The market is seething with the pieces of news about the possible disappearance of many Vietnamese famous brands. Highlands Coffee bought 100 percent of Pho 24 stakes and then sold 50 percent of the stakes to Jollibee, raising the worry that the Vietnamese brand would fall into the hands of foreigners.
Prior to that, the public was stirred up with other breaking news: Lotte has acquired 38 percent of Bibica’s stakes, Orchid Fund, the fund of New Zealand’s billionaire Richard Chandler, holds 10 percent of FPT’s stakes and has nominated its representative to the company’s board of directors.
While a lot of Vietnamese brands have been swallowed by foreigners, other brands have fallen into big difficulties because of the continued losses such as Bach Tuyen Cotton or Tribico.
Taking full advantages of the prolonged decay of the Vietnamese stock market, a lot of foreigners have been quietly collecting shares of Vietnamese companies at low prices to become the new owners of the companies. The current regulation that foreign ownership ratio must not be higher than 49 percent of stakes in a Vietnamese company proves to be the only barrier that has prevented the foreigners from gulping down the famous Vietnamese brands.
How Vietnamese businessmen build their brands?
Vietnamese businessmen have been aware of the importance of building up strong brands for a long time. Sao Vang rubber products, Co Ba soap, Da Lan toothpaste or Kymdan cushion were once well known among Vietnamese consumers as the high-quality products.
However, it seems that modern Vietnamese businessmen follow another way to build up their brands. They believe that they just need to spend much money on advertisement campaigns, and set up a logo on their products to be able to sell the products at the prices twice or triple higher than the prices of other unknown products.
A lot of Vietnamese brands appeared in the electronics industry, such as CMS, Elead, Robo, Mekong Xanh (computer), and Q-Mobile, Avio, F-Mobile (mobile phones). However, the products that bear Vietnamese brands, in fact, are manufactured by foreign groups, not Vietnamese.
Experts have pointed out that almost the parts and accessories needed for the products are the imports, from screws to logos.
The Vietnamese brands, when they were first introduced on the market, once caught the special attention from consumers thanks to their low prices.
Nevertheless, no further progress has been made so far, and the brands have fallen into oblivion. Some enterprises, which once possessed the well known brands, had to undergo the restructuring to survive, while other brands, especially mobile phone brands, have left the market quietly.
A brand cannot be well known or strong with just a beautiful and eye catching logo, or noisy advertisement campaigns. However, the brand can only win the hearts when it has high quality and competitive price. The brands, which succeed on consumer goods market, all have the prices lower than the products of their rivals.
Though Steve Jobs’ was eloquent, he would not have been able to sell iPhones and iPads if the products had not been cheaper than the products of his rivals and had higher quality.
The quality of a product should be assessed by a lot of factors, including the design, delivery time, stability, post-sale service quality, technical support…
Apple’s rivals cannot make the things which have high quality like iPhone or iPad at such prices. Therefore, they have to earn money from niche markets. The similar thing is happening with other global successful brands, from Microsoft, Facebook, Google, Samsung to BMW, GM, Toyota, Airbus and Boeing.
Part 2: Do Vietnamese people really need Vietnamese brands?