FROM TRADITION

TO TRANSITION

VIETNAM CONSUMER TRENDS 2017

AMCHAM VIETNAM APRIL 19,2017
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2017 Consumer
Confidence and
Retail Impact

INFOCUS MEKONG RESEACRH

2
Consumer confidence is what drives economic growth world-
wide and Vietnam is no different.

3
Consumers and business leaders are upbeat about 2017.
Business leaders seem more buoyed, while consumers suffer
from economic lag effect…meaning they feel the good later

4
Key concerns for 2017 revolve around the value of the local
currency and the increase in the cost of living.

5
For consumers the VND devaluation is seen as a major concern, due to
declining purchasing power, driving increased price sensitivity.
For business Leaders, economic impact, both global & domestic are worries

6
2017 should see continued growth in consumer spend with Education,
Entertainment, and Food & Beverage sectors driving growth. Healthcare
spend has dropped from the 2nd to the 9th position in the past 4 years.

7
Personal credit began IN 2007 with WTO accession.
Vietnam has gone from a cash - credit - debit culture in a short 10 years.
Any major economic crisis hits Vietnam, private debt could be devastating

30%

10%

8
Loans were driven by personal item purchases, business & real estate
investments. Hence, consumers are beginning to live above their means.

9
Savings are in decline, largely due to an increase in conspicuous spending,
stuff we want but are not necessities… showing further consumer confidence

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DIGITAL VIETNAM
TREND 1: URBAN EXPLOSION OF DIGITAL
In a short four years, all that is smart / communications driven has exploded.
Consumers are craving connectivity / info / entertainment via personalized gadgets…

2013
Digital Ownership 2016
31
Smartphone
86
58
Home WIFI
84
37
Laptop
81
42
Desktop
60
11
iPad /Tablet
54
4
Smart TV
41
TREND 2: PURCHASING FOR SELF FULLFILLMENT “CONFIDENCE”
All things that give pleasure for work, rest and play are now key purchase items

Used car 5%

New Car 7%

Apartment 12%

House 14%

Smart TV 40%

Motorbike 42%

Laptop 47%

Smartphone 82%
TREND 3: SMARTPHONE CONVERGENCE AS EVERYTHING DEVICE
Vietnam embraces all things digital, as witnessed by past and forecasted growth.
In a short 4 years, Mobile looks to converge with all things digital at the key digital
platform in Vietnam
Millions of USERS
2020
INTERNET 62 Million
SMARTPHONE

PC
56
53 54 55
51 52 56
53 46
38 48
32 43 42
38
35
32
29

2015 2016 2017 2018 2019 2020

TREND 4: TV DOWN, MOBILE & SOCIAL AS KEY INFO SOURCE UP
Mobile as a source of Information, mixed with Social media, has seen the highest growth,
dictating a viral solution which should reach about almost a high percentage of audiences .

TV Newspaper/Magazine
Social media (Facebook, YouTube) Mobile phone
Internet/Online

90%
TV
89%

65%

44%
34%

33%
30%

20%

Q1'15 Q3'15 Q2'16 Q4'16

TREND 5: DIGITAL TIME CONSUMPTION UP
Major shift in consumers activities where 1/3rd of all free time is spend on devices in
both urban and rural Vietnam.

Most popular daily activity (%)

57% Hanging out with family 60%

48% Using Smart Phone 51%

27% Going out with friends 18%

24% Using Laptop / PC 24%

21% Playing sports / exercise 20%

12% Watching TV 14%

9% 9%
Listening to music
4%
2%
Others
TREND 6: SOCIAL PLATFORMS AS KEY COMMUNITION MEANS
Anonymous communications, blogs
35 million users in Vietnam
and marketing feedback

TOP SOCIAL PLATFORMS %

SOCIAL MESSENGER

FACEBOOK 29 USER PROFILE

FB MESSENGER 25
ZALO 25
GOOGLE +
SKYPE
VIBER 11
15
20
#1 watched channel
In Vietnam

LINE 10
TWITTER 9
INSTARAM 9
WHATSAPP 6
TREND 7: ECOMMERCE PURCHASE BEHAVIOR FUNNEL BEHAVIOR
Very high correlation to search and purchase, over 60% urban have purchased in last
3 months
PAST 30 DAYS

On-line Search 45%

On-line Purchase 37%

Purchase via PC 32%

Purchase via SMARTPHONE 23%

 KEY DIGITAL INSIGHTS
Smartphones are already the #1 digital device in urban
1 Vietnam, with rural to follow, thus communications and
marketing need to catch up to reality and will become the
number platform nation wide by 2020

2 Personal SELF FULLFILLMENT

driven by consumer
“CONFIDENCE” the and
convenience of digital is driving
purchasing as well as debt culture
4 We don’t even
know what is
3 does yet?
In Vietnam, Social
Digital is redefining platforms have
consumer product become a daily
awareness & shopping means of
behavior communications
THE FUTURE OF SHOPPING IN HCMC
PRESENT VERSUS FUTURE SHOPPING TRENDS
Convenience stores will see the largest future growth in HCMC followed by
supermarkets, all at the expense of wet markets…

Supermarket Traditional Convenience Wet Market

Shop Now 61 6 7 26

Shop in Future 68 5 21 6

Base: N = 200 HCMC

Q.1. Which of the following do you presently shop at Most often for groceries and which will you shop at most in the future?
Modern trade = promotion, security and product range
Traditional trade = reasonable price
Supermarkets / Hypermarket Wet markets Traditional

My favorite place to shop

80
70
60
Offer more promotions than My most often shopped at
50
other places store
40
30
20
10
0

More secure than other Has more reasonable prices

places than other places

Has more services than Has more range of products

other places than other places
Base: N = 200 HCMC
GROCERY SHOPPING PHONE ORDER / ONLINE / SMARTPHONE

A surprising 77% have shopped for groceries via Phone, Mobile or On-line, while
future intent is also strong

Ever shopped Future shopping intent

23% Modern trade 31%

On-line
77%
Smartphone

Yes No Other

Base: N = 200 HCMC

Q.5 have you ever shopped for Groceries on-line, by telephone or smartphone and if the service were available, would you use?
INCIDENCE OF ORGANIC FOOD USAGE
50% all major urban Vietnam centres populations are purchasing organic
food monthly. At present organic is restricted to HCMC and Hanoi, due to
environmental concerns not yet felt in the rest of Vietnam

89%

74% 74%
67%

50%

Organic Food Packaged Fresh Products Baked goods Goods from

Branded Food butcher
Base: n =1000 27

2
7
MAIN ORGANIC FOODS / PRODUCTS CATEGORIES
Basic daily staples drive organic food purchases today…

THE MOST
89%

61% 59%

39%

Fruit & Vegetables Poultry & Egg Meat Rice, Pasta

Base: n =500
1
9
RETAIL SOLUTIONS

Mobile New ways to reach consumers

POD Maslow’s Priority of hierarchal needs changing

Security More focus on health and eating healthy

Transport Location less critical to store choice

Convenience All in one concepts attracting shoppers

Thank you for your time and please contact us for more!

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