Sharon's Assignment Final Project Marketing - Revised

8/3/2019 Sharon's Assignment Final Project Marketing - Revised

1/30

1.1. Student Name: Gursharan Kaur Sharon Rachael / HS101184 / Hartford

Institute / Advance Diploma in Marketing / 2007

1.2 Project Start Date: October 2007, Completion Date: December 2007

1.3 Project Title: The development of a market entry strategy for personnel

computer programming, helpdesk and technical services which Micro 2000

Technology Pte Ltd plans to expand in Vietnam.

2. Introduction

2.1 Objective

This report is essentially the evaluation result of the market potential of

Ho Chi Minh City, Vietnam in which Micro 2000 Technology Pte Ltd is planning to

expand on their marketing and sales in computer programming, helpdesk and

technical services. The point of contact for this assignment is Mr. Brandon Ng,

Managing Director of Micro 2000 Technology Pte Ltd. The company profile can

be viewed at (http://www.micro2000.com.sg). This report will discuss the current

problems faced by the organization with its competitors and the possibilities of

entering newer markets as Micro 2000 plans to expand its business to include

consultancy and integration services, distribution and retailing in the ASEAN

market and also to expand their business venture in Ho Chi Minh City, Vietnam.

The report will also present possible solutions for Micro 2000 to exploit and adopt

new marketing plans and strategies for future growth.

2.2 Purpose of Report

The rationale behind this marketing proposal is to expand and grow Micro

2000s Technology market share in the ASEAN shores and to establish a global

presence in the long term. Whilst assessing the company's current strategies to

allow for potential future growth with the company's strengths to exploit

environmental opportunities. In an era of increasing globalization, the costs of


2/30

labor, transportation, and materials constantly fluctuate. This presents a problem

because it creates new complexities and encourages new competition. However

this also presents an opportunity because those complexities challenge

organization to re-evaluate its pricing process and grow a business.

2.3 Scope of Report

The report will look into the economic, social, financial, political,

infrastructure and technological influences in new potential markets and evaluate

potential markets and financial advantages that could be penetrated in the near

future. Foreign markets can be very attractive to a business looking for new

customers, especially when its home market is becoming saturated. Such an

expansion, however, needs to be thoroughly researched and carefully planned to

ensure that the timing is right. To begin with, a business needs to have

successful strategies. As with any company or organization, the main reason for

being in business is to make a profit. Unfortunately, there are times some tend to

lose sight of this goal because they get too involved in running the daily affairs of

the business. One key solution to restoring profitability is to review financial

ratios to restore financial health. This report examines the factors that make

Vietnam stand out among the ASEAN member nations, including the forms of

investment that are permitted, the availability of land for factory construction,

transport issues, water and electricity supply, communications, labor costs and

labor relations, and taxation.

2.4 List of recommendations made and feasibility of them

An informal interview was conducted with Mr. Brandon Ng, Managing

Director of Micro 2000 Technology. During our meeting it was discussed that

their next logical move is to upgrade its technology structure and promote

research and new product development in Vietnam. However, many issues have

to be in place for the expansion into Ho Chi Minh City, Vietnam with their various

key Business Partners in reselling the range of solution-centric products. We

discussed the marketing strategy, promotional channels and activities which I


3/30

had proposed to boost their company IT services and sales in the Vietnam

market. The proposed marketing plan consists of 3 stages: -

Stage 1 Conducting an internal analysis of Micro 2000 Technology to see

how they can best harness new opportunities. Series of analysis covering theorganization strategy, organization mission, product and service features and

the overall marketing strategies for this new venture.

Stage 2- Macro-environment analysis of beyond the current (forecasting) to

grow the business. The analysis being from a market player beyond the

current spectrum, political stability, economic situation, social issues, financial

stability, banking sector, currency risk and technological infrastructure and

their opportunities.

Stage 3- The entry into Ho Chi Minh City, Vietnam requires in-depth

marketing entry strategies, differentiation strategies, product strategy,

promotional strategy, distribution strategy, pricing strategy, performance

analysis and funding to campaign for three year period. It will also include

Micro 2000 Technology Sales performance analysis and the budget sheet for

anticipated investment and returns of this company.

3. Internal Analysis of Micro 2000 Technology Pte Ltd

3.1 Company profile

Micro 2000 Technology was established in 1996 and have grown from

two to over forty people and now ranked as one of the top Authorized Service

provider of Apple Computer, as well as one of the top Business Partner of HP,

IBM, Microsoft and Adobe. The founding focus of the company is in personal

computer programming, IT Services, helpdesk and technical services. Today

they have expanded its business to include consultancy and integration

services, distribution and retailing. The company have proven their business

acumen that has led to various partnerships. Appointed Courts Service


4/30

Centre, Apple GOLD Authorized Service Centre, HP Solution Partner,

SonicWall Medallion Partner, Cisco Solution Partner, Intel System Builder,

Microsoft Business Partner, to name a few. Micro 2000 Technology Pte Ltd

has plans to bring her presence to ASEAN countries such as Vietnam,

Malaysia and China. Their current operation consists of 30 staff strength in

various departments including Admin, Finance, Sales, Logistics as well as

Technical. Their business includes sourcing of all IT equipment for its local

resellers as traders. Micro 2000 plans to set-up a team of System Integration

Sales and Consultancy division to extend its arm into corporate businesses.

The companys mission is market orientated and the long-term aim is to have

fully marketing programs to create, communicate and deliver quality service to

the consumers. Other than gaining entry into new markets, another aspect

Micro 2000 is focusing on is to retain these new markets that will crate a

stable profit and economics of scale for the start-up investment. And to do

these, she will have to be more effective than competitors in creating,

delivering, designing and developing software solutions that help businesses

increase performance, reduce cost and build lasting relationships to the

chosen target market. (Philip Kotler, 2001:19).

3.2 Organizational strategy (Michael porters generic strategy)

With its continuous effort in providing IT solutions, Micro 2000 first

support plan AssistPAK was launched in mid October 1998 is an uniquely

design bed service agreements plan with flexible and comprehensive

coverage to cater to any company with an IT infrastructure. Among the

industry's top players, such as IBM and EDS, custom programming services

are only one of a multitude of IT services offered, ranging from consulting and

training to systems integration and facilities management. Indeed, the broader

IT services industry has increasingly evolved towards a one-stop solution

model, where a single contractor provides a comprehensive set of computer

services to its clients. As such, many non-government statistical sources, and
http://www.answers.com/topic/international-business-machines-corporationhttp://www.answers.com/topic/one-stophttp://www.answers.com/topic/international-business-machines-corporationhttp://www.answers.com/topic/one-stop


5/30

often the companies themselves, do not separate custom programming from

these other activities.

Custom programming services are used primarily as an alternative to

using packaged software unmodified and hiring in-house programming staff to

write custom software. The first use is noteworthy as a reminder that

packaged software is often modified by third-party vendors for specific

businesses; not all custom software work begins from scratch. The second

use highlights that the industry is closely associated with outsourcing

technical functions. In fact, it is sometimes described as the IT outsourcing

industry.

A separate and popular way for companies to obtain programming services

without committing to maintaining an in-house staff of programmers is to

contract for leased or temporary programmers and consultants. Several large

national agencies have special units devoted to placing experienced technical

workers. However, unless the contracting firm is itself a programming services

provider, such activities are considered outside the scope of this industry.

The diagram below is a simple summary of Porters generic strategy where

segmentation strategy is use in narrow niche market while differentiation and

cost leadership strategies are used open broad market. The choice between

differentiation and cost leadership strategy depends on the product nature

itself.


6/30

Porters Generic Strategies

Reference: http://en.wikipedia.org/wiki/Focus_strategy#Segmentation_Strategy

According to Michael Porter, to focus on a niche market, the best strategy is

market segmentation (it is also commonly referred to as focus strategy or

niche strategy) and product differentiation strategy. By combining market

segmentation strategy with product differentiation strategy, it is an effective

way of matching the organizations supply strategy (supply side) to the

characteristics of the target market segments (demand side). Micro 2000

Technology looks to gain a competitive advantage through effectiveness

rather than efficiency, thus by focusing the marketing efforts on one or two

narrow market segments and tailoring the marketing mix to these specialized

markets, they can better meet the needs of that target market.

Product differentiation strategy describes the process of highlightingthe products unique differences to make it more attractive in the target

market. This involves differentiating it from competitors products.

Differentiation will gives them a competitive advantage over other computer

and software programming companies. Micro 2000 cost-effective solutions for

maximum service proficiency would benefits the customer if this strategy is to


7/30

be successful. If consumers see their services as unrivaled and unequaled,

they tend to be more brands loyal and they can charge a premium price at a

later stage.

Reference:

Porter, M. E. (1980), "Competitive Strategy: Techniques for Analyzing Industries and Competitors". New York, FreePressTreacy, M., and Wiersema, F. (1993), "Customer intimacy and other value disciplines". Harvard Business Review,Jan/Feb

3.3 Organizational Chart See Appendix A

The department responsible for setting up and expanding the business

opportunities in Vietnam for Micro 2000 is Mr. Patrick Ee the Sales and

Marketing Director. His tasks include, but not limited to: providing assistance

in organizing project tasks, making assignments, scheduling staff and

workflow milestones, maintaining production logs to ensure jobs are

completed within the scheduled timeframe, reviewing deliverables for

completeness and quality, preparing deliverables for submission to client,

reviewing timesheets of production staff for correct time accounting and task

order billing, and reviewing deliverable quantities to prepare reports for project

billing.

3.4 Overall marketing strategies

The marketing strategy of the 21st century should be steered towards

social-orientated marketing, where the focus is on the consumers long-term

benefits. To ensure successful marketing of the Micro 2000 Technology

services in the international market, they must be able to meet the wants and

needs of the targeted consumers. Being a reputable company, they can only

market their products and services to lawful and respectable organization

bodies, such as government bodies and Multi-National companies. Before

they market their products and services, they will have to assess the products


8/30

and services nature/ strengths/characteristics and the particular niche market

that they want to target on.

Adopting Porters product differentiation strategy in marketing IT

programming, consultancy and integration services, they have to

demonstrate the unique aspects of their products and services to create a

sense of value. This can be achieved with a clever integration of the

marketing mix, primarily the 4 Ps- Price, Promotion, Place and Product.

Differentiation marketing strategy, as explained earlier, is the process of

describing the differences between products or services. The objective of

differentiation is to develop a position that potential customers see as the

product as unique. Differentiation primarily impacts sales performancethrough reducing direct competition. As the product becomes more different

in the eyes of the consumers, categorization becomes more difficult and

hence draws fewer comparisons with its competition which will benefit us in

the short and long run. A successful product differentiation strategy will

move IT services from competing based on price and customer service

orientation, (which will be done in the initial stage to aid the market entry) to

competing on non-price factors (such as product characteristics, distribution

strategy, or promotional variables).

3.4.1Promotional strategy

The method of promotion includes advertising, merchandising and

through public relations. The promotional strategy should be built on the need

of delivering innovative IT solutions and advanced technical infrastructure that

ensures quick start of development process that will exceed customers

expectations. Thus it is important to upgrade with technology which is

diversified and competitive with technology-laden systems and solutions.

Reference: www.stengg.com/AR2002/finreview.htm
http://www.stengg.com/AR2002/finreview.htmhttp://www.stengg.com/AR2002/finreview.htm


9/30

3.4.2 Distribution strategy

Micro 2000 Technology being a reputable company can only promote

their products and services to lawful and respectable organization bodies,

such as government bodies and multi-national companies. The method for

distribution that they can consider includes collaboration with various key

Business Partners and securing collaboration agreements that has a strong

coverage in the local government and multi-national companies. They can

also go through different channel to have a complete coverage of this niche

market.

3.4.3 Pricing strategy

When it comes to pricing their services and products in a foreign

market, the points that they will have to consider includes the list price,

discounts allowances, payment period, cost-effective solutions and credit. The

foreign exchange risk of Micro 2000 arises from operations in foreign

countries, as revenue and incur costs generated are denominated in foreign

currencies. Presently, Micro 2000s major foreign exchange risk exposures

result from anticipated sale and purchase transactions denominated in foreign

currencies, primarily in Singapore and U.S. dollars. Thus, to hedge the impact

of foreign exchange fluctuations on the profit and loss accounts, all

transactions should be carried out in Singapore Dollars if possible.

3.5 Market entry strategy.

Successful overseas market entry requires doing business differently.

Different business practices, different business values, communication

difficulties, sustaining business relationships all create challenging market

entry barriers. To penetrate the foreign market, Micro 2000 can start by

introducing IT Solutions at international exhibitions, trade shows, delegations

and special events. Their web pages on the Internet and to its compiled


10/30

database of prospect and customer names will allow easy access in obtaining

information on their products and companys profile.

To aid market entry into a new foreign country, they can price their

products and services as close to their competitor as possible. As a new

entrant to industry, prices need to go low in order to entice them to buy. The

supplies for raw material may be costly, thus they should constantly look for

resources to cut down on the cost.

Micro 2000 can choose to join forces with a local business partner to

provide efficient, low cost and innovative IT solutions for the country. This will

aid the company in penetrating a new market.

Reference: http://www.defensereview.com/modules.php?name=News&file=article&sid=435Reference: Philip Kotler and Kevin Lane Keller (12E edition) 2001, Marketing Management, Pearson Internationaledition

3.6 Macro environment analysis of Vietnam

Reference: http://www.lonelyplanet.com/maps/asia/vietnam/
http://www.defensereview.com/modules.php?name=News&file=article&sid=435http://www.lonelyplanet.com/maps/asia/vietnam/http://www.lonelyplanet.com/worldguide/destinations/asia/vietnam/http://www.defensereview.com/modules.php?name=News&file=article&sid=435http://www.lonelyplanet.com/maps/asia/vietnam/


11/30

3.6.1 Vietnam Personal computer manufacturing Industry Overview:

While the attention of business enterprises all over the world has been

drawn to Vietnam as a target for investment, Taiwan's ICT sector is exploring

opportunities for investment in Southeast Asia. All these factors indirect opens

new markets to Micro 2000 as the ASEAN member nations, including the

forms of investment diversify to grown their businesses the cost of

communications, labor costs and labor relations, and taxation is still relatively

low in comparison to established IT areas like India, China Taiwan and

Singapore.

Growth rate of merchandise exports (% per year)

Resource: Asian Development Outlook 2007

Comparison Table: by Runckel & Associates

Country

2002

2003

2004

2005

2006

2007*

2008*

Cambodia 12.7 17.9 24.1 12.4 26.9 14.3 9.4

China 22.4 34.6 35.4 28.5 26.0 18.0 16.0

Hong Kong 4.9 12.1 15.9 11.2 9.0 3.6 10.1

India 20.3 23.3 28.5 23.4 20.0 16.0 15.0

Indonesia 3.1 8.4 10.4 22.9 18.1 9.8 12.0

Korea 7.9 20.7 30.6 12.1 14.8 13.5 14.2

Laos 2.3 21.6 11.0 31.4 50.9 15.3 31.0

Malaysia 7.2 11.0 20.9 12.0 16.9 9.5 10.6

Philippines 9.9 2.7 9.8 3.7 14.0 6.5 9.5

Singapore 3.0 15.0 24.3 15.6 18.3 10.5 10.0

Thailand 4.8 18.2 21.6 15.0 17.4 7.9 8.9

Vietnam 11.2 20.6 31.4 22.5 23.0 19.0 18.0

*Forecasted for 2007-2008

3.6.2 Vietnams Competitor Analysis

Micro 2000 designs cost-effective solutions for maximum service

proficiency. Their contracted clients enjoy substantial savings by taking


12/30

advantage of their unique business principle. They transfer third party

products at cost. Therefore, all their clients will get the combination of the the

best product price and the best technical expertise. They offer strategies that

use the most appropriate technology to help clients reduce cost, improve

profitability and gain market share which other IT companies are not offering.

3.6.3 Vietnams Consumer analysis

According to many sources, particularly (Carmel 2003) which

provided a highly useful taxonomy for classifying and comparing exporting

nations, India, Israel and Ireland are in the top tier for software outsourcing,

while Vietnam is classified as being in the fourth tier. Tier One countries,

have numerous firms in the 100s or thousands in clusters- actively

producing software for export with export valued over $1 billion and have

been in this industry for 15 or more years. Tier four countries by

comparison have been exporting for five years or less, have companies in

the tens of companies and have export revenues of less than $25 million a

year.

Reference: IT Industry Department, Ministry of Posts and Telemetric of Vietnam

To determined Vietnams consumer analysis, a customer satisfaction

survey form was developed for Micro 2000 Technology (see appendix

B). This form will be sent to all their customers to obtain feedback on the

services rendered by this company. With the information gathered, Micro


13/30

2000 can look at the trends; fix those areas that require improvement,

whether the company needs to improve on their products and services.

Most importantly, the company needs to provide feedback to their

customers and that their answers were appreciated and are being acted

upon. That feedback can be individual responses to the customers if

appropriate, or it can simply be fixing the things that they tell you need to

be fixed.

3.6.4. Vietnams Political Environment

A new state constitution was approved in April 1992, reaffirming the

central role of the Communist Party of Vietnam (CPV) in politics and society,

and outlining government reorganization and increased economic freedom.

Though Vietnam remains a one-party state, adherence to ideological

orthodoxy has become less important than economic development as a

national priority.

The most important powers within the Vietnamese Government--in

addition to the Communist Party--are the executive agencies created by the

1992 constitution: the offices of the president and the prime minister. The

Vietnamese President, presently Nguyen Minh Triet, functions as head of

state but also serves as the nominal commander of the armed forces and

chairman of the Council on National Defense and Security. The Prime

Minister of Vietnam, presently Nguyen Tan Dung, heads a cabinet currently

composed of three deputy prime ministers and the heads of 26 ministries and

commissions, all confirmed by the National Assembly.

3.6.5 Vietnams Economic Environment

The world's largest contract electronics manufacturer, which

assembles gadgets from Apple Inc. iPods to Sony Corp. PlayStation 3

consoles and Nokia Corp. handsets, became the latest company to announce

a high tech investment in Vietnam, with plans to spend a massive $5 billion


14/30

over the next five years. The huge investment shows that Vietnam has

continued to increase its allure as a haven for IT investments. Last year Intel

Corp. announced it would expand a chip packaging and testing project in

Vietnam into a US$1 billion affair, more than triple the size of the original

Vietnam's progress in building its technology infrastructure, as well as the

need to support demand for its chips as the main reasons for the investment.

Once finished, it will be Intel's seventh chip assembly site in the company's

global network, which includes Penang and Kulim, Malaysia; Cavite,

Philippines; Chengdu and Shanghai, China; and San Jose, Costa Rica. Intel

plans to spend over $6 billion by the end of this year on new factories and

equipment.

All this can only add and enhance the expertise and services that Micro

2000 Technology Pte Ltd plan of expansion to a wider base.

3.6.6 Vietnams Social Environment

In the past decade, Vietnam has experienced the rapid transition to the

market economy. The Vietnamese government has focused on the promotion

of small businesses as one of the top priorities and accelerated to develop thefinancing system for them, in order to realize the poverty reduction by

increasing the employment. While the economic boom has helped more than

halve poverty rates, it has also widened the gap between rich and poor, and

many risk being left behind. The influx of new business is going to improve

the situation for many Vietnamese.

3.6.7 Vietnams Technological Environment

Currently, Vietnamese companies cannot match foreign companies interms of competitiveness, business management, and use of modern

technology. I think that the lack of modern technology is the root of all the

problems that Vietnamese businesses face today. Every year, two percent of

the country's gross domestic product (GDP) is spent on scientific research


15/30

and technology development. State-owed companies have less inclination to

make use of research results while privately companies want very much to

modernize but have neither the expertise nor capital to do so.

It is apparent that India and China have been very successful in several

areas of technological development. China recently announced that it has

dozens of high quality high-tech centers, universities and research institutes.

At present, 40 percent of the high-tech products that are in use all over the

world were made in China. Scientific and technological development has

helped China attain the highest economic growth rate in the world. The

economic conditions within Vietnam is now are ripe in comparison to China's

experience in development with an economy that is much smaller than that of

China.

Low production costs (Vietnamese software professionals are about half

the cost of Indian equivalent software professionals and have much higher

retention rates), coupled with the governments obvious support and favorable

incentives make Vietnam one of the most competitive markets for IT

investors. Nevertheless, the Vietnam Investment Review (issued on June 26,

2006) also points out that increasing transparency on the software

companies part, and more effective policies on the governments part will

help boost Vietnamese investing environments rating from foreign investors

perspective, and hence, enhance the development of the industry.

Small U.S. and other software companies were the first to notice this

potential and to actively reach out to Vietnam. Now major U.S. companies like

Intel which has major operations in California, Hillsboro, Oregon and Arizona

have also realized the potential and have chosen Ho Chi Minh Citys Saigon

High Tech Park (SHTP - http://www.shtp.hochiminhcity.gov.vn/) as the

location for their chip first chip fabrication facility in Vietnam are also taking

note. Vietnam has rightly realized that to get this sort of notice and to continue

to build a dedicated core of IT professionals that more need to be done to

support IT education in the Ho Chi Minh City region. As such, the National


16/30

University of Ho Chi Minh City and Portland State University in Portland,

Oregon (www.pdx.edu) are currently exploring collaboration in advanced IT

training for National University Master and PhD students and also an

innovative mixed education program leading to a joint degree or with

substantial teaching instruction based on international education models.

The software industry in Vietnam is still in an early stage of

development but the market potential is already apparent. Further,

government support for this sector and well thought out policies like the recent

tie-up of the National University of Ho Chi Minh City in respect to improving IT

education at the University and advanced degree level all bode well for the

future. This industry is therefore one that bears continued attention andselective investment where conditions warrant.

3.7 Market Entry Strategy into Vietnam:

By direct collaboration with various key Business Partners in reselling

the range of solution-centric products, Micro 2000 has secured collaboration

agreements with multiple Business Partners who has strong coverage in the

local government and Multi-National Companies space.

Secondly, their firm strengthens its image in the host country because

having proven their business efficiencies in programming, designing and

developing software solutions which is currently available on a limited scale,

would create employment opportunities for the local community which will in

turn help boost their GDP and economic growth. Thus mutual benefits can be

derived from this investment.

Reference: http://www.business-in-asia.com/asia/asia_export.html
http://www.business-in-asia.com/asia/asia_export.htmlhttp://www.business-in-asia.com/asia/asia_export.html


17/30

3.8 Problems & Situational Analysis

3.8.1 The problems currently faced by Micro 2000 Technology is their

product line integration and delivering IT solutions to a market that is rapidly

growing in the computer programming and software designing industry. This

requires discontinuing some services (some loss in revenue) and bringing on

new services in this evolving environment and restructuring the product line

with some of the services offered whilst tailoring to specified needs in the new

market place.

3.8.2 The company has gone through reorganization and moving

personnel within the organization and multi tasking. In the computer industry

with its continual evolvement and newer technology requires the need forconstant integration into newer systems.

3.8.3 The cultural differences that Micro 2000 will face in entry strategy

into Vietnam will be the differences between the operational and cultural

environment in its home market and the Vietnamese market.

4. Summary of Analysis

Micro 2000 offers professional services and solutions draw on their

pool of extensive expertise in all aspects of IT. By setting up a new network to

enhancing an existing system to developing new extensions, they have the

right solution to fit our needs. Their contracted clients enjoy substantial

savings by taking advantage of their unique business principle. They transfer

third party products at cost.

They offer strategies that use the most appropriate technology to help

their clients reduce cost, improve profitability and gain market share. TheirNetwork Consultancy Unit offers solutions that include infrastructure design

(LAN, WAN, Firewall, Structured cabling), facilitating integration (NAS,

Enterprise Storage) as well as internal and external collaboration (Messaging,

Mobility, Integrated Fax, SharePoint Services/Portal, Web Design/Hosting).


18/30

The company always maintained their focus on delivering IT solutions that

are aligned to their business goals. Broad repertoire of solutions fulfills the

diverse needs of businesses in a wide range of industries. By matching

technology to customers' requirements, their solutions provide value for

customers' IT investment. Their solution & Consultancy unit offers solutionssuch as Server migration, Virtual Private Network (VPN), File Transfer

Protocol (FTP), Broadband, Internet/Intranet development, document

imaging, QuickTime Streaming as well as color management and Digital

Asset Management.

For business survival, companies need access to critical IT

competencies. By outsourcing various functions to Micro 2000, companies

can feel up their corporate resources and increase business continuity and

competitiveness. Backed by a proven track record of providing excellent IT

services and solutions, Micro 2000's array of solutions adds value and

positive gain to its customers' IT investment. This is reflected in the two-

pronged benefit of "Best Product Price with Best Technical Expertise" giving

the customer a competitive advantage.

Micro 2000 offer a selection of world-class IT support services that will

cover just about every imaginable support to keep an organization's IT

operations running smoothly. The company provides both phone as well ason-site help for desktop problem resolution to server support to network

assistance.

They offer application development with professional development

methodologies, tools that enhance productivity. Their Software Development

Unit provides design and implementation of the various application

components that constitute the integrated enterprise technology platform.

Whatever the business size, they can help manage the business. They

optimize business performance, cut cost, increase profitability and make

precise decisions with timely and accurate data.

The industry technology solution experts specializing in short term rental

of computer systems, network switches, routers, network printers, wireless

products as well as structured cabling catering to customers event. They also


19/30

provide manpower in rendering on-site installation and configuration to meet

precise events requirement. Technical assistance for on-site standby is also

available.

5. Recommendations and feasibility

5.1 Marketing, promotional channels and activities:

There are various ways Micro 2000 can conduct marketing and

promotional campaign to promote their services. In order to penetrate the

Vietnam market, Micro 2000 can create brand equity. Brands identify the

source or market of a product and allow consumers either individuals or

organizations to assign responsibility to a particular manufacturer or

distributor. Their partners in Vietnam can assist potential customers evaluate

the identical product differently depending on how it is branded. Consumers

can experience the mix of products and its marketing program. Their partners

offer the firm legal protection for unique features or aspects of the services.

With assistance from their partners, Micro 2000 can break into the Vietnam

market through road shows and Computer and Science Fairs.

5.5.1 The Marketing Communication Mix

The marketing communications mix (the specific mix of advertising,

personal selling, sales promotion, and public relations a company uses to

pursue its advertising and marketing objectives) that Micro 2000 Technology

will be using are:

1) Advertising (any paid form of non personal presentation and promotion

of ideas, goods, or services by an identified sponsor) broadcast and

print media,2) Personal selling (personal presentation by the firms sales force for the

purpose of making sales and building customer relationship),

3) Trade shows to send an effective selling message to a large interested

audience at one time.


20/30

The marketing campaign is only planned for a period of 12 months because of

their business arrangements with their partners. Their partners have the

strengths and things will get easier after the campaign.

Advertising Print MediaPC Magazine

I insert per month (positioning)Computer Shopper magazine

I insert per month (positioning)Macword magazine 1 insert per month

ColdFusion Developers Journal

magazine

1 insert per month total 12

throughout the whole campaign

(awareness)Trade shows

CeBIT Held annually in Hannover, GermanyRoad ShowsComex Singapore 1 road show monthly

Reference: Principles of Marketing Eleventh edition by Kolter and Armstrong Pg: 401

Business Marketing Management Eight edition by Michael D. Hutt and Thomas W.Speh Pg: 426

Reference: http://netvalley.com/top100mag.html

5.5.2 Strategy benefits of Communication mix

The plan of using print media, trade shows and road shows are to

position Micro 2000 Technology as a personal computer programming and IT

solutions provider and show its intention of staying in Vietnam for a long term

investment. Their business partners will participate in trade shows and road

shows to expose Micro 2000 Technology, its consultants designs in software

solutions that will help businesses increase performance, reduce costs, and

build lasting relationships that will increase future sales.


21/30

5.5.3. Computer magazines

Micro 2000 will be featuring their products and services in most of the

computer magazine for positioning and awareness. The magazines are read

by most computer enthusiasts. These enthusiasts pay a lot of attention on the

various computer programming and IT solutions that not only appeals to

adults but also to students. They are keen to know what the newest

technology in computer programming and IT solutions that are available in the

field.

5.5.4. Personal Selling

The sales and marketing department will be provided with leads and

qualify their prospect. The salesperson will approach the respective

departments to do his presentation and demonstration. Their salespeople are

also its marketing team. This is effective for several reasons: (1) customers

appreciate talking directly with salespeople who can answer a wide range of

technical questions about methods and features, (2) their salesperson benefit

from direct customer contact through gaining an appreciation for the

environment and problems of the customer, and (3) the relationships they

build through peer-to peer contact are useful in the government agencies.

5.5.5. Trade Shows and Road Shows

Trade shows and road shows provide the opportunity for the customers

to get hands-on experience. The shows are targeted to a large and interested

audience. They are a good platform for exposure.

5.5.6 Business convention trips to Vietnam lead by Singapore

government


22/30

Singapore Ministry of Trade Development may take the initiative to

lead a group of influential people from Singapore for networking. The team

will build a relationship with the government bodies.

5.7 Pricing

Pricing must be kept competitive in order to market their services in

Vietnam. This is because of many firms misconception that they have little

choice but to make sure their prices are comparable to those of the

competition. An expensive service simply makes their services unaffordable.

On the other hand, a low price provides opportunity for expanded product

placement, or creative promotional initiatives. Aside from making some pricing

strategies more prevalent, with the bench mark it affects the importance of

choosing correct pricing strategies by allowing customers to be better

informed and more vocal. Smart use of the Internet and available pricing

strategies can help boost their companys profile.

Reference:http://www.websitemarketingplan.com/techniques/pricing2.htm

The propriety approach from their partners to interactive provides a holistic

picture of needs, requirements, insights, challenges, risks, and opportunities.

For each digital communication they produce as shown above, their company

interactive maximizes relevance, experience, integration, and efficiency,

integration, and efficiency; ensuring that interactive marketing makes a

profound impact on their business.
http://www.websitemarketingplan.com/techniques/pricing2.htmhttp://www.websitemarketingplan.com/techniques/pricing2.htm


23/30

Reference: http://www.phptr.com/articles/article.asp?p=101588&seqNum=4&rl=1

5.8 Sales and Demand Forecast

$0

$1,000,000

$2,000,000

$3,000,000

$4,000,000

$5,000,000

$6,000,000

Projected Sales Forecast

Year 2007 2008 2009 2010 $3,500,000 $4,770,000 $5,177,100 $5,830,230

2007 2008 2009 2010

Based on the sales figures for 2006, we have projected that the sales for

2007 will reach S$3,500,000. The forecast for the next three years will be

18%, 23% and 30% respectively. Based on these projected sales increases,

the sales volume will be as illustrated above. The chart illustrates why we

think the ambitious sales increases we plan are reasonable: we have had

similar increases in the recent past.

5.8.1 Break-even Analysis
http://www.phptr.com/articles/article.asp?p=101588&seqNum=4&rl=1http://www.phptr.com/articles/article.asp?p=101588&seqNum=4&rl=1


24/30

For our break-even analysis, we assume running costs of approximately

$745,000 per month, which includes rent, and utilities, and an estimation of

other running costs. Payroll alone, at our present run rate, is about $435,000.

We will need to sell about $1,845,800 per month to break even, according tothese assumptions.

Monthly Units Break-even 438

Monthly Sales Break-even $1,845,800

Assumptions:

Average Unit Sale $4214

Average Per-Unit Cost $2714

5.8.2 Projected Profit and Loss

The most important assumption in the Projected Profit and Loss statement is

the gross margin, which is supposed to increase to 30% in the next 3 years.

This is up from 15% in the last year. The increase in gross margin is based on

changing our sales mix, and it is critical. Month-by-month assumptions for

profit and loss are included in the appendices.

Pro-forma Income Statement

2008 2009 2010


25/30

Sales $4,770,000 $5,177,100 $5,830,230

Cost of Sales $1,845,800 $2,050,800 $2,280,800

Production payroll $435,000 $450,000 $485,000

Others $745,000 $760,000 $798,000

Total Cost of Sales $3,025,800 $3,260,800 $3,563,800

Gross margin $1,744,200 $1,916,300 $2, 266,430

Gross margin percent 35.56% 37% 38.87%

Operating expenses:

Advertising $96,000 $126,000 $170,000

Market Research $50,000 $55,000 $60,000

Trade Shows $340,000 $360,000 $380,000

Total Sales and Marketing Exp $486,000 $541,000 $610,000


26/30

General and Administrative

Expenses

Leased Equipment $30,000 $31,500 $33,075

Utilities $9,000 $9,450 $9,923

Insurance $6,000 6,300 $6,615

Rent $84,000 $88,200 $92,610

Depreciation $12,681 $13,315 $13,981

Payroll Burden $60,660 $78,615 $95,265

Other $6,331 $6,648 $6,980

Total Gen.Admin. Expense $303,012 $334,413 $397,184

Other Operating Expenses

Contract/Consultants $12,000 $30,000 $30,000

Other $3,000 $3,150 $3,308

Total Other Operating Exp $15,000 $33,150 $33,308


27/30

Profit Before Interest and Taxes $1,744,200.00 $1,916,300 $2,266,430

Taxes Incurred $176,984 $216,674 $283,233

Net Profit $1,567,216 $1,699,626 $1,983,197

5.9 Marketing Budget (Assumption)


28/30

5.10 Control

All marketing plans need to have proper control to be successful. Micro

2000 will have to set key performance index for every committee member.

This is to ensure all objectives for the campaign are been achieved. It can

break down into phrases.

Phrase 1: Intangible

The initial target will be low. The aim is to do market penetration, branding

and positioning. The marketing objective is to increase mind share of brand

(Micro 2000).

Phrase 2: Tangible

To meet sales target set by the management and increase market share.

Marketing Budget

Plan Category Estimated Quantity Estimated AmountAdvertising

Magazine 48 $96,000.00Total Cost for Advertising $96,000.00

Market ResearchProfessional Consultation 1 $50,000.00Total Costs for MarketResearch $50,000.00

Trade Shows and RoadShowsTrade Shows 2 $40,000.00

Road Shows 60 $300,000.00Total Costs for Shows $340,000.00

Contingency (10%) $48,600.00

Total Estimated Budget $534,600.00


29/30

Phrase 3: Correction

The management will then reviews and provide solutions. Necessary

adjustments will be made on different phrases and correct all mistakes along

the way. The committee will hold meetings on a monthly basis. The

involvement parties are to submit their reports on how targets are met. How

many results have the committee realize in the planning? Department head

will evaluate the progress of their services.

6. Final Assessment and Conclusion:

6.1 Summary of key conclusions

In summary, based on the analysis contained in this report, Vietnam with

its stable economy, political and social environment make it conducive for

Micro 2000 to enter newer market. In a competitive international market

expanding within the IT industry and making it globally with their partners can

help the company grow and break into newer markets. Micro 2000 should

work at being a reputable market leader in the IT industry by maintaining:

strong research and development skills

strong product engineering skills

strong creativity skills

good cooperation with distribution channels

strong marketing skills

incentives based on subjective measures

be able to communicate the importance of the differentiating productcharacteristics

stress continuous improvement and innovation

attract highly skilled, creative people.


30/30

6.2 How the organization would benefit from my recommendations

Micro 2000 to hire highly educated and experience specialists

Reliable organization of software development process

Competitive prices

Emphasize service and support. The company needs to establish

their business offering as a clear and viable alternative for their target

market, to the price-only kind of buying.

Build a relationship-oriented business. Build long-term

relationships with clients, not single-transaction deals with customers.

Become the computer department, not just a vendor. Make them

understand the value of the relationship.

Differentiate and fulfill the promise. Company cannot just market

and sell service and support; they must actually deliver as well. They

need to ensure that they have the knowledge-intensive business and

service-intensive business they claim to have.

They must radically improve their direct mail efforts, reaching

their established customers with training, support services, upgrades

and seminars.

Sharon's Assignment Final Project Marketing - Revised

Documents

Transcript of Sharon's Assignment Final Project Marketing - Revised