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TH Milk TH Group Corporation & Bac A Bank

Marketing Plan in 2014

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INTERNET MARKETING PROJECT

Lecturer: Mr. Phạm Toàn Thắng

CLASS: 11BSM3

GROUP MEMBERS:

Nguyễn Lê Huỳnh Uyên Thư 1158136

Trương Phương Quyên 1158114

Vũ Hoàng Sơn 1158117

Lê Phương Nhi 1158089

Nguyễn Minh Tuấn 1158151

Bùi Thế Tân 1158126

EMAIL: 1158114@itec.hcmus.edu.vn

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TABLE OF CONTENT

Executive Summary ..................................................................................................4

Company Description ................................................................................................4

SWOT Analysis:........................................................................................................5 ◦ Strengths .......................................................................................................5 ◦ Weaknesses ..................................................................................................5

◦ Opportunities ................................................................................................7 ◦ Threats ..........................................................................................................8

Competitive Analysis ................................................................................................9

Customers Analysis ...................................................................................................10

◦ Customer Feedback .....................................................................................10

◦ Target Market...............................................................................................12

Alternatives ...............................................................................................................12

◦ Alternative 1 ................................................................................................12

◦ Alternative 2 ................................................................................................13

◦ Alternative 3 ................................................................................................13

Criteria and Alternative Evaluation...........................................................................13

Product .....................................................................................................................13

Pricing ......................................................................................................................15

Place.........................................................................................................................15

Promotion ..................................................................................................................16

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EXECUTIVE SUMMARY

TH Milk is a company that depended on TH Group Corporation and Bac A Bank. Our

company is a new company in the milk market since 2009, so that in this project we want to

develop a marketing plan for the year 2014. This plan is first focus on the consumer behavior.

More specifically, the problems of our company are about the rumors that our company using

low quality of the milk, and that is affected to the total revenue of our company in the previous

years. Therefore, in this plan, we want to focus on making a new product, and pasteurized milk is

the one we want to focus on, but we still continue to produce the previous product to reach new

customers and improve the reputation of our brand in the milk market.

COMPANY DESCRIPTION

The TH Milk company was established on February 24, 2009, and it is the first company

of TH Group with the financial advisor of Bac A Bank Commercial Joint Stock. Beside the

business services and financial activities, social security, Bac A Bank Commercial Joint Stock

investments with particular emphasis on the dairy industry and food processing.

With integrity criteria to keep the essence of natural materials in each product, TH Group

has equipped modern technology as well as human resources leading. TH Group also applied the

management system and advanced production processes stitched closed synchronously from

farming to distribute the product in the hands of consumers. The purposes are served the

consumer products safe, clean, fresh and nutritious.

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1http://www.place.vn/dia-diem/cong-ty-cp-thuc-pham-sua-th-th-milk-22335

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SWOT ANALYSIS

Strengths

TH milk is proud of having been awarded an ISO 22000:2005 certificate by the BVQI.

This is the group that also granted many other prestigious certificates in terms of quality and

brand name.

In fact, it is good quality of the product that has built up the brand’s position and gained

trust in customers. With a view to creating high quality products, TH has established a quality

control process with strict compliance requirements.

A combination of advanced technologies, Vietnam natural resources, and the expertise of

the group’s staff have created the milk products, which is imbued with the group’s love for

customers in particular and the nation in general.

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Weakness

High production cost leads to higher price, product: The project to build a large dairy

farm that this group has invested in the Nghia Dan district, Nghe A was started on May 14th,

2010 systematic large-scale farms in Southeast Asia with a total investment of 1.2 billion USD.

Only three after its inception, from number of cows than 1,000 cows, so far the company has

raised to about 26,000 cows. Of these only 13,000 cow's milk, accounting for 50% import cows

from the dairy country in the world such as New Zealand, America, Australia to ensure the milk

cow for the best. The farm system is applicable standards and specification barn raising "the

2http://www.thmilk.vn/en/news_events/message-th-true-milk-consumers

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most advanced in the world" (a roof, mounted cooling fan, cows is listening to music, daily

showers, etc.).

The prestige of the TH milk brand has not been popular in the public yet: In the report

"Survey, assess the situation and produce milk market in 2012 and forecast 2013" Dr. Tong

Xuan Chinh, Animal Husbandry Department (Ministry of Agriculture and Rural Development)

in the milk market, Vinamilk led to 40-50%, Dutch Lady 25%, Moc Chau 10%, BA VI milk 5%,

Hanoimilk 5%, other 15% of the company. The report absolutely no mention of TH True Milk.

More than that, TH true milk has been established since 2009 while VINAMILK is a huge milk

company in the domestic milk market today was established 35-36 years, with production

accounting for 65% of the market. It also is the only carrier of Vietnam's dairy exports.

Meanwhile, TH Milk is also investing, not to switch to the production phase.

TH True milk has only fresh milk: Remember, DANONE is the largest dairy group in the

world has product portfolio is extremely diverse, not only milk, but the yogurt is extremely

attractive profits for dairy companies. So most of the company in Vietnam market, from

Vinamilk, FrieslandCampina to IDP (BAVI milk launches fresh milk, yogurt Love' in Farm),

Moc Chau had their own milk products. Moc Chau also had cheese and yogurt, the IDP Love' in

Farm earlier this year, and Vinamilk had many different kinds of yogurt.3

3http://news.zing.vn/TH-True-Milk-va-nuoc-co-bi-lo-post324087.html

http://vietq.vn/vi-sao-th-truemilk-bo-phan-khuc-sua-chua-d11522.html

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Opportunities

Large scale and high demand of the market: With a high population about 80 million and

the consumption level rise about 15% to 20% every year going from the ratio of the previous

year. However the amount of milk on average per person is still very slow. The Vietnamese milk

market has become a better field for TH true milk for many reasons such as expanding in

spending needs of people because of increasing of wages, income and also GDP. Another one is

drinking or using milk and dairy products routine is a gradual form in the daily habits of

Vietnamese, especially with the younger generation and some people who want to beautify them

by TH true milk product line. Moreover, quality of TH true milk products is one of the reasons

that are a result of development of technologies, biotechnologies and farming techniques allow

TH true milk has high standards and stable resources and also produce the best quality outputs.

The government supports and creates favorable conditions. Not only that, government

supports and encourages and creates favorable conditions for the development and raising the

milk industry and the size of the cow herd by giving decrees like 189/2007/NĐ-CP,

92/2006/NĐ-CP, 04/2008/NĐ-CP, 92/2006/NĐ-CP, and so far, resolutions and designation of

the government, ministries. Former General Secretary Nong Duc Manh cemented TH Group’s

success: “I’m so glad to be informed of and witness to the milestones in the Group’s

development. In a very short time and with great spirit, TH’s board of management, employees

and expert consultants have achieved Uncle Ho’s ultimate desire for our people and country”.

Prime Minister Nguyen Tan Dung has praised TH Group’s policies and path of development: “I

appreciate and support the creativity as well as the principles of TH Group, which follow the

Party’s and the government’s policies about agricultural developments and local authorities,

along with the company’s efforts, will help the project to operate successfully”.

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Threats

Shortage of cows, not enough supply for the demand volume of milk produced daily. For

example, every cow supplies 35lit/day with once 14liters/year.

Make one small article we would have been calculated: 1 year 1 medium cow provides

milk enough for 900 people. With 35,000 cows will be 31.5 million people/ year. That Vietnam's

population now over 90 million people, so the number of cows that provide only about 30% of

the milk. Not to mention the Vietnamese drink milk every day is very low and the government is

trying to increase the amount of milk people consume up 20-25 liters/ year.

Not only stiff competition to domestic dairy companies as Vinamilk, Dalatmilk, baby

milk, LongThanh milk, but also its position high quality milk par with foreign firms such as

Dutch Lady.5

4http://www.thmilk.vn/en/ http://vneconomy.vn/20131127085755436P0C19/lam-sua-tuoi-sach-kieu-th-true-milk.htm http://moh.gov.vn/news/Pages/DiemTinYTeTuCacBaoCao.aspx?ItemID=24&QAItemID=24&sId=1 5Source- TH true book

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COMPETITIVE ANALYSIS

TH True Milk Dalat Milk Vinamilk

Main product Pure milk, pure milk with strawberry, chocolate flavors, fresh milk, yogurts, fermented yogurt drinks

Pasteurized milk, pasteurized milk with strawberry, chocolate flavors

Pure milk, pure milk with strawberry, chocolate flavors, fresh milk, yogurts Proby, fermented yogurt drinks Proby, pasteurized milk, powder milk for children, powder milk for mama, condensed milk

Target customers Middle class, young adults, people who have average income

Middle class, partner companies such as Gloria Jeans, Starbucks, young adults

Kids, teenagers, mothers, people who have low income

Prices +pure milk (180ml): 7000VND +yogurts: 4000VND per box

+pasteurized milk (180ml): 10.000VND +pasteurized milk with flavor (180ml): 11.000VND

+pure milk (180ml): 6.490VND +powder milk: from 80.000 +powder milk: from 80.000 +condensed milk 380g: from 15.400

Distribution,

Scale

156 stores of TH Milk in Nationwide

17 agencies company in nationwide

Large numbers of retail stores such as more than 140.000 retail stores nationwide

Brand awareness Stable brand new in the milk market since 2009

New brand in milk market

Long-standing and strong brand in Vietnam

The table above show that Vinamilk is a strong brand in the milk market of Vietnam.

Although TH true milk is a new brand, but with high advance technologies and good

quality, TH true milk quickly earn trust from the customers. Beside that, the price of

TH milk and Dalat milk are so high, therefore they just reach the customers from

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middle class, compare with Vinamilk, it has reached all the segmentation with all

ages.

CONSUMER ANALYSIS

After a few years since TH true milk was established, our company was proud of the

result and some feedback from the customers such as 98% consumers knowing about our

products, 92% meet the consumer need, 92% people said that the quality of the product satisfies

their require, 80% people said that TH true milk has higher advantages than any others, 25%

people loyalty with our brand.

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Customer feedback:

After doing the mini survey about our product, we get some results as figures below:

6Source: TH true book

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When we did a mini survey, almost interviewees said they knew and used TH true milk

products. And large of them have positive feedback for TH True milk products. Besides that,

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some of interviewees give us their opinions and feedback like. One of them said: they want TH

true milk creates more products which will give more options for the old, the young, diabetics,

Dieters. Others assumed milk taste of TH true milk is too pale and the price is a little high, so TH

true milk should give the promotions or reduce the price.

Through the surveys we can get some feedback from the customersssss about good and

bad points that the quality of TH milk is good, but the price is still high compare with other

brand in the milk market.

Target Market:

From the survey we decide to create new product to diversify the product lines and reach

new customers such as younger generations, adults. Pasteurized milk will attract those people

who like the pure milk without preservative.

ALTERNATIVES

To launch the new product line, we analyzed information about market, taste, purchasing

power of customers, and also TH true milk financial capability, and human resource. We jump

out with 3 alternatives which are the most suitable for the situation of form at this time.

Alternative 1: to expand our pasteurized milk market share, which is ignored by the big

firm, that is concentrated in milk powder and milk mixed with powder. We will take advantage

of this opportunity to increase market share and make more money by attracting new customers

who enjoy using pasteurized milk almost is the youngest. Since the normal milk market is so old

and highly competitive.

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Alternative 2: we perfunctorily work and produce with the available products and

concentrate on marketing, production, use all abilities to promote customers to use the new one

by some strategies which are measured below. This plan is so risky, because the nature of this

plan is getting all or nothing, it means if this plan work, the wine will be in our hand. Otherwise,

we lose all.

Alternative 3: unlike the second one, we continue to maintain the producing, marketing,

and others work for the existing products and just expand producing pasteurized milk a little bit.

The advantage of this alternative is nearly do not have any risk, but it's very slow to win the

pasteurized milk market.

CRITERIA FOR EVALUATING ALTERNATIVES

The alternatives above are evaluated on qualitative and quantitative criteria. The first

alternative can increase the market share in the milk market, and it can reach the new customers

and it will raise the brand awareness in domestic brand. The second is the risk one so we decide

to ignore, because we always follow the safe optimal. About the third one, maintaining produce

the existing product is not reaching the new customers so that the first one will be the optimal

solution compare with the second and the third one.

PRODUCT

Pasteurized milk will be the strategic product of TH True Milk is slated for release in mid

- 2014. This is particularly prominent product freshness, and is the most pure dairy products

competitive with domestic brands, which can produce and sell milk market in fresh milk as

possible in a short time. The purpose of the new product is to diversify the milk market and

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product lines. Not only that, we create more choice for the customersssss who want to use the

freshest milk without preservative.

Milk is pasteurized products, processed primarily from raw milk, without any additional

components of milk, can add sugar and other ingredients such as fruit juices, cocoa, coffee, food

additives, has through pasteurization (National Regulations 5-1:2010 / Health). Regarding the

process of heat treatment, pasteurization of milk is the milk is processed at a temperature of 80 °

C, then cooled abruptly at 4 degrees C over a period of 30 seconds, while sterilization process

milk (UHT) with a range of 140-143 ° C for 3-4 seconds. The process to kill pathogenic

microorganisms that retain maximum vitamins, minerals, and delicious fresh taste of raw milk.

However, pasteurized milk has a short shelf life of 7-10 days in cold conditions from 5-10

degrees C.

Still maintaining clean and fresh dairy criteria to show it on the packaging of the product,

pasteurized milk will keep white clouds and blue sky combined with the name and logo in blue.

Products will be 2 kinds of paper boxes and 1 liter plastic Jerry cans and corresponding 2litres, it

also means that customers can be sure about the shelf life of milk after the new milk production

and milk storage from the date of purchase.

With its flagship product, this time hitting hard in the domestic milk market will create

one solid step for TH True Milk brands that also faced many difficulties in transport from north

to south so the price will be higher than the same products of other brands. So the new product

should be done carefully follow each step of the plan, and is more focused on promoting product

promotion and should have 1 message gets the attention of a large number of potential customers

before the product launch.

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PRICING

Pasteurized milk is not a new market in Viet Nam. First of all, pasteurized milk is a

different way of milk. People, who drinks pasteurized milk is spend a little bit more than the

normal milk. Because pasteurized milk just can be used in seven days. So our targets belong to a

higher level with the normal milk.

Viet Nam economy at this time, we cannot push the price too much, but with the new and

higher technologies with the advanced processes of our corporation. The new products will not

be cheaper than the previous products. It is not about taking back the profit quickly, but we make

sure that the price will go with the right quality. We want people looking at our products, trying

our product, and then accept with the price we proposed.

PLACE

With the promotions accompanied PR factor "fresh milk", TH True Milk partially created

difference with others formula brands in the market.

Hence, every strategy is coming up with the market that also emphasize “fresh”. Our

fresh product should be sold on the freshest place. Therefore, we should focus TH True Mart

store system more than before. For instance, our storage system is only focused in some big

cities such as HCM city, Ha Noi or Hai Phong. To enlarge market in the long run, we don't only

sell in the big cities, but also focus in the countryside.

Nowadays, more and more technologies are developing, so online marketing plan should

be caring, such as Facebook or others online sales, we cannot encourage teenagers go on the

market and buy it. Focusing on online sales will help us get the milk market share for teens. So

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that, we create a webpage which is the forum for the customers discuss about the products on the

home page of TH true milk. Moreover, we write more blogs to help people easy to see the key

word of our brand on the google page.

A new and strange sale plan is “TH True milk will be delivered to your home”. This plan

is not strange in the developed countries, but it is not focusing on Vietnam. At the present, time

is very precious, let imagine that every morning we wake up and see a milk bottle. You will go

to companies with a joyful spirit and have more power as much as. If we pull off this strange

plan, we will occupy the fresh milk market.

PROMOTION

The purpose of promotion is to create customer awareness of our products and brand to

promote brand loyalty and also increase sales.

There are different ways to promote a product in different areas of media. We use digital

media, which includes internet, social networking and social media sites and lastly outdoor

media which includes banner advertisement. We also use social media to advertise such as TVC,

newspaper, and magazines promote our products. Beside that, we will discount the price when

the customers buy one set of milk. For instance, the sets include one yogurts, one box of pure

milk, and two boxes of pasteurized milk just only 27.000VND, so that the customers can buy the

products with the cheap price, if they just buy one box of pasteurized milk it will cost 9000VND

per box. Moreover, we will run the campaign with a special event for the customers trying the

new products, pasteurized milk, we give the customers a sample of pasteurized milk as a gift also

attracts the new customers trying the new product.

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Reference Sources:

TH Milk website: http://www.thmilk.vn/en/th-corporation

TH Milk Facebook: https://www.facebook.com/thmilk