4 - The benefits and costs of using marketing approach to doing business in Vietnam
Successful organizations realize that companies wanting to exist and do business profitably by providing customers with the right product, in the right time, at the right place with a good promotion is very importance
Goals of marketing is to stimulate customer, maximize consumer by meeting customers’ needs and make them feel pleased with products , after-sales services and following benefits of company . Furthermore, customer satisfaction is basis for purchasing again; buy more the same item or more expensive items and setting up trust, loyalty for the brand name and the producer. This result is important because it can lead to increased sales and higher profit. If customers are satisfied they may:
• Think this product is the best and most suitable for them • Don’t want to change other brands
• Use this product for a long time and stick to product • Buy again from the same supplier
• Buy more of the same stuff , or more expensive stuffs • Become a loyal customer of company
• Bring a stable turnover / profit for company
• Recommend to their friends about advantages of product
According to all this benefits, Canon Inc. Vietnam always attach special importance to customer care by opening two customer service centers at Ho Chi Minh City and Ha Noi with the main roles such as supplying services before and after sales , professional warranty services and consulting for customers . Mr. Mike Asao , Manager of Canon Singapore in Vietnam said : “Our goal when setting up the service centers in Vietnam to continue to support customers and add value for their products. Meet the growing needs of consumers is always a top priority of us.” (www.canon.com.vn)
It is far more expensive to convert a non-buyer (buy 0 product) into an occasional buyer (buy 1 product) than to turn an occasional buyer into a frequent buyer (buy from 2 products) The company should have a budget to maintain a certain amount of customers or campaign for launching new products or forms of promotion, personal selling that not only spend a lot of money but also waste time. Costs maybe involve some or all of following: • Advertising
• Personal selling
• Initial discounts
• Agent commission
• Physically transporting
Advertising is a form of communication which is paid to perform. Additional advertising aimed at persuading or influencing impact on buyers. Advertising messages can be sent to customers in many different media such as newspapers and magazines, radio, television, internet …to introduce a new product, convince customers to buy a new one and gain high profit. Companies have to spend a lot of money for advertising.
Personal selling is oral communication with potential buyers of a product with the intention of making a sale. The personal selling may focus initially on developing a relationship with the potential buyer, but will always ultimately end with an attempt to "close the sale”. The main disadvantage of personal selling is the cost of employing a sales force. Sales people are expensive. In addition to the basic pay package, a business needs to provide incentives to achieve sales (typically this is based on commission and/or bonus arrangements) and the equipment to make sales calls (car, travel and subsistence costs, mobile phone etc) (http://tutor2u.net/business/marketing/promotion_personalselling.asp)
Initial discounts are used to reduce the percentage of money for the outlets, shops or customers that buy a large amount of goods. It helps to encourage buying or paying cash directly.
The companies need agents to sale their products and have to pay them a commission on whatever sales they make
Transporting between the markets also take a considerable cost. The cost of physically transporting goods is estimated as high as about 25% of the cost of a product....
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