Yuhan Kimberly Marketing

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  • Topic: Koreans, Korean language, South Korea
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  • Published : April 10, 2013
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Assignment one
Yuhan-Kimberly : “Keep Korea Green”|

Designated Writer: CHONE JAE HUN
Supporting Writers HWANG JI WON
Designated Writer: CHONE JAE HUN
Supporting Writers HWANG JI WON

Opportunities and Threats in Long term Marketing Environment.

Yuhan-Kimberly, one of the oldest companies in South Korea, has been a great success since it was founded in 1970. It was established as a joint-venture company in order to avoid the pressure of dictatorial government. However, the venture enabled Yuhan-Kimberly to employ the manufacturing technologies of Kimberly-Clark. With these technologies, Yuhan-Kimberly started businesses in fields such as toilet paper, facial tissues, and feminine napkins. The company expanded surprisingly grabbing several opportunities caused by economic and demographic changes and it is now considered as a company which has obtained legendary success.

Even though it has succeeded ever since it was formed, Yuhan-Kimberly is still facing some threats. First threat arises from demographic change. In the past, especially in 1980s (when a birthrate per married couple was about 4.0), the demographic status in South Korea was major factor that enabled Yuhan-Kimberly to succeed in a domestic baby diaper market. However, the situation has been changed and will change drastically. According to data from KOSIS (Korea Statistical Information Service), the birthrate of South Korea will stay below 1.5 at least until 2060.(see EXHIBIT 1) It means that the baby diaper market which is the most lucrative for Yuhan-Kimberly is going to be shrinking. Unless Yuhan-Kimberly finds the market which substitutes for the diaper market, it will have to endure diminished profit.

Second threat comes from the formation of the company. As mentioned above, Yuhan-Kimberly is a joint venture enterprise. In a joint venture, inevitably there is conflict between two companies. Even though Yuhan-Kimberly Korea is guaranteed its sole control of a company, there is always probability of intervention from a parent company. In 2012, Yuhan and Kimberly Clark came into conflict because of board member election.

Third, despite the fact that Yuhan-Kimberly is dominant in its field, competition with other companies, especially with its rivalry P&G, still exists. For now, there is no doubt that Yuhan-Kimberly keeps its outstanding dominance in diaper, feminine napkins, facial tissues market. (see EXHIBIT 2,3) However, it’s extremely hard to keep. one’s first spot, and it’s also a truth to Yuhan-Kimberly. Since P&G is competitive and once it was a first class company in the same field, Yuhan-Kimberly should put more effort not to be caught up.

Lastly, as mentioned in the article “Yuhan-Kimberly : Keep Korea Green.”, Yuhan-Kimberly’s continuous project over the last 25 years which is called “Kepp Korea Green” has now become somewhat obsolete because so many other companies are mimicking the campaign. For the last 25 years, Yuhan-Kimberly’s activity related to environment conservation was a strong POD for the enterprise, and it helped the company build a brand image. However, because of numerous companies which are carrying out the same concept, the real intention of Yuhan-Kimberly can be distorted.

There are not only threats, but also several opportunities. Most importantly, majority of Yuhan-Kimberly’s opportunities will come from the company’s R&D center. It is no exaggeration to say that the success of Yuhan-Kimberly was mostly due to the R&D center. A consumer information system set up by R&D center played a very critical role when Yuhan-Kimberly surpassed its competitor P&G in a diaper market. Since Yuhan-Kimberly owns R&D center, it will be easy for it to collect information from consumers. In terms of technological advance, R&D sector...
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