Question:
Discuss about Global Marketing of Faux Facy Cosmetics.
Answer:
Introduction
Introduction to Company
Faux Facy Cosmetics which was established in 2014 especially established to fulfil the requirements of women at cheaper rates that other manufacturers and distributors of cosmetic products. They have various products such as lipsticks, eyeliners, mascara, products for face, etc. Faux Facy Cosmetics was started by a woman at small scale level in Singapore with a view to providing appropriate products to Singapore women at cheap rates. Their main competitors are L’Oreal, Maybelline, etc. They also provide online shopping facility at their website with a view to enhance their sales (Keegan & Green, 2015).
Introduction to India
India is a country with a huge population with unique cultures and it is the second highest across the globe in terms of population. Hence, a huge population is the attractive point for Faux Facy Cosmetics as scope for attaining success. With unique cultures, most Indians are much obsessed with their daily routine products, especially cosmetics. In India, various celebrities promote different brands of cosmetics. Faux Facy Cosmetics could use the same strategy for its brand’s promotion in the Indian market.
Introduction to South Korea
Korea is also one of the well-known countries of Asia and it is a part of East Asia. It is the country which was known for its high standardizes people earlier. So, Faux Facy Cosmetics has the great chance to promote its cosmetics in South Korea.
Introduction to China
This country is also known for its population as this stands as number one across the globe in terms of population. This country is also one of the highly populated countries of Asia and they have well utilized their man power. Many countries work with China as their labour is available at cheap rates. Faux Facy Cosmetics has targeted China with a view that in the high populated area, chances for emerging a new brand arises more.
Market Selection
Using McKinsey Matrix analysis, the market will be selected amongst the three countries i.e. India, South Korea and China. The comparison will be done on the basis of PESTLE analysis:
Singapore and India
- P: Singapore is included in the most politically stable countries and whereas India is emerging from the black money and corruption issues.
- E: Singapore is included in 7 least corrupted states, whereas India is struggling with the same.
- S: Cultural factors differ for both countries.
- T: Internet and technology users are increasing in India rapidly, whereas Singapore has an adequate technology.
- L: Indians are known for their business skills and Singapore is a bit low on these skills.
- E: Environmental conditions are quite similar in both places (Gaston-Breton & Martín Martín, 2011).
Singapore and China
- P: Similar, both countries are politically stable.
- E: Similar, China has controlled their economic conditions in past few years hence, their GDP is rising rapidly.
- S: Similar cultures.
- T: Both countries have adequate technology resources.
- L: Dissimilar, China is leading in business from past few years across the globe.
- E: Similar environmental factors.
Singapore and South Korea
- P: Dissimilar, South Korea is less stable in terms of political stability in comparison to Singapore.
- E: Dissimilar, same as politically stability, South Korea is moving towards development but at a slow rate.
- S: While South Koreans believe in living together and Singaporeans have mixed culture of European and Asian countries.
- T: In terms of technology, South Korea stands behind Singapore.
- L: Singaporeans have great business skills in comparison to South Korea.
- E: Quite common factors.
Conclusion
As per the PESTLE analysis was done amongst the three countries chosen by Faux Facy Cosmetics to promote their products for business’ expansion and for growth, China and South Korea found as the politically stabled courtiers whereas India has the highest growth rate.
China is at the peak position in terms of population but they have huge GDP and national income too and in terms of these factors, India is far away because India is on the second position in terms of population but their GDP and national income does not fulfil their country’s people requirement (Salami & Soltanzadeh, 2012).
Hence, Faux Facy Cosmetics ay chose China for promoting their products and South Korea and India will share the second choice for Faux Facy Cosmetics organization to promote its products (Roberts, et. al., 2012).
Macro Environment Factors
Economic Factors
GDP (Gross Domestic Product): The following table shows the data of India, South Korea and China in relevance to Faux Facy Cosmetics for its expansion:
| Countries | China |
| 2016 | 11,200 USD |
| 2015 | 8,069.21 USD |
| 2014 | 7,683.50 USD |
The below diagram shows the GDP of China for 2014, 2015 and 2016:
Demographics
The total number of people living in China is 1.379 billion. There is a bit difference left in terms of population between India and China. As per the status, it is proven that in coming years, India will attain the peak position in terms of highest populating country. Faux Facy Cosmetics has the great chance to prove its brand’s uniqueness and attractive features in populating countries like China as there they will find number of buyers for their products (Wang, et. al., 2011).
| Year | Population |
| 2016 | 1.379 billion |
| 2015 | 1.371 billion |
| 2014 | 1.364 billion |
Income
Income of every individual gave him the power of purchasing. If the purchasing power of an individual will be less, then he would not be able to fulfil his all requirements. As cosmetics are not covered under basic requirements of a human being and these are considered as luxurious items. Hence, a person with adequate income will be able to spend money for these products and services (Van Boeckel, et. al., 2014).
National Income of China:
| Countries | China |
| 2016 | 21.37 trillion dollars |
| 2015 | 19.73 trillion dollars |
| 2014 | 18.66 trillion dollars |
As per above data, with a huge population, China has an adequate income resources through which they can move towards development of their nation and along with this, Faux Facy Cosmetics needs to promote its products in China more, in comparison to India and South Korea as Chinese people will be able to buy more than these two country’s people.
Inferences
| Factors | Inferences |
| GDP | GDP rate shows the rate of development of the country. Amongst these countries, Faux Facy Cosmetics could be able to develop their effective image as they are the countries with huge consumption of cosmetic products. |
| Demographic | India and China are going through the same phase that they both have an adequate number of young people in their country and demand of cosmetics is much more in youngsters. |
| Income | China stands at the top in terms of earnings hence, chances of developing an effective image in China are more as compared to other two countries. |
Political Macroeconomic factors
Macroeconomic factors are linked with the whole nation and corruption, national income, inflation, unemployment, etc. are some of its components.
Corruption
Corruption rate in China is increasing and for controlling these issues, various anti-corruption campaigns are organized. In 2013, China was at the 80th place in terms of corruption across the while it stands at 100th place in 2014. Going down in terms of corrupted countries rankings state clearly that corruption is spreading its foot. Hence, in these conditions, Faux Facy Cosmetics may need to bear some issues in terms of settling down their business (Zhang, 2010).
Foreign Direct Investment
Foreign direct investment is the term which describes other country’s interest in one country. As China is leading towards development at a huge speed, many other big countries have come together for trading practices. China has offered other countries various services related to technology services and labour services at very cheap rates. For instance, Apple Inc. which is a big manufacturer and distributor of the automobile industry, their product named iPhones and MacBook is very famous which are assembled in California but manufactured in China. Apart from Apple Inc., there are various other big multinational corporations which have come up with China for trading related activities (Tolentino, 2010).
Conclusion
This report concludes the market selection for Faux Facy Cosmetics to promote its cosmetics products across the Asian countries. Amongst India, China and South Korea, Faux Facy Cosmetics realizes that China would be perfect place for them to promote their products as a number of cosmetics users are much high in China. A market selection process is done as per the McKinney and PESTEL analysis to evaluate the adequate features. Apart from this, there are many other factors of macroeconomic are discussed and represented through graphs and tables. Comparison between the global factors such as GDP and National Income was also evaluated.
References
Gaston-Breton, C. & Martín Martín, O., 2011, “International market selection and segmentation: a two-stage model”, International Marketing Review, vol. 28 (3), pp.267-290.
Keegan, W.J. & Green, M.C., 2015, “Upper Saddle River, NJ: Pearson”, Global marketing.
Roberts, M.J., Xu, D.Y., Fan, X. & Zhang, S., 2012, “A structural model of demand, cost, and export market selection for Chinese footwear producers”, NBER Working Paper Series, p.17725.
Salami, R. & Soltanzadeh, J., 2012, “Comparative analysis for science, technology and innovation policy; lessons learned from some selected countries (Brazil, India, China, South Korea and South Africa) for other LdCs like Iran”, Journal of technology management & innovation, vol. 7 (1), pp.211-227.
Tolentino, P.E., 2010, “Home country macroeconomic factors and outward FDI of China and India”, Journal of International Management, vol. 16 (2), pp.102-120.
Van Boeckel, T.P., Gandra, S., Ashok, A., Caudron, Q., Grenfell, B.T., Levin, S.A. & Laxminarayan, R., 2014, “Global antibiotic consumption 2000 to 2010: an analysis of national pharmaceutical sales data”, The Lancet Infectious Diseases, vol. 14 (8), pp.742-750.
Wang, L., Lu, W. & Malhotra, N.K., 2011, “Demographics, attitude, personality and credit card features correlate with credit card debt: A view from China”, Journal of economic psychology, vol. 32 (1), pp.179-193.
Zhang, Y., 2010, “Corruption In China”, Organizational Immunity To Corruption: Building Theoretical and Research Foundations, p.419.
Introduction
This report provides insights, gathered from secondary data, on the current political, legal, economic, financial and cultural environment of Vietnam. The purpose of this research is to determine the viability of launching a tourism opportunity targeted specifically at the affluent earners and families of Vietnam, to a destination within Australia. The proposed location is the Great Ocean Road, Victoria. With over 350km of one of the worlds most scenic drives, this picturesque holiday destination will provide a mixture of Australian wildlife, nature, food & wine as well as coastlines and beaches and terrain. Offering a diverse range of activities and things to do in the region, it can be tailored to each consumers needs, from family orientated to a luxurious destination for two. A self guided journey of an environment and landscape that the Vietnamese would have never experienced before.
Economic/Financial Macroeconomic Factors
DISPOSABLE INCOME AND SAVINGS
After a strong 2010, Vietnams per capita annual disposable income and per capita consumer spending took a slight fall in 2011, but still remained to present with an increase from 3.2% and 3.3% in comparison to that of 2010 of 8.3% and 8.7% respectively. While the savings ratio stood at a steady 3.5% of annual disposable income at a population level (a rate that has been unchanged since 2006), the average inflation rate presented itself at 12% per year and therefore presented consumers to invest their money in tangible assets. Conversely a projected forecast for a “gradual stabilization of the economy” (hoangle, 2013) from 2013-2020 presents per capita disposable income and consumer expenditure to increase at an average rate of 5.9% and 6.1% respectively.
(refer to chart 1)
INCOME LEVELS – BY AGE
With a population over 93 million, the majority are low-middle income earners, a ‘small segment of elite consumers, who often view luxuries as their aspirational goals which creates opportunities for marketers of luxury products and services” (hoangle, 2013), there is a segment in which affluent income earners fall within. The 40-44 age earned the highest annual gross income in Vietnam, earning VND36.6 million (US$1,786) followed closely by 45-49 age with a gross annual income of VND35.9 million (US$1,753). These affluent earners are successful managers and professionals with high positions in the business and political sectors. The 40-44 age group accounted for 24.9% of the population with an annual gross income in constant terms of “over US$150,000 in 2011, a trend that is likely to remain up into 2020” (hoangle 2013). Eventhough this segment remains small in terms of the population and majority income levels, they present themselves as an attractive market for luxury products and services and wealthy consumers are keen on exhibiting their wealth. Conversely, it can be stated that Vietnams youthful population (nearly half of population at 45.2%), while they may not be the most affluent earners, they are young professionals which are the drivers for the consumer market and can be exposed to products and services such as education, communications, leisure and travel.
SOCIAL CLASS
| Social Class | % of population | Dominant Age Group |
| A | 9.3% | 40-49 |
| B | 9% | 35-44 |
| C | 10.5% | 25-34 |
| D | 32.2% | 24-29 |
| E | 39% | 15-19 |
Social class A presents itself as an attractive market as, even though they present one of the smallest segments of the population, their dominate age group are the most affluent earners in the country, which entails them to have high levels of discretionary income. In which it is forecast that this social group is going to grow 9.4% of the population creating a growing market for luxury goods and services. Refer to table 1 and table 2. Refer to chart 3 for breakdown of social classes in age brackets.
| Social Class | Definition |
| A | Individuals in which their income represents a gross income over 200% of an average gross income of all Vietnamese ages 15+ |
| B | Individuals in which their income represents a gross income between 150-200% of an average gross income of all Vietnamese aged 15+ |
| C | Individuals in which their income represents a gross income between 100-150% of an average gross income of all Vietnamese aged 15+ |
| D | Individuals in which their income represents a gross income between 50-100% of an average gross income of all Vietnamese aged 15+ |
| E | Individuals in which their income represents a gross income less than 50% of an average gross income of all Vietnamese aged 15+ |
CONSUMER EXPENDITURE
In 2011 consumers expenditure averaged 43.5% on non discretionary items and the remaining 56.5% on discretionary items and services. Falling prices in such categories such as communications and internet has seen a spike in consumers availability the purchase these services. “The banking and financial sector has increased at twice the rate of Vietnams GDP” (Alejandro.L et al 2012) this has opened up avenues for those Vietnamese who have bank accounts to apply and borrow domestic credit.
CONSUMER EXPENDITURE – BY REGION
The red River Delta showed the greatest consumer expenditure which includes the most populated city Hanoi, the south East region was the second largest in consumer expenditure was the south East Region which is set to take over the Red River Delta as raising living costs and fluctuations in the economy are set to affect consumer expenditure. The Ho Chi Minh city presents itself as an area in which average income is several times larger than the average national income. Consumers in these areas are able to afford discretionary spending.
ECONOMIC
Some key economic figures for Vietnam in comparison to Australia. GDP, while experiencing a slight decline after 2011 has an anticipated growth from 2014-16 of 5.5%, 5.6% and 5.8% respectively (worldbank 2013). National savings has experienced an increase allowing availability of discretionary funds for expenditure, and with unemployment decreasing and as “households income continue to rise, providing workers with more disposable income” (Alejandro.L et al 2012) which in turn has “boosted demand for consumer services”. Outbound tourism has increased and is Vietnams second largest import.
| 2011 | 2012 | 2013 | World Ranking | AUS 2013 | |
| GDP | $171.4 (billion) | $1.488 (trillion) | |||
| GDP (PPP) Billion | $323.8 | $340.8 | $358.9 | 39 | $998.3 |
| GDP Real Growth Rate | 6.2% | 5.2% | 5.3% | 51 | 2.5% |
| GDP – per capita (PPP) | $3,700 | $3,800 | $4,000 | 168 | $4,300 |
| National Gross Saving | 32.8% | 39% | 38.4% | 12 | 24.4% |
| Unemployment | 3.2% | 1.3% | 6 | 5.7% | |
| Inflation Rate | 9.1% | 6.8% | 187 | ||
| Imports | $104.7 (billion) | $121.1 (billion) | 33 | ||
| Exports | $114.6 (billion) | $128.9 (billion | 34 |
Below outlines the key economic indicators that have contributed to Vietnams Economic growth. Since opening themselves to an open market economy in 1986, Vietnam has seen a considerable increase in there economic productivity.
| Key Aspect | Implications |
| Doi Moi (renovation) | · Open itself to the world and build a market based economy
· Open economy to private and foreign owned enterprises · High sustainable rates of economic growth have been achieved · Planned to develop multi-sectoral market, reform the legal, banking, fiscal and monetary systems, controlling inflation and creating environment that is attractive to foreign investment. · Proven increases in GDP since insertion. |
| Introduction of FDI (foreign direct investment) | · Increased employment
· Provided investment capital and stimulating export growth. · Annual growth rate of 28% (GSO 2007) · Significant increase in government tax revenue · Expanded the size of the private sector · Concentrated in Red River Delta and South East regions |
| WTO accession | · Direct effect – expansion in market access and foreign direct investment
· Indirect effect – competition, pressures to further reform · Continual unilateral liberalization brings substantial benefits, reducing impediments to business in the domestic market. · At aggregate level has positive impact on real economy – export, investment, growth and employment. · Concentration of economic activities in more favourable region conditions may cause significant gaps in supply/demand of labour in those regions. · Tariff rates are expected to fall for imports – imports values go up, base for calculating revenues from trade are larger. |
| Introduction into ASEAN | · Common trading policies in terms of tariffs and market access and preferential treatment for other joined countries.
· Seeks to remain globally competitive · Control the pace of integration. · Australia joined in 2009 (ASEAN-AANZTFA) · Gain wider access to markets and increase acceptability to investors · Agreed that Vietnam can comply with AFTA at a slower pace, but creates more integrated market and increased levels of foreign investment. · Demonstrates commitment to economic cooperation and opening economy to trade liberalization. · AFTA eliminate tariffs on normal tracks to 0% and tariffs placed in sensitive lists to 0-5% by 2015. |
|
Political Macroeconomic Factors
Vietnams one party communist state is made up of 175 full members and 25 alternate members that are elected at party of congress, this election is held every 5 years.
The national assemblies involvement has prioritized setting out national policies whereas the Government has assumed more of a role in administration and introducing new policies.
State President: Truong Tan SANG
Prime Minister: Nguyen Tan DUNG
The influence of the National assembly has given the Vietnamese people a clearer understanding of the national policies and legislation. The Vietnamese government will fall heavily onto any dissent within Vietnam, in particular; propagandizing against the state – this can result is harsh punishments and prison time.
Due to the national assemblies increasing influence and reviews of national policies and legislation this has created greater transparency for Vietnam and its people. There is little tolerance for dissent within Vietnam, especially for espionage, propagandizing against the state and as a result of this dissent hefty prison times can be incurred.
(Australian Government Department of Foreign affairs)
The graph highlights Vietnam’s political stability and its absence of violence over the past 16 years, what this graph shows us is how likely the Vietnamese government is to be destabilized through politically motivated violence and terrorism. A score of -2.5 is considered weak; 2.5 is considered a strong score. Vietnam sat and its lowest point in 2003 when it scored 0.10 and peaked during 2005 at 0.45.
(The Global economy: Vietnam political stability)
Furthermore, we are able to draw comparisons with Vietnam and more advance nations. We can see that Vietnam is currently off pace, it has stabilized somewhat and has continued to trend up since 2009.
There are three classifications of tariffs and non-trade barriers between Vietnam and Australia; Ordinary, Privilege tariff tax, Special privilege tariff tax.
A Most Favoured Nation (MFN) status applies to Australia with Vietnam and as a result of this the two Privilege and Special privilege tariff tax applies. The tax rates for ASEAN countries mainly fall between 0-5%. This all falls under the agreement CEPT/AFTA for 2003–2006. (Australia Trade Government Tariffs and Regulations)
Export processing zones exist in Vietnam. These zones are designed so that businesses can establish themselves in these areas and produce goods and services without having to incur custom duties and also take exemptions. All production within the EPZ must be exported. (Australia Trade Government Tariffs and Regulations)
The Civil Code came into force on January 1 2006, and then on 1 July 2006, the Law on Intellectual Property came into force. This codified the government regulations on intellectual property. The two principal laws mentioned above govern the protection of IP rights in Vietnam. They are adopted by Vietnam to conform to WTO standards on IP protection. But despite some legislative protection IPR infringements are prevalent in Vietnam, which stems from insufficiencies in the code of law, lack of understanding of private ownership and inadequate enforcement of regulations. Vietnam introduced the Tourists Refund Scheme that allows you to apply for a refund, as long as they adhere to certain conditions, of the goods and services tax (GST) and wine equalisation tax (WET) that you pay on goods you buy in Australia. Vietnam uses the civil law system. This is the most widespread legal system in the world, used in various forms in around 150 countries. Unfortunately, internet use is still monitored by the Government. In addition, differing religious views, freedom of speech in the media, and political diversity is still closely guarded by the Government. For example, Vietnam strictly enforces a provision of the penal code called Statement 258. Statement 258 is a provision used to control and punish the use of freedom of speech. As can be seen in the table provided (Transparency 2013), Vietnam is considered a highly corrupt country and need to improve greatly on their governance outcomes. An enterprise survey conducted in Vietnam by the World Bank and International Finance Corporation 2012, under the table payments are a frequent occurrence, with more than half of all companies that were surveyed explaining they are likely to make unofficial gifts or payments to public officials. Bribery is a serious crime in Vietnam and Australian individuals and companies alike are liable for these actions and can be prosecuted in Australia for bribing foreign public officials.
Legal Macroeconomic Factors
The following steps must be understood by all Vietnamese travellers as they make the journey into Australia; The three points are of the most important in regard to legal aspects for tourists entering Australia. These points will be stressed and made aware of as we promote.
Travel Visa’s
All travellers must obtain a visa or travel authority before travelling to Australia.
Vietnamese people travelling to Australia are required to apply for a Visa whilst they are outside of the country, so they are not able to travel to Australia and pick up a Visa at the airport. They must apply for a Visitor visa and selected the appropriate subcategory. Costs are involved and may vary depending on the type of visa you apply for and what type of passport you hold.
Visa and citizen applications must be lodged by appointment at one of two Australian Visa Application Centres located in Ho Chi Ming City or Hanoi. Prior to this appointment and to assist in the process, applicants are required to identify which one of the fifty-one subclass’ of visas available to Vietnamese citizens they are. Visa subclass’ are effected by variables such as, length of anticipated visit, skilled and un-skilled professionals, prospective marriage visas etc. Subclass 600 Visitor Visa, allows holders to visit Australia for leisure or business purposes for up to 3, 6 or 12 months. Charges for such a visa range from AUD130 to AUD335, with an addition AUD20 service charge for an Electronic Travel Authority (subclass 601) which allows holders to visit Australia as many times as they want within 12 months, for periods up to three months.
Applicants can obtain Visa Application forms from the Australian Visa Applications Centres, or alternatively they can download forms from The Department of Immigration and Border Protection web address. Dependent of the type of Visa being obtained additional documentation may be required; this must be made in submission of applications so as to minimize the time taken to process and approve claims.
Finally the candidate must make an appointment to lodge their application.
Visa applications can be tracked for status completion updates, however the table below outlines Australian Visa Processing Time Service Standards.
| Processing Time Service Standards For Visitor Visas | |||||
| Visa Application | Stream | Lodged in Australia | Lodged outside Australia | ||
| Low risk | High risk | Low risk | High risk | ||
| Visitor (subclass 600) | Tourist (including approved destination status) | 1 working day | 1 week`1 working day | 1 month | 1 month |
| Business visitors | n/a | n/a | 1 working day | 1 month | |
| Sponsored Family Visitors | n/a | 1.5 months | n/a | n/a | |
| Medical Treatment (subclass 602) | 1 week | 1 month | 1 week | 1.5 months | |
| eVisitor | n/a | n/a | 1 working day | 1 month | |
Customs and Quarantines
Australia’s customs laws prevent you from bringing drugs, steroids, weapons, firearms and protected wildlife into Australia. Some common items such as fresh or packaged food, fruit, eggs, meat, plants, seeds, skins and feathers are also prohibited. There is no limit on currency but you will need to declare amounts over $10,000. (http://www.vietnam.embassy.gov.au/hnoi/visiting_australia.html)
Local Laws
It is important for all people travelling to understand the laws of both the country they come from and the company they are visiting. A logical point, however one that holds great importance. It is up to them to understand the laws and regulations within Australia this includes, International Laws, Local legal systems and laws and jurisdiction.
Cultural Macroeconomic Factors
Vietnam has a very strong culture spanning back over hundreds of years. While modern technologies and concepts may have altered the way that some cultural aspects of Vietnam are carried out, there is still a strong sense of traditionalism, which has been carried through generations. The table below outlines the general cultural aspects which make up Vietnam and its people. The Vietnamese are extremely family oriented and social and is common for Vietnamese to “dine out thanks to a wide availability of food vendors and restaurants” (hoangle 2013). While there are clear differences between the way in which the social classes interact and go about every day life, a generality can be drawn from the Vietnamese social integration and interaction and commitment to their work and traditions.
| Cultural aspect | Vietnam |
| Vietnamese calendar | o Vietnamese people use both European (Western) and traditional calendar.
o Most everyday activities revolve around the Western calendar, whereas all traditional Vietnamese culture are organized accordingly with Vietnamese Culture. |
| Ethnic groups | o Vietnam is home to 54 ethnic groups, which exemplifies the country’s diversity. Each ethnic group has their own cultural traditions and lifestyle’s.
|
| Languages | o Most people in Vietnam, employed in travel, hospitality and business industries will be able to competently speak English and/or other languages, such as French and Japanese.
o However, a substantial amount of people outside these industries, will have a very limited (if any) knowledge of English. |
| Social Changes | o Some have been positive, such as a general rise in the standard of living, but others have not, such as increased corruption, social inequality, regional tensions, and HIV/AIDS epidemic.
o The Communist Party still exercises exclusives control over political life, but the question of whether Vietnam will continue its socio-economic development in a climate of peace and stability remains uncertain at the beginning of the twenty-first century. |
| Symbolism | o Ho Cho Minh is the most popular symbol in Vietnam, whom was a strong advocate of national unity and referred to all Vietnamese as “Children of one house”
o Other symbols that are readily visible in Vietnam are patterns of seabirds and other figured featured on Dong Son Drums. These drums are a representation of the nation’s antiquity. |
| National Identity | o Many Vietnamese are extremely proud of their vast array of languages and its complexities.
o Vietnamese people also have a special attachment to their “natural world”. The Vietnamese land encapsulates the notion that the Vietnamese have an organic relationship with their environment. o Another important component of national identity is the set of distinctive customs such as weddings, funerals, and ancestor worship that Vietnamese people perform. |
| Labor in Vietnam | o Vietnamese of all age’s work – as soon as they are able, young children help around the house or in the fields.
o Men perform the more masculine roles such as ploughing, construction or heavy industrial work whereas women work in garment and/or footwear sections. o The lack of tertiary education is generally not a barrier to occupying high-ranking business or political positions, this however begun to change by the late 1990’s/ o “National Occupational surveys show that only slightly more than 16% of the population is engaged in professional or commercial occupations, while just under 84% of the population is engaged in either skilled or unskilled manual labour”. |
| The role of men and women | o Vietnamese policies endorse gender equality however this being practiced in society is not always evident.
o Men dominate official positions, business and all other prestigious roles in social life. o Women play a strong role in their families, and in higher income households holds the decisions to financial spending. o The position and status of women has improved substantially over the times, however with lower literacy rates, less education, and a smaller presence in public life lead to their inferior status in society. |
| Vietnam | |
| Language (extended) | Vietnamese – Spoken by 86.7 – 90 % of Vietnamese Citizens.
– However there are 107 known other dialects spoken in Vietnam. Dialect differences serve as important symbols of regional identity in social life. |
| Dialect language | Khmer – 700,000 People
Nung – 700,000 People Tai Dam – 500,000 People Chinese – 500,000 People |
| Sybolism | – National Flag
– Ho Chi Minh – Representations of workers and soldiers |
| Minimum Wage | Region 1: 2,700,000.00
Region 2: 2,400,000.00 Region 3: 2,100,000.00 Region 4: 1,900,000.00 |
| Ethnic Relations | Vietnam is home to 54 different ethnic groups, exemplifying its diversity. |
| Religions | The Vietnamese Government recognizes six official religions:
1. Buddhism – 70% of population 2. Catholicism 3. Protestantism 4. Islam 5. Cao Dai 6. Hoa Hoa |
| Populations | 93,421,835 (July 2014) |
The page overleaf is a summary of Hoefstede’s cultural dimensions in which a comparison between Australia and Vietnam was taken out. There were clear differences in the scores that showed that there was a great deal of cultural diversity and life between the two countries and what people from each country expect in their society. Where Australia is very laid back, individualistic country with strong integration between the power levels that Basque in indulgence, Vietnam portrays itself as a collectivist society, with strong rules and regulations in which people work in order to get buy and only the wealthy have the ability, and the power to show off their success.
The graph clearly indicates the distance between the two countries on each cultural aspect, thus how marketers are able to communicate to the different cultures. Without an understanding how society interact and communicate the wrong message could be portrayed. Refer to table
| Cultural Dimension | Australia | Vietnam |
| Power Distance | – Australia scores low on this dimension (36).
– Within Australian organizations, hierarchy is established for convenience, superiors are always accessible and managers rely on individual employees and teams for their expertise. – Both managers and employees expect to be consulted and information is shared frequently. At the same time, communication is informal, direct and participative.
|
– Vietnam scores high on this dimension with a score of 70.
– This means that people accept a hierarchical order in which everybody has a place and which need no further justification. – Challenges to the lead
|
| Individualism | – Australia with a score of 90 on this dimension, is a highly individualistic culture.
– Australia is a loosely-knit society in which the expectation is that people look after themselves and their immediate families.
|
– Vietnam, with a score of 20 is a collectivistic society.
– This is manifest in the close long-term commitment to the ‘member’ group, be that a family, extended family or extended relationships. – Loyalty in a collectivist culture is paramount and overrides most other societal rules and regulations. – This indicates that the Vietnamese society fosters strong relationships, where everyone takes responsibility for fellow members of their group. |
| Masculinity | – Australia scores 61 on this dimension and is considered a “masculine” society.
– Australians are proud of their successes and achievements in life, and it offers a basis for hiring and promotion decisions in the workplace. Conflicts are resolved at the individual level and the goal is to win.
|
– Vietnam scores 40 on this dimension and is therefore considered to be a feminine society.
– In this type of society, the focus is on “working in order to live”. – Incentives such as free time and flexibility are favoured. – Status is typically not shown.
|
| Uncertainty Avoidance | – Australia scores a very intermediate 51 on this dimension.
|
– Vietnam scores 30 on this dimension and this has a low preference for avoiding uncertainty.
– Vietnamese people thus believe there should be no more rules than are necessary and if they are ambiguous or do not work they should be abandoned or changed. |
| Pragmatism | – Australia scores 21 on this dimension and therefore has a normative culture.
– People in such societies have a strong concern with establishing the absolute Truth; they are normative in their thinking.
|
– Vietnam scores 57, making it a pragmatic culture.
– In societies with this type of orientation, people believe that the truth depends very much on situation, context and time. – They show an ability to adapt traditions easily to changed conditions, a strong propensity to save and invest. |
| Indulgence | – With a high score of 71, Australia is an indulgent country.
– People in societies classified by a high score in indulgence generally exhibit a willingness to realise their impulses and desires with regard to enjoying life and having fun. – Australians place a high degree of importance on leisure time, act as they please and spend money as they wish. |
– A low score of 35 on this dimension indicates that the culture of Vietnam is characterised as restrained.
– Also, in contrast to indulgent societies (such as Australia), restrained societies do not put much emphasis on leisure time and control the gratification of their desires. – People with this orientation have the perception that their actions are restrained by social norms and feel that indulging themselves is somewhat wrong.
|
Conclusion
With the current information and research it can be established that the viability of launching a tourism destination to the Vietnamese consumer is strong. With an economy that is expanding at a rapid rate and an increase in consumer discretionary income in the higher echelons of Vietnamese society, these affluent earners are willing to show off their income and are interested in travelling. Launching a tourism destination along the Great Ocean Road with luxurious aspects will attract these consumers as their interest in luxurious items is paramount. With increasing English fluency, greater internet access and growing comfort with independent travel, Vietnamese consumers present themselves as viable consumer for Australian tourism.
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