INTRODUCTION Heineken Original is a product of one of the biggest beer company of the industry Heineken Lager Beer. Heineken Original was imported directly from Netherlands to Vietnam in 1992 and...

1. 
   

   INTRODUCTION

   
   

Heineken Original is a product of one of the biggest beer company of the industry Heineken Lager Beer. Heineken Original was imported directly from Netherlands to Vietnam in 1992 and became one of the most popular beer here. In this report, the group will analyze Heineken’s company strategy, specifically the Heineken Original. This report will analyze the Heineken Original beer along with external forces that influence Heineken Lager Beer Marketing environment, SWOT analysis (Strengths – Weaknesses – Opportunities – Threats) and STDP strategies (Segmentation – Targeting – Differentiation – Positioning).

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   SITUATION ANALYSIS

   
   

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   COMPANY DESCRIPTION

   
   

COMPANY PROFILE

HeinekenN.V,which belongs to one of the biggest brewery companies, has been well-known for ranking the top 1 beverages industry especially in Vietnam with the high-reaching consumption. It wasset upin 1864 by Gerard Adriaan Heineken.Now, Dolt van den Brink and he started as CEO and Chairman of the Executive Board in Heineken’s parentcompany. Earlier, Heineken started to create the solid foundation as well as the Heineken did in Africa that it boosts the health and the sense of well-being. Then it takes to become one of the most lucrative businesses in Vietnam and it opened widely via universal premium beer brand usingregularly.Thecompaniesheadquarterare inWhite Plains, NY,USA (United State of America).Heineken is a family company that is widely perceived as one of the leading beerbrandswith a history of more than 150 years. The logoconsistsof the five-pointed red star and the word green “Heineken” thatstood forthe 5 elements which are make up this beer product. The letter “e” in brand name evokes the joy associated with the vibrant summer atmosphere and bring afleshingfeeling.

HISTORY

In 1870, Heineken appeared for the first time.It wasconsidered the most successful beer brand andstood forthe symbolof beerindustry in over the world that based onInter-brandand Business week ratings.

In 1864, Heineken a yeast for Bavarian bottom fermentationwas built up by Dr.Elton, before it was a family-scale brewery repurchased by Gerard Adriaan Heineken’s wealthy.

In 1873,Heineken Lager Beerwas establishedin Amsterdam, Netherlandsofficially.

In 1887, a new factory was built in Amsterdam that make much progress in its diversified studies.

In 1942, Alfred Heineken transforms Heineken from a meremanufacturingfacility into a reputable enterprise.

In 1975, the new factory in the Netherlands comes into operation.

In 2002, Heineken Cold Filtered and Heineken Export was replaced with Heineken.

According to the statistic of Heineken revenue worldwide in 2019 by region,it producesand distributes more than 300 brands of beers and fermented apple juice in more than 190 countries before aiming about 30 billion Euros per year.There is a substantialnumberof companies which was distributed internally in Denmark or even exported in the others.Heineken is available and exist in more than 170 countries, over 250 brands among them.

In 2012, Heineken holds full control of Asia Pacific Brewery and owner some famous brands like Tiger,Laruein Asia.

HEINEKEN VIETNAM

HEINEKEN Vietnam, a member of Heineken group was founded in 1991.Heineken entered Vietnam in andkeeps40% of Heineken Vietnam Brewery.HEINEKEN Vietnam so far operates 6 breweries in Hanoi, Da Nang, Quang Nam, Ho Chi Minh City, Vung Tau and Tien Giang and 9 commercial offices across Vietnam.From a humble beginning with just 20 employees, HEINEKEN Vietnam today has become the second largest beer producer in Vietnam with more than 3,500 employees. Every year, HEINEKEN Vietnam contributes significantly to the Vietnamese economy, accounting for about 0.9% of the national GDP. In Vietnam, HEINEKEN produces and distributes beer brands: Heineken, Tiger, Amstel, Larue, BIVINA, Sol, Desperados, Affligem and Strongbow fermented apple juice.In 2017 and 2018, HEINEKEN Vietnam was honored as Vietnam's Most Sustainable Manufacturing Enterprise by the Vietnam Chamber of Commerce and Industry (VCCI) under the Assessment and Ranking of Sustainable Enterprises in Vietnam (CSI). (HEINEKEN Vietnam,The company states its mission is to become a leading proud and responsible beer producer in Vietnam, driven by its core value: Respect People and Planet, Enjoy Life, Quality, Desire to Succeed.

MISSION STATEMENT

The company’s vision is “We have a passion forqualityad bringing enjoyment to life, whilst respecting individuals, society and theplanet.”Heineken was accompanied by the guarantees which are an uncompromising potential of quality, a keen concentrate on innovation, a steadfast commitment to sustainability and especiallybeing stilla blissfully tensionless lifestyleduring its construction and development.Not only does Heineken want to serve its customers by satisfying their demands, but it also tries to build a good reputation in its workplace, to make its customers to feel comfortable when they purchase the company’s products.

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   PRODUCT DESCRIPTION

   
   

FUNCTION

FEATURES

DESIGN

MARKETSHARE

BRAND AWARENESS

Macro environment:
- The macro-environment is a set of factors outside the business that have a wide range of impacts and long-term effects on all business activities either positively or negatively. These elements are considered uncontrollable.

Demographic Forces:
According to UN data, the population of Vietnam is estimated at 97,338,579 people in mid-year 2020. This number extremely affects the number of beer drinkers in VietNam. Beer consumption in Vietnam is expected to reach 4.1 billion liters annually in 2020. Heineken said Vietnam is the second-most profitable market after Mexico, with huge potential. The number of people at the age of 18 (the legal drinking age) will exceed 72 million by 2021.Especially, the average beer consumption in Vietnam is expected to increase by 65% ​​in 2021. The target customers of Heineken are males are aged 25 to 45 years old. Most of the customers live and work in cities, large towns, with high salary and modern lifestyles.

Economic Forces:
Because of Covid 19, the unemployment rate in Vietnam increased to 2.73 percent in Jul 2020 which has reduced the purchasing power of the customers. If the economy of Vietnam grows and the capita income increases due to the increase of GDP, this can be the opportunity for Heineken. People's purchasing power will increase and they can spend more money on buying beer. Heineken contributes to Vietnam's annual economy, the percentage up to 0.9% of the nation’s total GDP in 2018. However, in 2020, the total beer consumption in the Asia-Pacific region decreased by nearly 5% over the same period last year, bringing the region's revenue down more than 10% year-on-year.

Cultural Forces:
Culture includes personality traits and knowledge of a group of people, encompassing language, religion, cuisine, social habits, music, and arts. Therefore, in order for brewers to continue to grow, they must know the taste of the consumer. Heineken always creates volunteer activities so that Vietnamese consumers can see that the company cares about the country's development and brings joy to the people of Vietnam. For example, Heineken did not use 10 billion VND to organize a series of launch events for Vietnamese Beer (2-4) but used that budget to support the prevention of the COVID-19 epidemic.

Natural Forces:
According to vbcsd, although the COVID-19 pandemic has had a heavy impact in 2020, HEINEKEN Vietnam believes that climate change remains the biggest threat that Vietnam will face in the coming years. Responding to climate change requires a clear, long-term, effort-intensive roadmap from all stakeholders and still feasible. With this in mind, HEINEKEN Vietnam has set ambitious goals until 2025 to contribute to responding to climate change:

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  100% Renewable Energy: Using 100% renewable heat and electricity in all six HEINEKEN breweries across Vietnam (currently 5 out of 6 factories are already using renewable heat).

  
  


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  100% Compensated Water: HEINEKEN Vietnam will return to the environment the entire amount of water usedto producethe product (including the amount of water in the product as well as the amount of water evaporated during the production process).

  
  


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  No landfill waste: HEINEKEN Vietnam aims to reuse or recycle 100% of waste or by-products (currently at 99%), without generating landfill waste.

  
  

Technological Forces:
Heineken factories have used a lot of advanced technology in the brewing process, they believe that using this technology will contribute to better beer. Especially, the Beer factory in District 12 - Ho Chi Minh City - started in 1991. Through nearly 3 records of construction and development, this is considered one of the most advanced and solidly operating breweries in Asia today. Ho Chi Minh City Brewery is also a model for the development and brewing of beer with 100% renewable energy. The visitor welcome area (named HEINEKEN Experience) uses 100% solar energy. The dry water treatment area with advanced technology not only guarantee a clean and safe water source after treatment, but also is used as a source of water for fish farming in the factory,andprovides the other quality render - that is biogas.

Political Forces:
According to a report by the World Health Organization, alcohol ranks 5th among the 10 highest causes of death globally and is the cause of many chronic diseases. The consumption of alcohol and beer of Vietnamese people in 2018 is high compared to many countries in the region. It is estimated that each Vietnamese person over 15 years old consumes 8.3 liters of pure alcohol a year, which is more than the Chinese and 4 times higher than the Singaporean. In Vietnam, alcohol is one of the top 3 reasons for the increase in the rate of traffic accidents among men aged 15 to 49. The cost of solving the consequences of traffic accidents related to alcohol, beer accounts for about 1% of GDP. The Prime Minister officially signed Decree No. 100/2019, for car drivers who violate the highest alcohol concentration (level 3), Decree fines from 30-40 million VND from 1/1/2020.

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   SWOT

   
   

4. Segmentation

*According to Brand Vietnam website, Heineken in one of the most popular beers in Vietnam, approximately 25% of the market (in 2015)

Targeting:

Heineken wants to be one of the most developed producers in Asian which is led by their core values such as respect for people & planets, enjoy life, consumption quality and desire to succeed. By research of Vietnam market the starting price is approximately 16 thousand vnd per bottle. Heineken was manufactured to high-class customers aged from 20 to 40. According to Alexander Koch reported that sustainable development is the most dominant goals, moreover in times of volatility, sustainable development helps them overcome challenges and maintain their core values ​​to achieve long-term success. Base on their advertise, after using beer you can become different character which is your real one such as crying, angry or smiling. Heineken Vietnam continues to apply a circular economic model in production and business activities. Five of the company have six factories are now brewing with 100% renewable heat, of which Vung Tau will become the first carbon-neutral brewery in Asia (100% electric and heat energy).

The other segments heineken targets are consumers who love the taste of beer, so they manufactured a non-alcoholic beer product (0.0 alcohol). Heineken target customer segmentation are the Vietnameses people who enjoy

Differientation:

Product Differientation:

Heineken is loved by beer drinkers all over the world for its rich and refreshing flavor. This flavor is achieved by only using three pure ingredients: water, malted barley, and hops. When A-yeast is added, this is when Heineken magically transforms into the brew we all know and love. Heineken assumes that "No corn, no rice, no additives. No compromise" in its beer. (Heineken) Van Waesberghe explains that A-yeast is still used in its beer today, adding that the “Yeast strain gives the unique taste to the beer.”

Heineken alters its recipe every year to get the precise same taste. “It’s not about the recipe, it’s about the original taste,” says Van Waesbergh. (Kirsten Yovino, 2016)

(Q&Me Vietnam Market Research, 2017)

Even though Heineken beer is not low-priced compared to others (450000VND/barrel) (websosanh) and is associated with the image of beer brand "Premium" and also the "Best Taste" beer, Heineken is still consumed a lot by Vietnamese, ranked second (25%+) in the Vietnam beer market. (forbesvietnam, 2019)

Channel Differientation:

In Vietnam, with 6 breweries based in Da Nang, Ho Chi Minh City, Quang Nam, Tien Giang, Vung Tau, (heineken-vietnam) Heineken's distribution channel is nationwide, from retailers like supermarkets, karaokes, convenience stores, or grocery stores such as Big C, Circle K, etc to main distributors to ensure its beer definitely reaches cities and even small towns because it is a popular drink and indispensable for men, whether in daily meals or in a large and small party at home or restaurant.

To catch up with modern trends, Heineken has partnered with e-commerce platforms such as Shopee, Tiki, Lazada, etc to satisfy customers' needs, and to encourage customers to shop on these sites, Heineken offers consumers a less expensive price product with a relevant delivery method.

Image Differientation:

For a long time, Heineken has been known for the red star on a green bottle, the bottle cap has a metal rim surrounding the words "Heineken Quality". Thanks to such designand being loyal to it, not only those who love this luxury beeriinthe world, even Vietnamese farmers who hear the name Heineken immediately know that it is a famous beer that is bottled in green bottles and cannot be mixed. Notonly does Heineken attach the quality of product, but it also concernes about environmental management and energy saving.

(Our sustainability story, Our Progress, theheinekencompany)

Having entered the Vietnamese market for nearly 30 years, first think of Heineken is creative Heineken advertisements that are always accompanied by an inspiring message, an impressive slogan. Since 2011, this brand always pays 10% of the annual cost for the advertising campaign for responsible drinking via the new message “Moderate Drinkers Wanted”. (mybrandinggroup5mba). Over the years, the Heineken ad templates are concentrated in a very consistent style: Young and funny content, mainly focuses on a humorous technical image which certainly impacts Vietnamese consumer awareness (mybrandinggroup5mba).

Advertising is what differentiates Heineken as a brand. Heineken's effective advertising envidence is

(Q&Me Vietnam Market Research, 2017)

In addition to advertising, Heineken sponsors numerous programs such as UEFA Champions League, Rugby World Cup, Bond Franchise (wikipedia) and Formula 1 Grand Prix 2020 (Van Khanh, hanoimoi.com, 2019). In addition, Heineken Vietnam also regularly organizes events such as Heineken countdown to celebrate the new year, ...

Over the years, Heineken has invested heavily in experiential marketing to connect with their fans on a whole new and more sophisticated level. Last year, Heineken® continues to work with the National Traffic Safety Committee, launching a social media campaign with the video “Solutions for brothers” based on the psychology and behavior of Vietnamese consumers. . With the participation of actor Lien Binh Phat using influencer marketing, the video has the idea of "solution for brothers", to help his friends get home safely after drinking alcohol, reminding his comrades "Drinking - No driving." During the program, customers are persuaded to sign a commitment not to drive after drinking. To assist customers in making the right decisions, Heineken® also provides technology vehicle travel codes worth 100,000 VND, helping people get home safely after fun. (experiential marketing) In just 3 days of release, the video "Solution for brothers" has earned more than 1 million views with tens of thousands of positive comments on social networks. (Van Khanh, hanoimoi.com, 2019).

(Van Khanh, hanoimoi.com, 2019).

Moreover, Heineken is also very active on social networks, evidenced by the number of likes and followers on Facebook

(Facebook)

The Facebook page is a combination of updates, images and videos related to current sports and music news, events. They use Facebook Live to broadcast a live Q&A session with brewers to emphasize the brand's image, tell stories, and capitalize on the brand's legacy. It's a very elegant and smart strategy as it sells beer without even mentioning it.

Positioning

Perceptual Positioning map 1 – Price & Taste

Based on the map we can view Heineken's location. Heineken positions itself in the premium segment with excellent product quality and perfection which is also a philosophy that Heineken pursues. And Heineken has earned himself a firm position in the Vietnamese market. Based on a survey of (qandme, March 2017) about the top favorite beer, the Vietnamese picked the right Heineken with 1945 votes. It proves that, despite the high price, the quality and taste of beer have helped Heineken succeed in Vietnam with the strategy of "more for more".

Perceptual Positioning map 2 – Regconisation & Usage

Having infiltrated Vietnam for nearly 30 years, Heineken has been recognized by most Vietnamese. The map demonstrates that the awareness and use of beer of Vietnamese people are proportional to each other. Figures are taken from(Q&Me Vietnam Market Research, 2017)above.On the map, we see that Heineken ranks first in both indicators with Heineken's quality taste and marketing strategy has conquered the Vietnamese people.

Conclusion

In conclusion, Heineken beer has been very successful in the Vietnamese market thanks to its quality products and innovative unique marketing strategies that are entertaining corporate social responsibility, creating controversial marketing campaigns bring people closer together, create ads with unexpected turning points, use customer insights when launching a campaign. Although Heineken ranks 2nd in the Vietnamese beer market share, Heineken still needs to dilligent, because more and more types of beer are entering the Vietnamese market, there is a high possibility of threatening the Heineken beer position.