Marketing Plan-Nguyen Son Bakery-Free Essay

Table of contents

3.1.1. STRENGTHS: 5
3.1.2. WEAKNESS: 5
3.1.2. THREATS 5
5.1.1 – Demographic: 9
5.1.2 – Geographic: 9
5.1.3– Psychographic: 9
5.1.4 - Behavioural 9
6.2.1 - Graph 1: 10
6.2.2 - Graph 2: 11
7.1 - PRODUCTS: 11
7.3 - PRICE 13
7.4- PLACE: 15
7.4 - PROMOTION: 15
7.4.1 – Advertising: 16
7.4.2 – Promotion: 16
7.4.3. - Public relationship: 16
9 – CONTROL: 19

1 – Executive Summary:

As the country is being more Westernized, Vietnamese people have opened their heart to welcome many foreign cultural aspects which are very different from our own culture, especially Western foods. In 2004, the first Nguyen Son bakery was founded to present to Hanoi people the delicious French cakes and has since then created a solid standing in the market it serves.
Regarding the market situation, competitors’ strategies and marketing budget, this marketing plan aims to provide a thorough understanding of the company’s current status and form the most effective Marketing strategies for the Nguyen Son franchise for the year to come. In order to achieve marketing objectives and gaining competitive advantage for Nguyen Son, we tend to put a greater focus on advertising, sponsor major conferences in Hanoi, and renew our distribution channels. Besides, we also concentrate in developing new products. By the end of the year 2008, Nguyen Son targets to increase sales by 25%, thus boosting market share by 15% more.
Finally, we want to introduce control process for the whole bakery which we will constantly ask for feedbacks from customers and employees and adjust our plans to achieve better returns.

2 – Introduction:

The first Nguyen Son outlet was established in 2004 on Phan Boi Chau street, Hanoi, selling cakes, chocolates and casual drinks. Up to now, Nguyen Son has opened 4 more shops on Vincom tower, Kim Ma street, Tran Duy Hung street and Thanh Nien street, becoming the first French cake chain in Hanoi with products extended to even fast Italian foods and wifi internet. However, French cakes are still this bakery’s main product, which differentiates Nguyen Son from other fast food chains.

3 - Situation analysis:
3.1 - SWOT analysis:
3.1.1. Strengths:
- Nguyen Son bakery has advantageous locations of their cake shops which are all in centre of Hanoi- the capital, and in the areas where concentrates the target customers (foreigners and middle-high class people).
- Strong financial position leads to fast expansion. Average of 1 new cake shop each year, especially in 2007, they opened 2 more shops in Hanoi, and having a plan to expand more to another city (e.g.: HCMC).
- Good relationship with suppliers. As we all know that, Nguyen Son imports almost raw materials from France, Mr. Son, the owner of the bakery chain, has built a strong relationship with the suppliers since he used to study in France. All the raw materials are quality standardised and arrived on the right time.
- An identical decoration among cake shops making the urban easier to recognize the brand name of Nguyen Son.
3.1.2. Weakness:
- Nguyen Son bakery has a lack of marketing strategy as they even don’t have a website to promote their cakes and brand name as.
- The service is not as good as other bakeries, especially we think that the staff of the bakery are needed a short-term training to be more professional.

3.1.3. Opportunities:
- Vietnam joined WTO in 2006 can bring more foreigners to Vietnam; hence the market size of Nguyen Son can be widen.
- “According to a study conducted by the Ministry of Finance, import taxes imposed on most of 87 surveyed industries are to be cut from an average 30.4 per cent to about 15.3 per cent as Viet Nam accedes to the WTO”. Thus, it is now cheaper to import raw materials due to lower import tax (VNnews, 2007).
3.1.2. Threats
- Since there are various existence competitors and also potential competitors may enter in the future, the market position of Nguyen Son is not guaranteed.

3.2 - Macro environment:

3.2.1 - Demographic Environment

- Hanoi’s population is increasing (due to both natural factors and immigration), promising a considerable increase in number potential customers for Nguyen Son. Moreover, the population is getting younger and younger, forming a considerable number of generation-Ys who value modern trends and foreign goods, which gives Nguyen Son more favours and attentions over the years.

3.2.2. Economic Environment
- Vietnam’s economy is booming with the rate of about 8% each year. General income of people rises and demand for higher quality products also rises as a consequence. With the high quality product, Nguyen Son aims to boost sales in this period.
- Vietnam has just become a member of WTO. In the past, there were not many cake brands coming from abroad, but the trend is about to change. People who were used to domestic products such as Hai Ha Kotobuki or Kinh Do cakes will have more choices with the foreign cakes and candies. The market will be highly competitive.

3.2.3 - Technical Environment
- In general, Nguyen Son is operating in tertiary sector of the economy which requires high technology- not only the machinery for making cakes but also computer systems for managing the enterprises and customer relations.
- Internet is another trend nowadays. Mostly the bakeries have or are developing websites for their uses, Nguyen Son as well. However, since other bakeries already have websites along with the information and services online, they can have a short-term advantages comparing to Nguyen Son’s case.

3.2.4 - Political Environment

- Vietnamese government has been paying attention to the safety of foods (Vnexpress, 2007). Strict regulations have been set in the food supply industry. As a result, Nguyen Son must make sure that their cakes are not harmful to the customers.
- In comparison with the other cake suppliers , Nguyen Son still have been bounded by some import regulations and taxes which are the main reason for the high prices , even though Vietnam has entered WTO.

3.3 - Micro Environment:
Micro environment contains factors that directly influence the company in term of the ability to serve customers.

3.3.1 Nguyen Son’s cake shops:
This is the main factor that could bring Nguyen Son the success or failure. Does the attitude of the servers satisfy customers? Does cake quality in every shop meet the quality standard of Nguyen Son?

3.3.2 Suppliers:
Since most raw materials are imported from France; therefore suppliers play an important role in achieving objectives of Nguyen Son. The raw materials must be high quality, tasty and in good condition.

3.3.3 Customers:
For Nguyen Son circumstance, the main type of customer market is consumer markets which consist of individuals and households that buy cakes for personal consumption.

3.3.4 Other Bakeries:
 Kinh Do Bakery: this is the biggest bakery in the market; however, in term of French cake, Kinh Do Bakery doesn’t show its strengths here. Nevertheless, Kinh Do’s birthday cakes could be considered as substitution for Nguyen Son’s one.
 Thu Huong Bakery: This is the most famous bakery in term of French cake which is the main competitor with Nguyen Son.
 Local cake shops: this type of competitor has a big advantage that people don’t have to go too long to buy cakes rather than nearby. However, the quality is a bit lower than Nguyen Son’s.

3.3.5 General Publics:
Nguyen Son’s public image will depend on the activities and product quality in term of consumers’ view. The public’s image of the bakery will affect its sales.

3.4 Market share analysis
Besides a few conspicuous names: Nguyen Son, Bui Cong Trung, Thu Huong, Paris Gateaux, the market for French cake shop in Hanoi also includes hotel bakeries (Hilton, Daewoo, etc.) and local bakeries such as Lan on Le Dai Hanh street. Since our marketing group is unable to find any specific information regarding the market shares of French cake market in Hanoi, we have asked Mr. Trung, who has been manager of the Nguyen Son shop on Kim Ma Street for 3 years, to make a close estimation of the market share of Nguyen Son and its competitors based on the financial reports and market researches he received:
Name % of market share
Nguyen Son 20%
Bui Cong Trung 15%
Thu Huong 20%
Paris Gateaux 5%
Hotel bakeries 10%
Local, single-unit bakeries 30%

4 - Objectives:
a. Statement of Product Objectives (SMART):
Nguyen Son Bakery, specialized in French cake section targeted, to delight customers by high quality cakes with reasonable price, which means Nguyen Son will apply “more for the same” approach for its cakes. There should be least gap between customer’s expectation and Nguyen Son’s cakes. By this, Nguyen Son wants to increase its market share by 15% by the end of the year 2008 and rising sales by 25% per annum.

Moreover, in order to achieve customer satisfaction, Nguyen Son bakery will make some product development, first and foremost, launching new product life cycle every three months.

In additional, Nguyen Son targets to gain customer awareness for the brand name by 40% in a year time period. On one hand, Nguyen Son has to maintain its current customers to gain customers loyalty for the brand. On another hand, Nguyen Son desires to target new customers as well; Nguyen Son aims to widen its market segment to not only the middle to high class but also occasional segmentation (Birthday cake, wedding cake, etc).

Besides, Nguyen Son will develop a new distribution channel in form of using internet. The website is being done by the end of June, 2008. A delivery service can be done a month after the launching of online ordering.

Finally, Nguyen Son will have to improve its quality but still keep the reasonable price. Any changes will be acknowledged about different consumer’s aspects, economic condition and environment.

b. Marketing Objectives:
- Increasing market share by 15% by the end of 2008.
- Increasing brand awareness by 40% in a year time.
- Increasing quality but keeping reasonable price in the range 100,000 VND- 250,000 VND/ large opera cake.
- Expanding market segmentation, targeting new customers.
- Developing website by the end of June, 2008.

5 - Segmentation and targeting
5.1 - Market segmentation
5.1.1 – Demographic:
Nguyen Son mainly aims at both foreigners and Vietnamese. Foreigners are specifically most Westerners living in or travelling to Vietnam, who are accustomed to French cakes and usually have high incomes. A typical Vietnamese customer of Nguyen Son would be somewhere between 20-45 years old and mostly white-collars or businessmen earning a comfortable salary.
5.1.2 – Geographic:
The only one geographic target of Nguyen Son Bakery is Hanoi- the capital of Vietnam. Hanoi has population of 3.5 millions people, most of whom are youngsters and it enjoys a great flow of 1.2 millions travellers annually (Goliath, 2008), besides, rapid economic development and internationalization. All of these elements engender a highly promising market demand for Nguyen Son.
However, apart from those potential benefits, it’s also a highly competitive market in which contains many other French cake shops. Hence, Nguyen Son has to establish a clearly distinctive image in customers’ mind.
5.1.3 – Psychographic:
Nguyen Son’s targeted customers are middle-class, upper middles, lower uppers and upper uppers people who have demands for the highest quality product.

5.1.4 Behavioural
We also divide our market into 3 groups based on their user status: non-users, potential users and ex-users.
Another way of looking at our customers is their loyalty status. This will be based on the frequency of customers purchasing cakes from Nguyen Son. Moreover, this can also show the popularity of Nguyen Son brand in term of other bakeries. .

5.2 - Target market:
Our target marketing strategy is “Differentiated Marketing”. High-income people in Hanoi, including both Vietnamese and foreigners, some how will need cakes not only on special occasions but also for daily consumption. Besides the generic strategies for our general targeted customers, we will develop different offers based on customers’ user status.

6 - Product positioning:
6.1 - Positioning statement:
6.2 - Perceptual map:
6.2.1 - Graph 1:

6.2.2 - Graph 2:

7 - Marketing mix:
7.1 - Products:
 Wedding cake
Wedding is considered as an important event and wedding cakes make the wedding more special. Most brides and grooms use wedding cake in their wedding in western countries and nowadays, more and more people use it in Vietnam too. Usual wedding cakes are piled up some layer and decorate with cream and decorations. There are various designs of wedding cake but it is customer-built product so we only make it when customers order the product.

 Customized cake
Customized cake is one of special cakes that customers order the cake what they want. In addition, it provides more on customer choices so customers are more satisfied with their products which represent their characteristic and taste. It also the customer-built products so only make it when customers order the product.

 Special day cake
There are some special days in a year, such as: Valentine’s Day, Christmas day, Women day, Children day, Fathers’ day and mothers’ day. People would like celebrate the day with items like gifts or cakes. Nguyen Son Bakery produces some special cakes for special days (available a week before the day). It can be produced as customers’ order but normally baker makes cakes as special design.

 Packages
Single items are packed together to provide cheaper price to customers. Also, customers can buy items at one place and it saves time and money up to 15% of total price.
Package includes;
 A cake
 5 paper well designed dishes
 5 party hats
 One pack of balloon (20 balloons are in each pack)
 One big plastic knife and 5 forks

 Brand name
Nguyen Son Bakery has been building a strong positioning with a well known brand name and a significant market share. It leads to strong competitive power of Nguyen Son to compete with competitors’ brands in the market. Various types and good taste of cakes can attract customers’ attention easily. It brings the brand name ‘Nguyen Son’ to certain image to customers and also attracts new customers in new market.

 Service
Nguyen Son Bakery provides several services to its customers to give customer satisfaction.
 Free packaging
 Free for normal candles, paper dishes, knives and forks
 Free delivery
 Free parking area
 Free catalogues
 Customized order
 Assistant training
 Provide new product in each quarter (depending on special days and seasonal fruits).

7.3 Price
Here are our listing prices of our main products:

Size/Type Wedding cake Valentine Cake Birthday Cake Party Cake
Small 199,000 VND 49,000 VND 89,000 VND 79,000 VND
Medium 299,000 VND 89,000 VND 159,000 VND 139,000 VND
Large 399,000 VND 139,000 VND 199,000 VND 179,000 VND

We also offer 2 services for customers: customized cake packages and delivery service. The customized packages mean that we sell cakes in complementary with some other accessories such as candles or birthday hats, knifes etc, which is creating convenience for customers in buying “once for all”. The expected prices of those packages will be the adding up of the cake’s price and the all accessories’ prices with the accessories’ prices below the retail prices.

About delivery service, as the customer requests, the cake will be delivered to the customer with the fee listed here:

Within 1km 1km-4km 4km-10km
Delivery Fees free 10,000 VND 20,000 VND

In addition, we also produce customized cakes based on requests from customers. However, the prices for those cakes will be considerably higher than ordinary cakes. While other ordinary cakes’ prices mark up 30 % of their production cost, we decide the mark up of customized cakes will be 50% of the price. Customers can request the cake with specific size, ingredients, shape, decoration etc, based on which we will propose a price to the customer.

For customer relationship management, Nguyen Son would have some policies to keep its faithful customers .Customers who buy our products 3 times will receive a discount of 5 % for the next 2 times. They will receive a VIP card from Nguyen Son if they buy 5 times in total. With this card, they can get a discount of 10% for all their purchases .We will manage those by storing basic information of our customers each time they buy our products.

In the early summer, where young people, especially high school and university students have a long holiday, we offer a promotional pricing: lowering down the price of all our products by 10% within the first half of June. This, hopefully, will raise demand for our product. It is crucial to keep an eye on our competitors. However, if our competitors lower their prices, we decide that we will not take any actions and keep our prices the same in order to solidify our image as top-notch, luxury cake producers and to assure the customers that our prices have been always reasonable.
7.4 - Place:
Currently, Nguyen Son follows vertical marketing system where Nguyen Son has united with other suppliers to have specific benefits.

As we want to promote for our products, Nguyen Son may have some agreements with other local competitors such as Thu Huong, Bui Cong Trung to hold a festival, an exhibition of cakes to market. The festival is scheduled in the beginning of the summer (1/6 – 5/6), combined with the promotional pricing to have higher effects. During the festival, customers will have chances to tastes new products with free and buy the current products with special prices. Also, we plan to hold some talk shows with specialists on food safety and healthcare which presently are “ hot topics “ which may attract potential customers who have not paid attention to our cakes .

At this time, customers can not order Nguyen Son’s cakes on the internet. However, Nguyen Son is going to build up a website and launch it by the end of this year, where customers can find information on products, make requests for customized products, feedback and order cakes. With the rapid expansion, Internet is expected to be an increasingly popular medium to contact with customers besides the ordinary methods of phone and direct selling.

At the end of the year, we shall revise our plan if our communication channels are effective or not. Customers’ feedback and statistics will provide information on the 3 communication channel applied (internet, phone, direct shop), based on which we will make decision on which channel we should invest more to increase effectiveness.
7.4 - Promotion:
According to Kotler P. and Armstrong G. (2004), pull strategy means that the marketer will use a lot of advertising and consumer promoting to create consumer demand.

Since cake is not a product which we could use direct selling in term of promotion. This is the consumer good that the purchasing process is mostly depending on the customers.
In order to achieve marketing objectives, we decided to have promotion in 3 types: Advertising, Sales promotion and Public relations (PR).

7.4.1 – Advertising:
By using both below- the- line and above- the- line advertising techniques, Nguyen Son believes that we can attract more customers in to the shop.
 Above- the- line (ATL) method:
First of all, ATL means using media to advertise product, going through the needs of Nguyen Son and also the marketing budget, we consider that Magazines (Mon An Ngon) and some news papers which are written in English (Vietnam News, the Economic Times, etc) can be the possible options. Since our target customers are middle to high class people, and foreigners, hence targeting in those types of media that they consumer daily can bring succeed with lower cost. That’s also the reason why we don’t choose TV ads; it’s too expensive and might not work as effective as the other lower cost one.
Secondly, advertising on those types of media also means that we are using niche media to target people. As not all people can purchase cakes due to high price, this method help us in targeting the right customers. Moreover, we also put advertisements during trailers of movies which targeting more pass-along audience and advertisements on the website of Nguyen Son.
 Below- the- line (BTL) method:
We want to deliver leaflets to the places where concentrate the target customers there (e.g.: luxurious apartment). The leaflet will be written in both English and Vietnamese. In case of possible, we also want to have a celebrity endorsement for our product. This not only can boost sales of the bakery but also can improve the brand image and brand awareness as well.

7.4.2 – Promotion:
For some occasions, Nguyen Son can run discount programs, for instance, on Valentine’s Day, Nguyen Son can offer Valentine’s package which is cheaper than usual. Another method is Nguyen Son can have seasonal discount such as the discount 10% for cold cream cakes in the beginning of the summer as drawing customer’s interests in the new products.
Moreover, Nguyen Son can offer the loyalty card to customers who purchase more than 3 times in store, or more than 2 times by delivery service. With the loyalty card, customers can have discount at the rate of 10%.
7.4.3. - Public relationship:
Nguyen Son has the plan of organising some events such as the cakes exhibition (in cooperating with other bakeries), moreover, participating in other fair, for example: the Exhibition of Vietnamese Highest Quality Product of the year 2008. We can consider this as our annum event. By this, Nguyen Son can show the high-class quality and safety of the product to customers.
Besides, as showing that Nguyen Son has concerns about the social health, the bakery is planning to have promotional programs at international kindergartens, such as running the “Cakes for more nutrition” freely for kids.
Furthermore, Nguyen Son can sponsor some international conferences which are held in Vietnam (ASEAN, APEC, etc) in term of providing tea break. This shows the high status brand within high quality cakes for not only the media press, the society but also is the springboard for future market expansion.

8 - Action & Budget:
Action Place Schedule (1st June 2008 to 31st May 2009) Expenditure
June July Aug Sep Oct Nov Dec Jan Feb Mar Apr May
Advertising on Magazine and newspapers Hanoi O O O O O O O O O O O O 96,000,000 VND
Provide new cake All stores O O O O 16,000,000 VND
Cake festival with competitors  Daewoo Hotel O O 48,000,000 VND
 Horizon hotel
Cake Exhibition (with special cakes; Wedding, Valentine and Christmas cakes) Wedding – Melia Hotel O 32,000,000 VND
Valentine – Nikko Hotel
Christmas – Hanoi Hotel O 32,000,000 VND

O 24,000,000 VND
Kinder garden events International kinder gardens O O O O 12,000,000 VND
Marketing research, find locations in other cities to expand the market Vietnam O O 25,000,000 VND

9 – Control:

 Customer service department: this department has responsibilities of collecting feedback about the quality and the service of staff. By doing this, the managers of Nguyen Son bakery can know exactly what the shops are missing out and find a way to improve the drawbacks.
 Marketing department: department has responsibilities of managing promotion programs in term of PR events, advertising campaigns. The target of this department is increasing sales along with maintaining good brand image and gaining brand awareness of the bakery in general and the Nguyen Son’s cakes in particular. This department also has to do market research for finding out the trend of the market to adjust changes onto the bakery to meet customer satisfactions.

10 – References:
• Kotler, P. 2005, Marketing Principles, McGraw Hill.
• Goliath, viewed May 9, 2008
•, viewed May 9, 2008
• Kotler P. and Armstrong G. (2004), Principles of Marketing, Pearson Education.
• Kotler P., Amstrong G., Ang S., Leong S., Tan C. and Tse D. (2005), Principles of Marketing- an Asian perspective, Pearson Education.
• Jud B. 2002, the Declaration of Dependence,, viewed May 9, 2008.
• Vnexpress, 2007, Se thanh lap thanh tra ve an toan thuc pham, viewed May 8, 2008,
• Vietnam news, 2007, WTO entry may lighten State coffers., , viewed May 9 2008

12- Appendix:
12.1- Market share:
Name % of market share
Nguyen Son 20%
Bui Cong Trung 15%
Thu Huong 20%
Paris Gateaux 5%
Hotel bakeries 10%
Local, single-unit bakeries 30%

12.2- Price list:
Size/Type Wedding cake Valentine Cake Birthday Cake Party Cake
Small 199,000 VND 49,000 VND 89,000 VND 79,000 VND
Medium 299,000 VND 89,000 VND 159,000 VND 139,000 VND
Large 399,000 VND 139,000 VND 199,000 VND 179,000 VND

12.3- Outdoor advertising price list:
Advertisement Unit/time Price (VND)
1- Banners VND per unit
+ Normal banner: Less than one month
+ Simile banner: Less than six months

2- Posters Less than three months
+  0,48 m2 10
+  0,48 m2 5

3- Scrolls on light (4-5m) Less than 3 months 40