Foreign players dominate Việt Nam’s thriving ad market

Advertising has emerged as an increasingly lucrative market in Việt Nam with more and more multimillion-dollar contracts being placed, but local ad agencies are only able to grab a modest piece of the cake.

Major groups and corporations always open tender to choose ad agencies for their new promotional campaigns, but most of the contracts offered by multinational groups or local market leaders are won by foreign advertising agencies.

Vinamilk, the country’s leading dairy producer, has most of its ad campaigns executed by New York-based TBWA Worldwide, while another U.S. player, Lowe Việt Nam, has also won fat contracts from big names including Coca-Cola, Dutch Lady, OMO, and Masan Consumers.

Japanese-owned Dentsu Việt Nam prepares ad plans for all of the Japanese businesses operating in Việt Nam, from Toyota, Yamaha, and Canon to Ajinomoto and AEON Mall.

It has even won trust from such Vietnamese enterprises as state-owned travel firm Saigontourist and cooking oil maker Cái Lân.

VN-AdsA TV commercial is seen on the screen of an LCD display at a Big C supermarket in Hồ Chí Minh City in this November 18, 2011 photo

Võ Thành Tài, director of marketing at Vinastar Motors, the Vietnamese authorized distributor of Mitsubishi automobiles, said Japanese agencies are favored for “long-term ad campaigns.”

“Vietnamese advertising firms will also be considered, but they must have a strong portfolio of previous campaigns to prove that they are able to handle the job.”

Tài added.

Tài said his company is assigning local businesses to be in charge of activities such as organizing small events or customer conferences.

But there are reasons for businesses to prefer foreign ad agencies to their local rivals.

“What matters is how Vietnamese ad agencies meet their customers’ request.”

Robert Trần, CEO in charge of USA and Asia Pacific at Canada-based Robenny Corporation, remarked.

“Global companies or major Vietnamese enterprises usually inform advertising agencies of the campaigns they want to launch, in return for the proposals on how to turn them into reality.”

Trần said.

“But few Vietnamese ad firms can have a face-to-face conversation with their customers to figure it out.”

Trần’s remark could be proved by a quick check by a Tuổi Trẻ News correspondent.

As the reporter contacted a well-known Vietnamese ad agency based in Hồ Chí Minh City, asking to negotiate a contract, he was asked questions such as how large the budget for the campaign was, what kind of customers it targeted, and on which media channels the ads should appear.

After getting the answers, the company employee sent back a proposal via email.

But the plan simply contains the money allocated for each media channel including print newspapers, TV, and the Internet.

The ad company only did some calculations with data provided by the reporter, and not a single idea was proposed as to how the campaign should be launched.

Source: Tuổi Trẻ News

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