VIETNAM GENERAL CONFEDERATION OF LABOUR TON DUC THANG UNIVERSITY FACULTY OF BUSINESS ADMINISTRATION REPORT SUBJECT: ELECTRONIC COMMERCE advised by Ph. Bui Thanh Khoa BUSINESS STRATEGY FOR E-COMMERCE BUSINESSES IN VIETNAM THE CASE STUDY APPLIES TO EUPHORIA COSMETIC _Group 2_ Ho Chi Minh, 22th May, 2022 COMMENTS OF LECTURER 1 0 0. Ho Chi Minh, May 23, 2020 Lecturer MEMBERSHIP AND ASSESSMENT TABLE Name ID Task Evaluation 2 0 0 - Part 2: 2.3 & Part 6 Trương Minh Thi 719D0173 - Conclusion & Summarize 100% (Leader) - Part 1 & Part 5: 5.2 Lê Trần Thảo Vy 719D0255 100% - Conclusion Hồ Thị Thùy - Part 2: 2.1 & Part 7 Bùi Lê Hồng Nghĩa 719D0099 100% - PPT - Part 2: 2.3 Trần Thị Bích Ngọc 717D0007 100% - Part 8: 8.2 Phan Trần Thiên - Part 3: 3.3 719D0123 100% Nhi - Translator Phan Thành Long - Part 3: 3.3 Lê Liên Long 719D0081 100% - Part 8: 8.4 Lê Nguyễn Gia - Part 3: 3.2 & Part 6 Trần Hà Mỹ Hiền 719D0049 100% - Editor 3 0 0 TABLE OF CONTENT I. Five Forces analysis.
COMMUNICATION AND ADVERTISING. Security and Policies:.1 Market: In the cosmetic industry, it is easy to see that lipstick is the most popular and best-selling product when leading with 88% of cosmetics used regularly.1: Popular cosmetic items According to a survey in 2020, about 30% of Vietnamese women have daily lip balm. In particular, Ho Chi Minh City is considered a large consumer market of the cosmetic industry in general and lipstick in particular. According to a study by the Far Eastern Economic Review, cosmetics companies are attracted to Vietnam have a rapidly increasing disposable income and an annual GDP growth rate of 7.
Increased income leads to increased willingness to pay for lipstick products. According to Mintel, a London-based market research firm, the Vietnamese cosmetics market was worth $2.3 billion at the end of 2018. Cosmetics market revenue has been constantly increasing in the past two decades, making Vietnam an attractive destination for many foreign cosmetic brands.2: Revenue of some Vietnamses cosmetic brands 1.2 Market share: Lipstick is the most used product line in the cosmetic market share. With market share of domestic and foreign lipsticks.
The amount of imported lipstick for a significant market share of 77%.3 : Lipstick market share With market share is lipstick for everyone. Euphoria also captures a separate market share for Vietnamese lipstick cosmetics.4: Lipstick domestic However, Vietnamese consumers tend to love products of foreign origin such as brands from Japan and Korea. Meanwhile, in the face of stiff competition and consumer preference for international brands, domestic enterprises make up only a small part of the entire lipstick market. In order to be able to stand on the home turf, domestic manufacturing companies need to pay special attention to improving packaging, design, marketing and promotion so they can take advantage of market opportunities.5: Natural domestics 8 0 0 According to a report on the Vietnamese cosmetic market, the demand for natural cosmetics is on an increasing trend.
If in the past beauty technologies were favored with cosmetic chemicals thanks to the quick effects it brought. Recently, beauty trends with natural extract products have been preferred. More than anyone else, cosmetic users are increasingly interested in ingredients in skin care products, hair etc. It has also been discovered that synthetic cosmetics are gradually having a negative impact, affecting health in the long run.
Therefore, consumers are gradually turning to using natural cosmetic products that are not chemically processed, do not contain artificial ingredients, colorants, alcohol should ensure safety for users. That is one of the reasons why the market for natural cosmetics is growing. Company background: Currently, the quality of life is increasingly improved, we will gradually move towards beauty, so cosmetics gradually become an essential need of the community, typically lipstick. This is an inseparable object of Asian women in particular and Vietnamese women in general.
But the lipsticks that we often use are really harmful to health and nature. Since then, we have had a deep belief in public health-oriented beauty products, which has led to the birth of Euphoria. Euphoria is committed to very benign lip care and lip care products, regardless of gender, young children or the elderly. Euphoria's ingredients and packaging are in harmony with nature, colorless, suitable for all ages, all genders with beauty and lip care needs without any barriers.
Short story “about us”. Founded on the desire to equal beauty for all genders. In addition, the product is safe for consumers of all ages. With the main message from the product "Life is beautiful" Mission: Euphoria's mission is at its core to bring customers a completely natural product.
“Life is beautiful” is our commitment to bring customers safe and quality beauty products with our careful selection, sincerity and high responsibility for the health of our customers. Vision: "Becoming the leading symbol of trust in Vietnam about safe and quality lipsticks serving people's lives".1 Short-term goals: Over the next six months, Euphoria will double its current number of employees, to a total of 100 in the production plant, 60 in the sales and marketing departments, and 40 in delivery staff. Aim to improve product quality and as well as customer service. Economically, the company is expected to sell 20,000 10 0 0 products/month and increase the price by 2% per product every 6 months.
Regarding the initial loan, it is expected to pay 20,000,000/year. Bring the "Euphoria" lipstick brand to consumers. In the first 6 months of 2022, implementing 5 marketing campaigns and 3 advertising campaigns on social networking platforms. In the last 6 months of 2022, 2 events will be held at 2 major shopping centers of Saigon Customer satisfaction, receiving at least 4.5* rating from customers.
B2C: After launching the brand Euphoria, it mainly focused on in-store retail services and online retail channels to reach the number of customers of the original target. B2B: Start cooperation and find distribution channels. Products are available at cosmetic stores of major trade centers: Vincom, Takashimaya, Lankmad 81, etc.1: Popular purchase locations After customers have gradually become acquainted and become familiar with Euphoria products, the brand will aim to build strategies to create core values, and better customer care strategies during this period. Cooperate with youtubers or 11 0 0 artists to represent the product brand.
Expanding the number of products sold and the number of customers reaching over 50,000 products.2 Long-term goals Economically, 10% growth per year for 5 years: period 2022-2027 and 5% growth in 10 years: 2027-2037 period. Reduce production costs by 5% in the next 3 years. In terms of operations, the first is to build a separate logistics system for businesses and do not need to hire a third party to complete this goal before December 2026. Increase the number of company employees to 1000 people in 5 years of operation motion.
Expanding 2 more branches in Ho Chi Minh City before 2030 and 1 branch in the North by 2033 and becoming a multinational company in 2040. Developed and marketed 2 new product lines. Increase brand awareness across Asia by 2035. Euphoria will continue to launch other lipstick product lines, namely color lipsticks with natural essences.
During the next half year - the second year, Euphoria continues to expand with many other cosmetic lines such as skin creams, hair creams, skin serums, etc, still following the safe and natural nature of the brand. brand stated from the very beginning of its launch. Core competencies and competitive advantages Core Competence: Europa invests heavily in product research, aiming to be 100% safe and natural. Paying attention to the health of consumers and being benign to all ages using the product.
As well as being unlimited in terms of gender are the distinct advantages of the brand. Businesses sell on both direct and online platforms. Make it easier for customers to purchase products. Create many sources of domestic and foreign customers.
Distributor network covers a wide range in supermarkets and trade centers. The place has a large number of regular customers. Helps promote brand recognition and brand familiarity to consumers. Promotion and research are two key areas of Europhia, besides the brand also pays 12 0 0 great attention to the 'post-consumer' aspect - customer care.
Employees are professionally selected and trained to be able to bring product values and messages to customers. Listen and care about the customer's experience because that is the shortest and most direct way for a brand to reach the hearts of customers. In addition, Euphoria is also constantly innovating in terms of products and service processes. Core values: All Euphoria products are meticulously cared for, from the outer shell to the inner quality of the lipstick.
Products are made from 100% Organic Ingredients/USDA/COPA Organic Certificate: 100% natural (Lead-free, Non Toxic, Chemical Free, Non-nano particles, No paraben) or USDA, COPA (safe) organic certifications, all subjects). Euphoria's products have a minimalist design combined with inscription technology on the body of the lipstick to help women choose a meaningful sentence for themselves, this is also an advantage of the brand for men when dealing with men. Faced with the problem of gifts for sisters.1 Politics: The political environment will have an impact on Euphoria as the brand goes global. The stable legal and political situation of Vietnam means that it contributes to creating positive impacts in the creation and implementation of business strategies of enterprises in Vietnam, including Euphoria enterprises.2 Economy: The per capita income in Vietnam in 2021 is estimated at 5.7 million VND by the General Statistics Office, down 32 thousand VND compared to 2020.
The current epidemic situation has greatly affected the source of income of consumers, reducing the need to purchase non-essential goods. Besides, Euphoria's customers who are interested in beauty mostly focus on young people, but their income and spending levels are still not high. These are issues that cosmetic businesses like Euphoria are interested in and businesses need to come up with appropriate economic policies for business operations and set product prices in line with the status of consumers. in the current context.
14 0 0 Figure 1: Percentage of cosmetic use by age In addition, Euphoria is a young brand, so it will face great difficulty in market share. Euphoria bears the cost of import taxes on ingredients in lipstick because the domestic supply cannot meet production demand. If inflation spikes, lending rates will rise, negatively impacting consumer spending and the cosmetics industry in general.3 Society The Vietnamese beauty market is still in the process of development. This is an opportunity to gain market share for businesses.
With about 20 million Vietnamese women between the ages of 15 and 39 (40% of the female population) is a potential land to exploit in the field of cosmetics and beauty. 15 0 0 Figure 2: Frequency of skin care product According to the European Union - Vietnam Trade Connection Organization (EU - Vietnam Business Network - EVBN), the South and South Central regions are leading the country in the trend of consuming beauty products with a large scale.1% of the whole market. More than 80% of urban consumers buy at least 1 beauty care product in a year. The beauty culture of Vietnamese people greatly influences the behavior of buying and using cosmetics, especially lipstick.
In Vietnam, lipstick not only represents women, but it is an indispensable thing when it comes to images. In addition, in recent years, consumers' shopping behavior has shifted from direct shopping to online shopping channels mainly on websites and e-commerce trading floors. Vietnam accounts for 41%, is the country with the highest percentage of new Internet users in the region. Specifically, in 2020, up to 74% of people shop on websites, e-commerce trading floors while buying on forums and social networks reaches 33%.
16 0 0 Figure 3: Percentage of online shoppers in Vietnam and other countries in the region.