Thai Tuan Textile Company, Vietnam - Marketing Strategies

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Lecturer : Prof. Dr. BENOÎT HEILBRUNN

Group members:

HUYNH THÊ THUY LE THANH

NGUYÊN THI THUÝ HANG

NGUYÊN THI THU HÀ

VÕ MANH THANG

ÐINH NGOC HUY

CHU DUY HUNG

HÔ THI HOÀI

. OVERVIEW

* The Thai Tuan Story

Thai Tuan Textile and Garment Corporation was founded in early 1993. At the moment, it is one of the leading Vietnamese textile product and fashion services supplying enterprises, that specializes in manufacturing and trading varieties of polyester fashion fabric such as Jacquard fabric, Sateen fabric, Chiffon fabric, Stretch fabric,...mainly for ladies. Its products now are consumed widely in domestic market and export to different states over the world. From the 1990s, when many other domestic enterprises attached special importance to exporting their products to foreign markets, Thai Tuan has decided to choose the essential strategy to develop domestic market and built step by step plan to penetrate into the international market. Through introducing products at "Vietnam's highest quality products" fair that was organized in different cities, Thai Tuan brings its products over consumers. Thai Tuan has won the prize "Vietnam's highest quality product" from 1998 until now in succession and the prize "Gold star of Vietnam" in 2007.

From the idea to manufacture fabric for the traditional custom - "Ao dai" at the beginning, Thai Tuan has developed many lines of products such as Thatexco, Lencii, Happiness, Rosshi...that specialize in different kinds of dresses for women: Ao dai, nightgown, dress for schoolgirls, wedding dress, office's fashion . Thai Tuan now also provides men's fashion with "Menni's" trademark.

Thai Tuan has got 3 big plants in Ho Chi Minh city and applying international management systems like ISO 9001:2000, ISO 14000, SA 8000, 5S. Total production capacity is 10 million meters of fabrics per a year. Growing rate is 15% per a year. Income in 2006 was 25 million USD of which 50% came from domestic market.

Thai Tuan established distribution system all over 64 provinces in Vietnam with 3 branches, 7 showrooms, 300 agents and 3,500 distributors. Thai Tuan 's products and brand are developing not only in national but also in worldwide markets which are attending in 10 countries in Asian, Middle East area, Australia and the United States.

In the condition of competitiveness nowadays, especially when Vietnam joined the World Trade Organisation, Thai Tuan is keeping its foothold in the markets.

With this report, we would like to present the marketing strategy of Thai Tuan to explain how Thai Tuan is situated in today's market.

2. MARKET SEGMENTATION, TARGETING & POSITIONING

Market Segmentation and Targeting

Today, if you ask Vietnamese ladies "Which fabric product you will buy for your Ao dai (Vietnamese traditional dresses) ? ", the most common responses are "Thai Tuan". Or, if you ask "which brand of fabric you will offer with premium/ high quality at reasonable price?", it's also "Thai Tuan", etc...

Vietnam united from the two parts to one nation in 1975 and came into the period of re-development under closed economy until 1986. People living standard was rather low so their basic needs like foods, clothes and accommodation are very simple. Obviously, most of people philosophy was "An chac mac ben", meant that I cared my foods in quantity rather than quality, I bought my clothes if they could be used in long time rather than fashionable.

A decade later, people income was remarkably increased plus a wide integration with the world. Vietnamese had step change in mind of their dress. Especially, youths who were born in the years of "happy baby" after war and emerging medium class in the urban area. They needed higher fabric quality, more fashionable dresses and recognition. Who satisfied these needs at that time? While most of domestic & state-own textile companies focused for export activities, and private sector was limited in capital to invest or few investors were confident in domestic textile and garment market, traders imported high quality fabric from Europe, India, Korea... to capture the needs. However, the problem was imported fabric price was too high that limited consumer affordability. Thai Tuan was founded.

The company imported technology from Japan to produce and supply premium and high quality fabrics with acceptable price. Thai Tuan built a very successful cooperate brand which totally differentiate to others by segmenting to right targeted consumers in the middle class, teenagers and women. It can be explained by key variables:

Firstly, it's about psychological approach. Thai Tuan is ahead of other competitors in high quality - reasonable price products targeted to medium income up. Thai Tuan does not participate in market at low quality - low price imported from China or so high quality - high price from EU, India... where competition is tough to a young domestic company like Thai Tuan.

Not only Thai Tuan maintains its position in middle class market but also the increasing income trend gradually switches consumer in the traditional market of low quality - low price imported from China to Thai Tuan segmentation. Besides, a part of high class accepted Thai Tuan quality as they had to pay more if buying products with same quality imported from EU, Indian... Thai Tuan is more attractive as it's said as "A High Quality Product of Vietnam" promoted by government campaign to encourage domestic brand in integrated period.

Secondly, it's about demographic approach. The textile and garment market is so huge, Thai Tuan mostly targeted to pupils from 15 to 18 and women from 22 to 45 years old. Why? It's simple that Vietnamese is promoting Ao Dai as symbol of Vietnamese lady to the world. It's obviously that every woman from 22 to 45 years old wears Ao Dai in a lot of occasions (company uniforms, at wedding party, at any festival, conference...) and that each of women usually owns 2 to 3 Ao Dai .

A hundred percent of schoolgirl from 15 to 18 years old wears Ao Dai at school as official uniform. Thai Tuan develops the commercial collection for this segment which is so called Lencii. Together, Menni's is a school boy uniform collection.

And because there have been not many domestic brands in textile and garment industry, while foreign brands' clothes are very expensive, Thai Tuan brand provides a wide range of clothes for woman from wedding clothes, evening dress, working clothes to indoor clothes.

A picture taken from Lencii collection.

Minh Hang, a famous teenager singer wearing Ao Dai to promote Thai Tuan dress.

Thirdly, it's about geography approach. Unlike other domestic companies in 1990s which were in "export race ", Thai Tuan found and successfully seized the market potentiality in Vietnam. After building a strong brand in Vietnam, Thai Tuan gradually starts to export to abroad.

Product Positioning

Thai Tuan sticks its brand image with Aodai- the traditional custom of Vietnamese women- a symbol of Vietnam's culture. The basic element of Aodai, and also of Thai Tuan products is creating elegance for ladies.

More over, with slogan "Weaving your dream", Thai Tuan is realising step by step a dream of most of Vietnamese enterprises: affirm Vietnam's brands in world trade market.

3. BRAND STRATEGY

Indeed, for the domestic garment industry, Thai Tuan is neither the "strong" player nor "beautiful" one in term of brand. However, considering the effort leads to its recent achievements, Thai Tuan is undoubtedly one of remarkable brands in term of brand strategy in Vietnam.

Firstly, let us consider the market out look at the time Thai Tuan joined in the market in 1993. At the moment, the decision to develop a domestic garment brand is really a brave and risky one when imported product was deeply flooding the market, especially ones from China. That main reason explains why the majority of garment companies rushed to produce for export only. And as a natural reflection from the customers, they somehow recognized that the national garment industry, and domestic industries in general, were facing survival problem losing their competitiveness and they themselves had to protect domestic products for the love for their country and for their own shake. As a result, there was a new wave raised in Vietnam: "Vietnamese people use Vietnamese products". Thai Tuan did get the point from soon and was one of the pioneers leading the activities in that wave to achieve their first "Vietnam's Highest Quality Product" title (voted by mass consumers).
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The decision of printing its brand name on the edge of the fabric made Thai Tuan one of few companies which started to be aware of the importance of brand development. That fact contributes a lot to emphasize the brand in customers' mind. It was not only matter of competitiveness but also being that Thai Tuan aimed to provide products with reasonable quality at reasonable prices, especially produced in Vietnam, so that the customers would choose among the messed up market at the time. Trustworthy Vietnamese products were what Thai Tuan started to build in their potential customers' ...

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