Manufacturers and distributors have been prohibited by the government to advertise milk-formula products used to replace breast milk. In an aim to force prices down, The Ministry of Finance (MOF) has requested enterprises to cut the ad budgets.
According to Ms. Huong, the owner of a sweets shop on Dich Vong Street, special promotions are usually offered to formula buyers, especially foreign-made formula products with the value sometimes accounting for up to 20 percent of the products’ prices. She also estimates that if formula manufacturers do not have to spend money on sale promotion campaigns, they will be able to slash prices by dozens of thousands of dong for every box sold.
As Mr. Ngo Tri Long, a renowned economist, said that dairy producers and distributors spend big money on ads and marketing activities, which are considered when they set prices. As a result, prices are always “sky high”. He believes that in case of the ad ban applied to formula products for children under 24 months old, to take effect on March 1, 2015, it will help formula manufacturers and distributors cut selling prices.
However, Mr. Long warned that the manufacturers and distributors may use their own way to dodge the laws to continue spending money on ads and marketing activities.
