EXECUTIVE SUMMARY

I.

OMO - the market leader of Vietnam detergent industry, is facing a threat of

being competed in rural area by it's competitor - Tide. This new product plan is to regain
the lost rural market by providing rural residents with their demand satisfaction. Current
FMCG industry and OMO's business situation are stated below. A customer insight,
home usage study is also included in this plan as a base of all decision to be made. All
of the data is according to Nielsen Report statistics.

COMPANY OVERVIEW

II.

1. INTRODUCTION
OMO is a detergent brand belonging to Unilever. On any given day, 2 billion
people use Unilever products to look good, feel good and get more out of life giving
Unilever a unique opportunity to build a brighter future. Here at OMO, we believe that
dirt is good. OMO is all about outstanding stain removal, in particular the stains that
children bring home after a much needed day of learning and playing in the great
outdoors.
OMO has always been committed to delivering the very best in stain removal and
laundry care innovation. Globally, hundreds of scientists are working on our laundry
detergent formulations. These formulations are designed to provide our consumers with
outstanding stain removal and clothes care. Whatever OMO product you choose you
can trust OMO to help you make the job easier.

2. CURRENT BUSINESS SITUATION (MARKET SHARE,

REVENUE ETC)
Despite the slight decrease, OMO still owns the biggest value % share of
detergent market in both rural and urban area (including Traditional Trade and Modern
Trade). However, while the other competitors remain unchanged, Tide is reaching out to
earn our lost market share. This is an urgent threat that needs to be concerned.
Especially in rural market, the gap is getting smaller. This issue needs more concern
and immediate treatment.

3. DIRECT COMPETITION ANALYSIS

At a closer look, Tide is paying much more attention in the rural area than the
urban one. Focusing on the VALUE % SHARE OF TRADE chart, Tide is now putting
more effort in this potential region (60% Vietnamese residents are located in rural). This
rapid growth indicates that their products and communication methods work effectively.

4. CURRENT DISTRIBUTION CHANNELS

-

Traditional Trade off North East/North West Rural

Traditional Trade off Red River Delta Rural
Traditional Trade off North Central Coast Rural

Traditional Trade off South Central Coast Rural

Traditional Trade off South East Rural
Traditional Trade off Mekong Delta Rural
Traditional Trade off North East/North West Urban
Traditional Trade off Red River Delta Urban
Traditional Trade off North Central Coast Urban
Traditional Trade off South Central Coast Urban
Traditional Trade off South East Urban
Traditional Trade off Mekong Delta Urban
Modern Trade off North East/North West Urban
Modern Trade off Red River Delta Urban
Modern Trade off North Central Coast Urban
Modern Trade off South Central Coast Urban
Modern Trade off South East Urban
Modern Trade off Mekong Delta Urban

III.

MACRO ENVIRONMENT

1. INDUSTRY SITUATION
Hanoi - Vietnams fast-moving consumer market is now
a magnet for foreign investors
As it is expected to outpace major markets like India and China with an annual
growth rate of 20 percent by 2020, fast-moving consumer goods ( FMCG ) or consumer
packaged goods ( CPG ) are products that are sold quickly at a relatively low cost such
as beverages, processed foods, milk, toiletries and tobacco.
The latest statistics released by the Ministry of Industry and Trade show that after
China, Thailand is Vietnams second biggest suppliers of consumer goods with its
garments and household utensils present in nearly 8,600 markets across the country.
Besides, Japan and the Republic of Korea are also penetrating into the Vietnamese
market through chains of convenience stores.
According to Phan Chi Dung, head of the Light Industry Department under the
Ministry of Industry and Trade (MoIT), Vietnamese rural residents whose income
increased about 44 percent over the past three years are interested in fast-moving
consumer goods.
However, he said, only 54 percent of the FMCG companies turnover come from
the rural market which accounts for up to 68 percent of the countrys 90 million people.
Given this, Dung suggested FMCG firms expand their reach to rural areas, especially in

the context of integration. The important job lies with rolling out suitable investment
plans, he noted. Dung said domestic FMCG companies are encountering a spate of
difficulties such as weak financial capacity and dependence on imported materials. In
order to boost the countrys consumer goods sector, he suggested completing the legal
system and technical barriers to trade, and simplifying administrative procedures to
create an open and favourable business environment. Dung also called on the local
businesses to improve their product quality and production and processing capacity,
especially in the field of food hygiene, while building brand names for their products.
Le Viet Nga, deputy head of the MoITs Domestic Market Department, blamed
the inequality in product distribution in rural and urban areas for the moderate figure.
The MoIT forecast that total revenue of the consumer goods-related sectors in Vietnam
will hit 140 billion USD in 2016, thus creating great opportunities for FMCG businesses
at home to boost production and expand the market.
They were also urged to build suitable distribution channels and develop new
products to stimulate consumption demands .-VNA
HCMC The fast-moving consumer goods (FMCG) market would expand 5-6%
this year as projected by market research firm Kantar Worldpanel.
The firm forecast the FMCG market in HCMC, Hanoi, Danang and Can Tho
would grow higher than 2.7% in 2015 while the rural areas would see growth slowing to
5-6%, compared to 8.5% in 2015.
In 2010-2013, the rural market enjoyed an annual expansion rate of over 12%
and even 30.5% in 2011. The market started to experience a slowdown in 2014 with a
rate of 10.4%.
Nguyen Huy Hoang, business development director at Kantar Worldpanel in
Vietnam, said the firm had made the growth forecast for the FMCG market this year
based the the countrys economic growth of 5.46% in quarter one, which was lower than
in the same period last year. Hoang said a slight increase in the consumer price index in
the first months of 2016 indicated more pressure on inflation this year. Hoang said more

women have gone out for working, so time saving is important to them. They prefer
buying convenient food items like milk, rye drinks and canned fish, among others.
Vietnams gross domestic product (GDP) growth is projected to cool to 6% this
year, lower than the Governments target of 6.7%, due partly to severe the impact of
protracted drought and saltwater intrusion in different parts of the country.
Lower economic growth would place an impact on purchasing demand in rural
areas, according to Kantar Worldpanel. The firm forecast demands of consumers for
convenient and healthcare products would remain high this year.
Nowadays, people opt to buy products at places near their houses or on their
way back to their homes as shown in the firms recent survey on lifestyle. This explains
why traditional retail channels remain dominant in Vietnam, and grocery stores in cities
and rural areas have posted sustainable growth over the years.
Mini-supermarkets and convenience stores have been attractive to shoppers
despite their small market share in the domestic retail market.
The firm said more consumers have paid attention to their health due to
increasing concern over food safety and environmental pollution. Therefore, sales of
healthcare products, including soy milk and yogurt, have grown strongly in recent years.

2. MARKET TRENDS ANALYSIS TRENDS

Standard powder detergents remained the key category contributing to laundry
cares positive growth in 2015. With sales of nearly VND 15 trillion, standard powder
detergents occupied over 70% of laundry cares retail value in 2015. Despite liquid
detergents increasing popularity, a large proportion of around 75% of Vietnamese
population still washed clothes by hand by the end of 2015, making powder detergents
the superior choice mainly thanks to its cheaper unit price against liquid detergents.

COMPETITIVE LANDSCAPE
Unilever Vietnam International Co Ltd dominated the category with 70% retail
value share. Its Omo detergent products dominance was mainly responsible for its

leading position on the market. In order to maintain its prevalence, the company has
been very active in its marketing campaigns. In 2015, Unilever Vietnam launched a
music video clip hosting one of the most popular V-Pop singers with Omo product
placement in it. The campaign received huge support from homemakers, which greatly
supported the companys performance in 2015.

PROSPECTS
Standard powder detergent will remain the key laundry care category, holding
approximately 70% of the overall laundry care forecast revenue. The Eco Bubble
technologys increasing presence in new washing machines, which allows powder
detergents to dissolve faster and more efficiently in water, is expected to be responsible
for the predicted trend. Consumers will no longer have to worry about powder
detergents clogging up in their clothes, which can cause skin irritations.

IV.

SWOT ANALYSIS

1. PESTEL Model
Political

Developing economy
Open business policy

Economical

International Economies

Steady economic growth

Inflation rate in Viet Nam is high
Social

Increase in number
concerned customers

of

health-

Technological

Create opportunities for new products

and products improvement in term of
marketing and production

Legal

Legal aspects focus on the effect of

the national and world legislation.
Omo receive all the rights applicable
in the nature of their business and
every
invention
and
product
development is always going into the
patterned process

Environmental

All facilities are strictly monitored to

the environmental context

2. PRODUCT WEAKNESSES
According to Nielsons home usage study, people in the rural areas, who mainly
wash clothes by hands, prefer Tide products because when washed there are lots of
foam. The fact that customers favor this foamy feature of Tide takes account for its
dominating share in rural areas. Furthermore, customers in big cities do not need this
feature since they mostly use washing machines instead of doing it by hands so thats
why OMO rules out in big cities.

V.

NEW PRODUCT DEVELOPMENT PLAN

1. PRODUCT IDEA ANALYSIS :
A new product that offers not only cost-proficiency but also fix the problem that
the current product has such as : not clean enough, not foamy enough, .

In order to gain back the share in rural areas, OMO must compete against Tide
and other leading brands not only by the foamy feature but also by taking advantage
of its advance innovation. OMO will launch a line of LIQUID DETERGENT product that
can solve the above problems. In addition, this new line of product will come in smallsize packages to provide not only convenience but also cost-saving feature because
smaller prize tend to attract more customers.

2. PROBLEMS WITH THE BRAND PRODUCT ARE THAT

IT DOES NOT HAVE :

_ Price advantage to other competitors
_ Customers insight correct response.
_ Good retail stores, distributor relationship
_ High market share and high brand awareness

3. RECOMMENDED PRODUCT CONCEPT

Main features of liquid detergent by OMO :
_ Lower cost than powder detergent.
_ Cleaner and more efficient (more longer-lasting foam).
_ Low-price impression & small size reference.
_ Good relationship with retail stores (additional)

4. RECOMMENDED TARGETED SEGMENT:

20 to 50 years old

Family income from 5 millions VND to 10 millions VND

Do groceries shopping daily

R
(
Price sensitive

5. CONCEPT EVALUATION AND TESTING

After many stages of testing the product before being published, the products still
need more evaluation and testing from the end users themselves for the most accurate
results.
OMO will carry out the traditional way to have the evaluation from the customer
by delivering free samples to retail stores and directly to the households certain rural
area. Later, OMO will collect the feedbacks by sending employees to the retail stores
and households with paper surveys. Then the results collected together, analysed for
better changes in the way employees of the company attend customers. The
management of the company can create questions with yes or no answers and should
be in the form of questionnaires where they are distributed to the specific population.

VI. Financial analysis

This section will offer the financial overview of OMO related to

opeartion activities. Brand will address break-even analysis, sales
forecasts, expense forecast, and indicate how these activities link to the
marketing strategy.
1.

BREAK EVEN ANALYSIS

Break even analysis

(Units, VND)

Monthly units break-even

750,000

Monthly sale break-even

1,500,000,000

Assumptions
Average per-unit revenue

2,000

Average per-unit variable cost

100

Estimate monthly fixed cost

1,000,000,000

The break-even analysis indicates that 1,500,000,000 VND will be required

in monthly sales revenue to reach the break-even point.

2.

SALE FORECAST

OMO knows that the sales forecast figures are conservative. It will
steadily increase sales as the advertising budget allows. Although the
target market forecast listed all of the potential customers divided into
separate groups, the sales forecast groups customers into two categories:
recreational and competitive. Reducing the number of categories allows the
reader to quickly discern information, making the chart more functional
(Billion VND).

5 years Sales Forecast

Sales

2016

2017

2018

2019

2020

Recreation

79,5B

93,5B

109B

115B

120B

Competitive

0.5B

1,5B

1B

1,75B

2,2B

Total sales

80B

95B

110B

116,75B

122,2B

Recreational

3,9B

4,3B

3,4B

4,5B

4,7B

Competitive

0.1B

3B

0.35B

0.42B

Subtotal
of sales

4B

4,6B

3,6B

4,85B

5,13B

76B

90,4B

7,4B

111,9B

117,07B

Direct cost of sales

cost

Profit

3.

0.2B

MARKETING EXPENSE BUDGET

The expense forecast will be used as a tool to keep the department on

target and provide indicators when corrections/modifications are needed for
the proper implementation of the marketing plan.

Marketing
Budget
Website

Expense

2016
0.1B

2017
0.12B

2018
0.13B

2019
0.135B

2020
0.14B

Advertisements

12B

14B

15B

16B

16,5B

Printed materials

1B

2B

2,5B

2,5B

2,75B

Totals
Expenses

S&M 13,1B

Percent of sales

16.375%

16,12B

17,63B

18,835B

19,301B

17.9%

16.02%

16.13%

15.79%

4. A.T.A.R MODEL (Billion VND)

5 years forecast (based on a research of Q&Me and a research about
laundry detergent Vietnam market in 2013).
Omo
detergent

liquid

2016

2017

2018

2019

2020

Awareness

Trial Rate

Availability

0.86

0.87

0.9

0.92

0.95

Repeat

0.83

0.84

0.85

0.88

0.9

MS

0.7138

0.7308

0.765

0.8096

0.855

Total sales Units

80B

95B

110B

116,75B

122,2B

A-T-A-R Variables

5.

PRODUCT LIFE CYCLE

Introduction (2 months)
-

In rural market, Omo lost market share because the different in customer insight, now
the brand has launched new product small package liquid detergent. It might be lost one
part of revenue on advertising cost, distribution cost or inventory.
The price at that time is just 2000 Vietnam dong, so it is the competitive advantage of
Omo. Rural consumers are likely to spend money on low price products.(Based on a
research of Nielsen)

 Growth (10 months)

-

At this time, Omo can start to benefit from economies of scale in production, the profit
margins, as well as the overall amount of profit, will increase. This makes it possible for
businesses to invest more money in the promotional activity to maximize the potential of
this growth stage.
The appearance of many competitors in domestics market in the similar segmentation
like P&G, Aba, Vi Dan, etc will affect a significant role in market war.

Maturity(7 years)
-

During the mature stage, the product is established, and the aim of brand is now to
maintain the market share they have built up. The revenue gain at stable, the market
share estimated is 85.5% of the whole market detergent.
Decline(1year)
- This stage happens when these rural market turn into the urban market. Vietnam is one
of Asian country have most rapid growth in area. The consumer behaviors might be
change to use products with high price and quality. The small package liquid detergent
Omo with just 2000 VND can be rejected out of market. And Brand get lower profit for
this SKU.

VI. LAUNCHING PLAN

1. Marketing mix 4Ps

Product
- Liquid detergent with more foam
- 50ml package size
- Package design includes hand-washing image (to avoid stereotype of liquids
usage is only for washing machine) and liquid detergent efficiency/advantages.

Price
2000 VND ~ 50ml package
Although urban customers can easily figure out small packages are just tactics to
earn cheap impression, rural residents do not consider much about the real cost.
Therefore, 2000VND is a very familiar price among rural residents who purchase 50ml
shampoo, condition, shower gel, Pricing strategy is to make use of this phenomenon
and create a cheap impression for the target customers, pulling them to try OMO new
laundry technology with low price and great efficiency.

Place
Nowadays, FMCG industry is not only about Traditional Trade but also Modern Trade.
However, since OMO is urgently losing the Traditional Trade market share and the
solution for this problem is a new product produced to meet the lost markets demand,
we only discuss about Traditional Trade market, including all of these below markets:
-

Traditional Trade off North East/North West Rural

Traditional Trade off Red River Delta Rural
Traditional Trade off North Central Coast Rural
Traditional Trade off South Central Coast Rural
Traditional Trade off South East Rural
Traditional Trade off Mekong Delta Rural
Traditional Trade off North East/North West Urban
Traditional Trade off Red River Delta Urban
Traditional Trade off North Central Coast Urban
Traditional Trade off South Central Coast Urban
Traditional Trade off South East Urban
Traditional Trade off Mekong Delta Urban

Promotion
-

TV commercials.
Free sampling at retailers, included with powder detergent packages.
Use KOLs familiar to farmers and rural residents like Viet Huong, Hoai Linh, Thu Giang.
Activate Booth in crowded areas, where target customers (housewives the decision
makers) gather such as markets, big retailers.

2. BUDGET (Billion VND)

TVC, Viral Media Marketing

2B

Promoting activities

5B

Celebrities/Influencers

3B

Discount prices for retailers, distributors

2B

Total

12B

3. GOAL
Repositioning brand and gain market share from P&G

4. OBJECTIVES
-

Achieve more than 80% market share in rural environment

Gaining brand loyalty via increasing brand love.
Monthly units sell over 750,000
Available in most of grocery stores.

5. PRE-LAUNCH(1 MONTH)

Public relation, newspapers articles to introduce and get attention of people.

Digital marketing: Generate the content is related to small package liquid for handwashing.

6. LAUNCH (3 MONTHS)

Place TVC commercial using KOLs like Viet Huong, Hoai Linh
To traditional trade(retailers):
Delayed payment: 50% in the next 6 months
Bonus commission for outstanding performance
Display all liquid detergent at stores in 3 months at the point of purchase.
Free sampling with the new customers.

7. POST LA UNCH (1 MONTH)

-

Measure impact through marketing research

Analyse data and do report.
Collect review from customers and listen them through social media like Facebook,
forum, chat box.

VII. Controls
It is entering strategic control to judge the firms overall strengths and weaknesses that
demonstrates companys long-term performance with reference to the close competitors. It is
the way to know firms capable to face challenges and threats. The following areas will be
monitored to gauge performance:
Revenue: monthly and annual
Expenses: monthly and annual
Customer satisfaction
New-product development fix for target customer
1.

IMPLEMENTATION

It has to decide on project size and time frame. Achievement milestones had mention in
marketing program about: pricing, place, product, advertising and promotion. It is important to
accomplish each one on time and on budget.

2. OPERATION ORGANIZATION
The top management and middle level management are responsible for the annual plan control.
They have to keep a check on the activities undertaken to implement the plans.

3. CONTINGENCY PLANNING
Difficulties and Risks
o

Into the market has strong competitors from P&G, Aba, Lix, Vidan, etc.

Problems in the product design. Difficulty create the new product to match target consumers
insight.
Worst-Case Risks

Omo cannot support retailers on an ongoing basis.

Having to liquidate equipment or intellectual capital to cover liabilities.