance, in recent, as the living
standard is increasingly improved, there is a sharp rise in heath and beauty concern of Ho
Chi Minh citizens, especially young women and parents of children. Thus, there will be a
large number of customers who are willing to pay a reasonably high price for such a
delicious healthy product as Yakult.
Thanks to this value-based pricing approach, the company can decide the best price at which
customer demand could be increased most.
5.2 Pricing in detail:
5.2.1 New product pricing strategy:

With many distinct healthy benefits of Lactobacillus Casei Shirota bacteria, Japanese hi-tech
equipments as well as in unique innovating formula as our differentiation, we aim to apply
market skimming pricing strategy for this new product in Vietnam, specifically in HCMC.
That means we set a high price for the new product to “skim” revenues layer by layer from
the market .The company will make fewer, but more profitable sales (Armstrong, G &
Kotler, P 2005). Beside with high-quality healthy Japanese Probioticss fermented milk
image, there are also other reasons for applying skimming strategy including not high cost of
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small volume and high barrier to entry characteristic of this oligopoly market, as mentioned
above.
More specifically, Yakult has set price of 18,500 VND/ bulk (5 bottles) through
intermediaries such as supermarket or retailers and 17,500 VND/ bulk for required direct
delivery to home in District 11 and District Phu Nhuan and other districts in near future.
5.2.2 Pricing adjusting strategy:
Discount in quantity:
This strategy is most appropriate to housewives segment who buy the products for the whole
family with large quantity, especially young housewives who care about heath and beauty.
This discount strategy will be applied in the first quarter of this marketing campaign. More
specifically, if customers buy 2 bulks (in total of 10 small 65ml bottles), they will pay at a
discount price as following table.
Normal price Discount price

Through intermediaries 37 000 VND 34 000 VND
( supermarkets & retailers) (18 500 x 2)
Through directly free delivery 35 000 VND 33 000 VND
system. (17 500 x 2)
Figure 14: Quantity discount pricing
Geographic pricing:
As briefly mention above in new product pricing strategy part, the company will charge
cheaper prices (only 17,500/ bulk) for customers who require for direct delivery to home
(called Yakult Lady) in District 11 and District Phu Nhuan. The primary aim for this
pricing adjusting strategy is to create a brand loyalty for customers, i.e. young women and
family living near our warehouses. We have tried to expand this delivery system
throughout the city to attract more customers (for more details, refer to Distribution).
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5.3 Positioning map:
Position map of level of quality and price:
PRICE High
Pro-bi
(Vinamilk)
YAKULT
Betagen
Drinking
yoghurt
(Vinamilk)
Vinamilk-
Yogurt Yomost (Dutch QUALITY
Lady)
Low High
Low
Figure 15: Comparison quality vs. price
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Position map of level of convenience and price:

Thanks to its diverse distribution system, especially free distinct delivery system in District 11
and district Phu Nhuan (be going to expanded throughout the city in near future) called ‘Yakult
Lady’ with many useful advices to customers’ health from considerable female deliverers,
Yakult has an upper level of convenience for customers compared to other competitors.
High
Pro-bi
(Vinamilk)
YAKULT
Betagen
Drinking
yoghurt
(Vinamilk)
Vinamilk-
Yogurt Yomost (Dutch Convenience
Lady)
Low
High
Low
PRICE
Figure 16: Comparison convenience vs. price
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6. PROMOTION STRATEGY
6.1 Objectives:
The company has just expanded to Vietnam, particularly in HCMC, for 1 year. Therefore,
primary objectives for promotion strategies should be:
Increase brand awareness of target customers to 85% by the end of year.

Gain 30% market share in Probiotics fermented milk oligopoly market in HCMC at the
end of this year.
Increase total sales by 40% each year since the second year.
6.2 Advertising:
6.2.1 Advertising objective:

Advertising is an effective promotion tool to reach masses of geographically dispersed
buyers with a message repeated many times (Armstrong G. & Kotler P., 2005). Obviously,
with such a new product as Yakult, information advertising which inform customer of huge
healthy benefits of the product and its available services is the most appropriate objective.
However, since cost for such communication is expensive, the most effective advertising
methods must be chosen for the best result.
6.2.2 Target audiences: young women, parents and children, especially in HCMC.
6.2.3 Advertising budget:

The company has decided to apply objective-task method which develops the promotion
budget by setting specific objectives, determining necessary tasks to achieve these objectives
and calculating the total of all tasks cost equal to budget.
6.2.4 Advertising strategy:

a. Advertising message:
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The advertising message applied should be able to reflect the huge benefits for hearth,
especially digestive system, and for beauty of Yakult Probiotics fermented milk product.
More specifically, advertisements have to tell prospective customers about advanced unique
Lactobacillus Casei Shirota ferment form Japan in the product and its fresh delicious taste in
the most attractive way. The creative concept will emerge as a combination of meaningful,
believable and distinctive visualization and phrase. Our phrase, i.e. considered as our slogan,
is ‘Refresh yourself to enjoy your life’.
However, to capture the target market’s attention and interest, we have to turn that creative
concept to an actual ad execution. It is suggested that the advertising message be presented in
musical style in advertisement in TV ads.
For print advertising, we will apply the following posters for separate customers including:
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Young women caring about beauty and heath parents caring prevention of digestive
deceases and resistance for their children:
Figure 17: Print ads no.1
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For parents caring prevention of digestive deceases and resistance for their children.
Figure 18: Print ads no.2
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b. Advertising media:
In order to gain brand awareness of 85% target customers, based on media habits of target
customers and types and costs of messages, Yakult will use following media vehicles
including TV ads magazines and internet.
Media types Specific media vehicles Media timing
Television
TV ads are the most popular HTV7 & HTV9 broadcasts Scheduled 2 times per day
media type that our target within the first month.
customers including young

women and are Obviously, HTV7 has attracted
families
exposed. Because of good the most proportion of HCM
mass-market coverage, cost citizens. It is effective for the
per exposure is low. It is the company to reach customers in
most appropriate to appeal to the city. Besides, the broadcast
the senses. are also at the top in Vietnam.
Magazines
Beside with good pass-along The Gioi Phu Nu Magazine In first two quarters, printed
readership and high-quality advertisement will be appeared
production, magazines has in two issues in the first week of
also high geographic and each month.
demographic selectively,
specifically for its two
separate target customers
such as young women and
One of the most popular
parents.
magazines with a wide
circulation of 130,000, targeting
at young women- our primary
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target customers.
Tiep thi & Gia dinh Magazine
Also one of the best-selling

magazines, with circulation of
110,000 and targeting
housewives. Thanks to its
credibility and prestige, the
advertorial of the company will
be more convincing.
Internet www.vnexpress.net
It is considered as one of the A banner will be advertised on
least expensive media types the website the week late of each
as well as having interactive month.
capabilities.
According to www.alexa.com, it
is at the top 3 sites in Vietnam,
with a wide audience base
attracted.
Figure 19: Proposed marketing mix
c. Evaluate advertising:
Advertising evaluation will be measured through sales effects. More specifically, past sales
will be compared with past advertising expenditures. However, in fact, sales are affected by
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many factors besides advertising such as product price and features. Therefore, managers
should also consider these issues.
6.3 Sales promotion:

The primary objectives for sale promotion are to increase short-term sales as well as build
long-term market share.
Price packs:
Every customer who buys a box of our product (total 80 small bottles) will be given a free
extra bulk of Yakult (5 small bottles) in Tet Holiday, i.e. in first quarter of our campaign. In
fact, Tet holiday is the period of time customers consume products most in year, especially
foods and drinks as our products.
Coupons:
In the first month of this marketing campaign, in order to promote early trial and customer
preference of Yakult product, we will offer 5,000 coupons with a 10% allowance for each
total bill through delivery requirement within HCMC. These coupons will be offered at the
same time with our advertorials begins to appear to customers through Tiep thi & Gia dinh
and Phu Nu Magazines in the first issue. The reason is to stimulate their trials when they are
developed a good perception for Yakult through our attractive advertorials. In fact, compared
to total circulation of 240,000 each issue of the two magazines, we intend to offer only 5,000
valuable coupons for first home delivery requirement. That will help to stimulate customers
to delivery as soon as possible.
6.4 Sponsorships:
Actually, sponsorship for building company’s image as a community caring and responsible
is in term of Public Relations. The company has decided to sponsor for Suc Song Moi
television show in VTV1 and ‘The warm world for poor children’ charity program.
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Suc Song Moi Show in VTV1:

In current, this show is one of the hottest show in Vietnam,
which has attracted a huge amount of various audiences
especially families and women. The show covers so many
diverse issues in life including cooking, entertainment,
traveling, education, fashion and heath care. Beside with
sponsoring for this show, we will require to appear our
advertisement before each show. With the high density of broadcasting (at 11.am from
Monday to Friday every week), it is ensured to build a good image of Yakult to customers
with a good mass-market coverage.
Charity program:
The company intends to establish a charity program called ‘The
warm world for poor children’ in next quarter. In particular, the
company will draw part of its net profit (10%) to build a charity
fund for this program to buy 5,000 gifts such as for poor children
in HCMC at Christmas and Mid-autumn Festival. Besides,
thousands of Yakult Probioticss fermented milk bottles will be included in gifts.
6.5 Promotion mix budget:
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Unit Cost Total Cost

in (000) in (000)
Promotion Mix VND Units VND
Print Advertising
Phu Nu Magazine 4,500 12 54,000
Tiep thi & Gia dinh Magazine 5,000 12 60,000
Total Print Advertising 114,000
Television Advertising
HTV 7 9,000 60 540,000
Total Television Advertising 540,000
Online Advertising
www.vnexpress.net 4,000 12 48,000
Total Online Advertising 48,000
Promotion Campaign
Coupons 4 10,000 40,000
Price packs 7 100,000 700,000
Total Promotion Campaign 740,000
Sponsorship
Suc Song Moi Show 300,000 1 300,000
Charity Program 50 5,000 250,000
Total sponsorship 550,000
Total Promotion Cost 1,992,000

Figure 20: Marketing budget
7. CUSTOMER STRATEGIES
7.1 Customer behavior

Armstrong & Kotler (2005) describe that “consumer buyer behavior is the buying behavior of
final consumers-individuals and household who buy goods and services for personal
consumption”. They also state that each of them has different motivation as purchasing.
However, base on the Model of buyer behavior (Armstrong & Kotler, 2005), it can be studied
and find out what/ where/ how/ how much/ when and the most difficult question: why customers
buy it.
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Figure 21: Model of Buyer Behavior

Source: Armstrong & Kotler (2005)
The starting point of this model is the marketing and other stimuli which will be processed to
enter buyer’s black box to generate buyer’s response definitely. Yakult looks into terms of the
consumer’s black box including buyer characteristics and decision process to identify how our
customers’ stimuli are changed into responses inside. For instances, when and where customers
would buy Yakult, how much they buy and why they would choose Yakult as healthy product
for skin and digest.
7.2 Characteristic affecting consumer behavior

7.2.1 Cultural factors
In order to discover new products to satisfy customers’ demands, spotting cultural shifts is
always required for marketers. In recent years, with developing life, Vietnamese people pay
more attention and increase spending for health care products (Hedley, 2007). Not only do make
outside more beautiful, Vietnamese consumers want to improve inside healthier. As a result,
fermented milk is considered as best choice for them to have gentle skin and good digestive
system (Vietbao.vn, 2008). Moreover, consumers aware that millions bacterium in it can help
them balance and adjust food digestion as well as decrease cancer danger of intestine.
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Taken advantage from this “cultural shift toward greater concern about health and fitness”, Yakult
has launching new product (fermented milk) into Vietnam food and beverage industry. So as to build
customers awareness of product advantageous, Yakult needs to advertise its feature on all media
including television, newspaper, magazines and internet as well. It will open to all classes of
Vietnam, especially for young lady and children.
7.2.2 Social factors

SaigonInfo (2007) states that Vietnamese family is traditional-oriented including many
generations: grandparents, married couples and children. Moreover, there are more than 26,335
households in Vietnam in 2007 (Euromonitor, 2007). The wife is the controller all expenses and
makes decision whether that product should be bought for family. Basing on this characteristic,
Yakult should consider placing its advertisements on Women magazines or publication related to
women. Also, it should pay attention on advertisement on television where housewives entertain
in free time.
Other target customers of Yakult are young ladies. They want to look brighter with beautiful skin
as well as healthy and fit body. As a result, Yakult should place advertisement on magazines
such as Tiepthigiadinh, Thegioiphunu or websites for young generation.
Children are one of target customers of Yakult. They have significant influence on parents’
purchasing. Vietbao.vn states that fermented milk is good for children digestion and increase
eating process. Consequently, on television advertisement, Yakult should add information
advantageous to children’s health to attract their parents on its product.
7.2.3 Personal factors

Occupation
Female population occupies 50% of Vietnamese population including young ladies or women
who are working in air-conditioner offices (Euromonitor, 2007). For a long time affecting by air-
conditioner, their skin will become rough and dry. As a result, fermented milk of Yakult is no
doubts to be the most convenient and healthy drink for them in order to smoothen and give
nutrition for skin from inside. Yakult should express that message on its advertisement on
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newspaper or magazines (by images of white-collar female worker with smooth skin or young
beautiful lady).
Life-styles
The second target customer of Yakult is parents with children, especially housewives who spend
amount of time on television and magazines besides housework. Taken advantage from this,
Yakult would have good indirect marketing from television and women magazines.
7.2.4 Psychological factors

Motivation:
Following the Maslow theory, there is an esteem need of women to seek for smoother skin and
fit body. Thus, Yakult should try to satisfy this need by expressing beautiful and healthy women
after using Yakult product on their advertisement in all media.
Belief & Attitude

Many people think that fermented milk is just normal yogurt. That means whether they use any
kinds of yogurt, they will have the same result such as healthy body and good digestive system.
This belief will result the wrong conception of consumers about Yakult product. Therefore, the
company should marketing to make clear about its differentiation in adding million of bacterium
beneficial for digestion in Yakult product.
7.2.5 Customer social classes

Armstrong & Kotler (2005) explain that middle class are white and blue-collars workers who
have average payment for household and personal consumption. According to http://state.gov,
the income of Vietnamese middle class in HCMC rose from $220 in 1994 to $726 in 2006. In
addition, they have job stability and above average knowledge as well as consider personal and
family health. Yakult also targets to the upper class which income rate is less growing than the
middle class. Both classes can easily get Yakult‘s friendly message for their better health:
decrease obstruction of digestion, increase the amount of good bacteria, and increase body
defense.
7.2.6 Customer’s buying decision behaviour
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The buying decision behavior for Yakult is complex buying behavior in which the consumers
purchase for high value brand name and seek a lot of product information before purchasing. In
fact, there are famous brand names of fermented milk product, for example Probi fermented milk
of Vinamilk – well-known brand name with Vietnamese consumers. Therefore, in order to
differentiate from Vinamilk and others, Yakult has to build good image and provide competitive
advantage of its product to consumers.
Figure 22: Types of Buying Decision Behavior

Source: Armstrong & Kotler (2005)
7.2.7 Customer’s buying decision process

Although there are several brand names of fermented milk in HCMC including Vinamilk and
Betagen, Yakult as a new comer with high Japanese technology is considered as new product in
Vietnamese food and beverage market. Adapting stages in Adoption process for new product
(Armstrong & Kotler, 2005) including Awareness, Interest, Evaluation, Trial and Adoption,
Yakult has started raising awareness about applying millions of Lactobacillus Casei Shirota
bacterium in its product to customers. Then, the company can skip two next stages to go through
the third stage by giving samples in supermarkets. Finally, as consumers find Yakult as healthy
product, they decide to use it regularly.
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8. Distribution strategy
8.1 Distribution channels:

Currently, the main distribution channel of Yakult Vietnam Company focuses on retail stores
and supermarket in districts 1, 3, 4, 5, 8, 10, 11, Binh Thanh and Phu Nhuan districts.
In addition, so as to give the best service for customers, Yakult provide ‘Yakult Lady’ delivery
system in district 11, Phu Nhuan district and some near regions (www.vnexpress.net, 2008). In
future, the company will broaden this system to other districts in HCMC. Yakult female
deliverers will distribute products right to homes or offices as well as give good advices for
customers to have better lives.
Retail Stores Supermarkets “Yakult

Ladies”
Figure 23: Yakult’s distribution mix
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8.2 Warehouses
After opening the manufacturer in use at Singapore – Binh Duong industrial zone in April 2008
(www.vnexpress.net), Yakult has distributed products directly to retail stores and supermarkets.
Each stores and supermarkets have their own warehouse for Yakult product storing. Those
warehouse can help Yakult Vietnam to decrease warehouse fee and transportation cost.
However, those need to equip suitable fridge to store Yakult product in appropriate atmosphere
from 8- 10 degrees.
9. SALES & FINANCIAL FORECAST

Our predictions are based on the following assumptions:
 Unit sales in HCMC = 1/5 total production in the whole country (73,000 bottles/ day
now, increasing to 865,000 bottles/ day after 1 year).
 Offered price = VND 18,500/ 5 bottle pack
 COGS = 30% sales revenue
 Total marketing cost = Print + TV + Online (1 year) = VND 700 million
 Depreciation: 2007, factory investment was $26 billion for 50 years.
 During the first 2 years, it will depreciate $1.2 billion/ year
 Depreciation 1 month = $100,000 = VND 1,650 million
 Rent (including offices and warehouses) = VND 500 million/ month
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PROJECTED INCOME STATEMENT, next 12 months

in (000) VND Before Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12 Total
Revenue Mktg plan
Unit produced (/day) 73,000 300,000 350,000 400,000 450,000 500,000 550,000 600,000 650,000 700,000 750,000 800,000 865,000 6,915,000
Unit sales (/day) 14,600 60,000 70,000 80,000 90,000 100,000 110,000 120,000 130,000 140,000 150,000 160,000 173,000 1,383,000
Monthly unit sales 438,000 1,800,000 2,100,000 2,400,000 2,700,000 3,000,000 3,300,000 3,600,000 3,900,000 4,200,000 4,500,000 4,800,000 5,190,000 41,490,000
Sales Revenue 1,620,600 6,660,000 7,770,000 8,880,000 9,990,000 11,100,000 12,210,000 13,320,000 14,430,000 15,540,000 16,650,000 17,760,000 19,203,000 153,513,000
Revenue (/day) 54,020 222,000 259,000 296,000 333,000 370,000 407,000 444,000 481,000 518,000 555,000 592,000 640,100 5,117,100
COGS (30%) 486,180 1,998,000 2,331,000 2,664,000 2,997,000 3,330,000 3,663,000 3,996,000 4,329,000 4,662,000 4,995,000 5,328,000 5,760,900 46,053,900
Gross Profit 1,134,420 4,662,000 5,439,000 6,216,000 6,993,000 7,770,000 8,547,000 9,324,000 10,101,000 10,878,000 11,655,000 12,432,000 13,442,100 107,459,100
Expenses
Advertising 20,000 45,000 45,000 50,000 50,000 50,000 60,000 60,000 70,000 70,000 70,000 65,000 65,000 700,000
Utilities (5%) 81,030 333,000 388,500 444,000 499,500 555,000 610,500 666,000 721,500 777,000 832,500 888,000 960,150 7,675,650
Depreciation 1,650,000 1,650,000 1,650,000 1,650,000 1,650,000 1,650,000 1,650,000 1,650,000 1,650,000 1,650,000 1,650,000 1,650,000 1,650,000 19,800,000
Entertainment/ PR 10,000 12,000 12,000 12,000 12,000 12,000 12,000 12,000 12,000 12,000 12,000 12,000 12,000 144,000
Insurance 15,000 15,000 15,000 15,000 15,000 15,000 15,000 15,000 15,000 15,000 15,000 15,000 15,000 180,000
Maintenance 25,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 600,000
Management fee 200,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 300,000 3,600,000
Rent 500,000 500,000 500,000 500,000 500,000 500,000 500,000 500,000 500,000 500,000 500,000 500,000 500,000 6,000,000
Salary (15%) 243,090 999,000 1,165,500 1,332,000 1,498,500 1,665,000 1,831,500 1,998,000 2,164,500 2,331,000 2,497,500 2,664,000 2,880,450 23,026,950
Supplies (5%) 81,030 333,000 388,500 444,000 499,500 555,000 610,500 666,000 721,500 777,000 832,500 888,000 960,150 7,675,650
Telephone 40,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 50,000 600,000
Delivery (1%) 16,206 66,600 77,700 88,800 99,900 111,000 122,100 133,200 144,300 155,400 166,500 177,600 192,030 1,535,130
Miscellaneous (3%) 48,618 199,800 233,100 266,400 299,700 333,000 366,300 399,600 432,900 466,200 499,500 532,800 576,090 4,605,390
Total Expenses 2,929,974 4,553,400 4,875,300 5,202,200 5,524,100 5,846,000 6,177,900 6,499,800 6,831,700 7,153,600 7,475,500 7,792,400 8,210,870 76,142,770
% of sales 180.8% 68.4% 62.7% 58.6% 55.3% 52.7% 50.6% 48.8% 47.3% 46.0% 44.9% 43.9% 42.8% 49.6%
PBT (1,795,554) 108,600 563,700 1,013,800 1,468,900 1,924,000 2,369,100 2,824,200 3,269,300 3,724,400 4,179,500 4,639,600 5,231,230 31,316,330
Income Tax (28%) 0 30,408 157,836 283,864 411,292 538,720 663,348 790,776 915,404 1,042,832 1,170,260 1,299,088 1,464,744 8,768,572
Net Profit (1,795,554) 78,192 405,864 729,936 1,057,608 1,385,280 1,705,752 2,033,424 2,353,896 2,681,568 3,009,240 3,340,512 3,766,486 22,547,758
Mktg Investment 1,192,000
Cashflow (1,192,000) 78,192 405,864 729,936 1,057,608 1,385,280 1,705,752 2,033,424 2,353,896 2,681,568 3,009,240 3,340,512 3,766,486 23,739,758
ROI 54.62%
Page 49 of 56
10. CONCLUSION
All in all, the marketing plan has proved its potential benefits. It’s high time
Yakult Vietnam act to gain customers’ awareness and compete with Vinamilk and
Capina!
11. REFERENCE
 Writer S 2008, Yakult Vietnam reportedly inaugurates yogurt factory, Food
Business Review, viewed 17 August 2008, <http://www.food-business-
review.com/article_news.asp?guid=58CEFBA7-912A-41CE-9AB9-
9A08DF2D586F>
 Masaki H 2006, Japan Inc smitten by Vietnam, Asia Times Online, viewed 18
August 2008, <http://www.atimes.com/atimes/Japan/HF15Dh01.html>
 Yakult Japan 2008, Yakult Profile and History 2007-2008, viewed 18 August
2008, <http://www.yakult.co.jp/english/pdf/history2007-08.pdf>
 Armstrong, G, Kotler, P 2005, Marketing: an introduction, 7th edn, Pearson
Prentice Hall, United States of America
 Yakult Japan 2008, Company Profile, viewed 18 August 2008,
<http://www.yakult.co.jp/english/htm/index.html>
 Yakult Japan, News Release, viewed 18 August 2008,
<http://www.yakult.co.jp/english/news/200708-02.html>
 Yakult USA, Why drink Yakult?, viewed 19 August 2008,
<http://www.yakultusa.com/yakult/>
 Euromoniter International 2008, ‘Future demographics-Vietnam’, National
Statistics office, viewed 26 August 2008, GMID database.
 ACNielson 2008, Vietnam society: demographics and life style, Buying Behavior
course, Pakawat Kietisalsopon, RMIT University, viewed 16 August 2008, RMIT
Black Board.
 Binh, M 2008, ‘Ad spending remains strong despite economic woes TNS Media
names top ten advertisers in Vietnam’, The Saigon Times Daily, 26 August,
viewed 27 August 2008, Factiva.
Page 50 of 56
 McShane, S & Travaglione, T 2002, Organizational Behaviour on the Pacific

Rim, 2nd edn, McGraw-Hill Australia Pty Limited, Australia.
 General Statistics office 2006, Industry output value of households economic

sector at constant 1994 prices by industrial activity, viewed 26 August 2008, <
http://www.gso.gov.vn/default_en.aspx?tabid=470&idmid=3&ItemID=6403>
 General Statistics office 2007, The 2007 population change and family planning
survey: Major findings, viewed 26 August 2008, <
http://www.gso.gov.vn/default_en.aspx?tabid=515&idmid=5&ItemID=7245>
 Vietnambranding 2008, Vinamilk, viewed 26 August 2008, <

http://vietnambranding.com/danh-ba/danh-ba-thuong-hieu/110/Vinamilk>
 Just_food.com 2008, VIETNAM: Vinamilk sees profits rise 29.5%, viewed 26

August 2008, Factiva.
 Van, H 2008, ‘Foreign powdered milk brands dominate local market’, The Saigon
Times Daily, 14 August, viewed 26 August 2008, Factiva.
 PR Newswire Europe 2008, Campina Invests 10 Million Euros in Cologne
Branch, 4 June, viewed 26 August 2008, Factiva.
 Webtretho 2007, ‘Chau bi tao bon keo dai’, Dinh Duong, viewed 26 August 2008,
<http://www.webtretho.com/forum/showthread.php?p=1166546>
 BMI Industry Insights - Food & Drink, Asia 2008, ‘Company Finance Alert -
Vinamilk Continues Rapid Ascent’, Business Monitor International, 14 August,
viewed 26 August 2008, Factiva.
 Phuc, H 2005, ‘Vinamilk liên doanh với tập đoàn Campina’, Vietnamnet, 14
March, viewed 26 August 2008, < http://www.vnn.vn/kinhte/2005/03/389377/>
 Nghi, TV 2005, ‘Campina vào thị trường VN’, Vietbao, 21 July, viewed 26
August 2008, < http://vietbao.vn/Kinh-te/Campina-vao-thi-truong-
VN/40089687/87/>
 Big C 2008, About Big C Vietnam, viewed 26 August 2008, <
http://www.bigc.com.vn/index.php?o=modules&n=seminar&f=seminar>
 Coop-mart 2008, He thong sieu thi Coop-mart, viewed 26 August 2008,<
http://coopmart.saleoff.com.vn/store/news.aspx?NewsID=184&StoreID=353>
Page 51 of 56
 Euromoniter International 2005, ‘Consumer Lifestyle-Vietnam’, National

 Euromoniter International 2007, ‘Vietnam’ distribution of income’, National
 ‘Nhà máy Yakult Việt Nam chính thức hoạt động’ 2008, SanhDieu, viewed 21
July 2008, <http://sanhdieu.timnhanh.com/khoe_dep/chi_tiet/55796/0/khao_sat>
Page 52 of 56
12. Appendix:
12.1Appendix 1: Consumer Expenditure by Purpose (% Analysis): 1990-2015
% of total consumer 1990 1995 2000 2005 2010 2015

expenditure
1990 1995 2000 2005 2010 2015
Food and non-alcoholic
beverages 26.00 26.00 24.94 22.78 23.18 23.84
Alcoholic beverages and
tobacco 5.60 5.60 5.78 5.86 5.65 5.53
Clothing and footwear 8.60 8.50 8.19 9.23 10.20 10.24
Housing 8.70 8.60 8.58 8.66 8.22 8.66
Household goods and
services 8.70 8.60 8.51 8.76 8.74 7.77
Health goods and medical
services 7.93 7.83 7.71 7.64 7.78 7.90
Transport 12.57 12.42 11.96 11.87 11.21 10.70
Communications 1.16 1.15 1.55 1.76 1.66 1.64
Leisure and recreation 5.03 4.97 4.90 5.08 4.87 4.95
Education 7.54 7.45 7.36 7.48 7.44 7.50
Hotels and catering 5.00 5.90 6.11 6.44 6.55 6.86
Misc goods and services 3.18 2.99 4.39 4.43 4.50 4.41
TOTAL 100.00 100.00 100.00 100.00 100.00 100.00

Source: National statistical offices/OECD/Eurostat/Euromonitor International
12.2Appendix 2: Population structure by age group and sex, Vietnam 1/4/2007
Page 53 of 56
(Information adopted from General Statistics office 2007)
12.3Appendix 3: Age specific fertility rate for the whole country from 1/4/2006 to
31/3/2007 by urban and rural areas.
Page 54 of 56
10.4 Appendix 4: Coop-mart network service in Ho Chi Minh City
1. CO.OPMART CỐNG QUỲNH Tel: 08. 7307233

ĐC: 189C Cống Quỳnh, P.NCT, Q.1, Tp.HCM Fax: 08. 7307240
Tel: 08. 8325239
Fax: 08. 9253615 12.CO.OPMART BMC
ĐC: 254 Lũy Bán Bích, Q. Tân Phú,
2.CO.OPMART NGUYỄN ĐÌNH CHIỂU Tp.HCM
ĐC: 168 Nguyễn Đình Chiểu, P.6, Q.3, Tp.HCM Tel: 08.9734024
Tel: 08. 9301384 Fax : 08.9736312
Fax: 08. 9301386
13.CO.OPMART LÝ THƯỜNG KIỆT
ĐC: 497 Hòa Hảo, Q.10, Tp.HCM
3.CO.OPMART ĐINH TIÊN HOÀNG
Tel: 08. 9572857
ĐC: 127 Đinh Tiên Hoàng, P.3, Q.BT, Tp.HCM
Tel: 08. 5100092 Fax: 08. 9522843
Fax: 08. 841 8227
14.CO.OPMART AN ĐÔNG
4.CO.OPMART THẮNG LỢI ĐC: 18 An Dương Vương, Q.5, Tp.HCM
ĐC: 2 Trường Chinh, P.Tây Thạnh, Q. Tân Tel: 08. 8352612
Phú, Tp.HCM Fax: 08. 8352592
Tel: 08. 8155483
Fax: 08. 8152969
5.CO.OPMART PHÚ LÂM

ĐC: 6 Bà Hom, P.13, Q.6, Tp.HCM
Tel: 08. 7514798
Fax: 08. 7514800
6.CO.OPMART TRẦN HƯNG ĐẠO

ĐC: 727 Trần Hưng Đạo, P.1, Q.5, TP. HCM
Tel: 08. 8382886
Fax: 08. 923 9496
7.CO.OPMART ĐẦM SEN

ĐC: 3 Hòa Bình, P.3, Q.11, Tp.HCM
Tel: 08. 8589968
Fax: 08. 8608516
8.CO.OPMART NGUYỄN KIỆM

ĐC: 571 - 573 Nguyễn Kiệm, Q. Phú
Nhuận, Tp.HCM
Tel: 08. 9972477
Fax: 08. 9972479
9.CO.OPMART HẬU GIANG

ĐC: 188 Hậu Giang, P.6, Q.6, Tp.HCM
Tel: 08. 960 0913
Fax: 08. 960 0254
10.CO.OPMART PHÚ MỸ HƯNG

ĐC: Đại lộ Nguyễn Văn Linh, P. Tân
Phong, Q. 7, Tp.HCM
Tel: 08. 4120084
Fax: 08. 4124944
11.CO.OPMART XA LỘ HÀ NỘI
ĐC: 191 Quang Trung, Q.9, Tp.HCM
Page 55 of 56
Information adopted from the website of Coop-mart

http://coopmart.saleoff.com.vn/store/news.aspx?NewsID=184&StoreID=353
Appendix 5:
Source: Euromonitor International from national statisticsNote: Figures for 2007 onwards are projections
Page 56 of 56

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RMIT International University Vietnam

ASSIGNMENT COVER PAGE

Subject Code: BUSM2371

Subject Name: Business Enterprise 2

Location where you study: RMIT Vietnam – Saigon South Campus

Title of Assignment: Work-In-Progress

File(s) Submitted BE2_G2_ICEBERG_WiP.doc

Student name: Nguyen Thuy Trang s3160865

Assignment due date: 29 August, 2008

Date of Submission: 29 August, 2008

Late Submission Approval NA

Number of pages including this one: (Please 56

Word Count: 9,300

4.5 Packaging ............................................................................................................. 27

The marketing plan includes 8 major parts:

2.1 Company background information

Product Name Yakult

2.2 Mission statement

2.3 Business objectives

2.4 Business strategies

As stated above, one of Yakult’s business objectives is to increase customer awareness.

2.5 Company structure

2.6 Management Team

Marketing Finance Human Production

Figure 1: Shirota-ism Principles

2.7 Departmental communication

3. MARKET RESEARCH & ANALYSIS

3.2 Market opportunities

Young population of Vietnam:

Source: Euromonitor International from National Statistics

Figure 4: Income growth (2002 – 2006)

Significant rise in health concern:

3.3 Market segmentation

Figure 5: Maslow’s hierarchy of needs

In the first three years, there are two target segmentations:

Young ladies (18-30 years old)

Figure 6: Population pyramid of Vietnam in year 2007

Figure 7: Fertility rate for the Vietnam from 1/4/2006 to 31/3/2007

Children (1-12 years old)

3.5 Competitors’ products

Figure 9: The design of Probi package

Design of Yakult product Design Betagen product

3.6 Competitors’ customers

3.6.2 Final consumers

Figure 11: Most Vietnamese urban family behavior

PRODUCER WHOLESALERS RETAILERS CONSUMERS

3.7 SWOT analysis

4.1 Product attributes

In short it is expected to strongly increase customers’ awareness about the importance of

4.3 Products classification

4.4 Product levels

In general, Yakult’s package performs the following functions:

5.1 Overall pricing stragies:

5.1.1 Factors to consider when setting prices:

Yakult’s pricing decision is influenced by both internal and external factors.

5.1.2 General Pricing Approach:

Figure 13: Value-based Pricing Process

5.2 Pricing in detail:

5.2.1 New product pricing strategy:

5.2.2 Pricing adjusting strategy:

Normal price Discount price

5.3 Positioning map: