Research and recommendations about marketing comunication of securities companies in vietnam

Objectives and aims Objectives: - Study about marketing communication - Know how securities companies are communicating with customers and the effectiveness of these activities - Know

Nguyen Xuan Quynh

RESEARCH AND RECOMMENDATIONS ABOUT MARKETING COMUNICATION OF SECURITIES

COMPANIES IN VIET NAM

master of business administration thesis

Hanoi - 2007

Nguyen Xuan Quynh

RESEARCH AND RECOMMENDATIONS ABOUT MARKETING COMUNICATION OF SECURITIES

COMPANIES IN VIET NAM

Major: Business Administration

Master of business administration thesis

Supervisor: DR Chu Thanh

Hanoi - 2007

TABLE OF CONTENT ACKNOWLEDGEMENTS i

ABSTRACT ii

TÓM TẮT iv

LIST OF FIGURES 8

INTRODUCTION 9

CHAPTER 1 THEORY FOUNDATION ABOUT MARKETING COMMUNICATIONS 11

1.1 General about Marketing Communications 11

1.2 Setting Marketing Communication Strategy for Service Firms 12

1.2.1 Define the Target Audience and Objectives 13

1.2.2 Divide the Communications Objectives and Target Audiences among the Channels 15

1.2.3 Define Communications Messages 16

1.2.4 Put the Communications Mix Together 18

1.3 Marketing Communication Tools 19

1.3.1 Advertising 19

1.3.2 Public Relations 27

1.3.3 Personal Selling 29

1.3.4 Sales Promotion 32

1.3.5 Direct Marketing 34

1.3.6 E-marketing 35

CHAPTER 2 RESEARCH ON MARKETING COMMUNICATIONS OF SECURITIES COMPANIES 39

2.1 Summary about Vietnam securities market and securities companies 39

2.2 Research on communication tools used by securities companies 42

2.1.1 Public relations 43

2.1.2 Advertising 48

2.1.3 Personal Selling 49

2.1.4 Sales Promotion 50

2.1.5 Direct Marketing 52

2.1.6 E-Marketing 52

2.3 Survey on efficiency of marketing communication from securities companies and customers behaviour 53

2.3.1 Aims of survey 53

2.3.2 Scope of survey and some limitations 53

2.2.3 Findings 54

CHAPTER 3 RECOMMENDATIONS 66

3.1 Define the target audience and objectives of communication 66

3.1.1 Define the target audience of communication strategy 66

3.1.2 Define the communication objectives 68

3.2 Divide the target audience and objectives of communication among the channels 69

3.3 Define communication messages 70

3.4 Put communication mix together 72

3.4.1 General recommendations 72

3.4.2 Recommendations for particular communication tool 73

CONCLUSION 78

REFERENCES 79

APPENDIX: Questionnaires for Thang Long Securities JSC 80

LIST OF FIGURES Figure 1-1: The Communication Process 11

Figure 1-2: The tools of the marketing communication mix 12

Figure 1-3: Marketing Communication Strategy for Service Firms 12

Figure 2-1: Percentage of Accounts Opened at Securities Companies 40

Figure 2-2: One article about SSI when it first listed on HASTC 44

Figure 2-3: SSI with the event of being listed on HOSE 44

Figure 2-4: Announcement about the establishment of STB Securities 45

Figure 2-5: VNDirect launches new service 45

Figure 2-6: Bien Viet Securities with CBV-Index 45

Figure 2-7: SSI and its CEO Tran Duy Hung 46

Figure 2-8: CEO of Vndirect – Mrs Pham Minh Huong 46

Figure 2-9: „Chung khoan cuoi tuan” on VTV1 47

Figure 2-10: INFOTV 47

Figure 2-11: Viet Dragon Securities Corp holds training course for customers 48

Figure 2-12: Advertising of Ocean Securities on InfoTV 49

Figure 2-13: Advertising of Thang Long Securities on Investment Review 49

Figure 2-14: Image of brokers 50

Figure 2-15: Promotion of Viet Tin Securities Company 51

Figure 2-16: http://www.bsc.com.vn 52

INTRODUCTION

1 The Problem

Recently, after the booming from the end of 2006 and beginning of 2007, Vietnam stock market has had downward adjustment The investors don‟t rush to the trading floors like they did before Securities companies, especially new-born companies are facing a lot of trouble in attracting customers They really need effective marketing communication tools to communicate more with customers, understand and find the way to attract and maintain them Therefore, this research was conducted to give out recommendations about market communication for securities companies to help them communicate more effectively with customers

2 Objectives and aims

Objectives:

- Study about marketing communication

- Know how securities companies are communicating with customers and the effectiveness of these activities

- Know how customers get communication messages from securities companies

- Know media tools and other communication tools which are being used

by customers to search information about stock market

- Give recommendations about marketing communication for securities companies

Aims: Help securities companies build up comprehensive marketing strategies

3 Research Questions

- Which communication tools are use by securities companies in Vietnam

- How effective are these tools?

- How do customers aware of the communication of securities companies

- By which way do customers find information about stock market?

- Which media platform do customers prefer and use most?

4 Scope of work

– Research on the communication with individual customers only, not including institutional investors

– Security market in Vietnam in 2005 – 2007

– Survey mainly in Hanoi

5 Data source & Processing

– Primary data: questionnaires

– Secondary data: newspapers, websites

– Processing: to use MS Excel

6 Methods

– Empirical

– Survey using questionnaires

7 Significance

– Theory: understand about marketing communication

– Practice: recommendation for securities companies to communicate more effectively with customers

8 Limitation:

- Time 2005 – 2007

- Survey mainly in Hanoi

- Survey only with individual investors

CHAPTER 1 THEORY FOUNDATION ABOUT

MARKETING COMMUNICATIONS

1.1 General about Marketing Communications

Communications is the process of conveying a message to others and require six

elements: a source, a message, a channel of communication, a receiver and the processes of encoding and decoding The source may be a company or person who has information to convey The information sent by a source, such as a description

of a new service, forms the message The message is conveyed by means of a channel of communication such as a sales person, advertising media, or public relations tools Clients who read, hear, or see the message are the receivers

Figure 1-1: The Communication Process

Source: Managing Service Marketing, John E.G Baterson, K.Douglas Hoffman

Marketing communications are all the communications between the organization

and all other parties, especially with customers Part of the wider academic research area of marketing, it encompasses all the traditional forms of promotion including advertising, sales promotion, personal selling, publicity, public relations, direct marketing and e-marketing But it aims to be broader than this It includes all points

of contact between the organization and other parties

The Marketing Communications Mix is the specific mix of advertising, personal

selling, sales promotion, public relations, and direct marketing a company uses to pursue its marketing objectives

Figure 1-2: The tools of the marketing communication mix

1.2 Setting Marketing Communication Strategy for Service Firms

The setting of a communications strategy follows a common pattern in irresponsive

of whether the firm is producing a goods or services The first is to define a target audience and clear objectives for the complete communication mix The main elements of the communication mix include advertising, public relations, personal selling, sales promotion and direct marketing Only personal selling is normally a two-way process The remainders are one-way communication, from the marketer

to the customer only With services, however, the service providers at the point of communication can also have an important two-way communication role

Figure 1-3: Marketing Communication Strategy for Service Firms

Marketing Communication Mix

Public Relations

Advertising

Marketing

E-Sales Promotion

Direct Marketing

Personal Selling

Source: Managing Service Marketing, John E.G Baterson, K.Douglas Hoffman

1.2.1 Define the Target Audience and Objectives

Defining the target audience

Consumer Behavior

Marketing Strategy

 Budget

Personal Selling

 Objectives

 Target Group

 Budget

Direct Marketing

 Objectives

 Target Group

 Budget

Sales Promotion

 Objectives

 Target Group

 Budget

E-marketing

 Objectives

 Target Group

 Budget

Setting communication objectives for services

The preconsumption choice phase

The objectives must to be ensuring that company‟s service is the one perceived to

be the least risky alternative Communications could be used to try to influence the choice process in the following ways:

 To ensure that the firm‟s service offering is in the evoked set

 To alter the weights attached to different attributes by consumers to favor those on which the company is strong

 To alter the score on a given attribute for the company, particularly if there

is gap between performance and consumers‟ perceptions

 To alter the score on a given attribute given to a competitor, again particularly if there is a gap between performance and consumers‟ perceptions

 If the company is not in the evoked set, to build enough awareness of the offering to arouse inclusion

The consumption phase

During this phase, the services consumer is a more or less active participant in the production process It is important that consumers perform that production role successfully From the firm‟s point of view, successful performance will improve the efficiency of the operation and the satisfaction of other customers From the consumers‟ point of view, successful performance will ensure a high level of

perceived control and, in all probability, a high level of satisfaction in the postconsumption phase

Therefore, communication in this phase can be used to ensure successful performance by giving the consumer a clear script The nature of this script depends on the nature of the service operation

The postconsumption evaluation phase

Consumer expectations come from a number of sources, some within the control of the services firm and some outside its control Expectations arise either from previous experience with the firm and/or its competitors or from some form of communication The objective for this phase is to attempt to match customers‟ expectation to the performance characteristics of the servuction system

1.2.2 Divide the Communications Objectives and Target Audiences among the Channels

Once the overall objectives and target audiences for the whole communication mix are set, it is necessary to divide the tasks among advertising, selling, public relations, and point-of-sales messages This is a process of matching the tasks to the capabilities of the different communications channels and to the ways consumers uses those channels and the different objectives

One way of assigning tasks across the array of communication channels is to consider the degree to which the message can be targeted at specific audiences Media advertising itself varies along this dimension TV advertising can reach very board audiences but it is not very selective except in the variation in audience across channels by time of day Nation print media such as newspapers and magazines offer more selective focus, as they themselves tend to be targeted at more specific segments of consumers

1.2.3 Define Communications Messages

Key differences in information usage between goods and services

In order to create communications messages for a service, it‟s necessary to understand key differences in information usage between goods and services These differences are crucial to understanding how divide the communications objectives, target audiences, and budget between the different channels

Consumers of services are less likely to purchase without information than those buying goods This relates to the increased perceived risk associated with services and the need for consumer to reduce that risk by collecting information before purchasing

Consumer of services will prefer personal over impersonal sources of information Because services are experimental, it is extremely difficult to describe or specify the “product” before purchase It might be possible to use TV advertising to convey the experience, but it is clear that consumers prefer to obtain their information from individuals who have experienced the services directly or indirectly

Even among personal services, the high level of risk inherent in the process mean that customers will give greater credibility to independent sources of information rather than those perceived to be controlled by the firm All this implies that mass advertising communication from comparable individuals is far more likely than mass advertising to be used by consumers as a source of information

However, it is possible to use advertising and other forms of promotion to leverage word-of-mouth communication Such as an approach might imply using advertising and promotional tools to persuade satisfied customers to tell other consumers Word-of-mouth communication can be used directly in media advertising, in the form of testimonials from satisfied customers

Consumer information sources can be classified broadly into internal and external sources Both types can be used to help consumers cope with perceived risk Internal sources are fundamentally linked to memory scan

Define Communication Messages

These guidelines have developed based on the key differences in information usage between goods and services and features of services including: intangibility, inseparability, heterogeneity, and perishability inherent in services products

Promise what is possible

In its most basic form, customer satisfaction is developed by customers‟ comparing their expectations to their perception of the actual service delivery process In times

of increasing competitive pressures, firms may be tempted to overpromise Making promises the firm cannot keep initially increases customer expectations and then subsequently lowers customer satisfaction as those promises are not met Two problems are associated with overpromissing First, customers have disappointed and a significant loss of trust then occurs between the firm and its customers The second problem directly affects the service firm‟s employees

Tangibilize the Intangible

In tangibilizing the intangible, the scale of market entities, which reflects the degree

of tangibility among products, should be turned on its ends The advertising of tangible-dominant products tends to make them more abstract to differentiate them from one another In contrast, the advertising of intangible-dominant products

should concentrate on making them more concrete through the use of physical cues and tangible evidence

Feature the working relationship between customer and provider

Service delivery is an interactive process between provider and customer, and it is therefore appropriate that the firm‟s advertising should feature, for example, a customer and a company representative working together to achieve a desired outcome The advertising of services, in particular, must concentrate not only on encouraging customers to buy but also on encouraging employees to perform

Reduce consumer fears about variations in performance

The firm‟s advertising can also minimize the pitfalls of heterogeneity in the customer‟s mind To enhance the perception of consistent quality, the firm‟s advertising should provide some sorts of documentation that reassures the customers

Determine and focus on relevant service quality dimensions

The reasons customers choose among competing services are often closely related

to the five dimensions of service quality: reliability, responsiveness, assurance, empathy and the quality of the tangibles associated with the services However, some features are commonly are more important to customers than others; therefore the company should more focus on them

1.2.4 Put the Communications Mix Together

If the objective is to reach nonusers of the service at the preconsumption phase, then the choice of communication channels is limited Media advertising can be used either directly or as way to harness or create word-of-mouth communication in the market place If the number of target customers is limited, it might be possible

to use other means such as personal sales force or direct marketing The decision would depend on the cost-effectiveness of the different channels and the complexity of the message to be conveyed

By the time consumers reach the consumption and postconsumption phases, they are already part of the servuction process On a cost/audience member basis, it would seem more logical to use the point-of-sale environment or the service provider to handle the communication

1.3 Marketing Communication Tools

1.3.1 Advertising

1.3.1.1 Concept of Adverting

Advertising is any paid form of nonpersonal communication about an organization, good, service, or idea by an identified sponsor The paid aspect of this definition is important because the space for the advertising message normally must be bought Advertising involves mass media (such as TV, radio, and magazines), which are nonpersonal and do not have an immediate feedback loop as does personal selling

There are several advantages to a firm using advertising in its communication mix

It can be attention-getting and also communicate specific product/service benefits

to prospective buyers By paying for the advertising space, a company can control what it wants to say and, to some extend, to whom the message is sent Advertising also allows the company to decide when to send its message The nonpersonal aspect of advertising also has its advantages Once the message is created, the same message is sent to all receivers in a market segment If the message is properly pretested, the company can trust that that the same message will be decoded by all receives in the market segment

Advertising has some disadvantages, the costs to produce and place a message are

significant, and the lack of direct feedback makes it difficult to know how well the message was received

1.3.1.2 Types of advertisements

a) Product advertisements

Focus on selling a good or service, product advertisements take three forms: (1) pioneering (or informational), (2) competitive (or persuasive) and (3) reminder

Used the introductory stage of the life cycle, pioneering advertisements tell people

what a product is, what it can do, and where it can be found The key objective of a pioneering ad is to inform the target market Informative ads have been found to be interesting convincing, and effective

Advertising that promotes a specific brands‟ features and benefits is competitive The objective of this message is to persuade the target market to select the firm‟s brand rather than that of competitors An increasingly common form of competitive advertising is comparative advertising, which shows one brand‟s strengths relative

to those of competitors Firms that use comparative advertising need market research and test results to provide legal support for their claims

Reminder advertising is used to reinforce previous knowledge of a product Reminder advertising is good for products that have achieved a well-recognized position and are in the mature phase of their product life cycle Another type of reminder ad, reinforcement, is used to assure current users they made the right choice

b) Institutional advertisements

The objective of institutional advertisements is to build goodwill or an image for an organization, rather than promote a specific good or service Often this form of

advertising is used to support the public relations plan or counter adverse publicity Four alternative forms of institutional advertisements are often used:

 Advocacy advertisement states the position of a company on an issue

 Pioneering institutional advertisements, like the pioneering ads for products

discussed earlier, are used for announcement about what a company is, what

it can do, or where it is located

 Competitive institutional advertisements promote the advantages of one

product class over another and are used in the market where different product classes compete for the same buyers

 Reminder institutional advertisements, like the product form, simply bring

the company‟s name to the attention of the target market again

1.3.1.3 Develop the advertising program

Because media costs are high, advertising decisions must be made carefully, using

a systematic approach The advertising decision process is divided into (1) developing, (2) executing, and (3) evaluating the advertising program

Development of the advertising program focuses on the four Ws:

 Who is the target audience?

 What are (1) the advertising objectives, (2) the amounts of money that can

be budgeted for the advertising program, and (3) the kinds of copy to use?

 Where the advertisements should be run?

 When should the advertisements be run?

a) Identifying the Target Audience

The first decision in developing the advertising program is identifying the target audience, the group of prospective buyers toward which an advertising program is

directed To the extent that time and money permit, the target audience for the advertising program is the target market for the firm‟s product, which is identified from marketing research and market segmentation studies The more a firm knows about its target audience‟s profile – including their lifestyles, attitudes, and values – the easier it is to develop an advertising program

b) Specific Advertising Objectives

After the target audience is identified, a decision must be reached on what that advertising should accomplish Consumers can be said to respond in terms of a hierarchy effects, which is the sequence of stages a prospective buyer goes through from initial awareness of a product to eventual action

Awareness: the consumer‟s ability to recognize and remember the product or brand

name

Increase: an increase in the consumer‟s desire to learn about some of the features

of the product or brand

Evaluation: the consumer‟s appraisal of the product or brand on important

attributes

Trial: the consumer‟s actual first purchase and use of the product or brand

Adoption: through a favorable experience on the first trial, the consumer‟s repeated

purchase and use of the product or brand

For a totally new product the sequence applies to the entire product category, but for a new brand competing in an established product category it applies to the brand itself These steps can serve as guidelines for developing advertising objectives

c) Setting the Advertising Budget

After setting the advertising, a company must decide on how much to spend Determining the ideal amount for the budget is difficult because there is no precise way to measure the exact results of advertising

d) Designing the Advertisements

The central element of an advertising program is the ad itself Advertising messages consists of advertising copy and the artwork that the target audience is intended to see (as in magazines, newspaper and TV) or hear (as on radio, TV) The message usually focuses on the key benefits of the product that are important to a prospective buyer in making trial and adoption decisions

Message content

Most advertising messages are made up of both informational and persuasional elements These two elements, in fact, are so intertwined that it is sometimes difficult to tell them apart For example, basic information contained in many advertisements such as the product name, benefits, features, and price are presented

in the way that tries to attract attention and encourage purchase On the other hand, even the most persuasive advertisements have to contain at least some basic information to be successful

Create the actual message

The creative people in an advertising agency have responsibility to turn appeals and features such as quality, style, dependability, economy, and service into attention

getting, believable advertisements

e) Selecting the Right Media

Every advertiser must decide where to place its advertisements The alternatives are the advertising media, the means by which the message is communicated to the audience Newspapers, magazines, radio, and TV are examples of advertising media This media selection decision is related to the target audience, type of product, nature of the message, campaign objectives, available budget, and the costs of the alternative media

Television

Television is a valuable medium because it communicates with sight, sound and motion Besides the network television is biggest network that can reach the most audience However, television‟s major disadvantage is cost

Radio

The major advantage of radio is that it is a segmented medium Each station will lead to different segment of audience The disadvantage of radio is that it has limited use for products that must be seen Another problem is the ease with which consumers can tune out a commercial by switching stations Radio is medium that competes for people‟s attention as the do other activities such as driving, working,

or relaxing

Magazines

Magazines are becoming a very specialized medium because there are more and more magazines launched The advantage of this medium is the great number of special-interest publications that appear to narrowly defined segments Each magazine‟s readers often represent a unique profile In addition to the distinct audience profiles of magazines, good color production is an advantage that allows magazines to create strong images

Newspapers

Newspapers are an important local medium with excellent reach potential Because

of the daily publication of most papers, they allow advertisements to focus on specific current events, such as a “24-hour sale” Local retailers often use newspapers as their sole advertising medium

Two trends are influencing newspapers today The first is a dramatical increase in their cost of paper In response, many newspapers have attempted to cut cost through hiring freezes, while others have raised prices The second trend is the rush

to deliver on-line newspapers

Outdoor

A very effective medium for reminding consumers about your product is outdoor advertising The most common form of outdoor advertising, called billboards, often results in good reach and frequency and has been shown to increase purchase rates

A disadvantage to billboard is that no opportunity exists for lengthy advertising copy

1.3.1.4 Executing the Advertising Program

a) Presetting the Advertising

To determine whether the advertisement communicates the intended message or to select among alternative versions of the advertisements, pretests are conducted before the advertisements are placed in the medium

b) Carrying out the Advertising Program

The responsibility for actually carrying out the advertising program can be handles

in one of three ways The full-service agency provides the most complete range of services, including market research, media selection, copy development, artwork and production Limited-service agencies specialize in one aspect of the advertising process Finally, in-house agencies made up of the company‟s own advertising staff may provide full services or a limited range of services

1.3.1.5 Evaluating the Advertising Program

The advertising decision process does not stop with executing the advertising program The advertisements must be posttested to determine whether they are achieving their intended objectives, and results may indicate that changes must be made in the advertising program

a) Protesting the Advertising

There five approaches common in posttesting, including:

Aided recall (recognition-readership): After being shown an ad, respondents are

asked whether their previous exposure to it was through reading, viewing, or listening

Unaided recall: A question such as, “what advertisements do you remember seeing

yesterday?” is asked of respondents without prompting to determine whether they saw or heard advertising messages

Attitude tests: Respondent are asked questions to measure changes in their

attitudes after an advertising campaign, such as whether they have amore favorable attitude toward the product advertised

Inquiry tests: Additional product information, product samples, or premiums are

offered to an advertisement‟s readers or viewers Advertisements generating the most inquiries are presumed to be the most effective

Sales test: Sales tests involve studies such as controlled experiments (e.g., using

radio advertisements in one market and newspaper advertisements in another and comparing the results) and consumer purchase tests (measuring retail sales that result from a given advertising campaign)

b) Making Needed Changes

Results of posttesting the advertising copy are used to reach decisions about changes in the advertising program If the posttest results show that an advertisement is doing poorly in terms of awareness or cost efficiency, it may be dropped and other advertisements run in its place in the future On the other hand, sometimes and advertisement may be so successful, it is run repeatedly or used as the basis of a larger advertising program

1.3.2 Public Relations

Public relations is form of communication management that seeks to influence the feelings, opinions, or beliefs held by customers, prospective customers, stock holders, suppliers, employees and other publics about a company and its products

or services

Many tools such special events, lobbying efforts, annual reports, and image management may be used by a public relation department, although publicity often plays the most important role

Publicity is a nonpersonal, indirectly paid presentation of an organization, good or service It can take the form of a news story editorial, or product announcement A difference between publicity and both advertising and personal selling is the

“indirectly paid” dimension With publicity a company does not pay for space in a mass medium (such as television or radio) but attempts to get the medium to run a favorable story on the company In this sense, there is an direct payment for publicity in that a company must support a public relations staff

An advantage of publicity is credibility When you read a favorable story about a company‟s product, there is a tendency to believe it The disadvantage of publicity relate to the lack of the user‟s control over it A company can invite a news team to

preview its innovative exercise equipment and hope for a favorable mention on the hot-time newscasts But without buying advertising time, there is no guarantee of any mention of the new equipment or that will be aired when the target audience is watching With publicity there is a little control over what is said, to whom, or when

Public relations efforts may utilize a variety of tools and may be directed at many distinct audiences While public relations personnel usually focus on communicating positive aspects of the business, they may also be called on to minimize the negative impact of a problem or crisis

Publicity Tools

In developing a public relations campaign, several methods of obtaining nonpersonal presentation of an organization, good, or service without direct cost – publicity tools – are available to the public relations director Many companies frequently use the news release, consisting of an announcement regarding changes

in the company or the product line The objective of a news release is to inform a newspaper, radio station, or other medium of an idea for a story A recent study found that more than 40 percent of all free mentions of a brand name occur during news programs

A second common publicity tools is the news conference Representatives of the media are all invited to an informational meeting, and advance materials regarding the content are sent This tool is often used when negative publicity requires a company response

Finally, today many high-visibility individuals are used as publicity tools to create visibility for their companies, their products, and themselves These publicity efforts are coordinated with news releases, conferences, advertising, donations to

charities, volunteer activities, endorsements, and any other activities that may have

an impact on public perceptions

1.3.3 Personal Selling

Personal selling involves two-way flow of communication between a buyer and seller, often in a face-to-face encounter, designed to influence a person‟s or group‟s purchase decision However, with advance in telecommunication, personal selling also takes place over the telephone, through video teleconferencing and interactive computer links between buyers and sellers

1.3.3.1 Types of personal selling

There are three types of personal selling: order taking, order getting, and sales support activities

Order Taking

An order taker processes routine orders or reorders for products that were already sold by the company The primary responsibility of order takers is to preserve an ongoing relationship with existing customers and maintain sales

Order Getting

An order getter sells in a conventional sense and identifies prospective customers, provides customers with information, persuades customers to buy, closes sales and follows up on customers‟ use of a product or service

Sales Support Personnel

Sales support personnel augment the selling effort of order getters by performing a variety of services For example, missionary salespeople do not directly solicit orders but rather concentrate on performing promotional activities and introducing

new products A sales engineer is a salesperson who specializes in identifying, analyzing, and solving customer problems but often does not actually sell products and services

1.3.3.2 The Personal Selling Process

The personal selling process consists of six stages: (1) prospecting, (2) preapproach, (3) approach, (4) presentation, (5) close, and (6) follow-up

Prospecting is the search for and qualification of potential customers If an

individual wants the product, can afford to buy it, and is the decision maker, this individual is a qualified prospect

Preapproach

Once a salesperson has identified a qualified prospect, preparation for the sale begins with the preapproach The preapproach stage involves obtaining further information on the prospect and deciding on the best method of approach Knowing how the prospect prefers to be approached, and what the prospect is looking for in a product or service, is essential regardless of cultural setting

Approach

The approach stage involves the initial meeting between the sales person and the prospect, where the objectives are to gain the prospect‟s attention, stimulate interest and build the foundation for the sales presentation itself and the basis for a working relationship The first impression is critical at this stage, and it is common for the sales people to begin the conversation with a reference to common acquaintances, a referral, or even the product or service its self

Presentation

The presentation is at the core of the order-getting selling process, and its objective

is to convert prospect into a customer by creating a desire for the product or service Three major presentation format exit: (1) stimulus-person format, (2) formula selling format, (3) need-satisfaction format

Stimulus-response presentation format assumes that given the appropriate stimulus

by a salesperson, the prospect will buy With the format, the sales person tries one appeal after another

Formula selling format

A more formalized presentation, the formula selling presentation format, is based

on the view that a presentation consists of information that must be provided in an accurate, thorough, and step-by-step manner to inform the prospect A popular version of this format is the canned sales presentation, which is a memorized, standardized message conveyed to every prospect

Need-satisfaction format

The stimulus-response and formula selling formats share a common characteristic: the salesperson dominates the conversation By comparison, the need-satisfaction presentation format emphasized probing and listening by the salesperson to identify needs and interests of prospective buyers

Close

The close stage in the selling process involves obtaining a purchase commitment from the prospect This stage is the most important and the most difficult because the salesperson must determine when the prospect is ready to buy

Follow-up

The selling process does not end with the closing of a sale; rather, professional selling requires customer follow-up The follow-up stage includes making certain

the customer‟s purchase has been properly delivered and installed and difficulties experienced with the use of the item are addressed Attention to this stage of the selling process solidifies the buyer-seller relationship

1.3.4 Sales Promotion

Sales promotion is a supplemental ingredient of communication marketing and it not as advertising but also high effective

1.3.4.1 Consumer-Oriented Sales Promotions

Directed to ultimate consumers, consumer-oriented sales promotions, or simply consumer promotions, are sales tools used to support a company‟s advertising and personal selling The alternative consumer-oriented sales promotion tools include coupons, deals, premiums, contests, sweepstakes, samples, continuity programs, point-of-purchase displays, rebates, and product placement

Coupons

Coupons are sales promotions that usually offer a discounted price to the consumer,

which encourages trial

Samples

Another common consumer sales promotion is sampling, which is offering the product free or at a greatly reduced price Often used for new products, services, that is smaller than the regular package size If the consumers like the sample, it is hoped they will remember and buy the product

The final consumer promotion, product placement, involves the use of a name product in a movie, television show, video, or commercial for another product

brand-1.3.4.2 Trade-Oriented Sales Promotion

Trade-oriented sales promotion, or simply trade promotion, are sales tools used to support a company‟s advertising and personal selling directed to whole sellers, retailers, or distributors Some of the sales promotion just reviewed are used for this purpose, but there are other common approaches targeted uniquely to these intermediaries: (1) allowances and discounts, (2) cooperative advertising, (3) training of distributors‟ sales force

1.3.5 Direct Marketing

Direct marketing is a sub-discipline and type of marketing There are two main definitional characteristics which distinguish it from other types of marketing The first is that it attempts to send its messages directly to consumers, without the use of intervening media This involves unsolicited commercial communication with consumers or businesses The second characteristic is that it is focused on driving purchases that can be attributed to a specific "call-to-action." This aspect of direct marketing involves an emphasis on trackable, measurable results regardless of medium

The most common form of direct marketing is direct mail, where the marketers use

a reduced "bulk mail" postal rate to send paper mail to all postal customers in an area or all customers whose addresses have been taken from a list

Direct mail allows the greatest degree of audience selectivity Direct-mail companies can provide advertisers with a mailing list of their target market Direct mail has an advantage in providing complete product information, compared with

that provided in 15-second, 30-second television or radio spots Mass media are used to create awareness, while direct mail builds a relationship and facilitates a purchase One disadvantage of direct mail is that rising postal costs are making it more expensive The major limitation is that people often view direct mail as junk, and the challenge is to get them to open a letter Databases, which help marketers send their target market only mail that is relevant to them, are improving consumers‟ response to advertising they receive in the mail

The second most common form of direct marketing is telemarketing, where marketers call selected (or random) telephone numbers Email Marketing, including spam may have passed telemarketing in frequency at this point, and it is a third type of direct marketing

1.3.6 E-marketing

E-marketing means using digital technologies to help sell your goods or services These technologies are a valuable complement to traditional marketing methods Though businesses will continue to make use of traditional marketing methods, such as advertising, direct mail and PR, e-marketing adds a whole new element to the marketing mix Many businesses are producing great results with e-marketing and its flexible and cost-effective nature makes it particularly suitable for small businesses

Tools of e-marketing include:

 Websites

 Search Engines

 Blogs, Forums

1.3.6.1 The benefits of e-marketing

E-marketing gives businesses of any size access to the mass market at an affordable price and, unlike TV or print advertising, it allows truly personalised marketing Specific benefits of e-marketing include:

 Global reach - a website can reach anyone in the world who has Internet

access This allows you to find new markets and compete globally for only a small investment

 Lower cost - a properly planned and effectively targeted e-marketing

campaign can reach the right customers at a much lower cost than traditional marketing methods

 Trackable, measurable results - marketing by email or banner advertising

makes it easier to establish how effective your campaign has been You can obtain detailed information about customers' responses to your advertising

 24-hour marketing - with a website your customers can find out about your

products even if your office is closed

 Personalisation - if your customer database is linked to your website, then

whenever someone visits the site, you can greet them with targeted offers The more they buy from you, the more you can refine your customer profile and market effectively to them

 One-to-one marketing - e-marketing lets you reach people who want to know

about your products and services instantly For example, many people take mobile phones and PDAs wherever they go Combine this with the personalised aspect of e-marketing, and you can create very powerful, targeted campaigns

 More interesting campaigns - e-marketing lets you create interactive

campaigns using music, graphics and videos You could send your customers a game or a quiz – whatever you think will interest them

 Better conversion rate - if you have a website, then your customers are only

ever a few clicks away from completing a purchase Unlike other media which require people to get up and make a phone call, post a letter or go to a shop, e-marketing is seamless

 Together, all of these aspects of e-marketing have the potential to add up to more sales

1.3.6.2 Stages in developing e-marketing plan

It is important to recognize that planning for e-marketing does not mean starting from scratch Any online e-communication must be consistent with the overall marketing goals and current marketing efforts of your business

The main components of an e-marketing plan will typically include the following stages:

Identify target audience - if you identify multiple targets, rank them in order of

importance so that you can allocate resources accordingly Profile each target group and understand their requirements and expectations so that you can pitch your costs and benefits at the correct level

Set objectives - possible objectives could include awareness raising (of

your business or disseminating information about your products or services), entering new markets, launching a new product, focusing on sales (building Internet sales of a product or increasing the frequency of sales from regular customers), or internal efficiency (decreasing marketing costs, reducing order-taking and fulfillment costs, or improving customer retention rates)

Decide upon the marketing mix - you should choose a mix of e-marketing

activities that will help you achieve your objectives and fit with any existing traditional marketing activities you already have planned Agree a budget - careful

budgeting allows you to prevent costs spiraling out of control By identifying the returns you expect to make from your investment in e-marketing activities you can compare these with the costs in order to develop a cost/benefit analysis

Action planning - identify the tactics for implementing the selected e-marketing

activities The plan should also cover other non-Internet marketing activities that are being undertaken

Measure success - build in feedback mechanisms and regular reviews to enable

you to assess the success of your e-marketing activities, particularly as e-commerce

is such a dynamic and fast-changing area

CHAPTER 2 RESEARCH ON MARKETING

COMMUNICATIONS OF SECURITIES COMPANIES

2.1 Summary about Vietnam securities market and securities

companies

Vietnam securities market official has officially operated since 2000, when Ho Chi Minh Securities Trading Center - HOSTC (now changed to Ho Chi Minh Securities Exchange – HOSE) was established on July 2000 At that time, there were only few stocks traded with total capital about USD 1.7 million Through first 6 years, market capitalization only reached USD 0.5 billion In two year 2006 and 2007, Vietnam securities market has developed significantly with series of impressive records Market capitalization in Dec

2006 was estimated USD 13.8 billion, account for 22.7% GDP This number in April 2007 reached USD 24.4 billion, approximately 38% GDP, increased 1400 times comparing to the year 2000 Currently, the number of listed companies is 213 companies, increase 704% comparing to 2000

Figure 2-1: Chart of VN Index from 2001 to 2007

Source: http://vndirect.com.vn

The above chart describes the performance of VN Index in 8 years from 2000 to

2007 If in the first session on 28 July 2000, VN Index only got 100 points, then in March 2007, it reached the peak of 1170 points It‟s obvious that the market has grew tremendously in 2006 and 2007 In 2006 only, VN Index grew 146%, while in

the first three months this year, the Index made another 43% growth Currently, VN Index fluctuates around 900 point, 90 times higher from the beginning day of trading

Up to date there are 60 securities companies operating in the market There are 60 securities companies trading in Ho Chi Minh Securities Exchange (HOSE) and 55 securities companies trading in Ha Noi Securities Trading Center (HASTC) These companies operate in four main areas including (1) deposit and brokerage, (2) consultancy, (3) self-trading and (4) under writing

The total trading account have increased from 50,100 accounts in 2005 to 106,393

in 2006 and up to Sep 2007 is about 320,000 account, increase 300% against 2006,

in which there are more 140,000 new account were open in first 6 months of 2007

The chart below describes the percentage of accounts that were opened at different securities companies The leader currently is Sai Gon Securities Incorporation (SSI) with 21.20%, the second is Vietcombank Securities Company (VCBS), the third position belongs to Bao Viet Securities Company The other big players are Securities Company of Asia Commercial Joint Stock Bank (ACBS), Securities Company of BIDV (BSC), and Securities Company of Agribank (AGRISECO) and Incombank (IBS) The others securities companies only account for 20.90% of the total accounts These statistics show that the brand names of experienced and big securities companies help them attract a lot of customers It‟s rather difficult for new-born securities companies to compete with the existing players if they don‟t have marketing policies that suit their status and affect the awareness of investors

Figure 2-1: Percentage of Accounts Opened at Securities Companies

Percentage of Accounts opened at Securities Companies

OTHERS

Source: Statistics of State Securities Committee in Sep 2007

Base on company size, market share, time of establishment and fame, securities companies in Vietnam can be divided into three groups

Group 1 includes big and well-known securities companies which keep the big

market share, at least 5% of total market share Besides, these companies have been established and operated in the market for a long time, at least two years Several companies in this group are:

Sai Gon Securities Incorporation (SSI)

Vietcombank Securities Company (VCBS)

Bao Viet Securities Company (BVSC)

ACB Securities Company

BIDV Securities Company (BSC)

Agribank Scurities Companies pany (Agriseco)

…

Group 2 consists of medium companies These companies are established after the

first group for about 6 -12 months and have a relatively well-known market position One common feature of companies in this group is that they are normally

a member or closely related to big financial institutions, big banks, big corporation Therefore, they are supported in terms of capital, human resource and customer relationship Some companies in Group 2 are:

Thang Long Securities Company

Sai Gon Thuong tin Bank Securities Company

An Binh Bank Securities Company

VnDirect Securities Company

Trang An Securities Companies

…

Group 3 is companies opened recently, smaller size and less accounts They are

joint stock companies that established by rich individuals who take advantage the development of securities market

Dai Viet Securities Company

Bien Viet Securities Company

Tan Viet Securities Company

Viet Tin Securities Company

Viet Dragon Securities Company

2.2 Research on communication tools used by securities companies

The research was conducted by using depth interview with marketing managers of

6 securities companies, combining with desk research of the author Securities companies have different market positions, different sizes and uses different ways

to communicate with customers

Key finding:

 In general, securities companies in Vietnam have used some of 6 tools: advertising, PR, personal sales, sales promotion, direct marketing and e-marketing to communication with customers