Zorok beer report

1. INTRODUCTION
SABMiller Manufactory in My Phuoc 2 Industrial Zone,
Binh Duong Province.
(Source: http://vietbao.vn/Kinh-te/5-ly-do-de-uong-
bia/55157659/88/)
The Company was founded in South Africa in 1895 as
South African Breweries (SAB). SABMiller Plc is one of the
world’s largest brewers, representing six of the world’s top fifty beer brands and distributing
agreements across six continents (SABMiller Plc 2010).
SABMiller Vietnam JV Co. Ltd has been established on 30 June 2006 as a division
of SABMiller Plc in Asia with 2% contribution in the global market (see appendix A). It is
a joint venture between SABMiller and Vinamilk. The total investment capital is 45
million USD with the capacity of 100 milion liters per year.
Zorok beer is a main product of SABMiller Vietnam and it was launched in 2007.
Its purpose is “It’s refreshing, easy to drink, and it’s very hot” (SABMiller Plc 2010). By
advertising frequently and widely on Television, Newspaper, and Internet, as a result, it
has become an appearance beer of any restaurants and parties in Vietnam.
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2. Furthermore, SABMiller Vietnam is a new brand name in the Vietnam beverage
industry, therefore the company has a signed joint venture with Vinamilk which an extensive
distribution network in Vietnam. SABMiller Vietnam objective is that ‘developing and
expanding interests further in the growing and attractive Vietnamese beer market’ and
‘increasing flexibility to implement various business initiatives in Vietnam and the company
will complement our existing beer businesses in the broader Asian region’ (‘VIETNAM:
SABMiller takes control of SABMiller Vietnam JV’, 2009). According to ‘Vietnam beverage
market lures investors’ (2010) that “the alcoholic drink sales in Vietnam will increase by 50, 6%
from now to 2013 with the revenue expected to increase by 16% a year”. Therefore, that is a
good opportunity for SABMiller Vietnam gain more than 5% of the market share with new
technology and production lines.
3. SITUATION ANALYSIS
3.1 The Macro Environment
Demographic, economic, natural, and technological are the most impact to the
Zorok beer because the successive of the product in the market are depends on the
consumers, quality, price, and environment issues.
3.1.1 Demographic Environment
According to ‘Vietnam population hit 85.5 million’ (2009), Vietnam population
had reached to 85.5 million people in 2009 and the average of people drinks beer around
12 liters per year. Furthermore, Vietnam is the fastest growing beers market in the world
such “growth from 1.3 billion litres in 2003 to 1.5bnl in 2005” (SABMiller signs
Vietnam beer venture 2006). Therefore, Vietnam is a potential beverage market to
consume. Zorok has created a perfect beer for both genders and also called “lady beer”.
The main market of Zorok beer in Vietnam are Ho Chi Minh City and Ha Noi capital
because its contents a larger number of consumers.
3.1.2 Economic Environment
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3. In 2008, Vietnam has jointed into WTO and it was a good opportunities for a
growing economy. For example, the level income and living condition of the Vietnamese
has increased in 2009. According to Vietnam GDP - per capita (PPP) (2010) that GDP
per capital of Vietnam was raised to $2900 in 2009 compare with $2700 in 2007.
Therefore, Vietnamese people in rural and urban areas are spent their money to consume
Zorok beer with suitable price.
Furthermore, the inflation rate in Vietnam has reached to 22% in 2008 (General
Statistics Office 2008). Therefore, it has negative impacts to Zorok Beer as the weak
consumption and the increased raw material price.
Figure 1: Levels of Vietnamese Income (Sources: ACNielsen Omnibus 2007)
3.1.3 Natural Environment
In September 2008, Vedan was caught discharging untreated waste water into the
Thi Vai River. As a result, Vedan has paid more than 119 billion VND compensation to
famers in Dong Nai by its pollution (Vietnam News 2010). Vietnam government has
passed strong laws to protect the environment. Therefore, SABMiller Vietnam has
introduced production plans to protect the environment such as ‘making more beer with
less water’, ‘reducing our energy and carbon footprint’, and ‘packaging reuse and
recycling’ (SABMiller plc Annual Report 2009). As a result, the company has reduced
the cost of raw material and improved the material efficient.
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4. 3.1.4 Technological Environment
SABMiller Vietnam has invested to build the most modern brewery in Vietnam
with new technology and production lines from Germany. The total capacity is 100mil.
ht per year.
Zorok is a remarkable combination between malted barley, wheat and hops that
make consumers feel harmonious with nature. There are two types of Zorok can in the
market which are 330mml and 500mml in volume. They are finely and handy designed
with international standards.
3.2 MICRO ENVIRONMENT
Suppliers, market intermediaries, and competitors are four main internal factors
that affect to the process of Zorok beer.
3.2.1 Suppliers
According to the SABMiller Plc annual report 2009 that there are many local
and international companies that supply the raw materials for SABMiller Vietnam such as
Vinamilk (production lines and distribution channels), SABMiller Africa ( raw material as
malted barley and yeast) , and Coca-Cola (glass bottles and cans).
(Sources: http:// www.google.com.vn/images )
3.2.2 Market Intermediaries
Coop mart, Big C, LotteMart, and Metro are the big resellers of Zorok beer.
Resellers have a large amount of products and it is available for selling to the customer
needs. Furthermore, according to Skehan (2008) big supermarkets are the best place to
attract customers buying because it contents many items, suitable price, and many
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5. promotions. Therefore, Zorok beer offered in their places that help the company sell,
distributed its products to the customers.
3.2.3 Competitors
Vietnam beverage market contents of a number company beers such as
SABECO, Asian Pacific breweries, Carlsberg, and Heineken. Their company has
produced beer with the similar price, quality, and characteristic to compete with Zorok
beer.
Direct Competitors: the main competitor of Zorok beer is Sai Gon Beer or
SABECO. According to ‘beer market to increase 15% …’ (2010) SABECO has owned
around 35% of domestic market share. Sai Gon beer is a traditional beer in the South of
Vietnam and it is very popular in Ho Chi Minh City because of the lower price
8000VND and easy to drink. However, Zorok is a new brand in beverage market while
Sai Gon beer has introduced for a long time. Therefore, SABECO is a main competitor
of Zorok beer.
Indirect competitors: Zorok beer is a specific beer for “lady” with the premium
quality. Furthermore, there are many beverage companies that are introduced their
products which substitutes with Zorok beer such as Vina Vodka, Hanoi Vodka and rice
alcohol (Binh Tay Liquor JSC).
(Source: http://www.google.com.vn/imgres )
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6. 5. PRODUCT OBJECTIVES
5.1 MARKETING OBJECTIVE
 Building and maintaining good relationships with current and potential customers.
 Expanding the market share.
 Developing awareness of Zorok brand.
 Increasing productivity and gains more than 5% of domestic market beer and specially
achieves 10% market share of beverage in Ho Chi Minh City.
5.2 FINANCIAL OBJECTIVE
 Developing and expanding interests further in the growing and attractive Vietnamese beer
market
 Increase flexibility to implement various business initiatives in Vietnam and the company
will complement our existing beer businesses in the broader Asian region.
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7. 6. SEGMENTATION, TARGETING AND POSITIONING
6.1 MARKET SEGMENTATION
6.1.1 Geographic Segmentation
Figure 1. Reproduced from: Britannica Online
Encyclopaedia 2009 (Source:
http://www.britannica.com/bps/image/628349/137731/Po
pulation-density-of-Vietnam).
According to the chart in the left, the Red
River Delta, and the Mekong River Delta
are two regions that have the two highest
population densities than others’.
It is estimated that the total population of
the above regions are approximately 36.8
millions of people, accounting for
approximately 42.8 % of the total
Vietnam’s population (approximately 85.8
millions of people) in the year 2009
(General Statistics Office of Vietnam
(GSO) 2009).
Therefore, obviously, SABMiller will
target these areas – the most approachable
and profitable markets in Vietnam; with the
highest available and potential consumer
densities, to distribute and sell the Zorok
products.
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8. 6.1.3 Behavioral Segmentation
Occasions
Figure 4. Reproduced from: Photobucket n.d. (Source:
http://media.photobucket.com/image/cung%20ly
%20Zorok/Bi_Do/DSC04678.jpg).
Intrinsically, Zorok products suit all
occasions: birthday parties, wedding
parties, family meetings, business
meetings, carousal, etc.
Additionally, except for the ordinary roles
like other beers’, Zorok products are also
considered as healthful drinks, so that
people can consume them in many times
per day (e.g. after meals, before sleeping or
after waking up).
User Status and Usage Rate At the start of the Zorok products’
approach to the market, SABMiller aims to
target customers who are usually drink
beers – regular and heavy users (e.g.
carousers, businessmen), but after an
enough time of surviving in the market,
SABMiller are going to target customers
who are not often drink beers – potential
and light users (e.g. single women,
housewives).
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9. Figure 5. Reproduced from: Opera n.d.
(Source: http://my.opera.com/hc05dk/blog/Zorok-moi-tuyen-
model-moi-canh-tranh-voi-mr#comments).
6.2 MARKET TARGETING
6.2.1 Undifferentiated Marketing (Mass Marketing)
Due to the Zorok products’ high adaptability to every age, pocket, career, etc, SABMiller aims to
popularize Zorok products to the highest extent, by applying mass distribution and mass
advertising.
In the aspect of mass distribution, SABMiller aims to cooperate with as many powerful and famous
wholesalers and retailers as possible (e.g. Big C, CoopMart, LotteMart, Maximark and Metro),
as well as many restaurants and nightclubs as possible. Additionally, bulk buyers can order
Zorok products online.
In the aspect of mass advertising, SABMiller aims to cooperate with as many powerful and famous
mass media channels as possible (e.g. Tuoi Tre Newspaper, Thanh Nien Newspaper, VTV3,
Facebook and Google).
6.3 MARKET POSITIONING
6.3.1. Differentiation Strategy
People and Image Differentiation
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10. SABMiller aims to hire successful people
who are well-known by Vietnamese people
to burnish the Zorok products’ images (e.g.
in this case, national Vietnamese soccer
team coach – Calisto can create Zorok
products’ images as ‘the true beers for the
true lovers of soccer in particular and of
sports in general’).
Figure 6. Reproduced
from: Photobucket n.d.
Figure 7. Reproduced
from: 24h.com.vn n.d.
(Source:
http://i435.photobucket.com/
albums/qq78/vhzz10/Calisto
500ml.jpg).
(Source:
http://hn.24h.com.vn/the-
thao/hlv-calisto-binh-
luan-truoc-cac-tran-dau-
giai-vo-dich-bong-da-
the-gioi-tren-htv-
c101a302020.html).
6.3.2. Positioning Map
High Price High Price
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11. Low Quality
Heineken
Tiger High Quality
Low Quality
Ha Noi Sai Gon
Zorok
High Quality
Low Price Low Price MORE FOR LESS
6.3.3. Positioning Strategy
More for More
for the
MORE FOR LESS
SABMiller aims to offer global quality beers (Zorok
products) at a local price (Raymond Stark, Chief
11

12. More Same Executive Officer of SABMiller Vietnam, cited in
Minh Thien & Hai Au 2010), in order to occupy a
remarkable market share in the Mainstream or
“increasing premium-ness” beer segment.
The Same For Less
Less for Much Less
7. MARKETING MIX STARTEGIES
7.1 PRODUCT STRATEGY
LEVELS DETAILS OF PRODUCT
Core product: Zorok beer is not only good for relaxation, socializing activities
but also good for health.
Actual product: Brand name:
Zorok is a product of a joint-venture between SABMiller and
Vinamilk companies. Vinamilk is one of the most prestige
companies in Vietnam. SABMiller is one of the world’s largest
brewers with 110 years of experience in the beverage business.
The enterprise represents the world’s six top fifty beer brands and
owns more than 200 brand names, and now presents at 60 nations
around the world.
Quality level:
A 100% fresh beer.
Zorok’s message: “a combination of 2 malt and water” (“Vietnam
Beer Consumption Behavior” 2009) emphasizes that the products
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13. (Source: http://www.vtc.vn/thethao/200-
211434/the-thao/phu-thuy-calisto-quang-
cao-bia.htm)
was made from the finest ingredients, with the modernist
technology and from one of the world’s most famous breweries;
therefore, Zorok offers to customers a rich, yet very fine flavor.
Packaging: 3 types of packages:
Zorok can -330ml; Price: 9,400 VND
Zorok can-500ml; Price: 9,999 VND
Zorok bottle-330ml; Price: 6,500 VND
Design:
Professional and attractive design with green and yellow as main
theme colors and in high peak sport seasons, and Calisto, the
famous soccer coach was chosen to be a ambassador brand of
Zorok Beer’s and he is also pictured on the front of the cans.
Features:
Zorok is reformulated to reduce the bitterness flavor. Therefore, it
is suitable for consumers, especially women, who cannot bear the
bitterness flavor in normal beer.
It is good for consumer’s health since the levels of calories and
alcohols in the original formula have been lessened.
Augmented product: Warranty:
The expiry dates of Zorok are always engraved on the bottom of
the can or bottles.
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14. PRODUCT DIFFERENTIATION AND BRAND POSITIONING
_ Vinamilk and SABMiller are trying to make a product differentiation by providing Zorok- a low level of
alcohol and less bitterness flavor beer compare to other brands. This creates a strongest position of Beliefs and
Values for customers who love to drink beers but also are very much concern for consequences of consuming a
lot of them. Therefore, Vinamilk and SABMiller focus on this point and try to deliver a better quality with low
level of alcohol and newer flavor beer with more promises to customers’ health.
PRODUCT LIFE – CYCLE
Zorok has passed the Development and Introduction states and is now in the Growth State.
The company is trying to increase the sale and profit in order to reach the Maturity in a near
future.
(Source: http://www.sabertek.co.za/engmaintenance.html)
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15. 7.2 PRICING STRATEGY
• Competitor based and value based pricing strategies
With the value propositioning strategy of more for less (Kotler et al. 2004), the
company offers more benefits for customers with lower prices. For example, a 333
beer in can with 330ml median price is 7,800VND but with the same package Zorok
costs only 7,500VND; moreover, a can of Zorok in 500ml only cost 10,900VND.
Moreover, although with the same amount of beer, customers do not have to worry
about their health since Zorok has low level of alcohol. Likewise, ladies will have no
worries for their beautiful skins being destructed by acnes when consuming the
product. With this strategies, the companies is still in advantage regardless the prices
of others changes.
• Discount and allowances pricing and distribution strategy
At common restaurants, customers can have one can of Zorok for free after buying a
pack of four cans of Zorok. Moreover, in Sport high peak seasons, customers can have
a price discount of 10-20% for buying the product. The retailers can display the Zorok
and its postures in front of their stores and they can get quantity discount or cash for
every month.
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16. .3 PLACE
As other customer product manufacturers, SABMiller Vietnam choses Metro, Big C,
Lottemart, Citimart and Co-op Mart to become its main channel members. In addition, Zorok
manufacturer also focused on medium and small retailers in Ho Chi Minh.Zorok has appeared in
central districts in Ho Chi Minh City and in some suburbs such as Hoc Mon, Binh Chanh and
Nha Be. The company wants to increase both volume of sales and the number of retailers.
Moreover, the company also uses discount and allowance strategies to encourage the channel
members.
Channel: SABMiller (manufacturer) Wholesalers  Retailers Consumers
• Wholesalers: Metro and Ben Thanh market.
• Retailers (organization): Coop-mart, Big C, Maxi-mark, Citi-mart. These are well-
known brands in Vietnam in retailing.
• Retailers (private): We have reached to 1000 small retailers including restaurants, food
shops in Ho Chi Minh City.
7.4 PROMOTION
SABMiller Vietnam has not really been successful in building its image in Vietnam, especially in
Ho Chi Minh. The company made a wrong step and this leads to decrease in sales and negative effect
in PR.
 Advertising:
The target market of Zorok beer is men, the original
target market of almost beer companies in the world. In
addition, another same favorite thing of men is football.
Therefore, the best choice for SABMiller is Henrique
 TV advertising:
Because of the daily needs of this kind of
advertising, SABMiller chose national
TV channels such as VTV1 and VTV3 in
the golden period from 6 to 9 pm. This is
the period before the evening movies and
in the break time. Although this period is
really expensive, it is easier and more
efficient to attract more customers.
16

17. Calisto, the coach of Vietnam national football team. He
led the Vietnam national football team to the
championship in AFF Cup in 2008.
(Source:
http://dantri.vcmedia.vn/Uploaded/2010/06/07/CATP.jpg
)
 Radio:
SABMiller choses VOH (Voice of Ho
Chi Minh city People) for Zorok. This
channel is one of the main radio channels
in Ho Chi Minh and SABMiller chose
the time period in General Music and
Advertising during 11h45 – 12h00 and
17h45 – 18h00 to advertise for Zorok.
 Newspaper and magazine:
In this communication means, Zorok
manufacturer chose ThanhNien, one of
the most popular newspapers in Vietnam.
In magazine, we choose Dan Ong
magazine, the special magazine for men
in Vietnam.
 Personal selling:
SABMiller applied this strategy in Vietnam. Many beer companies such as SaiGon Beer, Heineken,
and Tiger Beer have used this strategy. They use salesperson to advertise for their products in food
shops and restaurants. This is effective for customers know and evaluate the product.
 Sales promotion:
• Premium: Zorok has the discount 100% for four cans with 500 ml if customers buy a
whole 500ml package.
17

18. (Source: http://dantri.vcmedia.vn/Uploaded/2010/06/07/THUNG%2028X330ML%20ok.jpg)
• Sample: Zorok puts beer sample into the public for its advertising show in Maxi-mart
in 2007.
• Price Pack: Zorok also discounts for the customer if they buy a package with 24
330ml cans inside with only 165,000 VND instead of 7,500 VND per single can.
(Source:
http://www.vatgia.com/pictures_medium/small_zkn1261787354.jpg)
• Advertising specialties: Zorok can give for the customers, who buy a large number of
units, some gifts such as lighters, raincoats, caps and helmets with Zorok logo on
them.
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19. 19

20. 9. CONTROLS
The marketing plan will be implemented from January 2010 to January 2011. Because of
the huge cost in run on this strategy, SBA Miller needs to review and evaluate the process
carefully. Below there are some Key Performance Indicators:
 Actual sales: the company will observe the process of selling product and analyze the
sale revenue after each three month. If the sale revenue does not reach to expected value,
we need to review in various departments such as promotion, distribution channels, etc
to find out and fix the current problem. If the company achieves the goal, we will
develop the strategy to get more profit.
 Internal factors: we try to reduce the weakness of Zorok which is new beer product in
the market by using the ‘word of mouth’ and strengthen our advantages such as
professional design and no bitterness.
 External factors: estimate the customer needs and research the competitor strategy.
 Budgets: the spending amount for each department need to be considered and reported
quarterly.
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