Advertising Campaign and Media Plan_SKY

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Introduction to Advertising

IKEA Advertising Campaign Page | 1

RMIT International University Vietnam

Bachelor of Communication

ASSIGNMENT COVER PAGE

Your submission will not be accepted unless all fields below are completed

Course Code: MKTG1294

Course Name: INTRODUCTION TO ADVERTISING

Location where you study: RMIT Vietnam SGS Campus

Title of Assignment: Advertising strategy and media plan

SKY

File(s) submitted

Student name: Tran Thi Mai Anh

Pham Thanh Khoa

Chau Tran Minh Dat

Le Nguyen Hoang Long

Learning Facilitator in charge:

Assignment due date: 13 September 2010

Date of submission: 13 September 2010

Number of pages including this one: 19

Word Count: 3,541





Table of Contents

1. INTRODUCTION .................................................................................................................. 4

2. COMMUNICATION STRATEGY ............................................................................................ 5

SWOT Analysis.................................................................................................................. 5

Key Learning .......................................................................................................................... 5

Communication Objectives ..................................................................................................... 6

Proposition ............................................................................................................................. 7

Values, Personality & Brand Essence ....................................................................................... 8

3. MEDIA PLAN ....................................................................................................................... 9

Media Objectives .................................................................................................................... 9

Advertising on Television ........................................................................................................ 9

Advertising on Magazines ....................................................................................................... 9

Advertising on Internet ......................................................................................................... 10

Public Relations ..................................................................................................................... 11

Sponsorship Marketing Activities .......................................................................................... 11

Direct Marketing ................................................................................................................... 13

Membership Card ................................................................................................................. 14

Media Schedule .................................................................................................................... 16

Budget .................................................................................................................................. 16

4. Big Idea/Creative Concept ................................................................................................ 17

Reference ................................................................................................................................. 19









1. INTRODUCTION

IKEA is a well-known household name which sell all kinds of household fittings form; the

smallest t-spoon to huge double beds. IKEA first started in the 1940's in a small farming village

in southern Sweden where it was founded by Ingvar Kamprad when he was 17 years old. After

seventy years operating, IKEA has establish a new concept that base on offering a wide range of

well ± design, functional home furnishing products at price so low that as many people as

possible will be able to afford them. This reports will more analysis about communication

strategy and prepare the new media plan for this type of product launching in Vietnam with

budget is $400,000. The IKEA creates the media plan in 6 months and the first store will be

opened on 5 January 2011.





2. COMMUNICATION STRATEGY

SWOT Analysis

Key Learning

SKY has success to build a global brand but focus on a low price offer in home furnishings to

help people live better life at home. Moreover, SKY has built a unique business model which isUnlikely with other brands in the world, when people choose the product of SKY, they have

accepted the concept that, they have to assemble the SKY product by themselves. However, In

the Vietnam Market, SKY is facing with the issue that, the major of Vietnamese are using motor

bike, therefore they hard to adjust the concept of SKY in the Vietnam market. Additionally, SKY

Strengths Weaknesses

y Broad of global distribution network

y Focus on providing product at low and

affordable cost.

y Strong international brand

y Be a western product with modern

design -> attract more customers from

ASIA

y Increasing use renewable material

y Wide product range

y Poor customer service (customers assemble

the product by themselves)

y Be a global company therefore IKEA's

global activities may make it difficult to

control standard

Opportunities Threats

y Less competitor in the Vietnam market

y Increasing demand for greener product

y The regulatory environments across the

globe vary and can affect how IKEA does

business and its product costs, especially the

use of natural resources

y Vietnamese mainly transport by motorbike -

> difficult to loading the product by

themselves





in Western countries focus on low price but when come into the Vietnam market they need to

adjust the pricing strategy because Vietnam is still a developing country and Vietnamese income

is also low compare with other Asian countries.

Communication Objectives y

G

ain 60 percent brand awareness of target audiences in the first 3 months launching period.

y Encourage 15 percent number of target audiences come to SKY stores after 6 months

launching campaign.

Category Insight

y The home furnishings industry in Vietnam is mostly covered by domestic companies such

as Loi Phat, Pho Xinh, Nha Dep, Chi Lai, etc and a few from China.

y Domestic brands focus mostly on high-class consumers. Meanwhile, Vietnam is still adeveloping country, so there is a large number of consumers belong to lower-class and

middle-class. SKY will be successful if they still apply their low-price strategy in

Vietnamese market.

y Vietnam is very potential market for low-priced products of SKY.

y SKY will bring a new and creative service for Vietnamese consumers when coming to

SKY outlets.

Product/Service Insight y SKY trademark represents the leading home furnishings brand in the world with more

than 300 stores in more than 35 countries.

y Provide a wide range of products.

y SKY concepts are based on well-designed, high quality, and especially with low prices.

y The prices are low because they minimize transportation and storage costs.

Moreover, customers also contribute to make prices low. They will select and pick up the

products by themselves, transport them home and then assemble them by themselves. This is a

creative and unique selling service of SKY.





Consumer Insight/Target Audience

Geographic

y Density: urban areas, including Northern and Southern of Vietnam.

y Focus on Ho Chi Minh City.

Demographic

y Family life-cycle: young and married with children.

y Occupation: office workers.

y Income: at least 3 million ± 5 million VND.

y Middle-class people.

Psychographic

y Care about where they live.

y Care about what it feels like at home.

y Appreciate simple design and modern furniture.

Proposition SKY is the perfect choice for their target customers because they provide:

y Global brand with local price

y High quality and simple designs

Support SKY group is a global brand with over 300 stores, 123,000 co-workers in 25 countries around

the world. According to 10 Keys to SKY¶s Low Prices (n.d), three of ten things help to reduce

the cost of product are:

W ast e Reduct ions

SKY's designers and engineers strive to reduce the amount of material used and wasted in

production. Additionally, many waste products are then used to make new products, further

reducing overall costs both to the pocketbook as well as to the environment.

Aut omat ic Selling

Despite the showrooms showcasing SKY furniture in real living arrangements (typically located

upstairs), SKY is a warehouse store designed to maximize customer self-sufficiency with

minimal reliance on staff assistance. Cost savings stem from reduced wages, training costs and





lower design, maintenance and outfitting costs associated with the marketplace and warehouse

areas of the stores.

I n-house designs

Virtually all of SKY's products are designed by SKY's staff of in-house designers who are well

versed in creating trend-setting designs while working from a set price point. In-house designalso means there are no large design commissions to be paid.

V alues, Personality & Brand Essence For a long time, SKY has become a big brand on many countries. Their achievement is seemed to be a

miracle. But the main aspect is not about where they are standing now, more than that is who they are and

what brings them to success. In 2007, the book "The Testament of a Furniture Dealer" written by the

IKEA father, Ingvar Kamprad, has established to unite SKY ideas as well as show their personalities.

These are some personalities that create the SKY today.

1. The product range ± their indentity

2. The SKY spirit ± a strong and living reality

3. Profits give them resources

4. Reaching good results with small means

5. Simplicity is a virtue

6. Doing it a different way7. Concentration ± important to their success

8. Taking responsibility ± a privilege

9. Most things still remain to be done ± A glorious future!

Most of people know SKY as the brand of cheap furniture. This aspect is really important in Vietnamese

market due to the fact that Viet Nam is a developing country; most of the population is middle class.

Furthermore, Viet Nam customers often consider a lot when they decide to buy something. The main

reason is they not only want the product with the cheap or affordable price but also acceptable standard.Knowing this, not only in Viet Nam but also in many other countries, SKY has come up with the new

idea that is never done before. "Low price with a meaning", that is the unique point of SKY. There no

doubt that SKY essence is totally fit in Viet Nam market.





3. MEDIA PLAN

Media Objectives y Concentrate heavily on advertising tools (TV, magazine, and internet) and sponsor for

charity events.

y Reach 65 percent of target audience with a frequency of 4.0 within first month launchingthe campaign.

y Generate 85 percent reach with 3.0 frequencies per month during launch.

Advertising on Television SKY plans to advertise in HTVC channel. The reason why SKY chooses HTVC channel is

because this is a home shopping network. With this channel consumers can interact to the

manufacturer because they can call to ask for the information or call to book the product.

According to Chitty, Barker & Shimp (2008), television advertising is particularly desirablewhen a company launches a new brand in market before it achieves national distribution.

Therefore it is suitable for SKY to use Television advertising as a major media tool to launch a

new brand in Vietnam. Following is the detail cost when use HTVC channel.

Channel Program Time Duration Unit cost Amount

of ads

Total cost

HTVC Shopping

online

Prime time (8

PM to 10 PM)

6 months $500/slot/minute 200 $100,000

Advertising on Magazines According to Quester et all 2007 when the Advertisement is strategically placed in the right

magazine, it can improve the business many times over. Therefore SKY chooses advertising in

magazine instead of newspaper. Moreover, SKY advertise in magazine because there are many

advantages which magazine advertising has such as selective, long life or ability to present

detailed information. SKY decides to advertise their product in Nha Dep, Tiep Thi & Gia Dinhand The Gioi Phu Nu magazine. The reason why SKY chooses those magazines to advertise is

because they are popular magazine in Vietnam talk about the interior design with hundreds of

thousand prints per year. We plan to advertise each of them every two weeks during 6 months.





Moreover we estimate that the cost for this tool will be ($800+$700+$900) x 4 magazines x 12

weeks (every two week during 6 months) = $28,800.

Advertising on Internet SKY has used about 5% of total budget for internet advertising. Because the budget is limited,

therefore SKY cannot advertise in any aspect of the internet. As the result in order to useeffectively that amount of money, SKY focuses on advertising in online newspaper.

Online newspaper:

The advertisement of SKY will be appeared in the shopping category of two popular online

newspaper websites in Vietnam, http://www.vnexpress.net/ and http://www.dantri.com.vn/.

Following is the detail of online advertising

Place of putting advertisement: Shopping category

Timing: December 2010 to May 2011

Time change new advertisement: every month

Costing: $15000/month for vnexpress.net and $1200/month for dantri.com.vn (adapt from

http://www.fptad.com/)

Total cost:

y VnExpress: $1500 x 6 months = $9,000y Dantri: $1200 x 6 months= $7,200





Public Relations According to Wells and other authors (2008), public relations is intended to generate goodwill

for an organization and has the objective of creating trust and maintaining the integrity of the

organization. Due to these advantages of PR, besides using mix of advertising tools we also use

PR activities to build a trust in SKY¶s target audiences. First of all, because SKY is a completely

new brand in Vietnam market, press release is very necessary in this case to official introduce

SKY. Secondly, we decide to create a new SKY website in Vietnamese version to provide more

information for Vietnamese customers. Next, organizing charity events or social activities are

also main parts of PR activities. Moreover, SKY wants to care about the development of

Vietnamese people as well as education in Vietnam, providing free facilities for schools in Cu

Chi and Can Gio province. Because the life standards in these two places are still poor, SKY

wants to give more chances for people here, especially homeless children, to come to school.

Sponsorship Marketing Activities To promote for the advertising campaign, attract the attention of public in the special way, SKY

wants to be one of the sponsors for game shows Sieu Thi May Man (LuckySupermarket) and

reality show Ngoi Nha Mo Uoc (The Dreamed House).

Game show Lucky supermarket is the product of HTV7 channel .The audiences of this show

only focus on South Vietnam. Tran (2010) provides information that even this show limited the

audiences by each domain but it still be one of the game show has highest rate audience at the

moment. Second, the number of people waits to attend on this game show rise by thousands of

people. The fascination of this show could be due to the attention of Vietnam celebrities in role

of player and the value prize. The main target audience of this show is housewife, parents,

student anyone who likes shopping. So become one of the sponsors for this show, SKY can

develop their image and reputation in their main market, Ho Chi Minh City and neighboring

provinces and generate the attention on the target audiences of this show. Finally, the cost for

sponsor is very reasonable, about 10,000,000 VND per game. As HTV¶s policies for sponsors,

the SKY¶s information on HTV¶s magazine will be published free if SKY sponsor for more than2 game of Sieu Thi May Man.

The reality show the dreamed home is the product of the cooperation between HTV channel and

Pomina steel company. The main goal of this show is help poor people who do not have the

ability to build the house. With the norm of The dreamed home, the good leaves protect the





worn-out leaves, they want to bring to poor people their own house by using money from

benefactors and material form Pomina steel company. The cost for every house usually fluctuate

from 20,000,000 to 25, 000, 0000 VND. To become a vice sponsor for The dreamed home, SKY

will sponsor the facility for these houses with the cost for facility will be 5 million VND. So the

cost to sponsor for 6 months will be maximum 120,000,000 VND.

Beside sponsor for these 2 shows, SKY will have a short TVC on HTV7. The TVC will appear

before and after on the game show Lucky Supermarket and before, between and after game show

The Dreamed Home. The amount of time for every TVC is 5 seconds.

With the general characteristic of these shows is:

Broadcast time is in the golden time (from 8pm to 10pm)

Most of their target audience is office workers, family.

These things can satisfy the criterion of SKY that is attract the attention of many people

and not wasted coverage.

Table of cost for sponsoring

Channel Show¶s name Time Duration Sponsor cost

(game/week)

Total cost

HTV7 Lucky supermarket Golden time( 8:15 to 9 p:mevery Sunday)

6 months 10,000,000 VND 240,000,000

HTV7 The dreamed home Golden time( 8 p:m to 8:20

p:m everySaturday)

6 months 5,000,000 VND 120,000,000

Total cost to sponsor for 2 shows = 600,000,000($31,000)





Table of cost for TVC

Channel Show¶s name Position Time

limit

Duration Cost/month Total cost

HTV7 Lucky supermarket Before andafter

5´ 6 months 10,000 $60,000

HTV7 The dreamed home Before, between andafter

5´ 6 months 12,000 $72,000

Total cost for 2 shows = $132,000

Direct Marketing Just like any other home furnishings companies, SKY also has catalogues. They have online

catalogue and printed catalogue. But that is not all. Their catalogue is not simply a normal

catalogue. Not only it represents the product, it also shows people their ideas about furniture and

the way they decorate interior. As a result of this big difference, the SKY catalogue has become

the first of the top ten secrets which lead them to success. Each year, they establish a new edition

catalogue. The amount also reach the massive which is 118 million catalogues printed under 23

different languages.

From this point of view, catalogue is an important part of SKY launch. With these strengths,

hopefully the catalogue could bring people to SKY more and more due to the fact that it make

customers more excited with its idea.

In launching day, a thousand of catalogues would be sent to customers who come first. Also

SKY will help customers use the online catalogue. Then, they will explain the ideas from the

catalogue so that people can understand deeper. After all, SKY will give them some advices

about a perfect interior space.

After launching day, many small pieces of catalogue would be printed on magazines and

advertising pages of newspaper. Also catalogues will be sent to customers home that left their contact address in the launching day if they have demand.

All catalogue cannot give for free because the fact that they are expensive. Each catalogue is

about 200 to 300 color page, which can cost approximately $ 30. That's why we will spend

around 1,000 x 30 = $ 30,000 on printed catalogue on launching day. Furthermore, the cost for





printed piece of catalogue on newspaper and magazine would be $ 700 per week. So the total

budget for the catalogue would be $46,800 [$30,000 + ($700 x 24 weeks)].

Membership Card In Viet Nam, customers tend to care a lot about free and other advance benefits. So that besides

building a good market, SKY also sets up a long term relationship with the customer by establish

Membership Card (MC). Customers that have MC would receive more advance benefits that the

other cannot have. There are 2 kinds of MC: SKY f riends Loyalty Payment Card and SKY

f riends Credit Card. They will be sent to customer on the lunching day and every new

customers come to SKY agree to become SKY's member. These are some benefits of MC

IKEA friends Loyalty Payment Card

- 50% discount on coffee/tea and food when come to SKY restaurant.

-

Each 100.000 VND payment equal to 2 points, then customer can use these save points to pick up thousands products.

- 10% off on sewing service.

- Within 30 days, customer can return and change the product.





IKEA friends Credit Card

- Free coffee/tea and food when come to SKY restaurant.

- 10% off on some products.

- Free home service.

- Each 100.000 VND payment equal to 4 points, then customer can use these save points to

pick up special products.

- Customers can pay many times within 1 years for products above 5 million VND

- Customers can be invited to SKY party every 4 months.





Media Schedule

In Vietnam, people will increase purchasing the furniture at the end of the year to prepare for the

New Year Eve and Luna Tet because Vietnamese believe that shopping at the end of the year

will bring much luck to them. Understanding the culture of Vietnamese, SKY applies pulsing

advertising schedule to capture those customers.

In detail, SKY push up advertising weight in three months from December 2010 (New Year Eve)

to February 2011(Luna Tet).

Moreover, there is higher frequency of advertising on weekend because people tend to shopping

more at weekend

Budget

Items Budget

Television $100,000 + $132,000 =

$232,000

Magazines $28,800

Internet $16,200

SponsorshipMarketing $31,000

Direct Marketing $46,800

Total Budget $354,800





4. Big Idea/Creative Concept

Because this is the first time SKY comes to Vietnam, a big and creative idea plays an important

role in the big success of SKY advertising campaign. During 6 months launching the campaign,

the message ³Show your home some love´ will be added in advertisements in all advertising

channels, including TV, magazines and internet. We also create an ad with home furnishingswhich are arranged in LOVE shape and message is showed in the left bottom of the

advertisement.

This ad will appear at the end of home shopping network program on HTVC, one color page in

Nha Dep, Tiep Thi & Gia Dinh, and The Gioi Phu Nu magazines, on shopping category of

VnExpress and DanTri website.

Home Shopping Network ± HTVC





VnExpress website

DanTri website





Reference1) Chitty, W, Barker, N & Shimp T 2008, Integrated marketing communication, 2

ndedition, Cengage

learning, Australia.

2) Q uester, P., Neal, C., Pettigrew, S., Grimmer, M., Davis, T. & Hawkins, D. I. 2007, C onsumer

Behavior: Implications for marketing strategy , 5th edition, McGraw-Hill, Australia.

3) IKEANFANS 2009, homepage, martindesign, USA, viewed 23 August 2010,

<http://www.ikeafans.com/ikea/ikea-why-ikea/10-keys-to-ikeas-low-prices.html>

4) Hà ình Nguyên 2006, µChng trình truyn hình Ngôi nhà m c: Nhng "cô tiên, ông bt"¨,

vietbao, 4 January, viewed 5 September 2010, <http://vietbao.vn/Van-hoa/Chuong-trinh-

truyen-hinh-Ngoi-nha-mo-uoc-Nhung-co-tien-ong-but-thoi-nay/45180343/181/>

5) htv.com.vn 2004, chng trình phát sóng, homepage, Ðài Truyn Hình Thành ph H

Chí Minh, Ho Chi Minh City, viewed 5 September 2010,<http://www.htv.com.vn/chuongtrinh/default.asp?channel_id=7&date=29-8-2010#lps>

6) MyVietbrand (NVSP) 2009, µBng giá qung cáo: ài truyn hình HTV¶,thegioimarketing, viewed 11 September 2010,<http://www.thegioimarketing.net/web/?frame=quotation_view&fullscreen=on&id=18>

7) Tran, N.T 2010, §GAMESHOW ³SIÊU TH MAY MN´ Phát sóng 20h30 Ch nhthàng tun trên HTV7 (109)¶,<http://www.vatgia.com/raovat/3657/1915412/gameshow-sieu-thi-may-man-phat-

song-20h30-chu-nhat-hang-tuan-tren-htv7.html>

8) Business Word Portal 2004, 10 secrets to succeed of IKEA, viewed 9 Sept. 2010,

<http://www.bwportal.com.vn/?cid=4,4&txtid=633>

9) AusBusiness Review 2010, IKEA Catalogue Online, viewed 9 Sept. 2010,

<http://www.ausbusiness.net/review/ikea-com-au-ikea-catalogue-online/>

10) IKEA Friends 2010, Member Benefits, viewed 9 Sept. 2010,

<http://www.ikea.com.my/friends/pages/membership.asp>

11) A Little IKEA Dictionary 2007, The Testament of a Furniture Dealer, viewed 9 Sept. 2010, <

https://www.emu.dk/erhverv/merkantil_caseeksamen/doc/ikea/english_testament_2007.pdf




d i i i |

12) Wells et al 2008, Advertising: Principle and Practice, Australian Edn, Pearson EducationAustralia, p.467

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Advertising Campaign and Media Plan_SKY