GROUP 5

Võ Duy Ngọc

Bùi Kim Ngân

Nguyễn Hoàng Nam

Ngô Nhựt Qui

Võ Nguyễn Xuyến Chi

Nguyễn Thị Cẩm Nhiên

Lê Minh Quang
VOCABULARY OF  READING
KELLOGG

Founded in 1906

Manufacturer of cereals
and convenience foods

It has manufacturing
facilities in 19 countries and
markets its products in more
than 160 countries.
 Kellogg Company has established its
30th manufacturing facility in India

Total investment capital

is 30 million USD

In 1990, Kellog company regularly

raised prices to help increase revenue.
 Launched in September 1994, Kellogg's first
products in India included:

Cornflakes Wheat flakes Basmati rice flakes

 Providing good quality products

+
The help of the parent company

Kellogg is still not successful in

the Indian market

The product launch date combined with exciting media

activities also failed to create an impact on the market
Negative media coverage of the product increased as
many consumers said they rejected the product's taste.
 According to analysis:

Out of 100 packages sold, only 2

packages are purchased regularly
by customers

The remaining 98 were first-time

buyers

Converting first-time product testers into regular

buyers has become a big problem for the company.
In April 1995, Kellogg India Ltd received worrying reports of
a gradual decline in sales from distributors in Mumbai.

National sales have dropped 25% since March 1995, the

month Kellogg products became available nationwide.
By September 1995, sales were almost stagnant. Marketing
experts point out many mistakes that Kellogg made
Kellogg banked heavily on the quality of its crispy flakes

Indians heat milk and boil it while it is still warm, but

pouring hot milk on the scales makes them soggy
 Main reasons leading to Kellogg's failure:

The taste of their products does not match the breakfast

habits of Indians.
Kellogg has asserted that the company is not changing
these habits, launching its products on a health platform
and making consumers see the benefits of the product to
replace the traditional dishes that Indians prefer usually
eat in the morning.
analyse the business environment

find out the needs and habits of

consumers; the culture of a country
How did they go wrong?

Wrong positioning and

product awareness
Eating habits and culture
Advertisements hurt Indian
sentiments
Price sensitive consumers
Customization
Poor distribution
 Wrong positioning and products awareness

Their product does not give a feeling of

fullness after a meal and it goes against
the Indian concept of breakfast, despite
claiming to be a substitute for their
regular breakfast
 Eating habits and culture

Indians are also used to having hot and spicy

food for breakfast. Asking Indians to eat sweet
and cold cornmeal for breakfast is foreign to
them.
Indians have hot and spicy food for
breakfast, which requires them to eat a sweet
breakfast and cold cornmeal, which is too
sweet a breakfast for Indians.
Kellogg’s products must be consumed with cold milk.
Since Indians are used to drinking hot milk from an
early age, eating cornmeal with cold milk is
unthinkable.
 Advertisements hurt Indian sentiments

Kellogg's in its advertisements pointed out that

Indian breakfasts were unhealthy and non-
nutritious which hurt the sentiments of Indian
homemakers
 Price sensitive consumers

Kellogg's has very high prices. The product is

33% more expensive than its closest
competitor. Indians are not willing to pay high
prices for a relatively new product
 Costumization

They do not research products based

on Indian tastes, but simply bring
products from the US and sell them in
India.
 Poor distribution

focus only on India's metros, high-end

and mid-range retail stores, which puts
many customers out of its reach.
 HOW DID
THEY COPE UP
WITH ABOVE
CHALLENGES?
 PRODUCTS

Took Indian products as the center or localized

according to the taste of consumers here. The
brand introduced Chocos in 1996 and Frosties in
1997. Kellogg's Chocolate Chocos were
essentially scoops of wheat with a chocolate
coating while Frosties had sugar on each wheat
bite.
 PRICE

Reduced product costs by replacing packaging

from glossy paper to paper bags and
introducing multi-pack sizes. And it attracted
large Indian consumers who were not high-end
customers.
 PLACE

Nationwide expansion and distribution of

its products in many cities, eveyone could
access products and help increase sales.
 Promotion

eliminating the wrong message to Indian

consumers, they instead promoted new
exciting brand positioning and eliminated
the premium brand image by making the
product more readily available.
Lessons learned from
studying the business
environment:

About Company
Any business must clearly
understand and evaluate
business enviroment.
 Some brands make mistakes

When businesses make mistakes,

how do they solve them?
 solve the problem

First of all,
businesses
Analyze and Develop a
find the Regularly
must do is Fix business specific
admit their cause and evaluate
mistakes and provide strategy plan to fix and adjust
take corrective errors the working
responsibility measures. mistake methods.
Why do business
need to analyze
the business
environment?
What is business environment analysis?
IMPORTANCE OF BUSINESS
ENVIRONMENT

Early recognition of
opportunities enables a A business organization
should shape its policies in
business organization consideration of the
to be the first to environmental demands.
capitalize on them.

The study of the business

environment is crucial for Environmental analysis aids
ensuring the optimal business organizations in
utilization of resources identifying strengths and
such as financial, human, weaknesses.
and physical resources.

IMPORTANCE OF
BUSINESS
ENVIRONMENT
Scanning the business
environment aids in
comprehending the
political situation and its
impact on business.
Due to globalization, the
influence of international
events on business is
growing. Understanding
global events and their
impact on business
necessitates the study of the
international environment
Environmental analysis contributes to
understanding market conditions, such as
changes in demand/supply, shifts in
fashion, taste, economic booms or
depressions, and more.
Environmental analysis
facilitates the adoption of
the latest technological
developments, resulting in
improved efficiency.
understanding the
government's economic
Scanning the business
environment helps in
understanding the
government's economic
policies and their effect on
business.
Through, environmental
analysis, business
organizations gain
insight into competitors'
strategies to formulate
counter plans.
Environmental analysis
assists business
organizations in recognizing
threats and exploring
available opportunities.
Identifying Opportunities and Threats
Businesses operate within a dynamic
environment influenced by various factors
such as economic conditions, market
trends, technological advancements,
regulatory changes, and competitive
landscape. By analyzing the business
environment, companies can identify
opportunities for growth and expansion, as
well as potential threats that may impact
their operations negatively
Strategic Planning
A thorough understanding of the
business environment allows companies
to develop effective strategic plans. By
analyzing market trends, consumer
behavior, and competitor activities,
businesses can make informed
decisions about product development,
market positioning, pricing strategies,
and resource allocation.
Risk Management
Business environments are often characterized
by uncertainties and risks. By conducting a
comprehensive analysis, companies can
anticipate potential risks and take proactive
measures to mitigate them. Whether it's
changes in consumer preferences, economic
downturns, or regulatory changes, businesses
that are aware of the risks are better equipped
to respond effectively.
Staying Competitive
In today's globalized and competitive
marketplace, staying ahead of the competition
is essential for business survival. Analyzing the
business environment helps companies
understand their competitive position relative to
other players in the industry. It enables them to
identify their strengths and weaknesses, as well
as opportunities to differentiate themselves
from competitors.
Adaptation to Change
In today's globalized and competitive
marketplace, staying ahead of the competition
is essential for business survival. Analyzing the
business environment helps companies
understand their competitive position relative to
other players in the industry. It enables them to
identify their strengths and weaknesses, as well
as opportunities to differentiate themselves
from competitors.
 Examples of some
successful businesses
and failures in
analyzing the business
environment
Amazon is one of the most
successful companies that
constantly analyzes and
adapts to the business
environment
Company failure
 Blockbuster is a
good example of
not adapting to a
changing business
environment.
 Macro environment
Political and Technological Economical Cultural
legal factors factors factors factors

Businesses Affects the Decide on the It is a factor that

must ensure output quality of business's requires investing
compliance the enterprise consumption time for businesses to
with the laws during the quantity and survey and research
R
of their target product affect the goods because business e
business
environment
production
process
market and
customers'
products impact
society and customer
an
to avoid legal spending ability psychology so w
cases or
lawsuits.
businesses can adjust
their products to suit
m
the business
environment.
Given the macro environment, businesses have no
other choice but to respond and adjust
accordingly. If entrepreneurs have a good
understanding of the business environment, they
can easily recognize, analyze and react to the
forces affecting the business.
Micro environment in business

It is the environment that

directly affects the business
activities of the enterprise.
Affects business processes and
overall company performance.
Unlike macro factors, micro
factors can be controlled and
changed by businesses
 Micro environment in business
Customer Supplier
Competitors
factors factors

Consumer psychology, Are individuals or Depending on the situation

the reasons and needs organizations that and type of product, there
behind customers' provide raw materials will be different
product purchases or for businesses. Affects competitors. This factor
purchase frequency will product price and requires businesses to
affect the way product output quality. have strategies to
businesses devise outperform competitors
marketing strategies. and how to upgrade
products or services.

General
public

Contribute to impact
and have the ability to
influence the A way to visualize and
campaigns and goals
of the business
analyze ALL of your data
in one place
 MACRO ENVIRONMENT IN BUSINESS

POLITICAL AND LEGAL TECHNOLOGICAL

FACTORS FACTORS
Online retail businesses operate Know how to access and use AI
in an environment governed by and automated machinery to
laws on electronic transactions create new and convenient
law and commercial law. experiences for customers

CULTURAL FACTORS
ECONOMICAL
Open acquisitions to buy other
FACTORS online websites because online
Know how to update and learn shopping is highly appreciated
about market fluctuations nowadays in almost every part
of the world
 Micro environment
Customer factors
Amazon has delivered
and received goods in
185 countries and
territories, covering more
than 300 million
international customers.
in business
Competitors
Ebay.com, Alibaba.com, Buy.com,
Overstock.com, Walmart.com,...
and other search engines and
marketplaces are increasing, but
Amazon still knows how to
compete and focuses on
improving service quality. service
About the labor market
As of December 31, 2021,
Amazon has employed
1.6 million people globally
and has a team of
talented employees
ready to create
achievements for the
company.
Minigame
Hidden Worrd Puzzle
a thing that is grown,
1 produced or created, usually
for sale

2 the number of items sold

to advertise a product in a
3 particular way in order to
make people want it
 Hidden Worrd Puzzle
P R O D U C T

T U R N O V E R

M A R K E T S T H

S A L E S

C O M P L A I N T

M A R K E T P L A C E

E X P E R I M E N T E R

L A U N C H S T H

C O N S U M E R
EXERCISE 2: DISSCUSING THE IMPACT OF EACH EVENT IN THE BUSINESS ENVIRONMENT.

Event Impact

1. High unemployment in a Negative impact: High unemployment can lead to economic stagnation, increased poverty,
region. social unrest, and decreased consumer spending.

2. Good relations between Positive impact: Good relations with suppliers can result in better pricing, timely deliveries,
suppliers and a company improved product quality, and stronger partnerships for innovation and growth.

3. The internet has opened Positive impact: The expansion of the internet increases access to information,
up. communication, and markets, fostering innovation, economic growth, and global connectivity.

4. Vietnames people invest Positive impact: Increased investment in education can lead to a more skilled workforce,
a lot in education. higher productivity, technological advancement, and improved economic competitiveness.

Positive impact: Heightened awareness of health issues can lead to improved public health
5. People care more about
outcomes, reduced healthcare costs, increased demand for health-related products and
health issues.
services, and overall improvements in quality of life.
Thank You
For Your Morning