Marketing Strategy assignment

Calvin Klein Inc.
205 West 39th Street, New York, 10018
Hanoi, 2011
Sunderland Faculty of Business & Law Undergraduate Programmes
MKT 306 MARKETING STRATEGY
Individual Assignment Report
ANALYSIS OF CALVIN KLEIN’S MARKETING STRATEGY FOR
VIETNAM FRAGRANCE MARKET 2012
by Pham Trung Hieu
ISME, National Economics University, 2011

ANALYSIS OF CALVIN KLEIN’S MARKETING STRATEGY FOR VIETNAM FRAGRANCE MARKET 2012 2
TABLE OF CONTENTS
SUMMARY
In the perspective of an international marketing consultant, this report will analyze current situation of Calvin
Klein Incorporation, Vietnamese fragrance market as well as existing trends for CK to develop its business and
achieve the company’s strategic objectives. It also exposes some important recommendations to obtain a
detailed marketing strategies, programmes and marketing mix in penetrating into this market.
With a hundred of luxury products, Calvin Klein brand is very popular and becoming an international one. The
company is now operating under PVH Corp. and licensing with Coty Inc. in fragrances. CK’s reputation,
finance are very strong due to its own high quality, lifestyle products and successful promotional campaigns.
However, in aspect of fragrances, CK falls a little bit behind when they increase production costs. It needs
change the marketing strategies by expanding into another market to meet the requirement of sustainable
growth.
Hence after a precise analysis, CK One Shock (or future is product line CK One) is the most appropriate
fragrances that satisfy Vietnamese market. And with a detailed marketing mix, CK can penetrate into this
market successfully and strengthen its global image and financial viability.
INTRODUCTION
Calvin Klein Incorporation (CK) is founded in 1968 and is one of the leading fashion design and marketing
studios in the world, designs and markets women's and men's collection. The company is currently owned by
Phillips-Van Heusen. CK brands are not just the collection of products but also imply differential unique
lifestyles. Calvin Klein fragrance now owned by largest fragrance in the world: Coty Inc. (Calvin Klein official
website)

Sexual imagery is used popularly and flawlessly in any CK products, especially fragrances, which CK is called
as a “king of sexually provocative advertising campaigns” (Women’s Perfume Reviews.) When those ads are
published, they attract both advocates and also antagonists as well (see Appendix 1.) However, controversy has
still brought CK successes and reputation on global best brands.
Calvin Klein operates business globally with multiple external licensees and third parties. The company
combines its own design, marketing and managing capabilities with Coty Inc. to develop the business supply
chain efficiency and create chance for expanding overseas. In second quarter 2011, revenue from Coty
fragrances accounted for only approximately 10%, the lowest ratio compared with 50% from Warnaco Inc. and
25% from G-III Apparel Group Ltd. (Phillips-Van-Heusen Corporation’s annual report, 2011.)
Phillips-Van Heusen’ board of directors has appointed a list of corporate strategies for CK to direct brand
development and growth sustainability by differentiating marketing brand identity, positioning. For CK
fragrances, it is given objectives to continue introducing and growing additional fragrances, such as Euphoria
(2005), CK IN2U (2007), Calvin Klein Beauty (2010), CK One Shock (2011), etc. (Phillips-Van-Heusen
Corporation’s annual report, 2011.)
As a professional marketing consultant, this report is provided for CK Inc.’s managers as well as PVH
Corp.’s directors a full analysis about marketing intelligence for Vietnamese market with two products, i.e.
CK Euphoria and CK One Shock, from which it extracts valuable recommendations marketing strategies in
order to meet corporate objectives.
CURRENT SITUATION
I. Reasoning choices

CK One Shock and Euphoria are two out of many fragrance products that CK strategy taken into consideration,
continuously introducing and growing in global market. Here, marketing mix, product life-cycle and BCG
matrix are employed to analyze and assess whether they can create a big hit when moving into a new market.
1. Current marketing mix
As Neil H. Borden stated in his published article “The concept of Marketing Mix”, marketing mix is first
defined as the collection of items in marketing aspects as product design, pricing, branding, quality, packaging,
servicing, distributing, inventory, advertising, sales promotion, etc. They are then re-categorized into 4 main
factors: product, price, place, promotion and the marketing mix first generation called 4P’s model.
1.1 CK One Shock
Recently in Autumn 2011, CK launched its latest fragrance to the market, CK One Shock, belongs to the
product line of CK One (1994.) CK One became a very successful product in the world history of fragrance.
This one changed the perception that beauty is “for everyone” and targeted to the mass market, mainly serves
the teenagers (15 to 16), the young people (average 25), and out of above implied provides for all age groups.
The product itself presents a young, dynamic and hippy image but it also appeals in the mindsets of all age
group in the time when society is developing and technology is changing. That is a contemporary trend. CK
One Shock, differentiated from its unisex ancestors, appears as the first “non-shared fragrance” in the CK One
portfolio. It comprises of two bottles: CK One Shock for Her in white and CK One Shock for Him in black.
According to Thomas Burkhardt, CK Vice President Global Marketing, CK One attracted a huge spark of
customers and led them to a new trend for beauty in the past. Hence, once again, CK One Shock has launched to
the market for the objective of making CK One a lifestyle brand completely (The Moodie Report, 2011.)

(The Moodie Report, 2011.)
1.2 Euphoria
Euphoria perfume, differentially, focuses on the women segmentation only. This product was created by CK’s
best innovative perfumers and launched in 2005. The perfume itself formed a new line of fragrances that has not
appeared in market before. Euphoria is valued outstanding quality and absolutely, it is awarded as the best
favorite fragrance for women in 2006. The targeted group for Euphoria has no range for distribution except
teenagers. The reason as Natalia Vodianova, ads model, said that Euphoria perfume attaches the feeling of first
love, first touch, first kiss like in the heaven and it appeals a sensitive seduction for a dating night. As a new
comer, Euphoria mission is capturing awareness of potential customers by its uniqueness and high quality,
strengthen corporate brand and simultaneously increase trial & purchases (Women’s Perfume Reviews.)
(Women’s Perfume Reviews)
2. Product life-cycle
Product
High-gloss, signature
bottle
Edgy, sexy &
impulsive
In Party mode
50, 100, 200 ml
Price
$38-44 US at retail
price
Place
UK domestic market
France
Others
Travel retail
Promotion
Pre-launch website
Print, TV, digital
elements
iPhone apps, QR-style
Image on shop floor
Product
Outstanding quality
First love feeling
Dating, night-out, fall,
winter
30, 50, 100 ml
Price
Consider as a gift
$50-65-80 US
Place
UK domestic market
France
Others
Promotion
Pre-launch website
Print, TV, digital
elements
Valentine, Christmas,
Women
Orchid promotion

Product life-cycle is a sequence of stages where a product processes from introduction, growth, maturity,
decline to withdrawal. Each stage of this model is collaborated with different marketing situation analysis which
sales figure is determined and 4P’s is combined to turn out appropriate marketing strategies for the product
development in the future (William and McCarthy, 1997.)
As CK launched the product in August 2011, CK One Shock is just introduced in UK domestic market and it
needs more endeavor to capture global awareness by implementing promotional campaigns. At introduction
stage, pricing strategy offered to the market is crucially important, either setting at penetrating price to obtain
more market share or at high skimming price to recover research and development costs.
Euphoria perfume is positioned further than CK One Shock when it is processing at maturity stage. After more
than 6 years launching, CK has already had not only awareness from their customers but received comments,
assessments, and reviews also. Through this time, the product certainly appears on the shelves of every shops
via company’s distribution channel.

3. BCG matrix
According to Bruce Henderson, the business can be classified into 4 categories based on the grid – combination
of two factors: market growth rate and relative market share (Bruce Henderson, 1974.)
CK One Shock is positioned at question mark because it is just a new release fragrance, hence it cannot compete
with other products in aspect of share but with the success story of CK One, it may have potential high market
growth rate.
For Euphoria, it is different. It is assumed that after the Fifi Award 2006, this perfume has captured a high ratio
of market share and through 5 years, customers demand is slowing down. Euphoria is then positioned at cash
cow where provides revenue for CK gradually.

Generally, through the analysis of marketing mix, product life-cycle and BCG matrix, CK marketing
manager can understand comprehensively about marketing tactics of 4P’s and positions of each product.
The manager can then decide to choose the optimal choice among alternatives to match with Vietnamese
market and appropriate the corporate strategies:
 CK One Shock
o Maintaining current marketing mix and introduce the product to Vietnamese customers by
pushing up promotional campaigns to make “a star” in the market
o Adjusting marketing mix to bring suitable product for potential customers: committed high
quality with low penetrated pricing (see Appendix), select unique distribution channel, attract
awareness and educate consumers through promotion. It must also make CK One Shock “a star”
in the market
 Euphoria

o Continue using current marketing mix to sell this perfume in Vietnamese market in objective of
lengthening its product life-cycle and maintaining revenue.
o Altering marketing mix to fit customers’ needs and differentiate with competitors: change product
features, added value, price variety, distribution incentives, and intensive promotion. This will
increasing profit for CK to stimulate market growth and change Euphoria to “a star”.
II. SWOT analysis
SWOT analysis technique is commonly used in the business to identify a variety aspects of internal factors
(Strength and Weakness) and external factors (Opportunity and Threats). These factors are matched together in
a way that company strategies can use Strengths to create Opportunities and reduce Threats as well as using
plans to overcome Weaknesses, prevent Threats and reach Opportunities (Tiles , 1968 and Turner, 2002.)
SWOT
analysis
Strength
Weakness
Opportunity
Threat

 Strengths
o Famous for variety of luxury perfumes and
colognes lines for customers by the best
designers and perfumers (see Appendix 2)
o Global brand recognition & coverage in
different zones: America, Europe, Middle
East & Asia (CK website)
o Premium international standard: high-end
retail stores, elegant webpage
o Good reputation among customers in CK
brand
o Experienced in marketing strategies
o Strong financial capability (see Appendix
3)
 Weaknesses
o Diffuse control of management and
resources for brand CK (PVH Group)
o Operates on large stores => high cost
o Peg on some legal problems of toxic
ingredients in perfumes (Environmental
Health Network, 1999)
CK advertising campaigns are made intentionally with controversy (Vickki, 2009), depends on local
culture either good or bad reputation but customers are still aware
 Opportunities
o Loosening of international trade barrier,
regulations (WTO, Eurozone, NAFTA,
Asean, etc.)
o Middle income people are increasing
 Threats
o Substitute products (e.g. solid perfume –
L’Occitane)
o Fluctuation in exchange rates => unstable
revenue
o Huge competitors within their market as
Channel, Gucci, DKNY, Hugo Boss,
Oriflame, L’Oreal, etc.
o Depends on the financial viability and
operational ability of licensees (Coty Inc.)
Huge wave of potential customers who follow trends: “herd mentality” => Shifting in customer taste or
trend on different brands (see Market Trends)
III.PESTLE analysis

PEST, PESTLE, SLEPT, STEEPLE, STEER analysis are different models in terms of factors included but they
are all very important techniques for assessing macro environment (Oxford University Press, 2007.) In
combination with SWOT analysis, the manager can understand thoroughly the current situation of a specific
market in a local country and generate strategies of how the company can properly utilize internal resources to
adapt with external conditions. For CK Inc., PESTLE analysis is recommended in identifying Vietnamese
fragrance market where not only do the politics, economics, social, and technology are concerned but also there
have seen a number of legal and environmental issues growing recently.
(Detailed in Appendix 4)
IV. Competition overview
In Vietnamese market, CK has a lot of competitors on fragrances segment such as Chanel, Gucci, DKNY,
Bvlgari, etc. However, according to Euromonitor International on the report “Fragrances in Vietnam”, “in
2010, Oriflame Vietnam remained in the leading position in fragrances with a 17% value share, due to its
PESTLE
ANALYSIS
Politic
•Removal of trade
restrictions (WTO)
•Tax: 22-33% ( Im.
Ex
Regulations/Chapte
r 33/3033-Ministry
of Finance)
Economic
•Unstable capital
market
•Medium income
increase
•High exchange rate
Social
•Giant market &
Young population
•Westernizing
culture
•Men & Women
seeking beauty –
peer to peer
Technology
•Internet coverage
•Interactive media:
TV, social blog,
promotion, etc.
Legal
•Developing
consumer protection
law
•Increasing cases law
Environment
•Green concern
•Tropical country
•Humidity climate
•High pollution

outstanding performance in mass segments. A strong commission-based system helped to build a team of
effective sales consultants who were willing to put great efforts into satisfying their consumers. The company
updated products with new catalogues, which helped to introduce new fragrance lines to attract more
consumers.”
V. Market trends
1. Global trends
Perfume industry are re-introduced the classic fragrances. Bvlgari is upcoming with the Pour Femme - it has
been 12 years. In the perfume industry, old is new again. When the outbreak of the new scent is becoming
increasingly expensive to launch new products, some companies looking to profit and reduce risk by re-
introducing the old flowers. Coty Inc. is "re-energize" the CK One appeared 12 years ago by CK One Shock,
one of the first fragrances on the market suitable for both men and women.
According to The Fragrance Foundation’s research on global fragrance market, almost women under 24 year
olds confirms that they will buy a fragrance after trying it and 88% would select fragrance because of smell.
Another trend is one third women will use different fragrances for different occasions however, who under 24
usually wear only one fragrance all the time. Hence, it is important for CK manager to segmentation the market
based on demography.
To show the profession for high-end product, press advertising is the key choice for catching up customers
attention.
2. Vietnamese trends
Recent Lancôme research shows that Vietnamese women pay attention to cosmetics and fragrances, with the
shopping frequency up to 75% compared to the make-up products with only 25%. Another feature is that while
the fragrances are less common in Asian countries (only 40% compared with 36% in Europe); in Vietnam, the
number of users is high.

According to Euromonitor International’s report (2010), “fragrances displayed a robust current value growth of
21%. This was due to the rising demand and greater availability of products. Fragrances were regarded as
luxury products by most Vietnamese and were used during special occasions such as parties and weddings.
During the review period there was a significant increase in frequency of fragrances usage, mostly among the
younger and fashionable generation. They employ fragrances as an essential component when going out and
socializing, rather than limiting it for special occasions only.”
The Vietnamese like strong and intensive fragrances. Therefore, many best-selling fragrances in France is
difficult consumed in Vietnam. Now the smell of fragrances producers in Vietnam are approaching the modern
fragrance under the direction of creating their own preferences with the strong aroma but a long-stay and
sweetie fragrances.
Another trend is that Vietnamese women are now having tendency to use local products due to the move of
Vietnam government to promote country’s production.
Hence, CK must strictly aware of these trends to make its marketing planning more effectively and efficiently
when penetrating into Vietnamese market.
RECOMMENDATIONS
I. Segmentation, Targeting & Positioning
Before implementing a strategic marketing planning of 4P’s (or 7P’s, 8P’s), the process of market segmentation
should be clarified to select appropriate targeted customers and positioning company’s product image in their
mind. (Phillip Kotler, 1994) (see Appendix 5) Based on the analysis of Vietnamese market and trends, a
summary STP model is formed to visualize a potential market CK should target to generate a proper marketing
mix.

As targeted customers recommended above, the CK One Shock has a higher potentiality to be launched into
Vietnamese market than Euphoria perfume. Hence, CK manager should take into consideration of what the
company’s objectives and strategies are employed to grow this market.
II. Marketing objectives & strategies
According to the corporate strategies for CK Incorporation listed in an PVH’s annual report of the US Security
and Exchange Commission 2011, marketing objectives for CK One Shock needs to be set up transparently in
the field that
 there is an integration and support between marketing objectives and corporate objectives
 easier for controlling and monitoring marketing plan, and
 guarantee success of this new fragrance launching into Vietnam market.
Segmenting
Targeting
(differentiate)
Positioning
• Personal characteristics: Ages (under 24, above 24),
Gender (male, female), Lifestyles (North & South)
• Benefits sought: Needs (esteem), Price (average & high)
Quality (high), Image (luxury), Style (young, sexy)
• Behavioral measures: Buying patterns (North & South),
channel (online, authorized shop, hyper-market)
• Lifetime value: care,
recognition needs
• Perceived value: unique, trendy
• Hard to copy: brand, styles
• Current perceived brand: CK apparel => rebranding:
CK has variety of products, especially fragrances
• Current perceived products: luxury, high price, old-
fashioned, fake from China => repositioning: luxury,
affordable price, contemporary lifestyles &
authorized product with high quality
Young people
under 24

This objective must strictly follow 5 indicators of SMART model (Amy Maranowicz, 2011)
In part I (Reasoning choices – CURRENT SITUATION), 4 alternative marketing strategies for CK One Shock
and Euphoria are generated. Through the STP recommendation and marketing objectives, the optimal marketing
strategy is that “adjusting CK One Shock’s marketing mix to bring suitable fragrance for potential customers:
committed high quality with low penetrated pricing, select unique distribution channel, attract awareness and
educate consumers through promotion. It makes CK One Shock “a star” in the market.” Hence, a new
marketing mix is formed in detailed of how the manager must prepare to approach Vietnamese market.
III. Marketing mix & programmes
Marketing strategy draws an overview of the way CK Inc. is going to implement to achieve its objectives,
however, it is not detailed enough to monitoring and controlling the progress. Marketing manager must use
many tactics includes different perspectives and the most crucial technique is marketing mix. There are a
variety of concepts for marketing mix: 4P’s, 7P’s, 8P’s, etc. The original concept of 4P’s is apply only for
product manufacturing but as time goes by, services industry has gradually developing and combined with
S
• Specific: To make the new product, CK One Shock, preferred fragrance of under-24-year-old
young Vietnamese people and to create a new lifestyle for potential young customers
M
• Measurable: This new launch will bring back a high profit which takes account for 12% to 15%
on the total revenue for CK from Coty Inc. partnership and CK brand recognition has 80% of
coverage on local country
A
• Achievable: To guarantee a sustainable growth of Calvin Klein fragrance
R
• Realistic: The expansion to a new highly potential market with young population and trendy
lifestyles will ensure the sales revenue with CK promotional campaigns
T
• Time-bound: this new market development will be evaluated by the end of 2012

product, the original concept is extended to many other factors. Because fragrance is not just a product itself but
representing a personal characteristic, a lifestyle, a feeling. Hence it is necessary to concern about “people”
communication, convenient “process” and “physical evidence” which potential customers perceive of. 7P’s is
employed for CK One Shock.
Apart from the original marketing strategy above, Calvin Klein should take into consideration of another
effective one that is integrating with a local fragrance company in Vietnam market. Through the understanding
about this market, Saigon Cosmetic Perfume is the only company provides fragrance products and it is
receiving good responses from Vietnamese customers. Hence, CK can think of merging or acquiring this
company in aspects of financing, designing product, promotional campaigns, etc. This recommendation comes
from the previous section (Market trends) which CK can satisfy both local customers and government to take
competitive advantages over competitors.
Product
High-glossy, signatured
bottle
Edgy, sexy & impulsive
In party mode, hang out
with peers
50, 100 ml (easy carry =>
dynamic)
Price
$25-30 US at retail price
(included import tax;
assume 60% indirect costs,
15% marginal profit)
Place
Online purchases
CK authorized shops
Hypermalls
Travel retails
Promotion
Pre-launch website
Calvin Klein TV
(customer education
programmes, rebranding,
repositioning)
iPhone, Android apps
Press advertising at
malls' center
People
Young, dynamic,
elegant
Uniform with trendy
styles
Well-communicate
Southern staffs
(appendix)
Process
Hotline services
Online FAQ & online
feedback
Physicalevidence
Store design: fragrance
arrange, young color, music
Hygiene, feeling of
pure
Professional staffs
Trial sections

CONCLUSION
After analyzing currently situation and recommended marketing strategies for Calvin Klein fragrances, the
company has high opportunities to launch CK One Shock into Vietnamese market by employing its internal
resource-based values to alter marketing mix, appropriate with potential customers and reduce minimally
weaknesses as well as avoid threats. CK business can be ensure growth sustainably.
(Word count: 2998 words)
APPENDICES
Appendix 1
The different advertising themes below expose different feeling for
audiences. Maybe they have positive or negative thoughts but they are
all aware.
Analysis of Calvin Klein’s ‘Escape’ advert (excerpt from Christina
Low’s Blog, 2010)
“This is one of the more recent Calvin Klein advertisements,
promoting their men’s and women’s fragrances.
… The relationship between the couple is semi-reciprocal as the
woman is looking at the man, however the man seems like he is trying
to avoid any form of eye contact with her. This suggests that the
woman is chasing the man, which could reinforce a certain stereotype
that it is women that depend on and need men. Another effect of this pose is that where the woman attention is
directed at the male instead of the camera, it intensifies the relationship. The pose could subconsciously suggest
to the audience that if they buy this perfume they will somehow be able to be in a relationship with that type of

intensity, with either a man or woman …
… the way that the woman is leaning on the man while the man looks away almost connotes that the man wants
to ‘Escape.’ The man is wearing darker clothes, which juxtapose with the light background, making him seem
like the more dominant person, as he is the one who stands out the most. This may appeal to a male audience as
it gives out the false allusion that if you use this fragrance, you would become irresistible and dominant…
The mise-en-scene in the advert is quite bare with a plain white background. The couple look like they are
wedged in a narrow corridor, which could also link back to the name of the fragrance ‘Escape.’ There is
minimum text used in the advert, making it look quite simplistic but still professional. The text used in the
advert is a gold, the gold has connotations of royalty and money, like if you wear this fragrance you will be
superior to everyone else.”
Calvin Klein Perfume Analysis (excerpt from Beth Wyer’s Media as
Blog, 2009)
“This advert appealed to me as one that I would like to analyze as it is
simple and yet the message is clear and appealing. The three ideologies
I can see from this advert are: security, love and happiness.
I believe that the theme of this advert is love and intimacy; it is unlike
many of the adverts around that advertise half naked men or women
and instead suggests that the perfume will bring you long lasting love
and/or a steady relationship – which is also backed up by the title of
the perfume which is: ‘Eternity’.
The photo in the advert is a close up of a couple that are cuddled up together, asleep. This shows that they are
comfortable with each other and have a lot of trust in their partner. It may be significant that his face is close to
hers, showing that even in his sleep he is reaching to be able to smell her fragrance…
I believe that the black and white shows that the theme is timeless and classic and that it has always been what

people look for and what they will always look for. It suggests that the relationship is perfect with no troubles or
‘grey areas’ and that the perfume being advertised is able to help you achieve such a perfect relationship…
I believe that this advertisement is extremely clever and would appeal to a wide audience of women as most
women dream about having a perfect relationship and that is what the advert is portraying.”
Appendix 2
Here is a list of perfumes and cologne created by this great designer house.

(Perfumeforme)
Appendix 3
At the end of August, PVH Corp. has organized a conference between CEO’s to discuss the financial
performance of every members in the Group for Quarter 2, 2011 results. And it is a successful half year of
Calvin Klein when all the figures show strong financial performances. As Manny Chirico, chairman and CEO,
stated: “Our Calvin Klein business continued its strong growth momentum in the quarter. Total revenues in the
second quarter for the combined Calvin Klein business is up 19% and our operating profits increased over 20%.
The CK apparel business wholesale and retail that we are running in North America, those businesses posted a
21% sales increase in the quarter. The strong performance was driven by our men’s wholesale sportswear
business as well as a very strong performance in our own retail stores in North America. Our Calvin Klein retail
business has posted a 21% comp store increase in the quarter… Moving on to fragrance, our Coty fragrance
business had a strong quarter posting a 10% increase in revenues. Business was very good across the board with
our Euphoria Calvin Klein Beauty and CK One fragrances continuing their strong growth momentum. In the
third quarter, we’ll have the major product launch with CK One shock. It will be supported by strong marketing

campaign. It will be a global launch. Product has begun shipping in early August. We’ll see much more of a
presence as we step into September and going into the full holiday selling season. So, we have very high
expectations to CK One. We see excellent placement of the product. We think the marketing campaign, which
started in the first half of the year around CK One will accelerate in fragrance in the second half of the year and
we are very positive as we see that business going forward…” (Seeking Alpha, 2011)
Appendix 4
1. Economy
First Vietnamese economy is developing rapidly with a rate of about 6.78% (2010) and living standards have
improved over the years, seeing the increase of medium income people that Calvin Klein may believe that more
women here are eligible to use its high quality products. It is high expectations about the retail system such as
Parkson, which has been successful in helping perfumes and cosmetics continually increasing market share for
years in some Asian countries, especially in China where the situation economic and social development similar
to Vietnam. However, there is a drawback on financial market where Vietnamese government is tightening
control of investments from FDI and promoting for export activities. Generally, Vietnamese market is still the
most stable and attractive market among Asian nations.
2. Politic
According to Ministry of Finance, the government sets import tax applied for fragrances is around 22% to 33%
depending on its origin and the ingredients inside. Hence, CK must calculate a math to balance between the cost
and price to penetrate into the market.
3. Social
In the wave of globalization, there are many social cultures immigrating into Vietnam, especially from Western.
They also brings new trends for shopping, consumption from young to old. Because of increasing living
standard, Vietnamese are seeking to a high level of “esteem” (Maslow’s hierarchy of needs) which they want

confidence, beauty (both men and women) recognized by others.
In Vietnam, the preference of living is also different between the North and the South where have a variety
degree of climate, consumption styles, religions, tastes, etc.
Thus, CK manager should concern about creating the trend that satisfy different Vietnamese people needs then
they will aware and purchase its fragrances.
4. Technology
Through time, technology is an factor which has the fastest growth in Vietnam, especially the interactive media
and marketing industry. With a large coverage of the Internet, marketers have a hundred of channels to
advertise and promote to targeted customers.
5. Legal & Environment
In recent years, local administration is putting pressure on controlling goods market by generating consumer
protection law which prevent companies selling fake, low quality and toxic products. A research shows that
50% of Asian women have oily skin type and sensitivity, therefore CK should have the right fragrances to avoid
giving customers experiencing adverse health (Lancôme research.) Vietnam also lies near equator and
surrounded by seas hence its climate has high humidity and temperature that can transform some fragrance
ingredients into toxicity and causes health problems. To protect customers as well as company’s reputation, CK
must carefully determine its products before launching to the market.
Appendix 5
According to Phillip Kotler (1994), “market segmentation is the subdividing of a market into distinct and
increasingly homogeneous subgroups of customers, where any subgroup can conceivably be selected as a
target market to be met with a distinct marketing mix”. By segmenting the market into different groups, CK
manager can then develop a suitable specific marketing mix strategy which aims to satisfy targeted market.
Moreover, segmentation also comprise of selections which CK has competitive advantages over its competitors

to maximize profit. This is very important initiative to create a monopolistic or oligopolistic market for the
company which can have a "powerful effect on competitive advantage because it shapes the configuration of the
value chain." (Porter,1985, p. 53).
Secondly, targeting market is the process of selecting one or more of those market segments and developing
products and programs that are tailored for each segment. Once the segments have been identified, management
must evaluate the opportunities each segment offers (Phillip Kotler, 2003). According to Kotler (1994, p. 293)
“the only sustainable generic strategy in a segmented market is differentiation. He explains that the only other
generic competitive strategy alternative (low cost) is not sustainable in a segmented market. In addition, a
strategy successful at differentiating must generate customer value, provide perceived value, and be difficult to
copy.” Hence, building brand equity is the most effective and consistent way to differentiate the company to
others in the customers’ mind.
Once, the segmentation process gives a clear picture of the market and the target marketing strategy has been
selected, the positioning approach can be developed. Aaker (1996) recommends developing the positioning
objective only after the brand identity and value proposition have been developed. Aaker's definition of
positioning is "the part of the brand identity and value proposition that is to be actively communicated to the
target audience and that demonstrates an advantage over competing brands."
REFERENCES
Books & Articles:
Borden, Neil H. (1964), "The Concept of the Marketing Mix," Journal of Advertising Research, 4 (2), 2-7
Doanh Nhân Sài Gòn Cuối Tuần, 2011, Cuộc chinh phục thị trường của Lancôme, Hochiminh, Vietnam, Vol.
25, p7, 2011
Euromonitor International, 2011, Country Report: Fragrances in Vietnam, London, U.K.

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