CJ O Shopping Overseas Market Development Corps with SMEs - Vietnam
The CJ O Shopping Overseas Market Development Corps marks its third anniversary after visiting China in 2014 and Mexico in 2015! CJ O Shopping has been operating the corps as a representative win-win program between CJ O Shopping and small and medium-sized enterprises (SMEs) in addition to its Big Company and SME Business Cooperation Foundation since 2014 in order to actively support Korean SMEs’ advance into overseas markets. CJ O Shopping started the program for the first time as a home shopping channel.
The Overseas Market Development Corps visited a certain nation for market development for four days from November 2. Where were they headed? A young country with an active production population (15 to 64 years old) accounting for 70%! A country of good sons and daughters! A country that loves Korea! It is a country of rice noodles, bikes, and ao dais. This country is Vietnam.
Overseas Market Development Corps, Win-Win Growth Project between CJ O Shopping and SMEs
Vietnam, with a GDP growth rate of more than 6% per annum and a stable inflation rate of less than 2%, is a nation where CJ O Shopping is operating a home shopping channel known as “SCJ.”
SCJ also prepared “Korean Product Golden Zone,” a program dedicated to Korean products, and Korean SMEs have shown much interest in this. The CJ O Shopping Overseas Market Development Corps, which left for Vietnam in 2016, also decided to look first at the possibility of entering the program.
▲ The CJ O Shopping Overseas Market Development Corps which flew into Vietnam in 2016
The following is a story about searching for new opportunities in the Vietnamese market with 15 Korean SMEs selected as excellent companies by sectors that took place over the course of four days!
Korean SMEs Which Took Part in CJ O Shopping Overseas Market Development Corps
Inet, TP Korea, Liu & Com Co., Ltd., YB Soft Co., Ltd., Iwha SMP Co., Ltd., BKW Co., Ltd., Liz Tara Co., Ltd., DK Mode Co., Ltd., Welcome MS Co., Ltd., Eyesel Creative Co., Ltd., T&I Co., Ltd., Tops Living Co., Ltd., Charmzone Co., Ltd., PFD Co., Ltd., TAEJU Co., Ltd.
Visiting SCJ, Hot Spot of Korean Wave
Members of the Overseas Market Development Corps left for Vietnam in the early morning and arrived at SCJ in Ho Chi Minh City. The TV home shopping channel ranking first in Vietnam’s home shopping market was jointly established by CJ O Shopping and Vietnam’s No. 1 cable TV operator SCTV in July 2011.
When the Overseas Market Development Corps visited the studio, live broadcasting was in progress! They remarked that it impressed them to see show hosts in Hanbok (traditional Korean dress) enthusiastically explaining “Hansam.” In the sub-control room, K-Pop was inserted as background music, fueling the fever of the live broadcasting.
They looked around the SCJ studio and the sub-control room and found that the studio and the sub-control room were not different from those of CJ O Shopping Channel. They were proud of the fact that CJ O Shopping’s know-how was successfully transferred to Vietnam and were able to directly feel the popularity of the Korean Wave in Vietnam.
Thanks to the Korean Wave that has swept across Vietnam, local Korean products draw much interest from Vietnamese people. The portion of Korean product sales in SCJ’s total sales stands at 25%. Vietnamese people are particularly interested in health, so Korean health food such as red ginseng is enjoying immense popularity. Then, they are followed by sets of kitchen utensils and beauty products in terms of interest.
Thanks to this popularity, SCJ has been broadcasting the “Korean Product Golden Zone” program once or twice a week since July of this year. SCJ claimed that they could respond immediately to customer inquiries because the program was broadcast live and sales are two to three times higher than sales of recorded programs. SCJ is going to gradually expand the program in the future, so Korean SMEs are likely to have more opportunities to make a foray into the Vietnamese market.
However, the Korean Wave was not successful at SCJ from the beginning. Unlike Korean customers, Vietnamese don’t tend to offer much feedback so SCJ had trouble finding what Vietnamese customers felt inconvenient or what to improve.
This was attributable to the optimistic characters of the Vietnamese people. Vietnamese people had the world’s fifth highest happiness index, leading to a strangely relatively very low rate of return!
Import and Export Fair between Korean Exporters and Vietnamese Buyers
On the following day, they held a briefing session on strategies to enter the distribution market in Vietnam and Southeast Asia, and one-on-one import/export business meetings which were the highlights of the corps’ activities. Merchandisers of SCJ in Vietnam MD and CJ IMC, a product supply affiliate of CJ O Shopping participated to share the characteristics and information of the Southeast Asian market and consumers.
All of samples at one-on-one counters at the import and export fair were transported from Korea, reflecting thorough preparations.
Among various products, beauty and fashion goods for Vietnamese women became distinctly popular. A hair cap that keeps hair healthy and glossy has a heating function so it became popular in winter especially in Korea. In Vietnam, the hair cap enjoyed strong popularity and drew much interest.
You may wonder why Vietnamese women use hair caps in hot weather. Vietnamese women use hair caps as they know that hair caps protect their hair from strong sunshine and keep their hair healthy all the year round, so they wear them even in hot weather.
In addition, jewelry products and color cosmetics were also popular items in Vietnam where party culture is so common. They could understand the preferences of Vietnamese customers who choose bold designs for special occasions by way of the event. We also had in-depth business meetings to export a variety of color cosmetics that can help Vietnamese women overcome hot weather and complete wonderful make-up.
Another impressive point was the popularity of health products and products for senior citizens. Vietnam is rooted in Confucianism just like Korea and has a strong family culture based on filial piety to such an extent that Vietnam is called a country of filial piety.
“An anti-fall wheelchair” developed by YB Soft Co. is a product that can move Vietnamese children who want to take care of their parents despite a task to take into consideration the Vietnamese government’s welfare policies and its price.
In addition, a representative of T&I Co. that brought a functional pillow to help people sleep tight enthusiastically explained and demonstrated the product so that merchandisers could directly experience its effects.
Exploring Vietnam and discovering the essence of Vietnamese Life
Then the members of the corps conducted a market survey in order to observe Vietnamese life and trends by visiting the main distribution channels in Ho Chi Minh City and CJ Group affiliates such as CGV and Tous Les Jours in Vietnam. Ho Chi Minh City, the iconic city of Vietnam with a population of ten million! There are various distribution channels such as traditional markets, grocery stores and department stores so they were able to get a sense of the lifestyles and trends of Vietnamese people in a variety of settings.
The members of the Overseas Market Development Corps became more active when they visited and inspected distribution channels based on the feedback ascertained from Vietnam merchandisers during the import and export fair. All materials for products, selections of products, display types, and prices among others were valuable information for them. Active discussion and communication also helped underscore the dedicated focus on the future.
While moving around Vietnam, they continued to exchange opinions with one another. They touched on many ideas as they looked at the flood of bikers that tended to cover so much of all the roads of Ho Chi Minh City.
It was very impressive that they discussed the possibility of introducing Korean functional sportswear, upon seeing how many Vietnamese people wear loose cotton clothing to combat the hot sun and weather.
The CJ O Shopping Overseas Market Development Corps spent some valuable time in Vietnam over the course of four days! To companies which took part in the corps, Vietnam was a land of infinite possibilities because the nation has a high proportion of a young population which makes its main consumption class solid and is based on the Confucian culture.
As a result of this visit to Vietnam, steps towards win-win growth have now been taken. It is said that approximately 70% of participating companies will sign contracts to export products to Vietnam and Southeast Asia. That’s great to hear! Global win-win partnerships between CJ O Shopping and Korean SMEs will surely continue to prevail in the future.