- Tram Ho
From the story of Vsmart Live …
Vsmart Live was launched VinSmart in August 2019 for VND 6.99 / 7.79 million. After three months, VinSmart adjusted the price for this device to only VND 3.49 / 3.79 million, which is only half of the original price.
With such a shocking price reduction, it is not difficult for Vsmart Live to receive a very enthusiastic response from users, because in the price of 3 million, it is difficult for a product to surpass it. For the first time in history, a Vietnamese smartphone was hunted to the point of being sold out. Vsmart also confirmed that Vsmart Live has increased by 115% in just a few days.
At first, the direction that VinSmart chose seems very reasonable. Users benefit when buying good products at low prices, VinSmart also benefits when the market share increases and quickly resolves inventory. So both sides are beneficial.
However, this is just a temporary victory, and it creates a huge problem for the Vsmart brand in the long run.
First, users who buy Vsmart Live for the first time (for 7-8 million) will feel their trust as betrayed. After all, Vsmart is still a young phone brand, reputable not equal to the “old” in the industry like Samsung, Oppo or Xiaomi, and with 7-8 million, users can easily buy. Get the good products from the big brands above. But for some reason, they chose Vsmart. To make this decision, users must have a certain “courage” and “altruistic” certain.
However, in response to that love from users, Vsmart decided to cut Live’s price in half after a very short time. As a result, first-time Vsmart supporters suffered a small loss, and they felt like they had given the wrong confidence. As mentioned above, for a fledgling phone brand like Vsmart, trust is an extremely important thing.
After only 3 months of launching, Vsmart Live is VinSmart adjusted half price
The second problem applies not only to previous Vsmart supporters, but to all potential Vsmart users in the future. Is there anyone else who wants to own a Vsmart smartphone when it is first launched, knowing that the previous device lost half its price after only 3 months? At this time, users will exist the psychology of “waiting for a discount and then buying”, thereby directly affecting the profit of VinSmart.
The latest leaked image of Vsmart Active 3 – a mid-range smartphone is about to be launched by VinSmart. After the price drop of Live, who dared to buy Active 3 at the time this new device hit the shelves?
Thirdly, sudden drops often create bad sentiments for buyers. They will ask the question: “Why did this machine come out and discount so quickly?” or “Is there an error to sell cheap?”.
It must be affirmed that, Vsmart Live is a very good product, very good quality, but we can not blame those who have such questions. “If the product is really good, what is the reason for such a shock discount?” – there will certainly be customers who have the same questions, and if I were a supermarket salesperson, I would probably “freeze” because I didn’t know how to respond.
Look how Oppo does promotion
On 28/12, Oppo organized the program “Oppo Reno2 F – 1 for you, 1 for family” at a mobile phone store in Ho Chi Minh City. Specifically, the first 100 people to buy Reno2 F will get a free Reno2F, the next 100 people will get 1 F11 Pro and the last 100 people will get 1 F11.
Oppo Buy 1 Get 1 Free Promotion
Reno2 F is currently priced at 8.49 million. In terms of value, Oppo “buy 1 get 1 free” device is like Oppo is selling half price. However, its corollary is very different from Vsmart Live above.
Firstly, “buy 1 get 1 free” gives users a more positive perception of the value of the product than cutting the price. VinSmart has discounted Live to more than 3 million, meaning the value of this device is just over 3 million. Oppo bought 1 get 1 free, but the value of Reno2 F is 8.49 million still unchanged – users still have to spend 8.49 million, at the listed price, if you want to own this machine.
Naturally, users can sell one of the two devices to turn the investment amount into 8.49 million / 2 = 4.24 million. But, since the list price of this device is still the same, there’s no way they’ll be sold so cheap. In fact, the Reno2 F is still being traded on the classifieds for about 7 million – not “catastrophic” at all.
On the contrary, the sudden decline of Vsmart Live has disturbed the market. This affects not only users as mentioned above, but also retailers and VinSmart itself. The return policy of retailers will be affected, as the old device returned to customers is forced to enter at a higher price than the new one. As for VinSmart, the reduction of Vsmart Live made the company’s product hierarchy disturbed, when its low-priced product Joy 2+ (price 2.9 million) immediately lost its appeal.
Second, the way Oppo integrates promotions with a major national holiday not only makes Reno2 F’s price drop much less “serious”, but also creates sympathy in the eyes of the public.
The promotion, synonymous with a decline in the value of the product, will become much less serious if integrated within such a meaningful justification.
You still remember the question “If the product is really good, why excuse the price so shocking?” above? If the salesman will hardly be able to give a convincing answer to the customer in the case of Vsmart Live, then with Oppo, they can completely stick to the message “1 for you, 1 for family” full. meaning that no one can judge.
Third, Oppo knows how to attract attention and create a good image of the public in the eyes of the public. The headlines “Users queuing up to buy Oppo phones” have appeared on newspaper pages during the past time, accompanied by mobile phone images filled with people buying Reno2 F, people will be curious: “Reno2 F is electricity What is it that people buy so much data? “.
Praising headlines or the image of a user queuing up to buy products is an extremely effective way to build a brand foothold in the hearts of users.
Regret and hope for VinSmart
At this point, you will probably wonder: “But Oppo limits the number of products that, not everyone can buy?”
Exactly, not everyone got the offer when they bought Reno2 F that day. Walking through a social network that day, it is not difficult to encounter a large number of dissatisfied people for not buying the device (from both subjective and objective reasons). Anyway, Oppo is limited to 300 seats, so it’s hard to please everyone.
In contrast, cheap Vsmart Live is sold without limitation, anyone can buy it. What if VinSmart also held a similar program Oppo?
People will feel that they can buy Vsmart Live cheaply because of luck, not because this is a “problematic” product, so they have to discount. Plus the unlimited power supply, so everyone will buy it, everyone will be happy. And because the value of the device remains the same, VinSmart can still confidently launch the future products without worrying about waiting for discounts from users. The images of queuing up can then be used to promote and strengthen the confidence of Vietnamese people about using Vietnamese goods – something that a young Vietnamese brand like Vsmart is still lacking.
Whether you like or hate Oppo, you have to admit that Oppo does marketing very well. While other Chinese phone companies like Huawei and Xiaomi are still struggling in Vietnam, Oppo is currently in the second position in terms of market share after only a short time.
As someone who has purchased and is using Vsmart Live cheaply, I really feel sorry for VinSmart. Discounting products and willing to sacrifice profits is a bold decision of VinSmart that not all businesses dare to make. But I think that VinSmart did not know how to take advantage and turn it into an opportunity to create the image of a high quality Vietnamese smartphone brand.
VinSmart’s products are good, but VinSmart needs measures to promote them more appropriately.
Speaking of which, I feel even more regretful, because Vsmart Live is a very good machine and completely unworthy of the “sale off” label. But, creating a good product alone is not enough, brands also need to find ways for users to know the same thing through appropriate and worthy promotion campaigns. And that is what I hope that VinSmart will do in 2020.
Source : Genk