Recently, the 2019 Global Summit of Women under the theme of “Women: Redefining Success” was hold at Basel, Switzerland.

On July 6, business woman Le Hong Thuy Tien – IPPG President attended as a speaker in the Summit’s session on “The Changing and Challenging Business of Fashion and Design”.

Leading the group with more than 60 representatives is Vice President of Vietnam Mrs. Dang Thi Ngoc Thinh along with other leaders: Former Vice President of Vietnam Mrs. Truong My Hoa, Vice President Vietnam Women’s Union Mrs. Hoang Thi Ai Nhien, Vietnam Women Entrepreneurs Council Mrs. Nguyen Thi Tuyet Minh along with more than 60 Vietnam’s outstanding businesses.

Global Summit of Women the 29^th under the theme “Women: Redefining Success” with 1,200 women leaders, politicians, businesses and social cultural houses of more than 60 countries around the world, including women government leaders of many countries, with many presidents, CEO of big corporations such as: Credit Suisse, IBM, Ernst & Young, Microsoft and international newspapers: Financial Times (UK), Enterprising Women (USA), Swiss Federal Railways (Switzerland), Financial Times (UK), News Anchor, CNN Money…

 

IPPG President with Former Vice President Truong My Hoa and other business women

IPPG President shared sustainable development strategy

Spoken at the ceremony, Vice President Mrs. Dang Thi Ngoc Thinh appreciated all of the support for the Summit during the past three decades in promoting gender equality and enriching women’s role in both international and national aspects. Vice President of Vietnam shared some perspectives in measuring success for women in the new era. 
IPPG President – Mrs. Le Hong Thuy Tien is one of the most influential business women in Vietnam as well as leaving many impressions in the international fashion market. She was honored to be nominated by the President of Vietnam Women Entrepreneurs Council (VWEC) – Mrs. Nguyen Thi Tuyet Minh and invited Ms. Nativida – President of Global Women’s Summit, to the summit under the theme of “The Changing and Challenging Business of Fashion and Design”. Along the session at the Global Summit of Women with Mrs. Thuy Tien, Kim Sung Joo – President of luxury brand MCM, Mrs. Tasset – President Nina Ricci and Mrs. Bellini – CEO of luxury fashion brand Elsa Schiaparelli SAS. Monitoring the Summit is Ms. Melanie – Editor of Handelszeitung online newspaper.

IPPG President at the Global Summit of Women 2019

Business woman Thuy Tien shared: “IPPG is the first corporation to invest in midtier and luxury fashion retail in Vietnam. Been in the luxury fashion business since 30 years ago, we want to prove to investors and international brands that our country is ready for infrastructure, clear regulations & hold clean investments environment, welcoming all firms for sustainable growth in Vietnam.
Vietnam is a developing country and some of the consumers have yet access to experiences and knowledge about using luxury goods. Therefore, the difference is that not only we are selling the goods, we are also shaping and educating to the consumer about what luxury is on an international scale in order to create brand awareness and loyalty. 

Not only that, we must also prove that IPPG has a deep understanding of our Vietnam market. We have a wide range of VIP customer (all top spender in Vietnam) and it is the key to our ability to expand the brands successfully in VN market with 100 million populations, and a 160 billon USD retail value.” – She shared. 

Challenges in business and solutions from technology

There are challenges that all of the retail distributors must be aware and ready to deal with: inflation, counterfeit goods, hand-carry and smuggling luxury products, manpower, prime location in luxury retail business,… “However, I’m confident that we have built a strong foundation for IPPG in terms of facilities and human resources. Now, brands approach us for Corporation proposal and listen to the right direction of an experienced and professional company in luxury retail Business in Vietnam like IPPG.” – Mrs. Le Hong Thuy Tien shared.

IPPG President shared how technology applications solve the challenges in business

She also claimed technology is a crucial part in the retail business. IPPG has invested in million of dollars for IT system and infrastructure, ERP including: HRM, CRM, Loyalty and smart Retail System.
IPPG will not stay behind the trend, the company’s next evolution will be e-commerce business with more than 100 brands, and this will elevate the retail business of IPPG within the next 10 years. CSR of IPPG becomes more and more important as they grow. They want to make sure their businesses environmental friendly and contribute to community sustainable prosperity.

Below is the full Q&A that Mrs. Thuy Tien - President of IPPG - shared at the Global Summit of Women 2019:

It’s privileged for me to participate in this seminar with all distinguished leaders from around the world 
And thank you again for having me here.

1/ In what way is running your luxury distributor company similar to running any other businesses?
In terms of general basic operation, running a luxury distribution company is quite similar to any other business, however there are a few different points:

Vietnam is a developing country and some consumers have yet access to experiences and knowledge about using luxury goods, therefore the difference is that not only we are selling the goods, we are also shaping and educating to the consumer about what luxury is on an international scale in order to create brand awareness and loyalty.

We are also targeting our niche market who holds a large sum of disposable income to encourage and educate them to love and spend more in luxury.

We are distributing the Luxury brands which have had a long history of quality and standards so we always have to build a strong and qualified internal team to match with the international level.  

We must also prove that we have a deep understanding of our VN market. We have a wide range of VIP customer (all top spender in VN) and it is the key to our ability to expand the brands successfully in VN market with 100 million population, and a 160 billon USD retail value.

2/ What propelled you to go in this direction?
After the economic and political reform period in 1985, IPPG opened the air flight route for VN to fly out and integrate with the world, the next mission of IPPG is how to bring in more tourists and promote the tourism industry, enhancing the development of our country. 

When people travel to a country, there is specification which define the development of a country such as 5 stars  hotels, fine dining restaurants, luxury cars , high rise building and you can’t miss luxury brands. 

With that purpose we invest to Duty free business in all airport. 

It would have been difficult to convince the luxury brands to enter our VN airport 30 years ago. 

We knocked many doors of DTF luxury brands but most of them refused. And luckily!  Hennessey wine & liquor and shoe /leather goods brand Bally form Switzerland welcomed us... I still remember the bally CEO interviewed me at that time: do u know what the margins are and how is markups? Do u know credit term? Do u have bank accounts? I said no, sorry no I don’t know but I have a DTF license, I have a reputation and my own determination for success!! He smiled and finally approved for Bally store opening in TSN and Noi bai airport And then many other luxury brand followed, joining our DTF…

- Thanks to the kindness of the brands Bally and Hennessey, we now carry a profile of over 100 brands. 

- We are so proud that IPPG is a pioneer in this luxury business in VN, in achieving that we had to suffer and scarify a lot from the beginning, but we want to prove to investors and international brands that our country is ready for infrastructure, clear regulations & hold clean investments environment, welcoming all firms for sustainable growth in VN.

3/ Currently, who do you feel is the clientele for luxury brands in Vietnam?
- We have 3 main type of clientele in our market:
- Our main drivers are the elite upper-class segment who are loyal customers who spend a large sums every time they go shopping. And according to the statistic The upper class segment in Vietnam is secure more than 1.62% of the population. And VN wealthy people is one of the 6 fastest growing country in the world in the past few years.

- Foreign tourists and expats are a crucial part of our business, even though they are less frequent than the other groups, they are a stable and consistent revenue source.  Vietnam tourist arrivals is the highest  increase in  the region in 2018 , tourism is booming in VN along with the country’s economic fortunes and thanks to the TAX refund policy of the State, they have contribute  for more than 15% of our total revenue.

- Finally, Millennials are accountable for 35% of the Vietnam population. Although it’s not yet the main sale contributions, these are the future generations that will take over the main drivers of our sales in the next few years.

4/ Are you making any special efforts to reach out to millennials? Is there a market for luxury products among youth, and if so, how do you reach them?
 
- Millennials is an important aspect of the current and future growth of the company. And I believe this is the target future client for everyone too! 

- Yes, we have been creating so many activities in Viet Nam to attract the millennial such as: fashion sponsor -concert, sport &fashion collaboration event, fashion show trunks-show workshops ...social media interaction competition.

- Even our partners in luxury & mid-tier brands have already created designs and marketing campaigns focusing on the younger generations, driving towards that direction is already a worldwide initiative because millennials are our next generation.

- There is always a luxury products market for youth! Through social media, digital Marketing, especially through the famous influencers. We develop brand awareness, shape their knowledge and create a demand on daily wear / street wear using luxury products.

- International brands are also using the collaboration way to reach Millennial clients.  As you already know the unexpected collaboration between luxury fashion brands and popular young street style brands with exclusive lines and limited edition ranges for ex.: Balmain for H&M, Kith for Versace.

- These trend are increasing interesting viral on social media among young generation. 

- The new collaboration strategy are successful for luxury brands as it answers to the need for continuous newness from Millennials. 

5/ What are the business challenges that you see going forward?  

- There are challenges that all retailers must be aware:
 • Inflation: I believe everyone be aware of decrease value of currency as and with us it creates problem on our pricing because all our products import from overseas countries.
 • Uncertainties in world economy: The world and domestic economy is still under many uncertainties during the development process. It will effect heavily our business without unpredicted for example US and China trade tensions create so many problems for both countries entrepreneurs. 

 • Counterfeit market: There is still an existing counterfeit market with go beyond the control of the brands and the local government.

 • Hand carry & smuggling luxury high-end product is our big challenged and that has created a bad competitive environment and affected to IPPG business as we are stick with legitimate trading 

 • Manpower, especially well trained staff poaching, as so luxury brands are now want to expand their market to VN and Asia.

 • Prime location: when you do luxury distribution, certain brands will only enter the market if they are guaranteed a good location in the center of the city.

 • Although facing a lot of challenges I ‘m Confident that we have built a strong foundation for IPPG in terms of facilities and human resources., now brands approach us for Corporation proposal and listen to the right direction of an experienced and professional Company in Luxury Retail Business in VN like IPPG.

6/ Where do you see areas of growth, product- and market-wise? 

According to the General Statistic Office of Vietnam, Vietnam’s retail value estimated 2020 is anticipated to reach more than USD 225 billion and double by 2025.

Statistic shows that the spending level of Vietnamese for fashion is currently 3rd, just behind spending on food and savings;  

The upper class segment in Vietnam is one of fastest growing in the world.

The increase in the standard of living will likely also raise the price and the quality of goods purchased by Vietnamese consumers.

So most investors and international market survey organizations see Vietnam as one of the world’s most attractive markets for retail investment,

According to Business Monitor International, the industries with growing local & international demand in Vietnam are tourism & education, transport & communication, health, housing and utilities, clothing & footwear, F&B, entertainment. 

Especially since Vietnam has signed 12 FTA with many countries there are so many players in the market and the competition in VN market is becoming more intense.

7/ What impact, if any, has technology had in your present and future plans?  Does technology help or hurt the industry? 

- Technology is important part of our business. We have been investing millions of USD for IT system and infrastructure, ERP including: HRM, CRM, Loyalty and smart Retail System.

- With business intelligence (BI) and big data, we are able to gain business knowledge, including market trends that allows us to make better and quicker decisions with greater efficiencies.
- The technology had a deep impact as it:
 • Promotes transparency;
 • Streamlines business processes;
 • Creates innovative and effective channels to manage the customers, suppliers, stakeholders, employees; and
 • Gives us ability to immediately adapt to changes and grab new business opportunities.
However, implementation technology has been challenging 
• High investment cost
• Shortage of skilled and competent specialists to deploy technology Industry 4.0;
• Technology eliminates jobs and creates redundancies. So we have to balance when applying technology into our business with proper plan for re-training and reallocating of workforce.
• Ecommerce is also one of trending technology for retail business 

So IPPG will not stay behind the trend, our company’s next evolution will be e-commerce business, with more than 100 brands, all of our products will be available online to our customers through a few clicks, that will help our business grow strong in the next 10 years.

8/ What about the clamor for sustainable materials? 

- Sustainability has been a popular topic in the last few years across all industries worldwide. 

- CSR of IPP becomes more and more important as we grow, and we want to make our businesses environmental friendly and contribute to community sustainable prosperity. 

- We are aware and cooperate with brands/ firms that operate under sustainability standards such as natural resources material, eco – friendly production processes, high & long lasting quality with reasonable price, to avoid high wastes to environment.

9/ In the U.S., traditional malls and department stores are fast disappearing given the ease of on-line commerce.  Does this apply to our country? 

- No, it doesn’t apply for now as Vietnam has different E-commerce market situation than us.

- Even though Vietnam is one of the world's fastest growing e-commerce countries. But mostly good trading on e-commerce are fashion /F&B/ house hold product in a low tier category, not the mid-tier and high end -luxury product. And most of online shopping operate by small, individual family trading business through Facebook or Instagram. The e-commerce giant Amazon still not yet enter. 
- In Vietnam shopping malls still offer a different value. There are not many choices of mall for Vietnamese.
Shopping Malls are still a main weekend attraction for family and friends to gather, they go there for many other purposes such as cinema, entertainment, F&B, bookstores ....and other ...not necessary just to go shopping, so shopping malls /convenience stores are still an important hobbies in Vietnam for now.

Beside that Vietnamese still enjoy the in-store luxury service experience, luxury environment, taking the time, optimizing their time in-store.

As you aware of all top tier international brand always have select the best interial design and material to offer the customer the best luxury experience... VM in the showdows are also the big investment of all brand for attracting customer and enhancing the brands.

The targeted market for luxury malls in VN are also the more mature clients who are not as tech-savvy as the younger 

However, the future spending is through digital marketing and e-commerce where tech- Savvy Millennial are.

So IPPG will not stay behind the trend, we are implementing the e-commerce platform, and this is a first authentically multi brands fashion e-commerce in VN where all of our products will be available online to our customers through a few clicks, that will help our business grow strong in the next 10 years.