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$2mil contract with Arsenal to benefit Moment coffee?
The Vietnam Dairy Products JS Company (Vinamilk) on May 19 announced its 2-year, US$2 million deal with world famous football club Arsenal, under which Vinamilk’s Moment coffee brand will be advertised by Arsenal.
Brand restructuring
The deal allows Vinamilk to use the logo, photos and the Arsenal brand to advertise its Moment coffee brand on the media or at its events.
Moment coffee brand can also produce promotional gifts with the Arsenal logo, images, brand and photos of Arsenal football players.
Along with this deal, Moment brand begins to restructure its marketing and advertising tasks after three years in the market.
The goal of Vinamilk is accounting for 5% of the local market for instant coffee with its Moment coffee and helping its Moment coffee processing plant in the My Phuoc Industrial Zone in the southern province of Binh Duong to sell 1,000 tonnes of instant coffee (equivalent to two-thirds of its capacity) by this year’s end.
Will success come?
In a market which has up to 30 brands of instant coffee, led by Vinacafe, Nescafe and Trung Nguyen coffee, it will be difficult for Vinamilk to fulfil its goal.
Vinacafe has upgraded its factory in Bien Hoa city to 1,200 tonnes of instant coffee per year with investment capital of $2 million. Trung Nguyen built a 3,000 tonne/year factory at a cost of $10 million (G7 brand). Nescafe has applied its global quality control and trade policy for its factory and distribution network in Vietnam.
In that context, Vinamilk’s modest goal of 5% of market share is not simple.
However, looking at Vinamilk’s financial potentials (sales of VND6,675 billion - $417.18 million and after-tax profit of VND963.4 billion - $60.2 million – according to Vinamilk’s auditing report released in April 2008), the firm is not cringing before any rival.
But financial ability is the tip of the iceberg. The hidden part is Vinamilk’s change of its business management, marketing and sales.
Vinamilk is attracting the top personnel in Asia-Pacific of multinational groups such as Pepsico, Dutch Lady and BAT, who are master’s degree holders that graduated in the US, Europe and Australia. The new, young team is led by Vinamilk Vice General Director Tran Bao Minh and is praised for its knowledge and international standards.
The failure of Moment instant coffee previously was its taste. This time, Moment has many new flavours. Vinamilk has hired foreign experts to design advertising clips and images for Moment, which reach international standards. Vinamilk hopes to successful launch its Moment brand again via its available distribution network and its relations with supermarket chains in Vietnam.
Can Vinamilk raise Moment coffee or not? At least one year will be needed to answer this question.
VNN
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