6)Analyze the ice cream industry in terms of relevant Porter's forces model ? 7. Give recommendations to Unilever Wall's ice-cream how could it increase share?
The Competition
Baskin Robbins: the U.S. ice cream maker, had three franchises in Ho Chi Minh City and one in Hanoi at the time of the Wall's launch. In April 1997, it was selling around 100 6kg boxes of ice cream in 31 different flavours per month. It imported all its equipment and ice cream directly from the United States. It claimed its customers preferred American ice cream, which was "real" ice cream. About half its customers were Vietnamese.
Vinamilk: the state-run dairy products company, made around 5.5 million litres of ice cream annually for the domestic market.
Dong was a typical Vietnamese manufacturer, with acerage sales of 150-200 k of of various type of ice cream per day. It imported refrigeration equipment only.
Domestic manufacturers such as Vinamilk and Dach Ding had the grow, with the imported Baskin Robbins 20 times more expetarve, and beyond the reach of many.
Goody ice cream an Italian brand unufactured in Ho Chi Minh City with raw material, technology and machinery imported from Italy, was 20-30% expensive than local brands.
In early 1997, Baskin Robbins reduced the price of a 75g ice cream come from VND 18,000 to VND 15,000. Bach Dang ice cream sold at VND 10,000 - VND 20,000 per cup, and Vinamilk at VND 11,400 per litre
The Launch
The Wall's factory had a low key opening in September 1997, Within weeks of the launch however, a spectacular marketing drive lud taken Vietnam's second city by storm, proaction was running at around 200,000 ice cream products per day, but still many agents claimed they could not get enough ice cream to sell. A Wall's spokesman said: "The consumption has surprised us two or three times higher than what we expected based on our experience from our business in south east Asia
High consumption was in part thanks to a strong advertising campaign, with colourful posters and billboards appearing everywhere before the launch. Employing a business strategy similar to that of Pepsi and Coca Cola, Wall's rapidly established 1,350 outlets in Ho Chi Minh City (Vinamilk had about 1,000 outlets nationwide) giving out special freezers designed to keep products cool for up to six hours in the event of a power cut to all its distributors. After launching a campaign depicting ice cream being distributed by pedicabs to the tune of a marketing jingle, Wall's set up a fleet of 120 men on bicycles to sell ice cream from street to street around the city.
To coincide with the hot and humid time of the year, Wall's ice cream stands, to quote one resident, "suddenly started to appear on every corner." Prices were the same at all outlets, with a 15% commission, and Wall's was committed to continuous support of its army of retailers in terms of ongoing training. All distributors were backed up by a fast-response fleet of supply trucks, filling freezers within minutes when they ran out-which happened on a regular basis, as both locals and expatriates succumbed to the craze for Wall's. Product Lines Unilever's plan was to manufacture and sell 'international quality ice cream at considerably lower prices than its international
competitors. The factory produced 12 lines, including Walls imumacinally famous brand as the Cornetto, regional brands such as Paddle Pop, sing with local brands specifically Ariesd ietnamese customers. As popular product in many countries, Wall's appealed to het tocals d foreigners in Vietnam. The Comento sold at VND 5,000, or around US 100, about a band of the price in Europe, and half that of Australia While Italian and American ice cream aimed the high-income market, Wall's also targeted low incomur coomers, with ice cream products ranging from VND 1,000 to VND 5,000
Vietnam was chosen by Unilever as the first place to modace in new heart shaped logo,eventually to be rolled out worldwide The success of the company's first few months in Vietnam seemed to indicate that its faith in the market was not misplaced.
Questions:
6)Analyze the ice cream industry in terms of relevant Porter's forces model ?
7. Give recommendations to Unilever Wall's ice-cream how could it increase share?
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