CURRENT MARKETING PLAN

Instructor: Dr. Pham Thi Lien Group 7: Pham Ngoc Nam (leader) Tran Thu Lan Bui Thuy Nga Company: Lan Hao Cosmetic, Inc. Product: THORAKAO GRAPEFRUIT FLOWER SHAMPOO Target Market: Vietnam

January, 2011

Content
INTRODUCTION EXECUTIVE SUMMARY MARKETING SITUATION SWOT ANALYSIS OBJECTIVES AND ISSUES MARKETING STRATEGIES 3 4 6 8 13 13

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Introduction
Establishing a marketing strategy is a very important mission of each business in order to complete the most effectively 3 goals: Profit, Position, and Security. In the competitive market economy, a business needs to raise every resource, and to run aggregately elements in order to achieve formulated targets. Therefore, this company could exist and develop in the keen competition. A business could also perform market oriented efforts with golden opportunities to help it maximize profits, promote trading efficiency and effectiveness, and strengthen abilities of competition in open-door process and economic freedom. Nowadays, with the development of economy, science & technology, and higher quality of life, cosmetic market is extended enormously in Vietnam market. However, the market share of cosmetics with herbal origin is still rare. Grapefruits shampoo is a brand new product of Lan Hao Cosmetic, Ltd., with the origin of herbs and plants, and it is considered as a type of ethical medicine cosmetic product. Lan Hoa Cosmetic, Ltd., which was originally from Lan Hao Cosmetic Company, was established in 1957, and officially become a company in 1961 with traditional products such as pearl skin cream, shampoo, soap, Paraffin & Brilliantine shine liquid Thorakao branded. Experienced challenging and difficult steps, the company established a steady market in a whole Vietnam territory with products that increasingly become various and enriched in brands, lines, and patterns. Besides the strong reputation of mark THORAKAO, the company has already had other well-known trademarks in the international market such as LEYNA, FREEWOMAN, ROSS, ONSON, JULIET, etc. Today, the firm has more than 70 products containing product lines for skin care, body care and hair care. They are a combination of the advanced, original formula and extraction from natural herb of Vietnam
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With the slogan: QUALITY IS THE FIRST PRINCIPLE. The company has made a strong belief and feeling of safe in consumers, and is chosen as High-quality Vietnamese product for many years by customers Currently, the company is extending not only the domestic market, but also the international market such as Singapore, Taiwan, Cambodia, Laos, China, Australia, New Zealand, the USA, Saudi Arabia, Russia, African nations, etc. The company developed factory system in Ho Chi Minh City up to 50,000 square meters with modern equipment to construct GMP system in order to satisfy competitive demand in world economy globalization context To broadcast widely the grapefruits shampoo product, bring it to consumers hands, and spread out market for THORAKAO brands, we never stop researching and finding new ways and our marketing activities are always concerned to complete and bring high economical effectiveness, contributing to increase business scale, boost consumerism, maximize revenues and profits. With the introduction of grapefruits shampoo product, we also make appropriate marketing strategy adapted to planned goals of the company.

Executive Summary
1. Product:
The main product for this campaign is Thorakao newest invention, the Grapefruit flower Shampoo, this is a natural-based product, with extracted ingredient from Grapefruit materials, and Sulfate-free, which is dangerous to human. Thorakao is currently launching this new product into the Northern area of Vietnam, especially the capital Hanoi. Firstly Thoraokao will launch this product into the market and will have further necessary modification from the feedback of the customers.

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2. Market
2.1. Competition:

Currently the shampoo market is a very competitive market with the participation of many domestic and foreign brands. Famous domestic brand focus mainly in natural-based product (sao Thai Duong) and other focus on chemical-based product ( Sunsilk, Clear, Nizoral).There are also fake product with mass volume which are produced in China. Beside the convenient brands as listed above, there are also luxurious brand such as Davines, Toni and guys, Loreal who focus on higher-income class.
2.2. Target market:

Thoraokao provides a product that is environment-friendly, health-friendly and economicallyfriendly too. Thorakao potential market would be on woman ( above 16 years old- 50 years old) because of nowadays pollution and chemical-based products have caused lots of damage to womens hair(who are so attracted to the new idea of beauty), and also its because this group of women is possibly aware of Thorakao product. A bottle of Thorakao Grapefruit flower shampoo is so helpful, and with reasonable price, women with desperation about damaged hair will be helped.

3. Strategies:
By applying the product mix concept, the company has built programs which help promote Grapefruit flower shampoo as a medicine, not as a cosmetic product, to differentiate itself with other common products in the market. Television public relation, e-newspaper and magazines are chosen in order to let the market know the existence of our product. Discount schedule and method was also considered and applied.

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Marketing Situation
1. General:
Vietnam Shampoo market includes many brands of product line but we can divide them into 2 main types of cosmetic products and pharmaceutical products. The medicinal products can be included such as Sao Thai Duong, Thorakao, NizoralThe cosmetic products can be included as Sunsilks, Clear, Davines.

2. Competitors:
2.1. Pharmaceutical competitors 2.1.1. Sao Thai Duong Corporation:

Besides Thorakao, Sao Thai Duong is a popular brand in the market. Sao Thai Duong research and focus in the field of cosmetic, pharmaceutical and healthcare products. Sao Thai Duong motto is to continuously learning from friends, competitors and experienced folks, with the help of modern technology to better its products. Its staffs are also very determined in improving the firm status to compete with others Although very young, but for Sao Thai Duong, the brand own the credibility of a large number of consumers as well as people's capital in the country. The following products (Thai Duong ginger oil, Luu ly, Tay Thi, Qui Phi, Bup Ngoc) ... have recently became quite familiar to the customer.
2.1.2. Nizoral (Canada)

Nizoral is also a trust-worthy pharmaceutical product to customers. Its a brand of pharmaceutical shampoo originated from Canada. Its also a very popular choice for customer in the Americas, especially African American. Most African American women wash their hairs less frequently than the general population. One reason is that we spend lots of time and money on styling their hairs, and they want those styling to last! Furthermore, they don't want to put our fragile hair through a daily shampoo regimen.
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African Americans have long sought an effective solution to this beauty dilemma-one that also respects all the hard work that goes into having great-looking hair, like relaxing, color, braiding, extensions, and styling with products like gels and pomades. Examples of Nizoral products: Nizoral A-D Anti-Dandruff Shampoo addresses the needs of African American hair. Nizoral A-D provides the benefit of long-lasting relief from dandruff, including flaking, itching and dryness -its active ingredient adheres to the scalp's proteins, so it keeps working in-between washings. Even though it's strong and effective, Nizoral A-D is also safe for relaxed, chemically and color-treated hair. This is particularly important for African American women, since so many of them have to consider the special needs of chemically and color-treated hair. It's also a silk-rich, luxury shampoo that will leave hair clean, healthy, and smelling great.
2.2. Cosmetics competitors

For cosmetic products lines also divided into two major categories: Product line for the normal income class such as: Sunsilk, Clear. And the product line for high income class such as: L Oreal, Davines, etc.
2.2. 1. LOreal

With LOreal lables,The French brand, L'Oreal Paris, one of the world's top beauty care brands, offers men and women on every continent beauty and personal care products that incorporate the latest scientific advances. Visionary formulas, upscale presentation and products that are a pleasure to use: L'Oreal Paris provides affordable luxury for people who demand excellence. With LOreal in Viet Nam, customers are welcome to ask questions from ordinary products such as pricing, sales areas, how to use ... plus advice beauty tips such as how to properly grooming mascara, choosing care products suitable for every skin type of skin ... This is one of L'Oreal's
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efforts in Vietnam to continuously improve and maintain quality service and professional advice to customers. L'Oreal brands in Vietnam, including L'Oreal Paris, Maybelline, Garnier, Lancome, Biotherm, Vichy, L'Oreal Professionnel.
2.2.2. Sunsilk

In recent years, the competition of goods between Vietnam and foreign goods became so fierce, especially the products originate from multinational companies are dominanting Vietnam market. Unilever - Vietnam is also one of the big giants in the consumer market, every year has provided a wide range of essential goods for daily consumption of Vietnam such as toothpaste P / S, Omo washing powder, etc ...and shampoo Sunsilks is one of them.This is not only a threat to domestic producers but also as examples to learn about business marketing experience of a large multinational company with world-class gender. Sunsilk is a line of products at reasonable prices with normal income people. Sunsilk line of products is the highest market share in Viet Nam Sunsilk: 4:32 million, 14% market share

SWOT analysis for Grapefruit Flower shampoo

1. Strengths:
Lan Hao-Thorakao cosmetic was 1 of the first company to research and develop naturalbased cosmetics product since the 1960s.The 40 years of experience ensure the customer about the quality of the product. The company has a very huge reputation, especially in the Southern market. Beside Domestic market, Thorakao has also proved the brand name outside Vietnam border.

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Thorakao was awarded many awards for the quality serving and contribution to the Vietnamese society. Especially the Vietnamese Quality Product which has been continuously awarded to Thorakao since 1997 until now

Nature-based cosmetic provides Khorakao a unique position in the market, while other brands in the market focus mainly on chemical-based cosmetics. Sulfate, the main component in these products is the main reason of hair lost. Thorakao produces only sulfate-free product.

Since Thorakao is a domestic brand, its easier to establish factory and brand, hire staffs, collecting of materials which are naturally and domestically available, production and distribution which help save plenty of cost.

With reasonable pricing and useful multi-purposed, safe to use, The Grapefruit shampoo can be consumed by every consumers on the product.

Beside the main products of Shampoo, Thorakao has developed others supporting products for hair which can be sold as a packet or aid in the promotion plan

Good relationship with a long history with medical stores, convenient stores and super markets was developed which put Thorakao product on the top list of recommendation for hair treatment.

Well-trained and experienced Thorakaos therapists are always available to customers who are in needs of clarification and medical consultation.

E-shopping is available for consumers

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2. Weaknesses:
In order to participate in the Northen market, especially Hanoi, which is unfamiliar to Thorakao, we have to understand the different culture, policies, regulation and competitions here. Because Thorakao product represent the Vietnamese agriculture, our products have simple designs and look unattractive to consumers who are fond of stylish and beautiful designs, and the Grapefruit shampoo adopt this weakness too Our capital is not sufficient to have huge commercial advertisement like competing brand such as Clear, Sunsilk..etc.. Thorakao only has 1 brand in Hanoi at the moment, which will weaken the brands distribution force. Even if Thorakao has continuously serve the Vietnamese market for more than 40 years, the weakness of technology is undeniable, compared to foreigner brands

3. Opportunities:
Widely available in the chain of convenient stores, pharmacies and super markets which lead to good positioning. The Grapefruit Shampoo has the chance to become the best unique Shampoo that has its ingredient extracted from Grapefruit flower. The Vietnams economy is raising and their spending behavior also changed. Vietnamese consumers no longer trust Chinese mass-volumed products because they dont provide sufficient quality. Vietnamese seemed to develop trust in good quaity national products. For example: Made in Vietnam clothes are proving their names in the market.Being the 13 years Vietnam Quality Award winner, Thorakaos products stand an obvious chance to popularized and successfully positioned itself in the market. The Vietnamese

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Government also create a slogan for the citizens: Vietnamese consumer use Vietnamese products. Recently, polluted environment and huge amount of bad quality chemical cosmetics/hair products lead to hair damage, (especially the women) drive them to seek the help of products like Thorakao Grapefruit flower shampoo.This is main attraction of the product, even if its not shiny among others stylist-designed products such as Davines or Tony and Guys Thorakao main local competitor is Sao Thai Duong ( Sunstar Joint Stock company) which also produce natural-based, but Sao Thai Duong have to focus their recourses and effort on other products such as medicines, helmets sprayer..etc..

4. Threats:
Sao Thai Duong is still a very competitive brand and if Thorakao want to have a share in the Northen-Hanoi market, Thorakao needs to prove its quality and services There are many famous and wealthy competing brands in the market, for example:Nizoral (from Canada) Clear- Unilever, Sunsilk, Davines ( From Italy), Toni and guys( Famous hair styler and hair treatment products from UK).they have long dominated the Vietnamese shampoos market Because Vietnam is still a developing country, many consumers, especially the lower income class, still choose cheap or fake Chinese products, even if Thorakao shampoo can be fitted to their income, but it can be wrongly judged as medicine or expensive product. Or worst, they dont even know the existence of Thorakao due to lack of information for many reasons. Consumers, especially the Youth or the higher income class, are fond of expensive and stylish product because their slogan is: The more expensive, the more quality guaranteed. This may lead to drop of sale and lost of position in the market for Thorakao Shampoo.
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Thorakao has to improve its product quality and on the other hands need to broadcast their images, which need to be carefully plan in order to compete with these activities from competitors.

Even with chemical-based, other brands are also launching hair-damaged treatment shampoos

5. Conclusion:
Thorakao should make full used of the current smooth running system of more than 40 years to continue growing and expanding. The reputation stress the development of Thorakao but also help making the brand name known to consumers Thorakao Grapefruit shampoo has competitive price, its cheap because of the domestically advantages which help reduce lots of extra cost for the value chain. Maintain the Uniqueness of Grapefruit shampoo will help Thorakao successfully positioning itself in the market Widely available in pharmacies, convenient stores will help making Thorakao more familiar Trying to copy the way other wealthier brand promoting themselves in the market would not help Thorakao, so Thorakao should not appear side by side with other products to reduce unfair judgments from users, since Thorakao is providing a product line of hair and healthcare at the same time, it should act like a doctor not a hair stylish expert But Thorakao should not ignore the fact that technologically we are not as modern as other competitive brands, so Thorakao needs to improve and catch up with the world rapid upgrade in technology.

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Objectives and Issues

1. Objectives:
After the first years of launching Grapefruit Shampoo into the market, the product should be among top 3 hair-damaged treatment shampoos in sale volume. Receiving positive feedbacks from consumers who actually use Thorakao Grapefruit Shampoo during quarterly and annually reflection. Receiving Vietnams Top quality product award for 2011. Successfully position Grapefruit shampoo in Hanoi and Northen Market.

2. Issues:

There are many competing brands in the market including both natural-based and chemical based, who are launching hair-damaged treatment shampoos such as: Sao Thai Duong ( Thai Duong number 3-7 Honey locust based) Nizoral (Canada) Clear (Unilever)

Vietnamese consumers are not used to the idea of filling up form, or they may not take it seriously, this issue limit the method of gathering feedback

Because Thoraokao HQ is located in the Southern region of Vietnam, so in order to invading the Northern Market, Thorakao has to spread its Human resources, capital, material to the North, this may not provide Thorakao the sufficient strength to successfully position itself in Northern market

Marketing Strategies
1. Product:
1.1. Product Features:

The main ingredient of Thorakao Grapefruit Shampoo is Grapefruit flower essential oil which reduces dryness of scalp and provide it the smoothness required, the ferment
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ingredients enhance the movement of oxygen which is vital to the scalp. For hair lost condition, the essence will stimulate the nutrition of hair roots to make them sprout again. Thorakao has studied and understand the Vietnamese hair structure for decades so its product is definitely suitable for Vietnamese and other brands may not have these important knowledge. Thoraokao Grapefruit Shampoo principle is based on the Vietnamese traditional way of hair-treatment, In the past Grapefruit dry skin and flower were cooked together to provide a home-made liquid for hair wash. Nowadays with the help of modern technology, Thorakao was able to provide this God-gifted cosmetics in bottled form for the convenience of consumers
1.2. Product Strategies:

Before launching Grapefruit flower shampoo into the market, conducting a survey in order to find out the consumers requirement of a hair-damaged treatment product. The best way to do this is through the doctor/pharmacist who directly distribute this shampoos to his/her consumers under a form of treatment record which provide sufficient and specific information , rather than a piece of survey paper given to the consumers. As Push and Pull strategy should be used simultaneously, Thorakao will decide if the current product needs any improvement.

Beside our own products, survey about other products in the market should be conducted too. In order to encourage the consumer to participate, each survey piece shall be a pricewinning ticket; the consumer will be attracted to the price and will put some efforts in the survey.

Thorakao Grapefruit Flower shampoo itself is a convenient product so we must make sure its widely and conveniently available to consumer

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Thorakao Grafruit Flower Shampoo focus on the hair-damaged treatment, and because of its safely natural base, specific features and reasonable price, its available for a wide range of age.

The shampoo volume should not be too high, but rather merely sufficient in order to increase sale.

Thorakao Grapefruit Flower shampoo will be branded under the name of its mother company, Lan Hao cosmetics Ltd.

Because the Grapefruit shampoo function is more like a medicine for hair than beautycare shampoo so in order to avoid competition to brands with beautiful designed labels and packaging like Davines, Toni and Guys which represent Urban life style, Thorakao Grapefruit flower shampoo should represent the careness of the mother to the daughter, therefore its packaging and labeling should be smoothly, light and flowing.

Ingredient information should be clearly stated so that consumer will have better understanding about the product and use it for the right purpose

Beside the main products (Grapefruit Flower Shampoo) there are other optional products for better hair-care such as: Silky Hair Coat, Hair-care Lotion, Various Ingredients Hair Gel

Doctor and Seller should provide users with sufficient information about Grapefruit Flower Shampoo for the best effect on hair treatment.

2. Pricing:
Since mostly other brand has set up a kind of high pricing system in the Northern Market, Thorakao should use penetration pricing method, which means having a slightly lower price in order to attract new customers. Frankly speaking, after damaged their hair by expensive and chemical-based product, customer would be thankful to have chosen a

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useful and reasonable priced like Thorakao Grapefruit shampoo (retail price= 21,000 VND). Volume discount can be applied in case of distributing products to resellers such as pharmacies, beauty salon and super market, this can increase customer loyalty, this reseller are 1 part of a successful selling chain. In the Northern area, there are 4 seasons; therefore Thorakao should have a seasonal pricing strategy. For example: During summer, which is humid and hot, discounting of price in order to increase sale is crucial. As for winter, because of cold weather, the uses of shampoo will decline, adjusting of price is necessary. Since there are other optional products, they could be sold as a packet of hair-care, Thorakao can come out with a name for this packet such as: Spring Forever, or Happy Care..etc..

Grapefruit Shampoo

Happy Care
Haircare Lotion

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3. Place (Distribution):
Because the Grapefruit shampoo is a medicine to damaged-hair, it should be appearing at medical station such as hair-care doctor or pharmacies. After building the customer trust and loyalty, this product can be widely found in convenient stores or super market

Thorakao

Consumer

Doctor

Shopping location

Pharmacy

Hanoi was expanded in 2008 so the locations for setting up factory and warehouse are plentiful. Currently the rural area (which has a large area of free space) covers the majority land space of Hanoi. Due to Modern scheming, Thorakao should locate its factory and warehouse here for safety and easier production. Many other plants are located in the outskirt of Hanoi such as Vinaxuki, Honda Vietnam..etc

Recently we already have a distributor in Hanoi which is Long Nam Private Ltd, which is located in Ha Dong district.

Vietnam has a long coast sea and cross-country railway so this will be an advantages in distributing. On the other hand transporting materials by trucks can cause damages

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because the Vietnams road system is not very well-structured. Transporting by plane can be rather unaffordable for Thorakao. Beside the biggest grapefruit source of Vietnam, which is located in the Southern Mekong river region, there are other sources in Nghe An (Middle of Vietnam) and Phu Tho (Doan Hung Grapefruit). These 2 locations can provide a large quantity of material for Thorakao A Reverse Logistic plan is necessary in order to reuse the packaging of product, this can reduce a lot of cost for Thorakao and also contribute to the natural environment of the market. E-commerce is now available to customer, which help save a lot of cost for distribution, therefore Thorakao encourage customer to directly order goods from Thorakao, which help develop better relationship with customer.

4. Promotion:
Multimedia advertisement is rather costly and to be honest Thorakao advertisement may not be as attractive as other brands with huge subsidized. One way to solve this is to cooperate with magazine such as Dep magazine, Phu Nu, or Gia Dinh, under health-care topics; this will make Grapefruit Shampoo more familiar to consumer, especially the female. A Fun fact is that Vietnamese have a very powerful mouth of word Due to the impact of internet, Thorakao should have it image appeared in online magazine, e-newspaper such as Ngoisao.net, Vnexpress.net which are very popular in Vietnam, Grapefruit shampoo can appear under advertisement slideshow alone, or can be mentioned in healthcare topics, where doctor, pharmacist and beauty therapist often indirectly introduce products to reader, who are potential customers Posters of Thokarao Grapefruit Shampoo should appear in each and every branch (Distributor, pharmacy, beauty salon).
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For further publication, Thorakao should participate in healthcare show on channel such as O2 TV, a very popular television show about health issues in Vietnam. By doing this, Thoraokao can indirectly commercialized itself and differentiate from others. For example, Thorakao can give lecture about how different between Caucasian Hair (European, American, Australian) and Asian Hair (Vietnamese, Japanese, Korean) to promote Thorakao Grapefruit flower shampoo.

The Consulting force (Doctor, pharmacist and beauty therapist) and Sale force (distributor, super market and shop assistant) should have sufficient knowledge about hair-care in order to instruct the consumer correctly.

During period such as New Year, healthcare week, Thorakao should have discounted its product to increase sale and to participate in public health concern program, to show how friendly Thorakao is to the society..

Doctor and pharmacist, beauty therapist should keep track of people who constantly use the product and reward them with special gift such as discount coupon, free sample
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As for customers who participate in online shopping, we have special discount for them ( can be more than 10%-20% of the product)

5. Conclusion
The potential segment of the market will be the Vietnamese women, in all level of income because Thorakao Grapefruit shampoo is easily affordable. In the Northen market, Thorakao will focus mainly in Hanoi area where demands are high. Strongly raise the awareness of consumer about health beside beauty-care, to make them understand that Thorakao is suitable for domestic uses.

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