Vietnamese advertising companies needed to be more professional with an improved attitude to customer services so they could compete with international firms

Viet Nam's advertising industry is losing out in the domestic market due to the presence of these international giants.

While foreign companies usually draw up advertising strategies for

customers and earn 10-15 per cent of contract value, domestic

companies play the roles of outsourcers or advertising service

providers.

Moreover, when an international advertising company enters the

Vietnamese market, it usually brings heavyweight clients with it who

already operate here.

while foreign companies were successful because of their strategic

thinking, domestic firms just thought about " following the right

direction", or in other words, they worked for bigger companies.

Dung said that domestic advertising companies were unaware of

the need to improve and create their own value to make clients

come to them.

In future, advertisers needed to put the task of gaining consumers'

trust in front of everything else, including market share.

He added that until now, most companies just concentrated on

satisfying clients' requirements, and instead of working together,

domestic advertisers competed closely with each other.

The competition has become tougher over the last few years after

the economic crisis forced many enterprises to cut advertising

budgets.

According to the Viet Nam Advertising Association, domestic

advertising revenue had increased on an average of 40 per cent

each year, but growth was becoming slower and slower.

Last year, the revenue reached nearly US$1 billion, just one sixth or

one seventh compared to neighbouring countries like Indonesia and

Thailand.

President of the association Dinh Quang Ngu said that

communication forms were constantly changing and modernising

with integrated advanced technologies.

Vice chairman of the Viet Nam IB Communications Group Phan Le

Khoi said that advertising should be part of an enterprise's

marketing strategy, and in tough economic times, they should find

alternative, cheaper means without losing effectiveness, such as

social networks or TVC [Televicentro] Online. — VNS

The internet, mobile, social media gaming and a new wave of consumers are changing the foundations of businesses. In Vietnam, digital advertising is forecast to double in the next three years. The Saigon Times Daily reports. 

Experts believe the trend of using digital advertising including online and mobile advertising will pick up in the near future. 

However, he noted that it was not easy to make advertising on social networks and digital advertising effective, adding most local enterprises have made inconsiderable investments in digital advertising, which accounts for less than 5 percent of the total budget for marketing. 

Vietnam is believed to be the lucrative market for the ad industry, where the world’s six leading ad groups have been present, including WPP, Ominicom, Dentsu, Publicis, Internpublic and Havas.

Foreign ad firms are the guests in Vietnam, but hosting the ad market thanks to their great advantages including the technology, experiences and financial capability. Especially, they have big clients, the multi-national groups which are willing to allocate big budgets for advertisement campaigns.

However, while the majority of Vietnamese ad firms are trying to glean like silver coins by working as “sub-contractors” for foreigners, some others try to get bigger pieces of the ad cake by providing comprehensive integrated ad solutions, which remain inaccessible even by some foreign groups in Vietnam.

In general, international ad agents have very high creativity in implementing services, which is obviously superior to Vietnamese, who lack knowledge and experience.

However, the limited knowledge about local culture, labor force and language barriers of foreign agents all make it impossible to develop the ideas suitable to Vietnamese consumers.

Vietnam can also be dominant in some other sectors such as PR, Digital Marketing, and Local Integrated Marketing.

80% market share is in the hands of more than 20 advertising companies

abroad. Statistics Advertising Association, which launched this morning in

the person not surprised that begs the question: How do to remove

difficulties and to help domestic enterprises 1000 stayed in their home

market. 

According to experts, advertising industry formed from Vietnam 10 years,

when the U.S. began to abolish sanctions. Meanwhile, the advertising

companies with foreign corporations to produce goods as large as

Unilever, CocaCola, Pepsi, and blowing a stream of air into this young

industry. Companies advertising Vietnam then only processing the

programs as planned production and television broadcast. Gradually,

through learning experiences from colleagues abroad, and advertising

companies in the country grew and began to receive the contract package

(full service). From the seat only a few dozen business, now has over

1,000 companies in Vietnam market participants.

"The advertising companies, Vietnam is rapidly accumulating experience

of foreign colleagues and apply the concept of advertising on the Vietnam

market," Vice President European Chamber of Commerce in Vietnam

(Eurocham ) Christian De Ruty get to. According to him, the biggest

advantage of the advertising industry as private companies in Vietnam on

an understanding the importance and power of advertising for the survival

of the product.

However, the fact that more than $ 1 billion in revenue from advertising each year in Vietnam, the domestic companies contribute only 10-20%. Than 80% of the remaining few large corporations advertising in the world. "In the domestic market, if only array processing, make the final stages of the process of advertising the businesses in the country accounting for 90%. But if you count the largest advertising contract, the package of foreign enterprises accounted for 90%, "Director of JSC solutions market Royal, Hoang Hai Au acknowledged.

The main reasons, according to Europe, is due to international groups have not believed in the level of professional advertising company in Vietnam, so they only hire foreign companies. Very few enterprises Vietnam receives advertising contracts for corporations like that, and if there is only a sub-contract (sub-contract) a collection of foreign partners. "Meanwhile, customers are mainly manufacturing enterprises in Vietnam, they believe in the quality of the ads, but not enough money to cover all costs," he said.

Like his European, many in the industry are acknowledged, the professional qualifications of the enterprises in the country are advertising is a limit not less. In Vietnam school does not have regular training in this specialized. Companies themselves who are receiving training from the

beginning to be very slow to develop human resources. As well as restrictions on professional, many units received only dare to do in part, and nature of outsourcing more. "A lot of companies called the ads themselves but essentially they are only processing the ad. Critical period before the study and construction, composed the logo of the brand is not some participants. Bring products to communication activities much simpler, "director of a company advertising reviews.

Awareness of enterprises producing goods and services have not caught up with the growth of advertising is also a limitation. Goldsun company representative, Mr. Vo Van Quang, said that with the fact that the advertising market Vietnam today, when many buyers will not know what to buy. "Sometimes you put a company to issue planning brand strategy they do not understand and thought the story should do advertising companies to build household. If the international advertising companies working on contract basis and enjoy an exclusive fee is about 17.65% in Vietnam, customers do not understand the story, they still purchase by each service specific programs such as a PR, a piece of film ... "he said.

Corporate income tax also is becoming a pressing matter of the companies advertising. "The tax applies to businesses in this area is very high (28%), it is maintained from 1990 of the last century, when the ad business is highly profitable. Feedback, the new international corporations in Vietnam, they pay for ads in the expenditure made in their country, a large ocean plates they can to 40000-100000 USD. Meanwhile, land rent, rent advertising space only a few million per year, "said Hoang Hai Au confided to VnExpress. According to him, the moment, a large ocean plate is very good so just signed a two-tens of thousands of dollars that rent land accounts for nearly all. So that tax policy remains unchanged. "High tax, competitive, less profitable to reinvest less than. Want to encourage development of an advertising industry is critical to good training, policies right, "he said.

In the macro, Secretary General Association of Vietnam Tran ad Year, said that the advertising industry is always control policy, although there were ordinances and decrees guiding the private enterprises in branches were always making difficulties by particular regulations for each locality. If Ho Chi Minh City has regulations prohibit outdoor advertising in Da Nang, the Left does not distinguish on the fee rates under water. "Also in Hanoi, the procedures to permit advertisers sometimes difficult process. Therefore, the new story advertisers to survive by building sea without permission. We only hope the local laws only as right, "he confided to VnExpress.

- Key advertisers are foreign and domestic FMCG companies that advertise across all major media.

- Real macroeconomic risks exist. These include recapitalizing banks, restructuring state-owned enterprises (SOEs) and managing declining property values.

- TV advertising is dominant and accounts for more than 75% of the total advertising pie. Print, out of home (OOH) and online are also significant.

PR in Vietnam is trying to find its way to professionalisation while facing challenges such as limited understanding of what PR practice and its benefits

are, a shortage of trained personnel and the absence of legal and professional frameworks.

While there are no official figures available about the number of communication agencies in Vietnam, anecdotal evidence suggests the figure has exploded to 7000.

contended PR in Vietnam “borrows from the West but is practiced in the Vietnamese style arguing “understanding the local knowledge and establishing personal connections . . . are two of the key principles for doing PR in the Vietnamese way” a heavy focus on media relations and event management, that personal relationships were significant while an envelope culture – in which PR practitioners pay journalists to attend their press conferences and publish their press releases – was widely entrenched a lack of professionalism, honesty and a legal framework as industry limitations, calling for more professional training and education, a code of conduct and professional body, and a proper legal framework in Vietnam as solutions to building “professional PR”.

The two empirical studies about PR in Vietnam appeared to adopt Western, normative concepts without seriously taking into account environmental factors specific to Vietnam The agency PR practitioners spend a large amount of their time with clients and in Vietnam, relationships are developed not just for work but also for friendship, further fuelling demand for interpersonal skills. The respondents generally believe the bulk of their clients do not have expertise in PR and there is a need to spend time educating them about PR and the media landscape. How- ever, due to their large workloads, and immediate deadlines from clients, some respondents lament it is difficult to invest a lot of time and research into one proposal. Respondents say while clients know PR is important, many do not fully understand what it is. Some of the respondents say clients are unwilling to share business objectives, resulting in disconnection between campaigns and client goals, and that this restricts PR to short-term efforts rather than long-term relationships. According to the respondents, as little as 10% of clients are willing to share their business objectives and forge long-term partnerships. Due to the recent proliferation of agencies, PR practitioners state competition among them is fierce, and this trend harms the industry in the long-term. Respondents say clients holding agencies in low regard also leads to other problems such as clients fielding ideas from agencies and implementing these ideas themselves. There seems to be a lack of consensus among the respondents regarding what constitutes ethics in PR in Vietnam.

cultural influence on perceptions of practice.