02/02/2024
Cultural heritage stands out as one of the potent strengths that can propel Vietnamese businesses onto the global stage, contributing to elevating the position of the Vietnamese National Brand in global rankings. However, this advantage is yet to be fully exploited.
Building a global wave of Vietnamese brands and leveraging the cultural heritage of the nation to help businesses establish internationally renowned brands has been the dedicated theme of Ms. Tran Tue Tri, Senior Advisor of Brand Purpose Organization, Member of the Executive Board of AVSE Global, and author of the book “Vietnamese Brands – The Golden Moment.”
“The Golden Moment” for Vietnamese Brands
According to Ms. Tue Tri, the current time is a “golden moment” for Vietnamese brands.
There are abundant opportunities for Vietnamese businesses to expand globally. For instance, the vast overseas Vietnamese community (according to the Ministry of Foreign Affairs, Vietnam has over 5 million overseas Vietnamese) serves as “brand ambassadors” capable of assisting Vietnamese businesses in broadening their international business prospects.
Another favorable factor is the “China Plus One” strategy. Many global companies are seeking to diversify their product supply chains, not relying solely on the Chinese market. Vietnam is a highly valuable choice in the China Plus One strategy of global companies, providing an opportunity for Vietnamese companies to reach global markets.
Alongside this is the increasing demand for cross-border e-commerce and digital media. Twenty years ago, going global was a significant challenge for Vietnamese businesses due to the high costs of communication and distribution channel development. Now, with digital communication and cross-border e-commerce, the narrative of international market penetration has become more straightforward, with more cost-effective options. Vietnamese businesses can now boldly venture into the global arena.
Analyzing the results of the Brand Finance Organization’s statistics, which place the Vietnamese National Brand at 32nd position on the global brand map in 2022, Ms. Tue Tri states: “This is a very positive signal. The 32nd position is very close to Vietnam’s GDP ranking in the world – the 33rd position.”
Examining what motivates the development of national brands, the Senior Advisor recognizes the crucial role played by the brands of products and services offered by businesses.
Looking at the Top 25 most valuable brands in the world (according to Brand Finance’s 2022 statistics), countries with robust economies tend to have more brands in the Top 25. For example, the United States has 12 brands, accounting for over 50% of the total value of the Top 25; China has 7 brands; Germany, Japan, South Korea, and the United Kingdom each have 1 brand.
The global brand landscape corresponds proportionally to the GDP landscape. The United States remains the country with the largest GDP globally: $27 trillion. Following is China.
It can be said that the global brand development of businesses in each country is the driving force for the growth of that country’s national brand. Mention the United States, and people immediately think of Google. In other words, Google – one of the global brands of the company – has contributed to enhancing the position of the United States’ National Brand.
Therefore, Vietnamese businesses need to realize the importance of building a global brand more accurately. In addition to contributing to the country’s economic growth, the global brands of Vietnamese businesses can also reinforce and increase the stature of the Vietnamese National Brand.
Better Utilization of the Cultural Heritage Advantage
“The cultural heritage of Vietnam is a strength that can help Vietnamese businesses go global, enhancing the position of the Vietnamese National Brand on the global stage. However, we have not yet fully tapped into this advantage. Looking at Google Arts & Culture, we only see a few introductions about the cultural heritage of Vietnam. We need to pay more attention to this issue,” noted Ms. Tue Tri.
The Senior Advisor of the Brand Purpose Organization suggests five cultural areas that Vietnamese businesses should focus on exploiting if they want to quickly build brands and step into the international market.
Firstly, culinary culture. Vietnam’s rich and diverse culinary cultural heritage is a valuable asset, with many healthy dishes. Among nearly 3,000 Vietnamese dishes, Hue alone boasts 1,700, and Hue’s cuisine has been recognized as the intangible cultural heritage of the world. This is a strength that needs to be harnessed. Vietnam can learn from the “land of kimchi”: Instant noodles have been effectively used in promoting South Korea’s National Brand. In Korean films, whenever a couple is in love, they always take each other out for noodles.
Secondly, agricultural culture. Clean and green Vietnamese agricultural products are increasingly winning the hearts of consumers worldwide. Looking at Japan, in 2020, Japanese Ruby grapes were once auctioned for $12,000 per bunch, equivalent to $400 per grape. In Japanese culture, fruits are considered precious gifts, and Japanese supermarkets do not sell crushed or ugly fruits, creating consumer awareness of the quality of Japanese agricultural brands. This is an inspiring story for building the brand of Vietnamese agricultural products in a similar way.
Thirdly, in the realm of art and architecture heritage, Vietnam was the first country in Southeast Asia to establish the Indochina School of Fine Arts in 1925, positioning itself as a pioneer in embracing the modern art movement. Vietnamese people have a deep appreciation for beauty and possess a keen artistic eye, which can be a significant advantage in product branding.
South Korea has excelled in creating visually appealing artistic designs for product branding. Some ceramic products in the UK have also leveraged architectural and artistic elements to craft inspiring stories about culture. It is hoped that Vietnamese businesses can harness and maximize their artistic capabilities in design to elevate the stature of Vietnamese brands. Some Vietnamese companies, such as Bitis, have already achieved success in this regard, representing a bright spot that can be further developed on a larger scale,” suggested Ms. Tue Tri.
“Fourthly, the cultural heritage of traditional craft villages. Vietnam boasts approximately 5,400 traditional craft villages. Many countries worldwide, like Japan, Thailand, Dubai, have successfully utilized the cultural heritage of their craft villages to build strong product brands. A notable example is Thailand, which initiated the OTOP program (One Village, One Product) around 2000. Currently, the annual revenue from the OTOP industry reaches about USD 50 billion, contributing 10% to Thailand’s GDP.
“I recently learned about Vietnam’s OCOP program (One Commune, One Product). This is also an opportunity to help Vietnamese businesses solidify their presence in the domestic market and gradually expand to the global market,” shared Ms. Tue Tri.
“Fifthly, cultural heritage tourism. Vietnam is one of the two countries in Southeast Asia with numerous UNESCO-recognized world heritage sites (Vietnam and Indonesia both have 8 recognized sites). This presents a robust opportunity for the development of the Vietnamese brand in the coming years.
Preparing for the global stage
“An important point I want to emphasize is that when building a global brand and expanding internationally, Vietnamese businesses must have better management capabilities, higher international competitiveness, and must be more innovative. Often, a business may be number one in their home country, but when going abroad, they may not be as competitive,” recommended Ms. Tue Tri.
In reality, 98% of Vietnamese businesses fall into the category of small and medium enterprises, facing various challenges such as capital and human resources and lacking experience in building large-scale brands. Moreover, the global economic downturn and instability are leading to a trend of reduced consumer spending.
Therefore, according to the perspective of a senior advisor from the Brand Purpose Organization, when devising a global strategy, Vietnamese businesses need to learn more about management and brand building, receiving additional support in creating an ecosystem to “travel together” on the journey to conquer foreign markets.
Discussing how Vietnamese businesses should prepare for international expansion, considering her extensive experience in developing global competition strategies for businesses in over 40 countries worldwide, the senior advisor of the Brand Purpose Organization analyzed: “Some businesses may not perform well in Vietnam but are highly successful internationally. However, for most large-scale enterprises to succeed abroad, their success in the domestic market is crucial. The domestic market is where businesses can test, build a strong management system, and a robust brand. A prime example is Samsung – not only a strong global mobile phone brand but also highly influential domestically. Therefore, Vietnamese businesses need to focus on building their brand and developing scale domestically before entering the international market. Strong internal capabilities are essential before ‘going to battle in foreign lands.'”
On the other hand, businesses also need a systematic approach to enter international markets. Firstly, they must study potential markets – markets where they have a competitive advantage. Secondly, they must understand the habits, needs, and challenges of the consumers they are about to approach. Understanding the target customers is a crucial factor when entering the global market.
From there, a plan must be developed to enter the market, especially in terms of distribution channels. If a brand has no distribution channels, it cannot create value and reach customers.
Additionally, finding reliable partners and attracting talent in international markets are also crucial issues.
For businesses still unsure about which model to choose for building a brand and entering international markets, Ms. Tue Tri suggested referring to the 6P model – comprising 6 key factors: Product, Price, Place, Promotion, People, and Process.
“When going abroad, businesses must position their brand appropriately for each specific market,” added a piece of advice from Ms. Tue Tri, accompanied by an illustration using Downy fabric softener.
In the US market, Downy is positioned as a product that consistently makes clothes soft and fragrant. However, when entering Vietnam, softening fabric was not a significant selling point for consumers since, at that time, many Vietnamese people did not use towels and could not feel the softness. For Vietnamese consumers, the important factor was the fragrance, as they enjoyed the pleasant smell when hugging their children or family members. Therefore, Downy’s positioning in Vietnam focused on the “long-lasting fragrance” story, along with a variety of scent options.
The Japanese market poses different challenges. The Japanese have a habit of eating a lot of grilled meat, leading to clothes easily retaining unpleasant odors. Thus, Downy’s positioning in Japan shifted to odor elimination.
“Understanding consumers is crucial. Even with a good product, without understanding what consumers want and conveying a message to every market, success is still unlikely,” Ms. Tue Tri summarized from her practical experience as someone who held the position of Vice President of the Global Brand for Unilever for many years.
Source: http://surl.li/qwvdi
