To become one of the famous retail businesses in Vietnam, FPT Shop has built and implemented an effective marketing strategy. Let’s learn and analyze FPT Shop’s business strategy in the article below.
Overview of FPT Telecommunications Joint Stock Company (FPT Telecom)
According to Wikipedia, FPT is one of the largest information technology service companies in Vietnam with the main business being providing information technology products and services. According to statistics from the United Nations Development Program, this is Vietnam’s 14th largest enterprise in 2007.
Established on January 31, 1997, FPT Telecommunications Joint Stock Company (FPT Telecom) started as Online Service Center. Over the past 10 years, from a center for building and developing Vietnam Intelligence Network with 4 members, FPT Telecom has now become one of the leading suppliers in Vietnam in the field of telecommunications and services. online with a total of more than 2,000 employees and dozens of branches nationwide (Hanoi, Hai Phong, Hai Duong, Ho Chi Minh City, Binh Duong, Dong Nai, Vung Tau, Can Tho…).
According to VNReport, FPT was the third largest private enterprise in Vietnam in 2012. The criteria for Vietnam Report to select private enterprises are those with private equity greater than or equal to 51%. In 2019, FPT revenue reached 27,717 billion VND, an increase of 19.4% compared to 2018; Pre-tax profit reached VND 4,665 billion, an increase of 20.9% compared to 2018. Revenue and profit from foreign markets grew highly, reaching an increase of 41% over the same period.
Some of FPT’s main areas of activity include:
- Providing telecommunications network infrastructure for broadband Internet services
- Agent providing telecommunications and Internet products and services
- Value-added services on the Internet and mobile phones
- Message, data, and entertainment information services on mobile phone networks
- Agent providing online games on the Internet and mobile phones
- Agents providing television, movie, and music services on the Internet and mobile phones
About FPT Shop
Established in August 2007, FPT Shop is a retail chain specializing in digital products such as Mobile Phones, Tablets, Laptops and electronic accessories… FPT Shop is the center The first retail store in Vietnam to be certified with ISO 9001: 2000 quality management according to international standards.
FPT Shop’s orientation is not only to provide customers with the newest and highest quality genuine products, but also to be a place for customers to experience products comfortably under the advice of a team of qualified staff and technicians. Highly-professional trained. The difference of FPT Shop is also its separate after-sales policies such as Gold Warranty: Warranty for cases of breakage or water damage, 1 for 1 exchange policy within 30 days, etc.
Analyze the SWOT model of FPT Shop
The SWOT model is a famous tool known and applied by many businesses because of its usefulness in helping managers analyze important factors inside and outside the business from which to establish strategies. appropriate strategy and business plan.
SWOT stands for 4 words: Strengths, Weaknesses, Opportunities and Threats – is a famous model that helps businesses analyze and build your business strategy effectively.
Among the 4 elements of the SWOT model, strengths and weaknesses are two factors for internal assessment of the business. For these two factors, businesses can control and change. Often these factors are related to company operations, assets belonging to the business, product development, etc.
Besides, the remaining two factors, opportunities and challenges, are external factors that are often related to the market and are macroeconomic in nature. Businesses may not be able to control these two external factors. Businesses can fully seize opportunities, but they must also pay attention and be wary of external challenges that can occur at any time.
For FPT, the strengths, weaknesses, opportunities and threats of this brand can be analyzed as follows.
Strengths
Regarding the strengths in FPT’s SWOT model, this brand has some outstanding strengths below.
Excellent, highly qualified staff
One strength of FPT is that the group possesses an excellent and highly qualified staff. They are all young, dynamic, highly qualified, enthusiastic and creative employees. It is the most valuable asset and the foundation for all of FPT’s success.
Many FPT staff have won international certificates such as CCNA, CCNP, CCIE for CISCO networks, international certificates for server generations MINI RS/6000, AS/400, SUN, HP…
Strong financial strength
Large capital resources (more than 700 billion VND), in addition to the investment of FPT Group, are conditions for FPT Shop to easily improve technology.
Modern technology
Use FPT.AI Conversation to create virtual assistants to provide sales consultation and automatically answer frequently asked questions from customers on e-commerce websites and Facebook.
Famous brand
The parent company is the distribution representative for many large suppliers, as well as the importer of most phone lines into the Vietnamese market. Therefore, other retail chains still have to get goods from FPT Shop. This makes FPT Shop always have products in advance compared to competitors with more competitive prices and faster warranty.
Along with its prestigious brand, FPT Shop is always a highly appreciated brand and a destination chosen by many people.
Weaknesses
Besides strengths, FPT also has weaknesses that need to be overcome.
Some of the main weaknesses in FPT’s SWOT model can be mentioned as follows:
Don’t focus too much on online advertising
One weakness of FPT is that it has not focused on investing in online advertising.
The field of online advertising has not had a breakthrough, with product-related information, FPT Shop does not focus on communication.
Depends on the supplier
FPT Shop does not directly produce products, but imports products from suppliers, so it is dependent on them. Without any strategy, some supply-side risks are likely to occur such as supply chain disruption, directly affecting product shortages to supply to customers.
Opportunities
To take advantage of strengths and overcome weaknesses, FPT can seize a number of beneficial opportunities to develop its brand and increase sales as follows:
Rising demand
Vietnam’s GDP is increasing rapidly and always remaining at a high level, which means people’s living standards are increasingly high and income has improved compared to previous years. Along with the expansion of the middle class is said to be the main reason helping the retail industry become a potential field.
Benefit from digital transformation
The wave of global digital transformation with compound growth in the period 2019-2022 could reach more than 16%, bringing growth opportunities for FPT Shop.
Opportunity to enter international markets
Vietnam’s accession to the WTO opens up new opportunities for FPT Corporation to enter the international market. Tariff barriers are being eliminated, information infrastructure is being strongly developed.
Threats
Besides opportunities, FPT also needs to face some challenges. The main challenges in FPT’s SWOT analysis can be listed as follows:
The entry of competitors is increasing
Vietnam’s accession to the WTO will make FPT’s competition not just limited to domestic companies. Rapid growth toward the liberalization and globalization of services has created intense competition in its own sector of both national and international retail markets.
Competition from e-commerce channels
With the emergence of e-commerce channels (Tiki, Lazada, Shopee…), consumer purchasing behavior gradually changes because of the convenience it brings. This will make the market more competitive and require current retailers to strengthen professional online sales channels with better services to meet consumer needs.
Prices fluctuate
Technology is one of the commodities with very rapid price fluctuations. This directly affects product distribution and profits of FPT Shop
Outbreak of COVID-19
COVID-19 has been negatively affecting the economy not only in Vietnam but also in the world. Along with the unpredictable developments of the epidemic, the global supply chain is disrupted. This leads to not meeting consumer needs.
In addition, the government’s continuous directives on social distancing cause businesses to stagnate, directly affecting workers’ income. From there, reducing consumer purchasing power.
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Analyze FPT Shop’s Marketing Mix strategy
FPT Shop is one of the most famous retail businesses in Vietnam. To achieve this success, FPT Shop has effectively implemented Marketing Mix strategies according to the 4P model.
So what is FPT Shop’s Marketing strategy? How has FPT Shop implemented the Marketing Mix strategy?
Marketing strategy of FPT Shop regarding products (Product)
Products are always the core of every business, and a good product needs to meet the needs and desires of customers, otherwise competitors will lose market share or even be eliminated from the market.
Regarding products, FPT owns a diverse product portfolio with high quality. Some main products that FPT provides include:
- Laptop product line
- Phone product line
- Tablet series
- Phone accessories line
FPT Shop’s Marketing strategy also focuses on diversifying products to meet the needs of FPT customers such as smart watches, accessories for all types of computers, phones…
In addition, customers often trust FPT products and services because these products are defined as products with clear origin and quality, genuine origin.
In 2016, FPT Shop was officially authorized to sell Macbooks and Apple Watches. This means that FPT Shop becomes Apple’s highest-level authorized dealer selling a full range of products including iPhone, iPad, Macbook and Apple Watch.
At the same time, importing directly from Apple will help retailers be more proactive in sourcing goods than before and help users access products sooner and faster.
FPT Shop’s Marketing Strategy in terms of price (Price)
Price is one of four important components in the marketing mix. It plays a decisive role in consumer purchases, and for companies, price plays a decisive role in competition in the market. Introducing a pricing strategy in marketing is important for businesses because it directly affects the sales and profits of the business.
According to McKinsey, just improving the price factor by 1% will increase profits by 6%. That has more impact than a 1% reduction in variable costs (which increases profits by 3.8%) or a 1% reduction in fixed costs (which increases profits by 1.1%).
Regarding product pricing strategy, FPT has used a dynamic product pricing strategy (Dynamic Pricing Strategy).
Dynamic pricing can be understood as on-demand pricing or time-based pricing. This is a flexible pricing strategy in which selling prices fluctuate based on the market and customer demand.
The decision-making process behind this dynamic pricing strategy goes like this: Algorithms developed based on machine-learning will help businesses develop new algorithmic models based on market needs and competitors’ strategies. This data-driven process allows businesses to seamlessly adjust their product prices within seconds.
With this strategy, FPT regularly offers product price adjustment strategies through monthly and event-based promotions to attract customers to the system.
In addition, understanding that customers often hesitate to spend large amounts of money on purchases, this brand quickly deployed a strategy to support installment payments with 0% interest. With simple procedures and conditions, FPT Shop recorded up to 60% of device buyers over 10 million VND paying in installments.
>> Read more: 10 popular pricing strategies in Marketing
FPT Shop’s Marketing Strategy regarding distribution system (Place)
Through using the right distribution system, a company can increase sales and maintain positive figures over a longer period of time. This means a larger market share and increased sales and profits.
Precise positioning is an important activity that is focused on reaching the right target customers at the right time.
With an extensive distribution network, FPT has succeeded in reaching its customers. The FPT Shop system is covering the whole country, right in the centers of big cities, FPT stores are “densely” distributed. Currently, the FPT Shop system spreads across 3 regions with more than 150 stores.
In addition, this brand also launched the F.Studio system – a chain of genuine authorized Apple stores. The design of each F.Studio store complies with Apple’s global regulations, and must undergo strict censorship by Apple experts.
F.Studio brings a luxurious and classy shopping experience like all Apple stores in the world. From then on, every customer who comes here feels like he or she is shopping at Apple’s own store.
In addition to traditional distribution channels, FPT Shop also builds online distribution channels. With the impact of COVID-19 making consumers more cautious when going out, shopping on online channels is gradually becoming more popular than ever. The benefits of online shopping include: easy product reference, price comparison, contactless payment…
With the online sales channel, FPT Shop easily reaches customers who are far away and do not have the conditions to go to the store to buy products.
FPT Shop’s Marketing Strategy on Mixed Promotion (Promotion)
Promotion is a necessary business activity to keep pace with the consumer market. FPT Shop implements promotion strategies with FPT Shop promotion programs such as purchasing goods with gifts, granting scholarships to students, saving 50% off…
These strategies show that FPT’s marketing strategy is directly aimed at people who are passionate about computers and other technology devices. Furthermore, FPT besides selling phones and laptops is the main product that creates profit. The profit is not small for the company’s products.
Besides the discount strategy, FPT Shop also cooperates with KOLs to promote its brand. In this way, FPT Shop can take advantage of the popularity of influential people in the social networking community, people with a large number of likes and followers, and people active in many different fields to increase recognition. presence, as well as attract potential customers.
One of FPT Shop’s most prominent KOL collaborations includes Hau Hoang – a famous Youtuber with nearly 7.5 million subscribers. With humorous content, keeping up with trends, and incorporating reasonable advertising details, it has so far attracted more than 32 million views on YouTube. This brand has been successful in attracting customers and increasing brand awareness.
Summary
To become one of the famous retail businesses in Vietnam, FPT Shop has built and implemented an effective marketing strategy.
Hopefully through this article, readers will have a better understanding of the case study of FPT Shop’s marketing strategy, from which they can refer to implementing appropriate marketing strategies for their businesses.
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