SAVOURY SNACKS IN VIETNAM - ANALYSIS

Country Report | Sep 2020

KEY DATA FINDINGS Market Sizes

COVID-19 boosts the appeal of some savoury snacks as suitable complements for at- Sales of Savoury Snacks
home activities during lockdown in 2020 Retail Value RSP - VND billion - Current - 2006-2025
In 2020 retail sales grow by 11% in current value terms and 6% in volume terms to
reach VND16.3 trillion and 86,800 tonnes 16,287 Forecast
30,000
Rice snacks sees the highest retail current value sales growth of 14% in 2020
The average retail current unit price rises by 5% in 2020 25,000
Orion Food Vina leads in 2020 with a 17% retail value share
20,000
A 12% retail current value CAGR (8% 2020 constant value CAGR) is expected over the
forecast period
15,000

2020 IMPACT
10,000
COVID-19 fosters demand for savoury snacks as consumers look for
diverse and healthier options during lockdown 5,000

Savoury snacks is projected to see its fastest retail volume and current value growth
rates of the review period over 2020 as a whole. Lockdown, with consumers working 0
2006 2020 2025
from home, and schools and foodservice and entertainment venues closed, was quite
short-lived, as Vietnam coped effectively with the outbreak of the Coronavirus (COVID-
19). In addition, modern and traditional grocery retailers remained open during
lockdown, thereby ensuring access to savoury snacks and minimising the potential for Sales Performance of Savoury Snacks
retail channel shifts. Stockpiling, as consumers tried to limit their visits to the shops, % Y-O-Y Retail Value RSP Growth 2006-2025
was visible, but generally short-lived.
Traditionally, young and older consumers are familiar with savoury snacks, which
10.9% Forecast
gained importance as some households looked for non-sugary snacks to help while 20%
away long periods of time spent in the home. Savoury snacks also benefits from widely
perceived suitability with a variety of drinks and various consumption occasions.
Vietnamese consumers traditionally consume savoury rather than sweet snacks with 15%
coffee or tea, as well as dried squid and other fish snacks or peanuts with beer. Thus,
the established and widely popular consumer habit of using savoury snacks is expected
to continue to foster sales growth through 2020.
10%
Puffed snacks’ large snack range fits well with at-home lifestyle during
COVID-19
Although savoury snacks is a diverse category in Vietnam, puffed snacks is set to 5%
continue to account comfortably for the highest retail volume and current value sales
over 2020 as a whole. Puffed snacks also benefited as many consumers were
increasingly likely to look for non- or low-sugar snacks to help pass the time at home
0%
during lockdown. In whiling away long hours in the home, many consumers looked to 2006 2020 2025
entertainment activities like watching TV and films, which that fit well with the
consumption of puffed and other savoury snacks. Puffed snacks are considered suitable
for various other occasions, such as snacking at break times and as complements to
non-alcoholic and alcoholic drinks. Consumers concerned about high sugar or salt
intake during the global health crisis, are likely to have seen puffed snacks as healthier
options. These products typically consist of potato or cereal (eg wheat, maize) snacks,
which can be flavoured (eg cheese, prawn) or unflavoured. Semi-prepared and unfried
extruded snacks from Asia (eg kerupok, also known as crackers) are also included in the
category. A large range of products enhances the category’s strong position within
savoury snacks.
Availability during COVID-19 was also enhanced by the high number of manufacturers
active in puffed snacks, offering popular and established brands like Oishi, Toonies and
Poca. In addition, the category sees significant brand-building activities, which help
puffed snacks remain top-of-mind among snacking consumers. Moreover, puffed
snacks enjoys the largest penetration in distribution terms, from independent small
grocers in remote areas to large hypermarkets in urban areas, supported by familiarity
with and the low unit prices of many types.

Orion Food Vina is set to consolidate leadership over 2020 despite

COVID-19’s impact on higher-priced savoury snacks

© Euromonitor Interna onal 2021 Page 1 of 3

Orion Food Vina is predicted to remain the leading player in savoury snacks in retail
Sales of Savoury Snacks by Category
value share terms over 2020 as a whole. The company owns major brands in the
Retail Value RSP - VND billion - Current - 2020 Growth Performance
category, such as Toonies, Marine Boy and Khoai Tayo! These brands enjoy significant
brand loyalty, despite carrying above-average prices, supported by nationwide
Nuts, Seeds and Trail Mixes
distribution coverage. Orion Food Vina also invests heavily in aggressive marketing 928.3
activities, including the use of major celebrities in Vietnam to promote brands on social
Salty Snacks
media platforms like Facebook. However, the player’s offer of mid-priced and premium 10,034.1
products has been impacted by COVID-19, as some consumers looked to trade down to
Savoury Biscuits
cheaper options. Nonetheless, the strong popularity of its brands is expected to see a 2,512.8
rebound as the country recovers from the public health crisis, with an increase in retail
Popcorn
value share projected for 2020 as a whole. -

While international brands lead savoury snacks, local brands enjoy exclusive Pretzels
-
competitive advantages in some categories. International brands benefit from high-
profile products and nationwide distribution, supported by huge budgets for aggressive Other Savoury Snacks
2,812.1
marketing programmes. However, owners of local brands leverage a deep
understanding of the tastes and traditions of Vietnamese consumers. Against the 0% 10% 20%
backdrop of the push towards buying Vietnamese products, which receives heavy SAVOURY SNACKS 16,287.2 CURRENT % CAGR % CAGR
government support, local brands are increasingly perceived as appealing, for reasons YEAR % 2015-2020 2020-2025
of national pride as well as lower prices. Domestic brands have also gained traction GROWTH
through stronger marketing activities and sales systems. International players are
expected to retain the leading positions in the category, but face tougher competition
from local rivals. The residual economic concerns in the wake of COVID-19 are likely to
enhance the demand for local brands. Competitive Landscape

RECOVERY AND OPPORTUNITIES Company Shares of Savoury Snacks

% Share (NBO) - Retail Value RSP - 2020
Wide consumption occasions set to boost savoury snacks sales over the
Orion Food Vina Co Ltd 17.1%
forecast period
Mondelez Kinh Do Vietnam... 13.5%
Savoury snacks is projected to see gradually increasing retail volume and value (at
Liwayway Food Industry C... 11.5%
constant 2020 prices) growth rates as the forecast period progresses. COVID-19 is not
expected to have a long-lasting negative effect, although some consumers are likely to PepsiCo Vietnam (PIVN) 10.8%
continue to trade down in the short term due to heightened economic concerns. On the Tuyen Ky Co Ltd 6.7%
other hand, savoury snacks fit well with at-home entertainments, which boosted
demand as consumers adapted to home seclusion and social distancing regulations. Vietnam One One Food JSC 3.4%
Moreover, the reopening of entertainment and foodservice venues is restoring popular Mondelez International I... 3.4%
consumption occasions. The return to school and workplaces similarly enhances the
Thien Ha Kameda JSC 1.8%
consumption occasions for savoury snacks. Some of these types of snacks, such as
puffed snacks, rice snacks and “other” savoury snacks, also fit with the needs of an Procter & Gamble Vietnam... 0.7%
increasingly health-conscious consumer base, which is expected to be swelled by the
Viet Hoa Co 0.7%
outbreak of the global pandemic in Vietnam. While carrying higher average unit prices
per kg than most other snacks, a wide range of products and pack sizes means that Meiji Holdings Co Ltd 0.7%
savoury snacks are often competitively-priced in terms of initial outlay, while carrying a LBB Vietnam Foodstuff JS... 0.6%
lower average unit price than chocolate confectionery. Hence, savoury snacks is set to
remain the best-selling category within snacks in Vietnam over the forecast period. Haiha Confectionery JSC 0.4%
Nhat Anh Trading Pte 0.3%
Growing health awareness and local trend to support shift to natural Trang An Confectionery C... 0.2%
ingredients and Vietnamese products
Tan Tan Food & Foodstuff... 0.2%
Natural local-origin ingredients are expected to appeal to consumers seeking healthier Ha Noi Confectionery Co 0.2%
snacking options in the forecast period. In line with the health and wellness trend,
which is set to be accentuated by the experience of COVID-19, Vietnamese consumers Tai Tai Co 0.2%
are looking for healthier options across packaged food. Manufacturers of potato chips Others 27.6%
and puffed snacks are likely to emphasise the use of natural ingredients through
marketing activities. In addition, PepsiCo Vietnam (PIVN) and Orion Food Vina are set
to continue to highlight their collaboration with local farmers and use of fresh potatoes
grown in Vietnam to tap into the localisation trend being pushed by the government. In
puffed snacks, Liwayway Food Industry has upgraded its processing technology to offer
better for you (BFY) products under the Oishi brand, such as vegetarian chicharrones
(pork rinds) with zero trans-fat and unfried options. The highlighting of product
freshness and local-origin ingredients is set to become an increasingly important
marketing message in the short to medium term. The global pandemic may accentuate
the localisation trend, with consumers being increasingly willing to trust local-origin
over foreign products.
The localisation trend is also expected to become increasingly visible in nuts, seeds and
trail mixes, as more local manufacturers enter the fray. Sources of raw materials for
these products are quite abundant and popular in Vietnam, including peanuts, cashews
and macadamia nuts. Local manufacturers are set to take advantage of local resources
to improve the quality of their offer of nuts, seeds and trail mixes, while ensuring
competitive prices to appeal widely to local consumers. Importantly, local consumers
consider nuts, seeds and trail mixes to be healthier snack options. Furthermore, local
manufacturers can expect the support of the government, which continues its attempts
to increase the value of and consumption of local agricultural produce.

Familiarity and trust in ingredients favours offers strong development

and growth opportunities in rice snacks
Rice snacks continues to be more quickly and widely accepted by Vietnamese
consumers, in comparison with some other types of snacks, as consumers enjoy the

© Euromonitor Interna onal 2021 Page 2 of 3

taste of rice, which is a staple food option in Vietnam. The category has received a Brand Shares of Savoury Snacks
boost from numerous new entrants, such as Orion An seaweed baked rice cakes in % Share (LBN) - Retail Value RSP - 2020
convenient 111.3g packs. In addition, the major Taiwanese Want-Want rice cake
company opened a factory in Vietnam in late 2019. The USD70 million investment is Oishi 11.0%
expected to see Vietnam become the company’s hub in Southeast Asia during the Lay's 9.0%
forecast period. The abundance of rice and white sugar sources in Vietnam has played a
key role in the company’s strong investment in the market. AFC 8.7%
Tuyen Ky 6.7%
Such new entries are increasing the competition in the country and pushing other
players to expand their activities in the category. In terms of new product Toonies 6.3%
development, besides popular generic tastes (salty and sweet), local consumers are Marine Boy 4.6%
able to choose from a widening array of new flavours/variants, such as honey, shrimp
and seaweed. Consumers are increasingly interested in new flavours and variants of Ostar 4.3%
rice snacks, often as trial purchases in the first instance. However, as consumers search OneOne 3.4%
for healthier and good quality snacks in the wake of COVID-19, such products are
Slide 3.4%
expected to become the preferred option for more and more snackers. As a result, rice
snacks is projected to continue to see the highest retail value sales growth over the Ritz 3.4%
forecast period. Khoai Tayo! 1.9%

Summary 1 Other Savoury Snacks by Product Type: 2020 Poca 1.8%

Product type ICHI 1.8%

Meat jerky Sachi 1.4%

Seaweed snacks Pringles 0.7%
Burnt rice Viet Hoa 0.7%
Rice paper snacks
Meiji 0.7%
Noodle snacks
Richy 0.6%
Source: Euromonitor Interna tiona l from officia l s ta tis tics , tra de a s s ocia tions , tra de pres s , compa ny Pinattsu 0.5%
res ea rch, s tore checks , tra de interviews , tra de s ources
Others 29.1%

5-Year Trend
Increasing share Decreasing share No change

© Euromonitor Interna onal 2021 Page 3 of 3