7 June, 2009

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Author: Huynh Anh Thu

Tang Thi Thanh Ha Nguyen Manh Luan

Diesel Fashion Company

Executive Summary
Since the economics growing, the demands of customers are also higher; for instance, customer in the past they only need foods and clothes, but now, they require cuisine and couture. That is why many services along with products in high quality were born. And Diesel is among of those new brands, a strictly high fashion label for designing and manufacturing jeans. Today, Diesel has also expanded its design in bags, watches, footwear, sunglasses, fragrances, a special fashion channel for kid, brings more options to the customers. Late of year 2007, DAFC Group chose Diesel to be a new branch of it distribution channel for luxury goods in Vietnam, and locate in Diamond Plaza. It has been almost two years since Diesel has came to Vietnam, but the sales volume in this market is not as much as the expectation. However the reason is not because consumers saturated with luxury brands or foreign brands regardless its reputation, it is due to the inefficient marketing strategy. Take a look at other competitors of Diesel such as CK jeans, Guess, or Levis who target the same market with Diesel, they are still expanding their branches simultaneously with building close relationship with customers, Diesel seems to be quiet and stay outside this severse marketplace. Although Diesel is one of the worlds most well-known design and fashion companies, it also need a marketing plan to raise people awareness about it reputation, as well as its style and its design. This marketing plan therefore made to meet the need of Diesel company, it includes three main parts: Situation analysis: Using Porter s Five Forces theory to point out the threats of new entrants, buyers, substitutes, suppliers and industry competitors. Besides that, it also has a SWOT analysis to figure out strengths and weakness of this business. Marketing strategy: describe some strategies such as product strategy, pricing strategy, or promotional strategy which can approve to Diesel Company.

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Financial Analysis: which provide more details about the marketing plan for implementing.

In comparing to other high label brands who are present in Vietnam longer than Diesel, the amount of money that Diesel spend for marketing investment are just modest. The financial statement supports a positive view for this business through the net profit, ROI figures, and the cash flow. With the marketing plan, the business needs only three months to achieve positive cash flow. And after six months, the cumulative cash will also out of negative. Especially, the ROI after one year is 21%, this is accepted number when operating a business. Despite the founder of Diesel brand Renzo Rosso said that Its really not that important to me to make a big sales, it in fact has brought 3 million Euro in 1985 to 1 billion Euro in 2007 (Grosvenor, C. 2008). Surprisingly, the founder of this brand whose knew little about advertising and business still can make Diesel become one of the most influential and fashionable clothing manufacturers that its reputation widespread all over the word. Here we have a specific marketing plan, combine with the Diesel fame, perhaps it enhance the development of this business faster than any one can.

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Table of Contents
I. II. Introduction ........................................................................................................................ 4 Management Team ............................................................................................................. 4

III. Situation Analysis .............................................................................................................. 5 Threat of New Entry: ............................................................................................................. 5 Threats of Substitute Products: .............................................................................................. 6 Power of Customers ............................................................................................................... 6 Power of Suppliers ................................................................................................................. 7 The intensity of competitive rivalry....................................................................................... 7 IV. SWOT Analysis.................................................................................................................. 9 V. Marketing Strategy........................................................................................................... 10 Product Strategy ................................................................................................................... 10 Pricing Strategy.................................................................................................................... 11 Promotion Strategy .............................................................................................................. 13 Customer Strategy................................................................................................................ 16 Distribution Strategy ............................................................................................................ 18 VI. Financial analysis ............................................................................................................. 19 Sales Forecast:...................................................................................................................... 19 Net profit prediction:............................................................................................................ 19 Financial Implementation: ................................................................................................... 21

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VII. CONCLUSION ................................................................................................................ 22 VIII.References ........................................................................................................................ 23 IX. Appendices....................................................................................................................... 24

I.

Introduction

The aim of this marketing plan is to indicate the current situation of Diesel Company in the Vietnam apparel market through industry overview, competitors, substitute products, customers and suppliers. Besides that, it also provides some probable strategies which will help the company to gain market share as well as increase the number of customers. The last part is financial analysis which shows in detail the implementation of this plan.

II.
Mission:

Management Team
Enhance the reputation of Diesel among the Vietnamese consumers as well as increase the sales volume of Diesel Company by the end of year 2010.

Goals & Objectives: Lead Diesel to become a premier of jeans and fashion brand in Ho Chi Minh city, and Hanoi. Expand the market share to 15% among the luxury brands such as CK jeans, Guess, or Levis. Increase the sales volume to 20% compare to the last year. Retain at least 90% of first time customer to be back, along with improve the loyal customers satisfaction. Roles & Responsibilities: Choose appropriate communication tools such as magazines, website or hold events in order to raise awareness about Diesel brand in consumers as well as spread out the Diesel reputation through the market. Maintain close relationship with current customers along with attract new ones by the promotion strategy. In addition, conducting a customer satisfaction surveys to improve in service quality. Follow the marketing plan but being flexible to operate it in a proper way. Manage not only advertising and promotion campaign but also customer information.

7 June, 2009 Communication: -

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Mobile phone is a primary tool to contact among team members. Any official document is sent by email throughout the team. Conference is held at least twice a month to update information from every single department.

Key Performance Indicators Percentage of new customers come to the store Percentage of customer loyalty Brand awareness in market as well as in customers perception. The number of complaints.

III.

Situation Analysis

By using the Porter s five forces, we will analyse this business contrast in a competitive environment.

Source: Porter, M . E. 1979, How co mpetitive forces shape strategy, Harvard Business Review

Threat of New Entry:

Barrier to entry: Due to the numerous of stores along with fashion company opening, Diesel are currently in monopolistic market structure which is low concentration and low barrier to entry. Economics of scale: As long as Diesel belongs to DAFC group, its imported products therefore are always bulk purchased and charged at lower tax rate, it is an advantage of

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authentic Diesel products sold in Diesel Store which are diversified in style, and variety in size compare to the small retail shops. Distribution channel: Although choosing the same distribution channel with our competitors such as CK jeans, Levis, or Guess will increase our disadvantages, yet this is the shortest way to communicate with our target customers. Therefore, we will distribute the products only in huge plaza or central street such as Dong Khoi or Nguyen Hue due to the reason that it is first place where people come to find a luxury brands, and the potential of customer willing to spend money is higher than any other places. Differentiation: Always fresh and creative, Diesel promise to bring new air to the fashion industry in Vietnam through its products including jeans and casual clothing as well as accessories.

Threats of Substitute Products:

Indeed, there are may be a thousand substitute p roducts for casual clothing or accessories, and may be nothing is substitute for it. For instances, people can pay millions VND for a meal instead of buying a pair of jeans, so meals become substitute for clothing. However, when you do need something to dress, you must buy clothing, not a meal anymore, and it seems like nothing can replace clothing. To simplify the confusedness, we look at the price of Diesel products which is usually cost around two to three millions VND for a pair, thus there are a thousand of substitutes for it. Hence, we have to convince customers that they are not buying just a jeans or an accessories, but they are joining the group of stylish worldwide, and they are unique in that.

Power of Customers
Look at the figure from Consumer Confidence Survey conducted by Nielsen Company ( October 2009) stated that Vietnam is the fourth most confident country in the world which confidence index jumped from 85 in April to 109 in October, while the global average just raised 9 points and stands at 86. Especially, from the General Statistics Office of Vietnam, they reported that textile, hats, footgear increase by 0.32%, rank number 5 among consumer price index. The most shocking news is from Ben Stocking (2007), the article concluded that Vietnam develops taste for Luxury goods and it describes the Vietnam consumers spent a thousand of dollar for their favourite things which is usually foreign brands. Member s of the new

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generation want to enjoy life and pamper themselves with luxurious things, said Van, who has purchased five $ 1000 handbags at Louis Vuitton. These all are perfect indicators to believe that Vietnam is a potential market for developing luxurious brands like Diesel Company. Another aspect is the power of customers in this business is strong due to the numerous of suppliers existing. They have a variety of brands to choose, and it becomes a disadvantage for the company to compete with others. However, the advantage of Diesel is that jeans is general fashion for all ages and genders, it seems like the first choice of casual dress from children to adult, sometime in middle-ages and elders. Like Cameron Diaz famous actress said Im like every other woman: a closet full of clothes, but nothing to wear. So I wear jeans. Therefore, people still buy a pair of jeans even when they have dozen of it. As the result, the demands for this kind of clothes are huge and uncountable.

Power of Suppliers
Because most of Diesel products are imported from overseas through an intermediaries DAFC group, a company which has responsibility for importing and distributing for majority of high-standard products like Burberry, or Diesel. Therefore, the suppliers of our company are from overseas such as China, Hong Kong, Italia, or the U.S. In short, this company does not have any supplier who takes the most powerful.

The intensity of competitive rivalry

This is the key factor of the competiveness of the industry, therefore, it is always place in the center of the diagram. Take a general view at Vietnam market, sumptuous fashion brands such as Louis Vuitton, Gucci, or CK jeans already have an official store in Vietnam, and some other famous brands like Salvatore Ferragamo, Roberto Cavalli are present in luxurious plaza, Diamond, Parkson for example. Those brands are direct rival to Diesel due to the same target market that they attract. As a market research and market development (2008) cited that in order to capture that attention of Vietnams nouveux riche, the luxury brands almost spent millions of marketing dollar (billions of VND) on this promising market. And there are still a lot of foreign manufacturers tend to expand their market in Vietnam due to its recovery economics and the power of consumer here. Besides that, some Vietnam high quality brands like N&M, Gosto, An Phuoc, Vietten are also indirect competitor of Diesel. Although their target customers are a little bit different from

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Diesel, these are potential consumer who easily switch to the foreign brands when their income higher. This table below will provide a broad of view to the fashion brands in Vietnam from the domestic brands to the foreign one.

Brands

Target customer Ages Income Low Medium

Price

18 50

100,000 300,000 VND 200,000 500,000 VND 600,000 1,000,000 VND 600, 000 1,500, 000 VND 500,000 5,000,000 VND

13 25

Medium

25 - 50

Medium High Medium High

22 - 40

18 35

Medium - High

18 35

Medium High

1,000,000 5,000,000 VND

18 35

Medium High High Medium High High

1,000,000 5,000,000

30 -50

2,000,000 10,000,000 VND

7 June, 2009

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Above 25

High

Above 30

High

IV.

SWOT Analysis

S
Famous brand name
Well-located

W
Lack of marketing plan
High cost of structure

O
Fashion industry in Vietnam is growing fast Vietnam consumers are willing to spend money prove their class
Jeans is demands for unlimited ages and genders

T
Competitive environment with a numberous of rival Counterfeit products in Vietnam market

Professional management team

Close relationship with mass communication tools

No factory in Vietnam

Tax on imported products is still high

Brand loyalty of customers

Slow respond to customer behavior

SWOT Matrix
STRENGTHS
SO strategies:

WEAKNESSES
WO strategies:

Reinforce the strong brand Flexible with the marketing plan

OPPORTUNITIES image among consumers.

demands of customers.

Quickly respond to the changes as well as customers behaviors.

Expanding outlet to meet the of environment

7 June, 2009 Raise people brand awareness. ST strategies:

VNMARKETRESEARCH

WT strategies:

Using mass media to raise Analyse the problem from inside

THREATS

people loyalty.

to outside.

Keep fresh and creative to Following but be flexible with attract customer. the marketing plan.

V.

Marketing Strategy

Product Strategy
Product attributes: o Quality: Diesel is famous for its high fashion label in manufacturing jeans as well as accessories. Although being born after Levis, it quickly became one of the worlds most well-known design and fashion companies, indeed, it outsold Levis in the U.S for the couture jeans section of fashion in recent years (eSsortment 2007) o Differentiation: We dont sell clothes, we sell life style, said Renzo Rosso. It usually releases a striking though with its ad campaigns which is creative, mischievous, and sometime controversial. Due to the reason that Diesel want to capture people attention, curious and then desire for the products. o Design: Unique style, distinction, creativity, and functionality are features that make Diesel bold and daring besides practical and versatile Branding: Short and memorable, the name Diesel was chosen very carefully by Ranzo Rosso the CEO, and also the founder, because it is pronounced the same in every language. Product level: o Core benefit: Meet a demand of dressing. o Basic Product: jeans and casual clothes o Expected product: Fashionable and high quality o Augmented product: Free repairing services, free gift on birthday, or discount for regular consumers. o Potential Product: Create an unpredictable design is Diesels forte. Maybe an astronautical costume in the near future.

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Product life cycle: Although Diesel are present in Vietnam long time ago in many retail stores, it official store just opened for less than two years. Hence, we can conclude that Diesel Vietnam is on the growth stage.

Product diversification: o Jeans and Casual wear: Including Diesel for Men, Diesel for Woman and Diesel for Kid., mainly focus on these products because these are the core products to attract consumer. Especially, Diesel Black Gold, the new type of couture jeans from Diesel which makes it differentiated from other casual fashion brands such as Gucci or CK jeans. o Accessories: Also concentrate on these products because it is complimentary goods of Diesel which also contribute to the sales volume of the store.

Product classification: Currently, Diesel belongs to shopping product category which is infrequently purchased and usually compared in price, quality, and style. The most intensive rivals place in same category with Diesel are Gucci and CK jeans which charge the same price and target the same type of customers.

Packaging: Paper is encouraged to use rather than plastic, because most of customers are from high- income and well-educated, therefore they will concentrate on every social aspect, particularly on environment protection, the hot topic recently. In addition, free wrapping gift service should be implemented, due to its small effort but unimaginably enhance customer loyalty.

Pricing Strategy
There are two factor need to consider when setting price:

Source: Kotler et al 2005, Pricing Considerations and Approaches, Principles of Marketing an Asia perspective, Prentice Hall, Singapore

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7 June, 2009 Inte rnal Factors : Marketing Objectives:

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o Become a leading of high fashion jeans brands particularly in Ho Chi Minh, and Hanoi, and generally in Vietnam. o High quality products with the high price o Not only sell clothes, but sell life style. Marketing Mix Strategy: Product: Besides provide tangible products to the customer, Diesel also provide

intangible product such as Fashion shows, Music Concerts, and some other branding activities through year in order to keep close relationship with current customer as well as expand Diesel reputation to the new one. Price: Diesel already chose to develop in the high fashion label zone since the beginning of opening. However, there will be some sale-off seasons for those whose has smaller pocketbook to have the opportunity to experience the world coveted denim. Place: Diesel will place only in luxury plazas such as Diamond, Parkson, or Paragon, and central streets like Dong Khoi, Nguyen Hue where most of people from high-class usually come to show off their wealthy. Promotion: Using as much as mass communication to spread out Diesel reputation such as advertising on newspapers, magazines, or websites, or public relations (Fashion show, Music Concerts, Sponsors, Events). More details will be discussed later in the next part.

Cost-based pricing: This tool will help Diesel calculate the number of units needs to sell in order to cover all the cost. For example:

Fixed Cost: 50,000,000 VND Price per unit: 2,000,000 VND Variable cost: 500,000 VND Break-Even Point = 50,000,000 2,000,000 500,000 = 33.33 units

External Factors: Competition-based pricing: According to Kotler et all (2005), even the company set price to make profit, it must consider the price elasticity and competitor s price. Therefore, the prices of Diesel

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product have to base on the common price of general high fashion brands. If the price set too high, it is hard to attract customers. On the other hand, if the price set too low, Diesel will lose its value in customers mind. In short, price setting depends not only on the cost of goods sold, but also on the competitors price.

Position map of Price level and Customer segmentation: Based on the customer segmentation and the different price charge on customer from variety competitors, currently Diesel place in fashion market as the graph shows below. Ages Middle - ages

Price Medium high High

Teenagers

Promotion Strategy
Personal Selling: o Training course for shop-assistants to enhance their knowledge in dealing and communicating with customers. First rule: Customer is never wrong Second rule: If customer is wrong, look at the first rule. o Minimize complaints from customers in purchase as well as postpurchase.

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o Assure the diversification in designs, and variety in size. o Be a friendly and wise advisor for customers. o Shop-assistants is also the representative for Diesel Company, keep good company image in customers mind, protect the reputatio n of company. o Keep smiling and being friendly with customer all the time.

Packaging: o Professional design, simple but style. o Using paper instead of plastic. o Display appropriate information about the brand, the products as well as the branches on it.

Adve rtising: This determinant is very important to be successful in the competitive environment. As the report in Asia Market research conducted that luxury brands such as designer jewelry, designer luggage, and other world class fashion brand are spending millions of marketing dollars in Vietnam market to capture attention of nouveux riche. Fortunately, there are a plentiful of ways to send a message to customer such as Newspapers, magazines, or Internet (see more detail in an Appendix)

Sales Promotion tools: o Coupons: Give a coupon to customer for the first time purchase at store in order to encourage they come back. Cooperating with magazines such as Stylish, Beauty, WomanWorld to distribute coupons to further customers. o Point-of-purchase promotions: is an effective way to keep customer loyal to the brand. The customers spending will be recorded in the computer system and they will receive a V.I.P card when their score reach two 30 million VND, and Gold V.I.P card when they reach to 50 million VND o Contest: An approach to retain the customer relationship. In the contest, the sales manager will have a communication with regular customer, listen to their opinion to improve customer s services better simultaneously decrease the number of complaints. Moreover, the contest is not only a chance to meet among company and customers but also the opportunity for customer to have a new relationship with each others such as sharing their product experience.

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o Advertising specialties: take a picture of celebrities using Diesel brand to convince the customers that they are using the same brand as famous people do. Furthermore, using striking ad campaigns to impress customer such as How sexy you are?, Dare you to do it, or Are you ready rock your life. o Premium: Give customer a small souvenir in addition to their main purchase, valuable present depends on the amount of customers spending. Voucher for two persons at Sheraton buffet Voucher for skin care at Shiseido Spa Little ear-rings Glass souvenirs, ect.

Public Relations tools: o Special events: In order to spread out brand awareness among customer in a short but effective way is hold an event such as Fashion show, Music Contest. (See more detail in Appendix) o Mobile marketing: Inform customers when new items arrive or any event held in the next month. o Public service activities: such as sponsor for a charity program.

Budget for Promotion: (see more detail in Appendix) Promotional Mix Unit Cost (thousand VND) 40,000 35,000 15,000 30,000 2 2 6 4 Units/year Total Cost (Thousand VND) 80,000 70,000 90,000 120,000 360,000

Print Advertising Beauty Magazine Stylish Magazine Saigon Entrepreneur Weekend Heriatage Fashion Total Print Advertising Promotional Campaign Coupons Distribution V.I.P Card Contest helding Premiums Total Promotional Campaign Public Relation Fashion show

500 10 5,000 1,000

200 100 12 100

100,000 1,000 60,000 100,000 261,000

300,000

600,000

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7 June, 2009 Music Contest Sponsor Total Samples Other mobile marketing Total Promotional Costs 0.50 800,000 200,000

VNMARKETRESEARCH 1 2 800,000 400,000 1,800,000

20,000

10,000 2,431,000

Customer Strategy
Customer Behavior Diesel target market is for young people included Vietnamese, foreigner and tourists. Understanding the customers needs is very important to provide them the best service and the final result is sales volume will increase. There are four factor affect the customer behavior such as culture, society, personal and psychological.

Factors Effect customers behavior

Culture: Vietnam is still a traditional country where many people have not accepted the Diesel design especially street style. However, the new generation, the target customers are more open-minded to the new fashion trend, and easy to adopt it. Society: this factor has important impact on the sales, especially in the group. People in the group or in a family usually influence each other. Besides that, celebrities also has a deep influence on the fashion, some people love to imitate the same as their idol or try to look similar to someone. Understanding about this, Diesel asks some celebrities to endorse their products.

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Personal: The fashionable people mostly purchase clothes depends on their life style and characteristic; this is the reason why every Diesel products has different designs and colors. Actually, everyone has different taste of fashion, some like simple design while the other like colourful with special feature designs. Diesels design has both line of the product, simple but different, classical but fashionable. On the other hand, people have good occupation with high salary will be able to spend more money for satisfying themselves. They do not care much about the price but the service is required in perfectly. Psychological: When walking into a store, being treated as a Very Important Person, the customers find hard to leave without buying any stuff. Realizing this fact, the saleassistants should have some skills to convince people that they are important to the shop, and they are truly important if they become a consumer of this brand. Besides that, with some type of customers, who seek for a free gift or high brand product with a cheaper price, the sale-assistant have to introduce a suitable one for them. Because selling something is better than selling nothing. By understanding the customers psychology, customer s service will be improve much. Custome rs buying decision process Need Recognition Information Search Evaluation of Alternatives Purchase Decision Post Purchase Evaluation (Adopted from Kotler et al 2005) Step 1: Need Recognition: Fashion is a huge topic and there is always a need for clothes. The most important is how the brand can get the most attention from the customer and build up a good image in the customers mind. Diesel focus on advertising to get the customer s attention and maintaining the quality to get the customers loyalty after using the product to assure that they will come back. On another hand, Diesel has already built a strong reputation in the fashion industry, people come to Diesels shop not just because the product but also because the Diesel Brand. Step 2: Information Search: Diesel is very popular and famous on over the world, and the information is available in internet, magazines, the refore customers can easy search for the product that they want. Moreover, they can ask experience from friends, colleges, or shop assistant before buying items. Step 3: Evaluation of Alternatives: There are many fashion brands available in the market, so the customers have many choices to purchase what they want. We build up our image in the customers mind as the high quality product, fashionable and high special

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feature design. Diesel provides variety products in order to satisfy the customer s demands. Step 4: Purchase decision: There are other factors can affect customers decision, beside the brand and the products, is the service. Diesel will provide the best service during the customer s purchasing to make the customer feel the most comfortable. Step 5: Post Purchase Evaluation: In case of the product and service of Diesel do not meet the customers needs and expectations. This may cause a negative effect to the sale of Diesel and the brand. Diesel keep doing survey and market search to minimize this risk and maintaining the quality and service.

Distribution Strategy
Distribution Channel Imported products

Diesel factory in HongKong

Diesel factory in Italy

Warehouse

Hanoi Warehouse

Ho Chi Minh Warehouse

Distributon

Department Stores

Diesel outlets

Customer

According to the chart above, Diesels products are imported from Hongkong and Italy usually by ship and plane. In Vietnam, transportation is mostly by truck from port to the warehouse, and then from warehouse, it distribute to the department stores and outlets. Diesel Company has two warehouse located in Hanoi and Ho Chi Minh city. Warehouse In HCMC: 143 Tran Nao, Dict 2, HCMC, Vietnam

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Diesel Company currently has 6 stores in the main area in Ho Chi Minh city and Ha Noi. o Ho Chi Minh is included Diamond Department Store, Parkson Saigon Tourist Plaza, Parkson Hung Vuong Plaza o Ha Noi such as Parkson Viet Tower, Trang Tien Plaza, Vincom Tower. In addtion, Diesel should hire a store in main streets such as Dong Khoi, Nguyen Hue, or Le Loi. In fact, location is one of the most important element and difficulty for every brand now because the renting cost in the centre is very expensive and sacred to find.

VI.

Financial analysis

Sales Forecast:
According to the figures in my survey, we conclude that time most time people go to shopping is the end of the year, from October to December, especially December, due to the most holidays gather in this time (Halloween, Christmas, and New years). Because January and
1 2 3 4 5 6 7 8 9 10 11 12
60 60

Sales forcast
Customers per month 180 180 180

210

90

120 120

150 150 150

February are the first time we launch this marketing plan, thus, the effective of it cannot be seen

Net profit compare to Marketing Investment

3.000.000 2.500.000

immediately. But, for the following months, the

2.000.000
1.500.000 1.000.000

number of customers will be positive growth.

500.000
(500.000)

Net profit prediction:

Although we spent a

10

11

12

13

Advertising

Sales promotion

Net prof it

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billion of VND for marketing investment, this is just a modest compare to the profit we earn later. Except month 8, when we held a fashion show, it takes a large amount of money, the rest spending are normally in this industry.

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Financial Implementation:
Before Customer /day Clothes Accessories S ales/customer Total income/month COGS Clothes (40%) Accessories (30%) Total COGS 2 3,000 2,000 5,000 300,000 Mon 1 2 3,000 4,000 7,000 420,000 Mon 2 3 4,000 4,000 8,000 720,000 Mon 3 4 5,000 4,000 9,000 1,080,000 Mon 4 4 5,000 5,000 10,000 1,200,000 Mon 5 5 6,000 5,000 11,000 1,650,000 Mon 6 5 7,000 6,500 13,500 2,025,000 Mon 7 5 8,000 7,000 15,000 2,250,000 Mon 8 6 9,000 8,000 17,000 3,060,000 Mon 9 6 9,000 8,500 17,500 3,150,000 Mon 10 6 9,000 9,000 18,000 3,240,000 Mon 11 7 9,000 9,000 18,000 3,780,000 Mon 12 7 10,000 9,000 19,000 3,990,000 805,950,000 Total 1,860

1,200 600 108,000

1,200 1,200 144,000

1,600 1,200 252,000

2,000 1,200 384,000

2,000 1,500 420,000

2,400 1,500 585,000

2,800 1,950 712,500

3,200 2,100 795,000

3,600 2,400 1,080,000

3,600 2,550 1,107,000

3,600 2,700 1,134,000

3,600 2,700 1,323,000

4,000 2,700 1,407,000 283,545,000

Gross Profit Expense Advertising S ales promotion Renting Franchise fee (5%) Market research Office expense Warehouse S alary

192,000

276,000

468,000

696,000

780,000

1,065,000

1,312,500

1,455,000

1,980,000

2,043,000

2,106,000

2,457,000

2,583,000

522,405,000 11,700,000 62,130,000 78,000,000 40,297,500 1,950,000 3,900,000 1,950,000 39,000,000

30,000

30,000 16,100

15,000 47,200 200,000 36,000 5,000 10,000 5,000 100,000

30,000 310,550 200,000 54,000 5,000 10,000 5,000 100,000

55,000 230,550 200,000 60,000 5,000 10,000 5,000 100,000

35,000 10,600 200,000 82,500 5,000 10,000 5,000 100,000

15,000 30,550 200,000 101,250 5,000 10,000 5,000 100,000

30,000 810,600 200,000 112,500 5,000 10,000 5,000 100,000

15,000 10,550 200,000 153,000 5,000 10,000 5,000 100,000

30,000 531,050 200,000 157,500 5,000 10,000 5,000 100,000

55,000 11,050 200,000 162,000 5,000 10,000 5,000 100,000

35,000 16,100 200,000 189,000 5,000 10,000 5,000 100,000

15,000 46,100 200,000 199,500 5,000 10,000 5,000 100,000

200,000 15,000 5,000 10,000 5,000 100,000

200,000 21,000 5,000 10,000 5,000 100,000

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Telephone Utilities (7%) Miscellaneous (10%) Insurance Total Expense

2,000 21,000 30,000 20,000 438,000

3,000 29,400 42,000 20,000 481,500

4,000 50,400 72,000 20,000 564,600

2,500 75,600 108,000 20,000 920,650

2,500 84,000 120,000 20,000 892,050

2,500 115,500 165,000 20,000 751,100

2,500 141,750 202,500 20,000 833,550

2,500 157,500 225,000 20,000 1,678,100

2,500 214,200 306,000 20,000 1,041,250

3,000 220,500 315,000 20,000 1,597,050

3,000 226,800 324,000 20,000 1,121,850

3,000 264,600 378,000 20,000 1,225,700

3,000 279,300 399,000 20,000 1,281,900

1,080,000 56,416,500 80,595,000 7,800,000 384,819,000

Profit before Tax Income Tax (10%) Net profit Marketing Investment Cash Flow ROI Culmulative

(138,000) (138,000) 2,431,000 (2,431,000) 21% (2,431,000)

(61,500) (61,500)

155,400 15,540 139,860

159,350 15,935 143,415

307,950 30,795 277,155

898,900 89,890 809,010

1,191,450 119,145 1,072,305

571,900 57,190 514,710

2,018,750 201,875 1,816,875

1,552,950 155,295 1,397,655

2,118,150 211,815 1,906,335

2,554,300 255,430 2,298,870

2,708,100 270,810 2,437,290

421,131,000 42,711,600 378,419,400

(61,500)

139,860

143,415

277,155

809,010

1,072,305

514,710

1,816,875

1,397,655

1,906,335

2,298,870

2,437,290

(2,492,500)

(2,352,640)

(2,209,225)

(1,932,070)

(1,123,060)

(50,755)

463,955

2,280,830

3,678,485

5,584,820

7,883,690

10,320,980

VII. CONCLUSION
To sum up, we have a material is high quality products from a luxury brand, and now we have a process to make it become leading brand of fashion clothes in Vietnam. The final step is starting, implementing this marketing plan into real, and waiting for its results.

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VIII. References
1. Business Source Premier 2008, Vietnams luxury goods market, Market:Asia Pacific, EBSCOhost. 2. General Statistics Office of Vietnam, Social-economic situation in 11 months of 2009, viewed on 20 December 2009.

<http://www.gso.gov.vn/default.aspx?tabid=622&ItemID=9383 > 3. Grosvenor, C. 2008, Denim from Italy: Diesel, Diesel Italy, viewed on 27 December 2009 < http://www.lifeinitaly.com/fashion/diesel.asp> 4. Kotler, P., Armstrong, G., Ang, S.H., Leong, S.M., Tan, C.T. & Tse, D.K.,

2005, Principles of Marketing an Asian perspective, Prentice Hall, Singapore

5. Nielsen Company 2009, Consumer Confidence Survey, viewed on 20 December 2009. <http://vn.nielsen.com/site/index.shtml> 6. Stocking, B 2007, Vietnam Develops Taste Luxury Goods, The Washington Post, viewed on 24 December 2009 <http://www.washingtonpost.com/wpdyn/content/article/2007/09/23/AR2007092300319_2.html>

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IX.

Appendices
1. Adve rtisement: Objective: Advertisment is very import to launch new products, build and maintain the brand image in Vietnam. On another hand this is the fastest way to approach to the customers and to boost business and grow market share.

Magazines: Focus on premium fashion magazines such as Dep, Phong Cach, Doanh Nhan Sai Gon Cuoi Tuan, Her World, Heritage Magazine Information

DEP MAGAZINE (Beauty) The most popular magazine in Vietnam (over 10 years) Circulation: 49,000 copies/ Monthly Target readers: Urban middle- and upper-class, aged from 18 to 45. Civil servant & office staff: 55%. Housewife: 25%. Overseas: 10%. Student & others: 10%. Single female aged 20-34, well educated with high income. Content: Nice pictures and design with in-depth feature stories, focusing on fashion, womens issues, beauty, etc Dep Fashion Show is organized every year in both Hanoi and Ho Chi Minh City to build the image for this magazine from 2003. Current advertisers: Estee Lauder, Lancme, Shiseido, Louis Vuitton, Herms, Salvatore Ferragamo, Bally, Gucci, Burberry, PHONG CACH MAGAZINE (Stylish) Circulation: 40,000 copies/Monthly Target readers: Vietnams trendy and successful women. Content: in-depth womens lifestyle topics, more dynamic and up- market design and more lifestyle information for an even more trendy target market with high income and education. It features high fashion, beauty, celebrities, entertainment news, Phong Cach Night is organized every year to build this magazines image from 2007. Current advertisers: Lancme, Shiseido, Louis Vuitton, Herms, Salvatore Ferragamo, Bally, Gucci, Burberry, Omega, Menard, OHUI, PHONG CACH MAGAZINE (Stylish) Circulation: 40,000 copies/Monthly Target readers: Vietnams trendy and successful women.

Age Group of 25-45

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7 June, 2009 Age Group of 25-45

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Content: in-depth womens lifestyle topics, more dynamic and up- market design and more lifestyle information for an even more trendy target market with high income and education. It features high fashion, beauty, celebrities, ente rtainment news,

Phong Cach Night is organized every year to build this magazines image from 2007. Current advertisers: Lancme, Shiseido, Louis Vuitton, Herms, Salvatore Ferragamo, Bally, Gucci, Burberry, Omega, Menard, OHUI,

DOANH NHAN SAI GON CUOI TUAN MAGAZINE (Weekend Saigon Entrepreneur) The most popular magazine for businesspersons in Ho Chi Minh City. Circulation: 40,000 copies/Weekly (every Friday) Target readers: businesspersons, senior officers. Content: Economic & Social Panorama, case studies, premium tours, fashion & accessories, spa, beauty, health, entertainment, car, etc Current advertisers: Louis Vuitton, Herms, Salvatore Ferragamo, Bally, Gucci, Burberry, Omega, Menard, OHUI, HERITAGE FASHION MAGAZINE Circulation: 72,000 copies/every two months (odd month) Target readers: High income Vietnamese and foreign travelers, professional, active, trendy persons. This is in- flight magazine of Vietnam Airlines. Content: Vietnamese & international lifestyle, culture, fashion trend, beauty. Golf Tournament is organized to build this magazines image. Current advertisers: Gucci, Bally, Louis Vuitton, Menard, OHUI

SANH DIEU MAGAZINE (Gourmet) Circulation: 40,000 copies/ monthly Target readers: Civil servant & office staff, well educated with high income. Active and trendy persons. Content: Vietnamese & international lifestyle, culture, fashion trend, cars, tourism, beauty, art, whats hot. Current advertisers: Louis Vuitton, Bally, Hermes, Burberry, Clo, Pinko, Nine West, Menard, Salvatore Ferragamo, Tudor, Rolex, Lacoste TUOI TRE NEWSPAPER (The Youth) Circulation: 500,000 copies / everyday Target readers: Almost all groups of readers

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Content: Current news, Government programs, market news, Health, World news, Economic news (business, finance, investment stock market, property market, etc), the youngs life, culture, art, entertainment, book, sport, law and life, etc.

Current advertisers: Fashion, FMCG, Telecommunication 2. Marketing activities:

Promotion and Event Event : New shop opening event and event introduce new season collection with jeans, clothing and accessories. Inviting potential customers, Model, celebrities and media, TV crew, reporter.. to new shop opening and to the in house show. Diesel will sponsor for the celebrities their clothes to wear in the event. Every guests come to the events will be given a sticke r with Disel logo. This is the way to make the goos relationship and get closer to the customer.

Sales Promotion: Sales promotion during special days ( such as Gift With Purchase program on Woman Day, Year-end sales) Press Conference: Model and celebrities to introduce new season collection, join in party..

- Cooperating with other activities and sponsors for fashion shows and talk shows. Example: Dep Fahion show, Phong cach va cuoc song ( Talk show Style and Life), Thoi Trang va cuoc song (Fashion and life). - Find co-sponsor for the event that they are also have the same target customer.

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Banner, show window : Banner will be placed in The department store, out side department store and in front of the shops of Diesel. The pictures will be change every season or month following the new collection of Diesel in other to draw the customers attention. Loyalty Program: Offer a loyalty program. Special occasions for VIP customers: (i.e.) Christmas card, Gift with purchase, Gala dinner for VIP customers. VIP card 10% discount for loyal customer and celebrites. Private sale before the sale season or clearance for the loyalty customers. 3. Public Relation Plan

New collection and press release on magazine, photo shooting activities, Diesel with celebritiesto make target customers know more about this brand.

Target 60 free pages per year on Dep, Phong Cach, Her World, Doanh Nhan Sai Gon Cuoi Tuan.

Sponsorship Music Gala Personal stylist for loyal customers, keep updating the new fashion trends and new collection of Diesel, mostly for the celebrities and business people who dont have much time to shop and care about their style. Every sale person in Diesel will responsible for a group of customer to update them the news of fashion and give them a special treatment when they shop in our stores in other to make the customer feel the most comfortable.

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7 June, 2009 4. Promotion schedule:

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Mon 1 Beauty Magazine Stylish Magazine Saigon Entrepreneur Weekend Heriatage Fashion Coupons distribution V.I.P Card Contest Helding Premiums Expense Fashion Show Music Contest Sponsor Event Mobile Marketing Advertising Sales promotion Total

Mon 2

Mon 3

Mon 4 40,000

Mon 5 35,000

Mon 6

Mon 7

Mon 8

Mon 9

Mon 10 40,000

Mon 11 35,000

Mon 12

15,000 30,000 10,000 100 5,000 20,000 200 5,000 20,000 30,000 5,000 50 5,000 300,000

15,000 5,000 50 5,000 20000 5,000 100 5,000

15,000 5,000 50 5,000 20,000 30,000 5,000 100 5,000

15,000 30,000 5,000 5,000 50 50 5,000 5,000 20,000 300,000 200,000 500 1,000 15,000 30,000 10,550 531,050 25,550 561,050

15,000 5,000 50 5,000 10,000 100 5,000

15,000 20,000 100 5,000 20,000

800,000 1,000 30,000 16,100 46,100 200,000 2,000 500 500 15,000 30,000 55,000 47,200 310,550 230,550 62,200 340,550 285,550 500 35,000 10,600 45,600 500 500 15,000 30,000 30,550 810,600 45,550 840,600 1,000 55,000 11,050 66,050 1,000 35,000 16,100 51,100 1,000 15,000 46,100 61,100

360,000 2,071,000 2,431,000

7 June, 2009 5. Survey form: Dear friends,

VNMARKETRESEARCH

This survey is going to be used for my personal research only, all the information about you will be confidential. Please answer it honestly. Thank for your help! 1. How old are you?

2. How often do you go for shopping?

Frequently

Sometime

Occasionally

3. How much do you spend for shopping a month? Under 5 million VND

Above 5 million VND 4. Which brand do you prefer?

Vietnamese brand 5. Where is the first place you go for shopping? Retail shops

Foreign brand

Department stores (Diamond, Parkson, etc.)

Oulets 6. Which time of year you usually go shopping? Jan April May Sep

Oct - Dec