Consumer Behavior individual assignment

Vietnam's economies have grown incredibility in the past few years. Since the launch of the
visionary plan "Đổi mới' in 1986, from a poverty nation, the country has turned into a middle-
income economy in just 35 years. (Bank, 2021). The growth in the economy has always
manifested through the buying tendencies of conspicuously consuming newly-rich population
(Ramanathan, 2019), and Vietnam is no exception., with 15% of the population can be
considered as having a high income at the ages of 25-45 with estimate earning at 75000$ per
years (Statista, 2021). International luxury brands like Gucci see the potential of the
Vietnamese market and are making noticeable moves to enter this market. This essay will
discuss the overall consumer behavior based on Gucci's marketing activities in Hanoi.
The customer decision-making journey consists of 4 steps: Need Recognition, Product choice
awareness, information gathering activities, and their overall evaluation (Schiffman &
L.Wisenblit, 2015). The first stage is the needed recognition when customers figure problems
in their life and are looking for a solution. After identifying that the needs cam solved by
purchasing, they will rush into looking for a product or service that meets the requirements.
To be purchased, products must satisfy consumers in 3 elements: Product Factors; Situation
factors, and Consumer Factors (Schiffman & L.Wisenblit, 2015). Then, consumers will
evaluate options through one of these three ways: The Compensatory, The Noncompensatory,
or Lexicographic Decision Rules.
Neither marketing managers, marketing agencies, nor the distribution systems, the market
forces are created for the Customer's needs, motivations, and market driving (Peter Sampson,
1995). Customers' perceptions are the results of satisfying the needs of customers. It
represents customers feeling with the services providers, or an emotional reaction to the
difference between what customers anticipate and what they receive, regarding the fulfillment
of some need, goal, or desire (Haaften, 2017). When consumers search information for
products or services, it seems like the one perceived distinctively and favorably will have a
much better chance of being purchased. (Schiffman & L.Wisenblit, 2015). This brand's image
(brands, packages, services, and prices) is how customers will perceive a product and
influence the selection and interpretation of external stimuli, thereby affecting the structures
of behavior choices or the formulation of alternative courses in action (Meglin, 1987). The
Customer must 'learn' about the products to create the perception. This process is called:
Consumers Learning Process, in which consumers evolve and change as consumers acquire
knowledge from experiences, observation, interactions with others. There are two main types
of consumer learning theories: behavior learning and classical conditioning. By understanding
consumers learning, marketers can easily sneak their images into customers' minds, disrupting
their evaluation of choices and making brand loyalty.
Brands are the only way to differentiate various products with the same features on the
market. According to American Marketing Associations, the brand is a name, terms, or other
features identifying one seller's good and services. High brand loyalty significantly increases
a brand's monetary value. There is an assuming relationship between the interpretations of
brand equality under the name-calling: The brand equity chain. The first chain is the brand
description, which contains the 4p's marketing mix: Product, Price, Place, and Promotion. The
formula must be distinctive to satisfy target consumers' needs, gain positive brand perceptions
from customers, determine the brand's strengths, create awareness, and gain customer loyalty.
The higher consumers' perception will increase overall brand value, guarantee stable income
(Wood, 2014).
For most consumers, luxury can be considered unnecessary. It is so desirable because luxury
goods come with social class recognition and convey personal taste and social image (Mason,
1989). Gucci has used the strategy of 'perception' and 'consumer learning' to conquer their
potential customers. Gucci products are considered good quality, made of expensive material,
such as silk, natural leather, or premium fabrics, and the feeling of wearing those are
incredibly comfortable. The Gucci design is relatively suitable for everyone, yet not everyone
can have Gucci items, so the uniqueness of the owners is highlighted. The signature of Gucci
products is The Gucci Patterns, including the two interlocking opposite G letters. It is being
printed widely on shoes, bags, clothes, and glasses (Gucci, 2021), and it is elegant enough to
inform the opposite people about prestige fabrics in front of them without being said as
showing off. Gucci does not promote itself through mass media. However, people can always
see the image of Gucci naturally appearing on the pictures related to luxury experiences on
Instagram, Facebook pages, and blogs about lifestyle on the famous magazine of Vietnam.
These elements create the link that Gucci symbolizes the luxury lifestyle. In addition, Gucci
regularly brings their collections collab with famous brands like Disney, Doraemon, or Kai
(EXO). These figures are the childhood and teenage life of millions of Vietnamese.
Associating luxury products with this figure uses cognitive learning to implement the brand's
image with something more related to the mass community. When they have luxuries, they
might be related to Gucci because of initial impressions and memories.
In 2020, Gucci had revenue from 5-10 million dollars in the Vietnam market alone (Direct,
2021), and they only have two stores in Hanoi and Hochiminh city. They are doing well.
However, despite having a solid image in front of customers, third parties retailers are
considering their potential threats, as they always provide a much better offer than an official
retailer. If customers go through non-official retailers, they will neglect the connection
between the brand's value and exclusive services connected with the customers, which
neglects the interaction with customers and reduces the brand's loyalty. In order to solve this,
they should consider enabling online shopping features in Vietnam for general and Hanoi in
particular. The flagship stores will likely be a place for customers to experience the vibe of
Gucci and pick up things they have ordered online. In earlier times, only the rich could afford
luxury products, but now with the increased level of exposure, taste, and increased disposable
income, luxury has become more accessible for any class. Pop-up stores in events that bring a
related message, such as art exhibitions, music shows, exclusive sporting events ( Formula 1
Hanoi Grandprix, Hanoi golf tournament,…) is another option to consider reaching these
'affordable' consumers.
The luxury goods market in Vietnam is worth 974 million dollars, primarily focusing on the
central city like Hanoi, where most rich people are residence. Gucci has successfully applied
Consumer Behaviors in their marketing strategies by giving potential a positive perception
towards their business and using the learning of consumers to create a connection with newer
generations of consumers. Gucci seems to be on its pathway to success in the Vietnamese
market, a tremendous potential market.
Bibliography
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