A few ads in the national press (the Saigon Times Daily, Heritage and Vietnam News among them) were the only signs that Gucci’s spring/summer collection was to decorate the walls of its very first store on Ho Chi Minh City’s fashionable Dong Khoi street.
Just as casual was the entrance of Louis Vuitton. Perhaps because its new store, which faces Ho Chi Minh City’s famous Opera House, is its second in Vietnam. A few print ads, a press release and a swanky launch party went barely noticed in Vietnam’s bustling commercial capital.
Of course, less is more when it comes to media for highbrow labels. Too much exposure, say observers familiar with the category, is deemed vulgar — like a booming voice at a stylish party — and tarnishes the brand’s reputation for exclusivity.
Not that Vietnam has much to offer yet in the way of luxury-friendly media. Fashion and beauty titles Dep, Sanh Dieu and Phong Cach, and premium women’s magazines such as My Thuat, are growing in quality and stature. But they’re hardly Vogue-esque.
“There hasn’t been much advertising yet — probably because there’s nowhere to put it,” considers Matt Turl, account director at ZenithOptimedia, LV’s globally aligned media agency, which has yet to be called into action in Vietnam. Gucci hasn’t hired a local media agency either. Both use global creative work, so have no need for the services of ad agencies.
“Their biggest consideration is whether the environment is prestigious enough so as not to dent the brand’s heritage. They are extremely strict — almost obsessively so — about execution, from everything from the store’s look, feel and location, to the media in which their ads appear.”
More of a surprise, reckons Jim Goh, regional MD of OMD, and former marketing director of Möet Hennessy Malaysia, is that these brands have any presence in Vietnam at all. While neither Gucci or Louis Vuitton, not unusually for brands of their ilk, were forthcoming with reasons for entering the market, Goh points at a big Japanese community within a stone’s throw of Dong Khoi, Korean holidaymakers and wealthy Vietnamese returning from overseas as sensible reasons to go in.
But luxury labels that are setting out to create a market in places such as Vietnam and China often use brand building as a tool to whet appetites. In China, for example, the likes of Louis Vuitton has begun to increase its profile in third-tier cities, where consumers may not be able to afford its products, with an eye to building brand loyalty for the future.
WTO membership, a rocketing economy and an increasing thirst for consumerism are, of course, solid motives too (property prices in downtown Ho Chi Minh City are now almost on a par with New York’s). But while Vietnam’s proportion of its 89 million people living on a dollar a day has risen above the Philippines, India and China, almost a fifth of Vietnamese remain below the poverty line.
“LV would not set up shop if there was a chance it would lose money,” says Goh. “It does not believe in loss leaders. In a sense their presence is propaganda. The Government can point down Dong Khoi with confidence say: ‘Vietnam is a great place to invest’.”
