Set in 2016, this case follows Phua Koon Kee, the CEO of Kova Group, one of the largest paint manufacturers in Vietnam, as he pondered upon the business expansion strategy that could elevate the Kova brand’s status to that of a household name. Based on a patented NANO technology that used silicates from rice husks to make paint, Kova’s products were of higher quality than its competitors, in terms of environmental-friendliness, durability, waterproof properties and anti-fungal capability. Kova’s distinct competitive advantage was its adaptation for the tropical climate and its localisation for geographical landscapes in Vietnam and other SE Asian Markets, which were the key reasons Kova was able to enjoy price premiums in its home market.
Despite offering innovative and superior-quality products, Kova faced multiple challenges to growth. Domestically, as the Vietnamese economy opened up to the entry of foreign paint companies, competition in the paint industry has intensified. Kova wanted to grow the retail market, where the bulk of its revenue stream was derived, but channel distribution to numerous small stores and brand promotions to end-consumers would demand the company to come up with a well-crafted strategy. Internationally, Kova suffered from a lack of brand presence and a poor country-of-origin image.
Given the multi-faceted challenges, Phua is left thinking about developing an effective integrated marketing plan to create a strong brand positioning for Kova. How could he then leverage the distinctiveness of the Kova brand to gain a larger local market share and subsequently conquer overseas markets?
Students will be encouraged to discuss the competitive strategies using differentiation and cost leadership approaches for the company in question. The case will lead students to examine the development of brand equity in terms of brand loyalty, brand awareness, perceived quality and brand associations. The case also provides opportunities for students to evaluate the selection of new target markets as the company, being from an emerging economy, considers internationalisation.
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