Dang Tran Hanh Thong i Final Project - MBAVB3 `DECLARATION

I declare that this final project contains no material that has been submitted to any other
program in other institutes, colleges and universities. This work was done by author
except where due reference is made in the text.
`
Signature: DANG TRAN HANH THONG ____________________
Date: Nov.12
th
, 2012___________________________________
Dang Tran Hanh Thong ii Final Project - MBAVB3 ACKNOWLEDGEMENTS

First of all, I would like to acknowledge all professors and coordinators who provided

Research the of relevant marketing concept, marketing strategies and find out the
characteristic of the market, customer purchasing habit, main factors affect to
purchasing decision, customer awareness, then the proposal an efficiency marketing
strategy of Petrolimex Gas for resident household segment is the aim of this study.
Methodology: To achieving the aim of study, the three main theories comprising
Swots, Marketing Strategy and Marketing Mix are applied in this thesis. Moreover,
secondary data are taken from desk research to get competitor in formation, identified
market share and analysis internal information. Primary data are taken from expert
interview for learn more the models of bottled LPG industry and mail survey to
understand the customer behavior and perception of customer toward to current
marketing strategy of Petrolimex Gas.
Conclusion & Recommendation:
Through the findings of research, author understands what are the main factors
influencing and playing the most important for both keeping customer loyalty and
acquiring new customers. Besides, author also understands the customer awareness of
Dang Tran Hanh Thong v Final Project - MBAVB3 Petrolimex Gas brand name vs. other competitor brand names; purchasing habit, and
the perception of customer toward to current marketing strategy of Petrolimex Gas.
After understanding the actual situation of Petrolimex Gas marketing strategy and
market situation, a proposed marketing strategy will be recommended for orienting
marketing activities to Petrolimex Gas JSC in period (2012-2015)



CHAPTER 2 LITERATURE REVIEW
2.1 What is the S.W.O.T 11
2.2 Marketing strategy 13
2.2.1 What is marketing strategy 13
2.2.2 Marketing mix strategy 13
Dang Tran Hanh Thong vii Final Project - MBAVB3 2.3 Strategic marketing plan 16
2.3.1 Offensive Strategy 16
2.3.2 Defensive Strategy 18
2.3.3 Market Grow Matrix Strategy 19
2.4 Conclusion 21

CHAPTER 3 COMPANY & MARKET OVERVIEW
3.1. Macro-economic factors 22
3.1.1. Population 22
3.1.2. GDP, GDP/Capita 23
3.2. Bottled LPG market analysis 25
3.2.1. Bottled LPG in household in HCM 26
3.2.2. Current market size & market share 27
3.3. Petrolimex Gas Joint Stock Corporation introduction 29
3.3.1. Vision, Mission, Core value 29
3.3.2. PGC sales performance 29
3.3.3. Current Marketing Strategy of PGC 31
3.4. Competitor analysis 37
3.4.1. Competitor overview. 37
3.4.2. Competitive advantage analysis 41


References I
Appendix I II
Appendix II IV
Appendix III IX
Appendix IV X Dang Tran Hanh Thong x Final Project - MBAVB3 GLOSSARY OF TERMS AND ABBREVIATIONS

LPG Liquefied Petroleum Gas
PGC Petrolimex Gas Joint Stock Corporation
Petrolimex Vietnam National Petroleum Corporation

Table 3.5: Allocation margin cost of 12kg-bottled LPG for customer 35
Table 3.6: Comparison of competitor marketing strategy in general 41
Table 3.7: Price comparison 42
Table 3.8: Product comparison 42
Table 3.9: Summarized Competitor Analysis 43
Dang Tran Hanh Thong xii Final Project - MBAVB3 LIST OF FIGURES

Figure 1.1: Market Research Process 6
Figure 2.1: The 4Ps component of marketing mix 15
Figure 2.2: Offensive strategy 17
Figure 2.3: Factors limiting full market development 18
Figure 2.4: Defensive strategy 19
Figure 2.5: Product – Market Growth Matrix 20
Figure 2.6: Strategic Planning Process 21
Figure 3.1: HCMC condominium Supply 23


1.1. PROJECT BACKGROUND
LPG product:
Liquefied Petroleum Gas (LPG) is a flammable mixture of propane & butane used
as a fuel in heating appliances from heavy industries: metallurgic, shipbuilding… to
light industries: ceramic, crystal factory… and also in household application such
as: heating, cooking Besides LPG is used to fuel internal combustion engines, it is
often referred to as autogas.
Nowadays, LPG is used popularly in around the world. LPG is replacing other
traditional fuel in some domains such as: cooking, heating, automobile fuel.
Emission if using LPG is cleaner than other sources as diesel, gasoline. Compared
with using electricity and fossil fuel, LPG is also cheaper in some applications
.In Vietnam, LPG in cylinder or bottled LPG is used almost in resident domain and
LPG in tank is used in industrial fields. There are three kinds of LPG product in
bottle: Mini size bottled LPG; medium size 10-13kg bottled LPG and large size 45-
48kg bottled LPG. Depending on the level of consumption of customers, they chose
the suitable item for their own purpose. In general, Mini size bottled LPG mainly
used for portable travel burner, Medium size bottle is used for residential house
hold and big size cylinder is used for restaurant and sometimes for heating in light
industries. The application of big size one in light industry is depended on technical
requirement, design, location of factory and economic condition of customers.
LPG market:
In Vietnam, LPG appeared in South of Vietnam in 1957 with small volume. At that
time, the demand consumption was around 400 tons annually. Until 1975s it was
2
Dang Tran Hanh Thong Final Project 17,000tons LPG per year and was distributed by Esso and Shell. Because of limited
technology; economics and political factors, LPG was temporarily stopped using in

firms distribute LPG to their agents and industry customers as the end users.
Meanwhile, Agents almost supply LPG in cylinder to resident house unit.
1.2. RATIONALE OF PROJECT AND PROBLEM STATEMENT
Petrolimex Gas Joint Stock Corporation (PGC) Gas company belonging to Vietnam
National Petroleum Corporation (Petrolimex) is a state company established by
Decision No. 1653 – 1988/QD/BTM in December 25th 1998 by the Ministry of
Trade, having registered capital of over 250 Vietnamese billion dongs. Its function
is to import and export liquefied petroleum gas (LPG), distribute LPG in cylinder in
the nationwide, LPG equipments, all services related to technological LPG in civil
& industries Fields.
In Vietnam, PGC have been known as the most famous company in LPG industry
with Petrolimex Gas brand name. PGC is offering to the market both LPG in
cylinders with medium and large size and LPG in tank. Meanwhile, proportion of
LPG in tank takes into account up to 51.27% of total quantity LPG delivered out
market; medium bottled LPG type takes 36.78% and the large size takes 11.95%.
(Petrolimex Gas Report in 2011)
In general, PGC is one of the leading bottled LPG companies of which distribution
network is reached to all of Vietnam provinces and takes nearby 17% market share
in Vietnam.
PGC import one a half of total quantity LPG for company and the balance quantity
is bought from local producers Dinh Co and Dung Quat Processing Plant through
Petro- Vietnam.
As the continuous economic high growth rate and the increase on living standard in
some previous years which is expected to be continued in the future, the
government has encouraged using clean fuel to protect the environment. LPG is
seemed as an integral energy for heating.
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Dang Tran Hanh Thong Final Project
Dang Tran Hanh Thong Final Project statement can be stated as “What should be an efficiency marketing strategy for
bottled LPG of PGC?”

1.3. OBJECTIVE OF PROJECT AND SCOPE OF PROJECT
Objectives of Project:
Purpose of this project is setting up an efficiency marketing strategy to penetrate
into the bottled LPG market. So some objectives of the project are listed as below:
- To investigate deeply LPG market, the main LPG suppliers and main competitors
also.
- To analyze important marketing factors which drive customers to buy bottled
LPG.
- To propose marketing strategy of PETROLIMEX in period 2012-2015
Scope of Project:
For the limited resource and timing as well, this project is focus on HCM
geography. The scope of this study is household customers, who are using bottled
LPG
This study focus on marketing issue only, not mention to other subjects such as
technology, financial, human resource and so on.
1.4. RESEARCH METHODOLOGY
This project is designed under theories of SWOT, Strategic marketing plan,
marketing and Marketing Mix Strategy of which data is collected from primary and
secondary resource. The research uses multi-methods to collect data such as mail
interview for quantitative research and expert interview for qualitative research.
Secondary data were collected from published documents and internet.

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Dang Tran Hanh Thong Final Project

Qualitative research interview:
Qualitative research conducted by interviews to experts and sales persons in bottled
LPG business. The purpose of these interviews is to understand the direct
competitor and customer behavior as well as LPG market in general. This
information will be used to create the questionnaire for quantitative research
Quantitative Research:
A Questionnaire related to many issues was sent to users - residential household for
finding and identify brand awareness; customer knowledge of products, customer
purchasing habits; perception about current marketing strategy of PGC and
customer demographics and so on.
The purpose of the quantitative study is to statistically confirm the relationship
between the purchase of LPG and the factors identified through the qualitative
study.
In order to minimize researcher‟s error, a pilot research was carried out as the
beginning. The pilot questionnaire was handled by ten sale man of LPG agent at ten
districts in Ho Chi Minh City. Sale man will interview minimum one end-user
based on questionnaire. After that he will feed back the result to Sale Department of
PGC in Ho Chi Minh. Through the pilot research, the researcher will learn more
about the real situation and adjust questionnaire accordingly.
The next step, the revised questionnaire will be sent by email to 3,000 customers
who are using bottled LPG in Ho Chi Minh area.
Secondary data:
Market research of Petrolimex Gas Corporation, Petrolimex Gas Report from
(2007-2011); World Liquefied Gas Magazine (2010) and Vietnam Gas Association
Report (2010); are used to synthesize and describe the general LPG market
comprising supplier and its segmentation, total demand and forecasted demand in
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Dang Tran Hanh Thong Final Project
Dang Tran Hanh Thong Final Project  Total sample for household resident segment:
Sample size n =
With Z: Standard error associated with chosen level of confidence
(95%)
P: estimated % in the population
q: 100 – p
e: acceptable sample error (3.5%)
This research used cluster sampling technique with fraction of 10,000.
Total population of Ho Chi Minh is about 8million, so the sample size for
this segment should be equal or larger than 800 which are allocated
geographically in Ho Chi Minh City. The questionnaire will be sent by email
to 3,000 people who living in Ho Chi Minh. After that, the number of
respondents will be filtered for equal to the numbers of sample size as below
Table 1.1: Number of chosen customers in HCMC
No
District
Population
Sample
Size
No
District
Population
Sample
size
1
1
187435

5
174154
17
15
Tan Phu
407924
41
6
6
253474
25
16
Binh Thanh
470054
47
7
7
274828
27
17
Phu Nhuan
175175
18
8
8
418961
42
18
Thu Duc
455899

methodology of research, other related research and organization structure of the
project.
Chapter2. Literature review
This chapter presents some literatures and theory of marketing concepts and
marketing strategies the model to growth business and strategic marketing plan.
Chapter3. Industry back ground – PGC Background – Bottled LPG market
opportunities.
This chapter provides a general introduction of related macro-economic factors and
medium bottled LPG industry. This chapter also provides PGC background
comprising of organization, business operation, and current marketing program of
PGC as well as business performance. Besides, this chapter provides the competitor
analyzed information market opportunities, market trend to develop middle size
bottled LPG in Vietnam.
Chapter 4 Research Methodology and Research Result
This chapter presents the objective of market research, research question, the way to
design market research. It also provides how to collect and analyze data. And
finally it provide the empirical finding of market research
Chapter5 Conclusions and recommendations
This chapter presents the summary of market research. Based on the conclusion the
objectives should be addressed and some recommend, propose an effective
marketing strategy for PGC in Ho Chi Minh
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Dang Tran Hanh Thong Final Project CHAPTER II
LITERATURE REVIEW

Generally, the main purpose of literature review is to give readers easy access to
research on a particular topic by selecting high quality articles or studies that are

have an impact on the firm. The opportunities and threats can consider from the
economic climate, demographic changes, market, technology, competitive activity,
channel pressure, politics etc. (Kotler et al. 2005)
Not all threats call for the same attention or concern – the manager should assess
the likelihood of each threat and the potential damage each could cause. The
manager should then focus on the most probable and harmful threats and prepare
plans in advance to meet them. (Kotler et al. 2005)
Opportunities occur when an environmental trend plays to a company‟s strength.
Each opportunity should be accessed according to its potential attractiveness and
the company‟s probability of success. Companies can rarely find ideal opportunities
that exactly fit their objective and resources. The development of opportunities
involves risks. When evaluating opportunities, the manager must decides whether
the expected return justify these risks. A trend or development can be a threat or an
opportunity, depending on a company‟s strengths. (Kotler et al. 2005)
Internal Environment Analysis
The strengths and weakness in the SWOT analysis do not list all features of a
company, but only those relating to critical success factors. It is nice to be good at
something, but it can be a weakness if the competition is stronger. (Kotler et al.
2005)

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Dang Tran Hanh Thong Final Project