Many organic products have components that support the health of our hair and scalp.As a result, our team made the decision to develop a new product using rice bran oil, an essential oil
EXECUTIVE SUMMARY
Founded in 2013, Cocoon is a pioneering vegan cosmetics company in Vietnam, recognized for embracing the global trend of vegan beauty products.
Cocoon is a Vietnamese brand created by Vietnamese people for Vietnamese people:
Cocoon has gained Vietnamese customers for many years by releasing products that contain highly benign and delicate nutrients from Vietnamese nature that are ideal for Vietnamese people's sensitive skin.
Cocoon gives special attention to indigenous ingredients found in Vietnam's diverse natural environment.
Through commitments, Cocoon plainly affirms its place in the hearts of consumers.
Cocoon sources all-natural ingredients directly from local farmers and combines them with imported active substances, vitamins, and background systems to ensure a 100% transparent origin The brand specializes in vegan cosmetics, utilizing plant-derived components instead of animal-based materials.
The brand demonstrates a strong "green commitment" in its designs, utilizing eco-friendly paper for all packaging, avoiding plastic lamination, and using recyclable bottles for their products Additionally, they promote positive environmental messages through various relevant events.
Cocoon achieved an impressive average income of VND 1.02 billion over 30 days in Vietnam, surpassing 99.73% of all businesses on Shopee Additionally, its sales figures, average monthly views, and customer comments consistently rank at or above the 90th percentile compared to competitors.
Cocoon, available at more than 300 retail locations nationwide and actively engaging with beauty forums across Vietnam, excels in promoting human values while encouraging the adoption of vegan cosmetics.
We are launching a new hair care product, rice bran oil shampoo, based on our study report, to enhance Cocoon's brand presence and market share in Vietnam This initiative will align with Cocoon's four core commitments while helping to differentiate the brand from competitors and boost customer awareness.
SITUATION ANALYSIS
Market Summary
People live in urban and big cities
People live in dry-weather areas.
Besides, Cocoon also develops a contribution channel in rural and suburban areas because Cocoon offers a reasonable price to suit almost everyone's budget. o Demographics
Cocoon primarily targets women through gender segmentation, but its products are equally suitable for men seeking to maintain healthy hair or address hair loss concerns.
Occupation: Student, housewife, officer, singer, actor, model.
Income: Medium to high income. o Behavior Factors
Prefer taking care of themselves.
Care about appearance, especially hair.
People who frequently change their hairstyle, dye their hair.
People have weak health conditions and enter middle age.
Market Needs
The increasing demand for natural hair care products stems from concerns over the harmful chemical content in conventional products that can damage the scalp and hair Despite the availability of natural alternatives, their high prices remain a barrier for many Vietnamese consumers Addressing this issue is essential to meet the evolving needs of consumers seeking safer hair care solutions.
Our products are crafted from natural, vegan ingredients with a transparent origin, ensuring they are beneficial for your health We adhere to the CGMP standards set by the Ministry of Health during the production process, guaranteeing the highest quality of our raw materials.
Rice bran oil shampoo is set at a cheaper price than other products in the same segment.
Market Trends
In the wake of the Covid-19 pandemic, there has been a significant increase in health awareness, prompting individuals to invest more in health products The greenhouse effect and global warming have disrupted nature's balance, directly impacting human existence and other life forms Consequently, many are adopting a green lifestyle and opting for eco-friendly, plant-based products Among the youth, common practices like hair dyeing and perming often lead to hair damage, including tangles and breakage While various shampoos claim to protect the scalp and nourish hair, most are foreign brands with high prices and chemical ingredients that do not meet the needs of the Vietnamese market To tackle these challenges, the company has launched a line of shampoo products formulated with rice bran oil.
Market Growth
The Vietnam hair care products market, valued at $854.3 million in 2019, is projected to grow to $1,922.4 million by 2027, with a compound annual growth rate (CAGR) of 11.7% from 2021 to 2027 Similarly, the skincare products market is expected to see a revenue increase of $1,154.25 million from 2020 to 2027, driven by rising disposable incomes and a growing young population Notably, Generation Z, which comprises 39.08% of the total population, represents the most promising customer segment for future growth These trends highlight a significant increase in demand for skincare products among domestic consumers in Vietnam.
The Vietnamese cosmetics market is experiencing a significant surge in consumer interest, driven by the rise of e-commerce platforms According to Kantar's Worldpanel Insight handbook 2021 report, sales of personal care products have soared by 63%, skin care products by 55%, and makeup sales have increased by 25%.
However, in low-cost segments, Vietnamese cosmetic companies account for only 10% of the market They are attempting to reclaim this territory.
Strengths
Purely refined from natural ingredients and bought from local farmers in accordance with consumer lifestyle and green consumption trends.
Furthermore, the product packaging is beautiful and appealing, combining people and special messages.
The price is extremely reasonable for the majority of Vietnamese consumers
The company's objectives and strategies are very clear and specific.
Especially, the production process is extremely close and modern, ensuring quality on each product
Periodically, advanced machinery and equipment are inspected and preserved.
Weakness
Because this is a new item, people don't know much about it and haven't given it their trust.
Currently, a large part of Vietnamese people (especially men) still do not have the habit of using beneficial hair products.
The product is only interesting domestically and not really popular abroad.
Because it is a Vietnamese product, it will be difficult to win the confidence of a segment of Vietnamese who are cultural xenophiles by promoting foreign goods while disparaging Vietnamese goods.
Opportunities
The herbal shampoo industry is gradually growing.
Consumer demand for products of natural origin is growing as consumers become more conscious of the side effects of chemical ingredients in everyday consumer products.
The business has created a strong brand image in the herbal shampoo market segment Therefore, it will not be difficult for new products to reach consumers.
Because the materials for the products come from abundant domestic sources, the costs will be cheap and the price will be suitable for the product's features.
The effect of rice bran oil in hair care has also been recognized and proven through scientific research reports.
Threats
The recent launch of the product has led to intense competition within the shampoo industry, featuring established brands like Sunsilk, Rejoice, Dove, and Xmen, alongside emerging contenders such as TRESemme, Tigi, and Malacca.
Vietnamese consumers have been using familiar goods for generations, so in order to join this market, our products must really be of breakthrough quality.
When a product defect is reported in the press in the Vietnamese market, consumers prefer to boycott that product The product, like the agent, faces difficulties in existence.
The growing trend of purchasing imported goods has led to a decline in the popularity of domestic products, including Vietnamese cosmetics like Cocoon While many consumers are drawn to foreign brands, there remains a segment of the population that is cautious about the quality and effects of these products, highlighting the importance of trust in local offerings.
Competition
The shampoo market is intensely competitive, featuring a mix of international and domestic brands Major players like L'Oréal SA, Unilever PLC, Shiseido Co Ltd, Johnson & Johnson, Procter & Gamble Company, and Kao Corporation are actively seeking to capitalize on growth opportunities in emerging markets By expanding their product portfolios, these companies aim to meet the diverse needs of consumers.
Some brands in VietNam such as
Thorakao and Vedette are notable brands that, like Cocoon, offer vegan products Cocoon Rice Bran Oil Shampoo faces significant competition from The Body Shop (L’Oréal) and Love Beauty and Planet, both of which provide similar products at competitive prices.
Key to success
The packaging is eye-catching and renewed continuously
Ensure the quality of product with suitable price
Properties and ingredients of product meet market demand
Critical Issues
Cocoon builds its brand as a leading vegan cosmetics brand in Vietnam
Choosing the right market segment is essential for addressing the specific needs, wants, and desires of a targeted group By understanding this segment, businesses can create effective strategies to attract these buyers, ensuring that their marketing efforts yield valuable results.
Constantly monitor customer satisfaction, ensuring that the growth strategy will never compromise service and satisfaction levels.
MARKETING STRATEGY
Mission
Bringing you the always healthy, youthful, and full of life skin and hair from simple and close ingredients that you eat every day.
Marketing Objectives
In the first year, our goal is to enhance product awareness by achieving a 40% increase in impressions on social media platforms targeting recent graduates and office workers interested in health products made from natural ingredients We aim to reach 60% brand awareness by the end of the first quarter.
Over the next 18 months, we aim to capture a 10% share of the Vietnam shampoo market by achieving a sales volume of 360,000 units Our strategy includes boosting sales to existing customers, re-engaging lost customers, and diversifying channels to effectively reach our target audience Additionally, we plan to establish partnerships with Key Opinion Consumers (KOCs) in the vegan lifestyle and beauty sectors, offering discount codes to their followers to further enhance sales.
In the past six months, we have established ourselves as the leading vegan hair care brand among our target audience To reinforce brand awareness, we launched a television commercial aimed at reminding customers of our product's benefits Additionally, we have focused on nurturing relationships with our loyal customers to drive increased sales and foster brand loyalty.
Target Markets
Our primary audience consists of recent graduates and office workers aged 22-35 who prioritize their health by choosing products made from natural ingredients Additionally, we also target singers, actors, and models who are particularly focused on maintaining their appearance, with a special emphasis on hair care.
Third target customer: Women aged 35-60 often are housewives with stable income, they will need look after their family’s health
Fourth target customer: female students who are in the developing stage.
Positioning
Cocoon Vietnam stands out as one of the pioneering cruelty-free cosmetic brands in Vietnam, firmly committed to not testing on animals This dedication not only enhances its appeal to consumers but also aligns with the growing global trend towards ethical beauty products By choosing Cocoon, customers can enjoy peace of mind regarding the ingredients used, while also supporting a humane lifestyle that protects vulnerable animals.
Rice Bran Oil Shampoo stands out as a 100% vegan product, formulated with clearly sourced vegetable and herbal ingredients This unique formulation not only enhances its appeal but also fosters customer trust and confidence in the quality of Rice Bran Oil Shampoo.
Mid-range and budget hair care products often contain silicones that can lead to hair loss This presents a prime opportunity for Rice Bran Oil Shampoo to enter the market at an affordable price point With its clear ingredient sourcing and being proudly made in Vietnam, this product not only supports local craftsmanship but also provides effective hair protection.
Product development process
STT INGREDIENT ABBREVIATION CONTENT (gram)
Strategies
o First Year : Increase product awareness
To collect data and prepare for product launch, do research on the Vietnam shampoo market and the vegan living market.
Increase consumer interest in the product through communication methods prior to the product's formal introduction.
Push the distribution of information and product functions to customers so that everyone is aware of rice bran oil products Particularly in the mainstream media
Offer incentives to distributors when they agree to display and sell rice bran oil shampoo products.
We emphasize the significance of hair health by encouraging students to ask questions, highlighting its importance Additionally, we aim to educate them about the benefits of using rice bran oil shampoo for healthier hair.
We target beauty bloggers to increase the shampoo's prestige, and it is almost widely accepted by today's youth.
Maintain connection with customers following the product launch. o 18 next months : increase sales of products
After the first year of concentrating on increasing the product's identity, the following 18 months will be dedicated to promoting customer purchasing behavior for the product.
Increase sales in order to capitalize on product development cycles.
Create coupons for e-commerce platforms or company websites.
Organize events that allow customers to interact with and learn more about vegan goods, promoting the vegan lifestyle and encouraging purchases.
Increase discounts for agents to make them more active in selling your products.
Collaborate with KOLs on creating exclusive discount codes for product purchases for their followers.
Build relationships with loyal and frequent customers through discounts. o Last 6 months : Maintain relationships with loyal customers and emphasize the product's stance.
After the peak period for sales growth has passed, this will be the time to sustain sales that always reach KPIs every quarter through loyal customers.
Implement pricing strategies to produce consistent monthly sales.
Make posts to remind loyal customers of the product's existence and use, as well as to reconnect with customers who have forgotten about it.
Are Bio-degradable and earth-friendly.
Regular usage of herbal shampoos can do wonders for your hair.
Support for scalp irritation, infection, fungus, and allergies with anti- inflammatory substances.
Helps to keep oily skin warm and UV radiation away from the hair.
Made from natural ingredients which prevent skin allergy and infection
Herbal shampoos are made out of pure and organic ingredients and there are no synthetic additives or surfactants and are free of any side effects. ii Branding
Marketing through social media: Cocoon has organized many minigames , giveaways , discounts , etc via various social platforms as the result it attracts many participants
Cocoon is leveraging the growing trend of influencer marketing by inviting renowned singers, beauty bloggers, and makeup artists to promote its products This strategy aims to create a positive impact on Cocoon's customer base, enhancing brand visibility and engagement.
Positioning the manufactured in Vietnam brand, users who are willing to test the brand-new Vietnam’s herbal items have been drawn to Cocoon.
The items are advertised as not having undergone animal testing which verify it natural and vegan qualities iii Packaging
Cocoon products not only feature vegan ingredients but also prioritize eco-friendly packaging, earning the trust of customers The brand is committed to sustainability with initiatives like eliminating microplastics and utilizing paper packaging without plastic coatings.
"recyclable product bottles." This improves Cocoon's image and demonstrates a genuine care for the environment and the health of its patrons.
The product's packaging has a contemporary label that provides complete information about ingredients, instructions for use, expiry date as well as the place of manufacture.
Color: the color of packaging based on the color of rice bran oil, which represents the main ingredient of the product. iv Services
Free product recommendations based on the customer's hair condition
On the spot, examine the client's tresses for health v Warranties
Ensure hair safety when using
Using the merchandise yields results that are obvious.
All products have a known provenance.
Don't use animals in product testing
The item is completely produced in Vietnam.
Cocoon's products are priced on average between 160k and 220k, allowing the company to reach a wide range of customer segments.
Rice roasted shampoo will be introduced to the market as a mid-priced product through a price infiltration strategy.
With the increasing number of vegan products on the market, businesses are lowering product prices to reach more customers than necessary.
The product will be sold for 130,000 VNĐ, which is less than the average price of other products.
The price will include both basic services and special products.
After the initial period of penetration and generating a certain number of customers, discounts will be reduced to increase the product's profit.
Bundle pricing: A combo combines one product with another in the company
At a lower cost than purchasing each product separately As a result, customers will have more opportunities to try new products, increasing revenue.
To create a perception of value, set a misleading price that is slightly lower than the true cost of the product, leading customers to believe they are getting a better deal.
Cocoon employs push strategies to expand its customer base and enhance product visibility, utilizing selective distribution as its channel approach In the first year, the company plans to onboard additional collaborators to ensure its new products are accessible in every market across Vietnam.
Rice Bran Oil Shampoo employs an extensive distribution strategy, ensuring that its products are readily accessible to customers The Cocoon brand is currently available at more than 300 locations nationwide, including various agencies, facilitating convenient purchasing options for consumers.
In addition to traditional stores, Rice Bran Oil Shampoo products are sold online on two official websites: cocoonvietnam.com and myphamthuanchay.com, along with e-commerce channels: Shopee and Lazada.
Combine with specialized cosmetic stores such as Hasaki, Guardian, Watsons, to expand product distribution
Reduction when registering at the point of transaction
free cloth with the purchase of rice bran cleanser
When you purchase a product, receive a coupon for a discount.
To effectively communicate the product's image and usage to consumers with similar preferences, collaborate with Key Opinion Consumers (KOCs) who promote a vegan lifestyle, such as the TikTok user "Sư tử ăn chay."
TVC describing the production of rice oil and how it is used in hair treatment and maintenance.
Cocoon will assemble and train a team of customer consultants for both point-of-sale and online merchants We will also collaborate with our partners to gather feedback from customers who have purchased and used the product, ensuring support is available for those who may be dissatisfied.
Create a call center to assist with product assistance for clients.
Marketing Mix
In today's digital landscape, most businesses actively engage with the Internet and social media platforms on a daily basis As reported by Statista.com, individuals spent an average of 135 minutes per day on social media in 2022, highlighting the significant role these platforms play in daily life and business strategy.
Social media's immense popularity makes it an effective platform for businesses to reach a large audience, implement targeted marketing campaigns, and enhance their conversion rates.
The rise of digital media has led to the widespread adoption of marketing campaigns on social networking platforms, thanks to their high interconnectivity.
To effectively gauge consumer interest in the shampoo market and vegan lifestyle trends prior to product launch, surveys will be conducted both online and offline The surveys aim to assess the number of individuals interested in a vegan lifestyle, hair care, and the use of domestic products, while also evaluating their perceptions of affordable domestic goods that adhere to international cruelty-free standards Online surveys will be distributed through product distributor websites, vegan-related blogs, and social media platforms, while offline surveys will take place in parks, shopping malls, and at distribution points Participants will be incentivized with a buy-one-get-one-free voucher for rice bran shampoo upon completion of the survey, encouraging them to purchase the product upon its release.
To accurately assess market needs, the survey aims to gather a minimum of 10,000 responses For the offline survey, seasonal staff will be hired to engage participants in commercial centers, parks, and garden cafes, offering a 10% discount voucher from Cocoon as an incentive, with an estimated cost of 10,000,000 VND The online survey will run for three months, utilizing Facebook and Instagram advertisements, along with media posts on the Vegetarian Lion page and Cocoon's homepage, also providing a 10% e-voucher for completion The estimated online costs include 7.5 million VND for Facebook ads, 7.5 million VND for Instagram ads, and 5 million VND for five media posts on the Vegetarian Lion page, targeting a reach of 10,000 and 2,000 interactions per post, totaling 30,000,000 VND excluding vouchers.
Gather and analyze survey data to assess consumer reactions to the newly launched rice bran shampoo Based on these insights, refine strategies and prepare for product testing in the target market.
To effectively distribute products in Phu Nhuan district, identify key distribution points such as barber shops and supermarkets Train employees to sell products directly at these locations and equip them with detailed product information for customer inquiries Additionally, calculate incurred costs and develop a risk control plan Finally, draft contracts with the identified distribution points to formalize the partnership.
Cocoon is initiating product testing for its rice bran oil shampoo in Phu Nhuan district, Ho Chi Minh City, by partnering with supermarkets to distribute trial products and gather customer feedback The product will be priced at VND 130,000 to gauge customer reactions to its pricing Supermarkets will offer a 20% discount on the shampoo, while Cocoon will deploy staff to sales counters for direct customer engagement Additionally, Cocoon aims to introduce its shampoo in hair salons, providing them with a special price of VND 100,000, a 23% savings, along with two complimentary products for every ten purchased In exchange, salons are required to collect and relay customer feedback to Cocoon The company will also educate salon owners and staff about the benefits and uses of the rice bran oil shampoo to enhance customer recommendations.
Gathering customer feedback is essential for understanding consumer reactions and refining product quality, pricing, and packaging to align with market trends Insights gained from test markets will inform a strategic plan for the official launch in Vietnam.
We are excited to announce a product launch ceremony featuring key partner leaders, marking the expansion of our product coverage To enhance product recognition, we will implement a strategic communication plan This month, we will also initiate a comprehensive online campaign aimed at engaging both consumers and business professionals.
To maximize visibility and engagement, we will launch out-of-home (OOH) advertisements at strategic locations, specifically billboards near Khanh Hoi Bridge and at the Green Goods junction, known for high foot traffic This advertising campaign will commence 15 days after the opening date, with a total investment of 20,000,000 VND.
Fifteen days after launching the product, initiate advertising campaigns on Facebook and Instagram to promote the rice bran shampoo The advertisements will predominantly feature yellow-brown hues and highlight the product's key benefits The total budget allocated for these ads is 10,000,000.
"Sư tử ăn chay" is a vegan influencer collaborating with a TikToker to inspire young audiences about the benefits of a vegan lifestyle With his notably long hair, he serves as an ideal spokesperson for rice bran shampoo products The partnership involves a payment of 10,000,000 VND for the TikToker to feature in a promotional video focused on the product Through this collaboration, he will highlight the features and uses of rice bran shampoo to engage his followers and encourage them to try the product Additionally, his TikTok store will showcase the items, offering a 10% discount on future purchases for his audience.
To enhance product visibility, we distribute our cosmetics to specialized agents like Hasaki, Watsons, and Guardian, as well as on e-commerce platforms such as Shopee and Lazada This month, customers can enjoy a 20% discount on Rice Bran Oil Shampoo and benefit from free shipping on their first purchase, thanks to our promotional incentives for new items at distribution agents and online stores.
Total cost:40.000.000 (excluding voucher) vi September to October:
To enhance consumer engagement and drive purchases, companies are actively collaborating with key opinion leaders (KOLs) while continuously updating their product visuals to align with current trends This strategic partnership not only attracts clients but also creates a fresh and innovative experience for consumers.
FINANCIALS
Break-Even Analysis
Break -Even Analysis Unit: VNĐ
Yearly Sales Break - Even 10.400.000.000 VNĐ
Average Per - Unit Revenue 130.000 VNĐ
Average Per - Unit Variable Cost: 20.000 VNĐ
Estimated Monthly Fixed Cost: 733.000.000 VNĐ
Sales Forecast (Unit:VND)
III Expense Forecast (UNIT: VND)
Expense Forecast ( dự báo chi phí) (UNIT: VND)
We will implement strict control measures to monitor quality and customer satisfaction, enabling us to address any issues swiftly Additionally, we will track monthly sales by segment and channel, as well as monthly expenses, to identify any early warning signs of deviations from our planned objectives.
The Brand Manager will be in charge of all marketing operations.
-Management personnel should be trained on a regular basis.
Constant stimulation of consumer desire.
-Managing continuing product and technology development effectively Worst-Case Scenarios
-A large number of discounts have an effect on the brand.
In the worst-case scenario, a business may suffer due to excessive discounts To navigate this challenge, it is crucial to establish clear business goals and understand the various strategies at our disposal to achieve them Additionally, accurately predicting key metrics will be essential for ensuring the successful attainment of these objectives.
CONTROLS
Implementation
We will implement strict control measures to monitor quality and customer satisfaction, enabling us to address any issues swiftly Additionally, we will track monthly sales by segment and channel, along with monthly expenditures, to identify early warning signs of any deviations from our plan.
Marketing Organization
The Brand Manager will be in charge of all marketing operations.
Contingency Planning
-Management personnel should be trained on a regular basis.
Constant stimulation of consumer desire.
-Managing continuing product and technology development effectively Worst-Case Scenarios
-A large number of discounts have an effect on the brand.
To mitigate the negative effects of excessive discounts on our business, it is crucial to establish clear business goals and explore various strategies to reach them Additionally, accurately predicting the necessary metrics will be essential to ensure we successfully achieve these objectives.