Local economic development through crafts: Co-designing new products in Vietnam

Change Management

The project was launched in February 2012 in 13 craft villages in Quang Nam Province. Rather than re-inventing the wheel and developing a new crafts industry in rural areas, the project partners are using a co-production approach by harnessing the existing craft skills of local people and skilling up local crafts men and women to found and run small enterprises. This has involved training and support in marketing, product design and tourism provided by international experts and national organisations.

In the villages of Quang Nam and almost all other provinces in Vietnam crafting and trading was traditionally based on small home-businesses. Product design was inherited from ancestors. This meant that local craft products no longer lived up to the tastes and expectations of potential current customers nor did local craft men and women have a marketing strategy or retail network to reach new markets.

The new economic development strategy was rolled out in a multi-stage process:

1. Market analysis and asset mapping of craft skills in local communities

In April 2012 local staff from the Quang Nam Department of Industry and Trade and its offices in Hoi An, Dien Ban and Duy Xuyen Districts were trained on survey methodologies by staff of the UNESCO Ha Noi Office. This enabled them to conduct a survey of 238 local villagers running home-based craft business, cooperatives and commercial enterprises, which together employ about 1197 people in the three districts of Hoi An, Dien Ban and Duy Xuyen.

The key findings were:

• Craft industries directly employ over 95% of local people but the local authorities in these areas lack knowledge and expertise in local economic development.
• Lack of supportive zoning policies regarding the supply of raw materials, which has led to an insufficiency of certain raw materials and a sharp decline of some local sources, in particular wood and clay.
• Lack of understanding by crafts men and women of the important role of product design and product development.
• Weak connection between the cultural values of craft products and the two World Heritage sites located in the area. The tourist market is underestimated or unrecognised.
• Uncoordinated and inadequate marketing of products.
• The family-based businesses which are typical of 81% of craft production units do not have business registration, and their access to capital (bank loans) is very limited.

On the basis of these findings, the UNESCO team designed an appropriate training programme for the villagers, which was then provided to craft producers in all the surveyed 13 villages. The asset mapping of the existing skills and business experience of villagers also allowed the UNESCO team to select four villages which showed the biggest potential to become economically sustainable, which were then given hands-on support in product development:

• Thanh Ha ceramic village
• Kim Bong wood carving village
• Lantern communities around Hoi An Old Town
• Duy Hoa pottery village nearby My Son sanctuary.

2. Training for business development of local crafts men and women

In January 2013, UNESCO Ha Noi started the training of 23 craft men and women from 13 villages in Hoi An. The workshops focussed on issues such as business management, risk management and product design. K’ARTS, the Korean Arts University, provided hands-on support in product design. The first two training courses were provided in a classroom using a variety of methods: group discussions, flashcards, games and other activities to get the message across. The trainers introduced and considered themselves as facilitators, encouraging a highly interactive approach.

Based on the results of craft survey and observations from the first two trainings, UNESCO and the Vietnamese not-for profit organisation Craft Link tailored the third training course over three days in late 2013 to better meet the needs and suit the craft producers. In this third course, trainees were broken in four groups for coaching and mentoring one-on-one on the following issues: costing and pricing, book keeping, managing customer orders. On the final day, all participants gathered for a plenary session on customer service and small-scale business management.

The participants in the training programme varied in age from 25 to 60 years old. At the beginning of the workshop they showed little knowledge of market-orientated product development but by the end of the second day they had grown in confidence and were able to come up with a variety of good ideas and plans for action in their businesses.

During the training programme, participants were particularly keen to link the conceptual issues about which they learnt to practical steps they could take in their business. For instance, the consumer profile game allowed them to think about the different ways people are motivated to buy their products and what the implications were for their product design and marketing.

3. Product design support

The product design support involved designers and crafts people in practical testing of a wide range of products, designs and techniques.

Newly developed products were tested by putting them on sale at production workshops, visitor centers in Hoi An and a craft bazaar in Ha Noi.

The general feedback from tour guides and visitors was positive. In particular, there was strong positive reaction to the range of ‘personal’ products (e.g. clothes and accessories), which was considered to offer a good mixture of contemporary design and traditional cultural elements, coupled with good functionality. However, many of the decorative home products were seen to require further development. 

4. Development of a marketing strategy and marketing materials

In October 2012 the international branding consultancy QUO partnered with UNESCO to develop a joint branding initiative for locally produced crafts in Vietnam. A market analysis of Quang Nam Province revealed a number of regional characteristics such as:

• passionate local people connected to their culture by deep roots;
• unique historical landmarks qualified as UNESCO World Heritage sites;
• genuine craft tradition still practiced by skilled artisans;
• a diverse eco-system located in the centre of Vietnam; and
• commercial trade acumen, which has driven the local economy for over 2000 years.

The results of the market research were discussed with key provincial stakeholders with a view to shape a regional tourism brand, which was presented for discussion and validation by relevant provincial stakeholders at a workshop in November 2012.

Following the workshop, QUO consolidated the results of the discussion and presented provincial stakeholders with three options (as in pic 1, pic 2, and pic 3 below) in January 2013.  The option in pic 3 was picked. In partnership with ILO, UNESCO is now supporting the Province to develop a set of guidelines on how to use this branding, including the selection process for products and retail outlets that are entitled to use this branding.

The project will also develop tailored tourism packages to provide more visibility and new markets to the craft villages. The new craft products will enrich the experiences of visitors to Quang Nam and their understandings of World Heritage values while generating income for local communities.