To expand domestic and export markets and create added value for products, Vietnam must develop some strong and highly competitive brands. However, branding investment requires concerted effort from companies and overall approach to respond to diverse and changing demands of the market, coupled with reasonable State policies to facilitate businesses to bring products to domestic and foreign consumers.
Aimed to deploy some national brands with a new approach, respond to the Government's proposals and continue to ask the National Assembly to lift the cap on advertising costs at the National Assembly’s meeting in November 2014, the Vietnam Chamber of Commerce and Industry (VCCI) recently collaborated with the Association of Vietnam Retailers (AVR), under the sponsorship of Vietnam Prosperity Bank (VPBank) to organise a seminar entitled “ Investing in branding and spending on advertisement for enterprises” in Hanoi.
Speaking at the workshop, Pham Thi Thu Hang, VCCI General Secretary, said comprehensively intensive and extensive international integration has been a globally inevitable trend. Brand is playing a growingly important role in the existence and development of a company. The brand building and development, coupled with promotions for it, is an urgent need for businesses to approach, penetrate, maintain and expand domestic and foreign markets. On the surface, although this activity has been strongly developed in Vietnam, it has been actually restrained by regulations on ceiling cost of advertising. The lifting of the ceiling cost of advertisement will bring benefits to Vietnam in three aspects: Economy, consumers and the business community.
Dr Dinh Thi My Loan, Chairperson of AVR, said foreign companies have very good marketing strategies. In Vietnam, the budget is taken from Vietnam-based units, and, in foreign markets, it comes from foreign units. Hence, their brand names are very popular. Meanwhile, Vietnamese companies cannot do so because their advertising costs are capped at 15 percent of income tax-deductible expenses (in China, the cap is 15 percent of gross revenue). So, she said that removing the cap of 15 percent is an opportunity for Vietnamese companies, especially when competition stiffens after tariffs in the ASEAN and ASEAN+1 areas are brought to zero. If Vietnamese companies cannot build up their brand names, they will hardly compete with other rivals. When the cost ceiling of advertising is lifted, it will encourage enterprises to develop production, business and branding, promote new products on domestic and international markets.
She pointed out that the State budget revenue will not be reduced because the spending on advertisement of this company is the income of other one. There is no need to worry about rampant advertising because all companies have to weigh up their expenses to be profitable. To restrict boastful ads, the government should introduce other legal instruments.
At the seminar, international branding consultants from the United Kingdom-based National Consultancy Company will introduce some basic methods for Vietnamese enterprises, especially exporters, to make successful investment in brand development, raise product value and grasp opportunities from international economic integration.
Quynh Anh
Vietnamese
