Businesses, related agencies join hands in building Vietnamese brands

Businesses must be conscious of investing in brand building for their own products. Of course, the government and related ministries should support them with preferential policies.

Businesses, related agencies join hands in building Vietnamese brands

The intrinsic development of each enterprise, together with the advantages of many new generation free trade agreements, has created an impressive export growth rate for many years. This helps bring Vietnam into the group of 20 leading trading nations in the world. However, according to many experts, the amount of exports under Vietnamese businesses' own brands is still modest not to mention fewer Vietnamese brands with dominating positions in the global market.

According to the Ministry of Industry and Trade, four main factors have been affecting the development of brands as well as the competitiveness of Vietnamese businesses. Specifically, in the domestic market, the preference for foreign goods is still prevalent among a large number of consumers.

Through the signed trade agreements, the price of imported foreign goods is quite close to that of domestic Vietnamese goods, so Vietnamese consumers prefer to choose internationally-made goods meanwhile there are not many necessary policies and mechanisms to support the development and expansion of distribution channels for Vietnamese goods.

Meanwhile, the current distribution systems are at risk of narrowing due to being taken over by foreign businesses. Although Vietnamese goods have been standardized to international standards, 90 percent of Vietnamese businesses are small and medium-sized enterprises that lack the internal strength for market promotion, especially brand building and development, so consumers do not know about these brands.

Recognizing the importance of this issue, Head of the Ministry of Industry and Trade’s Europe-America Market Department Ta Hoang Linh stated that the Ministry of Industry and Trade has directed diplomats and Vietnam’s trade offices abroad to study the process of registering intellectual property rights for brands. They also provide training and guidance to domestic businesses before venturing into foreign markets.

Additionally, alongside brand-building efforts, there is a focus on connecting Vietnamese products with consumers through branding. Accordingly, the Vietnam Trade Office has collaborated with distribution systems to support Vietnamese goods in supermarkets or virtual stores on e-commerce platforms.

Previously, the Ministry of Industry and Trade and the Ministry of Agriculture and Rural Development worked together with localities to implement the program for building local product brands (OCOP). This is also an opportunity for small and medium-sized enterprises to establish their brands and access export markets.

Chairman Nguyen Anh Duc of the Vietnam Retailers Association and CEO of Saigon Co.op stressed that small businesses can export goods if they register to sell their products on e-commerce platforms. The key issue is for businesses to standardize their brand and quality, enabling them to reach global markets.

A study carried out by NielsenIQ Vietnam reveals that up to 77 percent of customers make purchasing decisions based on brand. Customers who favor a brand tend to develop stronger emotional connections, leading to higher loyalty, increased profits, and positive word-of-mouth advertising for businesses. Approximately 43 percent of customers are willing to spend more on products from brands they are loyal to. Well-recognized brands can positively impact sales figures and require less marketing effort when entering new markets.

Therefore, investing in branding directly or indirectly enhances the production capacity and competitiveness of Vietnamese businesses and Vietnamese products in both domestic and international markets. This also contributes to the building of the intangible strength of Vietnamese enterprises.

Exemplary Vietnamese brands not only represent high-quality products with innovative designs but also affirm the identity and position of Vietnamese goods globally. Simultaneously, they serve as a new motivation for Vietnam’s products to develop robustly and expand further in the international market.

General Director Aly Ansari of Walmart Vietnam shared that Vietnamese products are currently targeting product lines serving Vietnamese people in foreign markets, but there are still many products that have not been researched and adapted to meet the preferences of consumers in export countries.

He added that in addition to relevant authorities’ supporting solutions, businesses should proactively adapt to the new commercial trends of the market. He revealed that his company’s sourcing team is always ready to support the export activities of Vietnamese products to global markets, including the United States, Canada, Mexico, Chile, and China. However, for Vietnamese products to reach global consumers, it is essential to build a brand and develop products that align with user preferences worldwide

Many businesses voiced their opinions that the imports of raw materials for production, accounting for 60 percent of the total amount of raw materials produced domestically, have pushed Vietnamese businesses to depend on raw material sources, making it very difficult to control their competitiveness.

In addition, this is also the reason why businesses have to accept to process products for partners. Furthermore, Vietnam's e-commerce platform is weak, businesses have to export on foreign e-commerce platforms, so the dependence is high making it difficult for domestic businesses in the long run.

Therefore, businesses proposed that the Ministry of Industry and Trade should soon put into operation a national e-commerce platform to support the domestic strength of branded Vietnamese goods for export. As for the Ministry of Agriculture and Rural Development, in addition to policies to support agricultural products in building brands, it is necessary to consider planning for planting areas of raw materials that meet international standards, in combination with supporting attracting investment in deep processing.

This solution is expected to pave the way for domestic businesses to reduce their dependence on foreign raw materials and gradually reduce the proportion of processing in the finished product structure. It can be said that Vietnam has many trade advantages with North America, ASEAN and the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) markets.

In recent years, Vietnam has gradually become a destination for the production shift from Northeast Asia and has emerged as a key manufacturing center in the global supply chain.

Director Herman Xu of Miniso Group said that in terms of the product chain, Vietnam has many advantages in terms of labor costs, focusing on developing a number of key industries and developing a supply chain that is connected to the global market.

The remaining issue is that Vietnamese businesses need to enhance their competitive capabilities with similar products in the global supply chain, with the first crucial factor being branding. Miniso Group currently aims to connect and build a supply chain for Vietnamese goods that meets global product demand. Vietnamese products, which are of high quality, can fully meet the requirements of global consumers, said the director of Miniso Group.

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