FMCG

An integrated
update of Vietnam's
FMCG market
Q1 2023
(12 weeks ending 26/3/2023)
Monitor
Urban 4 Key Cities & Rural Vietnam
By Worldpanel Division

1
 Executive summary

The rise in average

Shopping online and in
price paid is notably Tet Gifting tradition Transforming from
GDP was 3.3% in the small-modern formats
represented in Urban returned with strong offer-centric to more
first quarter of 2023, are popular due to the
4 regions, adding increase this year, shopper-centric is the
lower than the ease and diversity of
significantly to overall demonstrating the key objective for both
predicted 5.6%, items, particularly for
value growth while importance of Gift manufacturers and
marking Q1 with the Tet - Q1, opening a
for Rural, the growth Giving activities over retailers on the way to
weakest growth rate new opportunity for
engine comes from in Festive season. winning more
in recent years. early Tet push on
higher volume shoppers.
Online & Minimarket.
purchased.
Macro economy Spotlight of
FMCG overview Retail landscape the Quarter
Hot topic of
the quarter
Vietnam’s macro economy
Following the previous quarter's bumpy recovery, Vietnam posted a softer GDP growth of 3.3% in Q1 2023, lower than the
projected target of 5.6% and its weakest growth since Q3 2020. Furthermore, the continuous rise in consumer prices has a
significant impact on the rise in retail sales of products and services.
% Change vs the same period last year

GDP CPI Retail sales of consumer goods

& services
13.7 42.5

7.7 4.4 4.2 19.5

5.9 3.3 17.1
5.0 3.0 14.0
3.3 1.9
4.8

Q1'22 Q2'22 Q3'22 Q4'22 Q1'23 Q1'22 Q2'22 Q3'22 Q4'22 Q1'23 Q1'22 Q2'22 Q3'22 Q4'22 Q1'23

Source: GSO
 Consumers' perspective
In this economic backdrop, customers' confidence in their financial status has barely improved since the last quarter,
posing challenges for producers in adjusting to match consumer expectations.

The economic situation will be better or the same as today

in the next 12 months (% households agree in Urban 4 key cities)

88
84 86
82
76
72 73
65
60

Q4'19 Q2'21 Q3'21 Q4'21 Q1'22 Q2'22 Q3'22 Q4'22 Q1'23

Source: Worldpanel Division | Consumer Confidence Survey | Urban Vietnam 4 key cities | MAT Q1’23 4
 Consumers' perspective
As economic difficulties persist with a lack of production orders, concerns about Job security rise consecutively in the last 4
quarters. Besides, households expressed rising concerns about Increasing utility costs.
Currently what do you consider to be the biggest concerns you and your household is likely to face?

% HH agree

80 Q1_2022 Q2_2022 Q3_2022 Q4_2022 Q1_2023

% Key Decision Maker Agree

71
70 68 66
62
58 57
60
53 51 51
50 45
40 40
40 36 37
29 28 31 27 29
30
24 23 23 22 24 24
21
20
20 17 16 18 18 18 16 17 19 18 19 19
15 14 15 15 14 14
9
10

0
Disease / Food Safety HH Income Job security Increasing costs Cost of Food Environmental Price of Oil Natural Disaster
Sickness Pollutio

Source: Worldpanel Division | Consumer Confidence Survey | Urban Vietnam 4 key cities | MAT Q1’23
 FMCG
overview % Change vs YA

In Urban 4 areas, the 15

8 15
rise in average price 4
7
11
paid is noticeable and 1 1
5
has a considerable Urban 4 3
1
impact on the overall key cities -3 -4 -4
value increase. On the val vol price Q1'22 Q2'22 Q3'22 Q4'22 Q1'23
other hand, Rural
consumers show
Q1 2021
higher consumption
levels, suggesting Q1 2022 Value Volume* Avg. paid price** Quarterly value trends
there is room for Q1 2023
17
manufacturers to 14 15 14
improve their 10 11
penetration in Rural 6
areas. 4 4 4
2
1
Rural

-1 Q1'22 Q2'22 Q3'22 Q4'22 Q1'23

-2
val vol price

*: To calculate FMCG volume change, we calculate how much volume contributes to the value change for each category, sum up these contributions and relate to value YA (this results in an average category change in volume)
**: To calculate FMCG price paid change, we calculate how much price contributes to the value change for each category, sum up these contributions and relate to value YA

Source: Worldpanel Division | Households Panel | Urban 4 Key Cities & Rural Vietnam | Total FMCG including Gift
 Sector % Value change vs YA in Urban 4 key cities

performance Q1 2022
Q1 2023 Value Volume* Avg. paid price**

Driving the stronger

FMCG 1 -4 4
growth of FMCG value in 15 8 7
Q1 this year are
Beverages and Personal
Care. The comeback of Dairy 5 0 5
16 6 9
celebratory categories
this Tet 2023 period
boosts the performance
Beverages -6 -9 3
of the total Beverages 20 13 6
sector, particularly
thanks to Soft Drinks,
Coffee & Beer. Packaged 6 -2 8
Foods 9 2 7

Personal -3 -3 -1
Care 18 13 5

Home 1 -3 5
Care 12 6 6

*: To calculate FMCG volume change, we calculate how much volume contributes to the value change for each category, sum up these contributions and relate to value YA (this results in an average category change in volume)
**: To calculate FMCG price paid change, we calculate how much price contributes to the value change for each category, sum up these contributions and relate to value YA

Source: Worldpanel Division | Households Panel | Urban 4 Key Cities Vietnam | Total FMCG including Gift
 Sector % Value change vs YA in Rural

performance Q1 2022
Q1 2023 Value Volume* Avg. paid price**

In Rural, all sectors show

FMCG 4 -2 6
solid growth in Q1. 14 10 4
Personal Care is the
highest growth sector,
with a 26% increase in Dairy 16 10 6
15 10 7
volume driven by the
Skincare and Makeup
categories.
Beverages -4 -7 3
15 11 3

Packaged 5 -4 9
Foods 9 4 6

Personal 1 -4 8
Care 19 26 -2

Home 5 -2 7
Care 15 12 4

*: To calculate FMCG volume change, we calculate how much volume contributes to the value change for each category, sum up these contributions and relate to value YA (this results in an average category change in volume)
**: To calculate FMCG price paid change, we calculate how much price contributes to the value change for each category, sum up these contributions and relate to value YA

Source: Worldpanel Division | Households Panel | Rural Vietnam | Total FMCG including Gift
 Topic of Q1 The bounceback of FMCG gifting played a significant role in boosting Tet 2023 FMCG growth after taking a nosedive
last year. Besides key categories for Tet Gifting such as Beer, Biscuits & Cakes; Wine/champagne, and Chocolate are
- Tet 2023 gaining popularity as premium Tet gifting options, indicating that consumers still view gift-giving as a special
occasion, with both recipients and givers, putting a premium on high-quality and monetary-value gifts.

Discover more how FMCG shopping and

gifting have changed in Tet 2023.
Urban 4 Urban 4
cities cities Top growing Gifting categories in Urban & Rural
% contribution to the 100 75 25 % occasion change Tet 2023 vs Tet 2022
total value of Tet
40% 29%
19% 16%
20%
% Value change YOY
0%
-20%
+50% +49% +42%
Wine/Champagne Energy Drink Chocolate
-40%Value spend on demand
Total value in Tet Value of gift received
Tet 2023
Rural Rural

% contribution to the
100 73 27
total value of Tet
40%
20% 15% 12%
22%
+43% +35% +28%
% Value change YOY Granules Biscuits Soft Cakes
0%
-20%
-40%
• Tet 2022: 5 weeks ending 6 Feb 2022
• Tet 2023: 5 weeks ending 29 Jan 2023 Source: Worldpanel Division | Urban 4 key cities and Rural | Tet 2023
 Retail The next focus for businesses is to continue to be available on more channels and platforms, taking advantage of the
power offered by online channels and consumers’ demand for omnichannel shopping experiences. Shoppers show a
landscape steadily growing preference for shopping online and in small modern formats thanks to the convenience and
improved variety of products, especially during the Vietnamese new year period in Q1.
% Value contribution of channel % YOY value change by channel
100
Online 58 48
7 7 7 24 22
90 8 7 7 21 16

11 13 12 11 11 11
80 14
Hyper + Super -8 -9 -2 7 1

70 11 10 11 11 12 11
6 6 6 6 6
60 6 Mini Store
6 7 7 24 20 21 22 27
7 7 6 -20
50
30 21 29
40 Specialty Stores
-9 -12 -14
30
54 54 53 52 51 53 97
Wet Market -17 -12 29 6
20 -26

10
Street shops 12 12
0 5 4 3
-3
Q4'21 Q1'22 Q2'22 Q3'22 Q4'22 Q1'22
Q4'21 Q1'22 Q2'22 Q3'22 Q4'22 Q1'23
The rest is other channels, including hand-carry, direct sales, factory outlet,…)

Source: Worldpanel Division | Households Panel | Urban 4 Key Cities Vietnam | Total FMCG excluding Gift | 12 weeks ending 01/01/2023
 Why Shopper-centricity delivers higher business growth?
Spotlight of Considering the evolution of shopping behaviours as well as the growing competition of modern and convenience
formats in key cities, manufacturers’ main goal is to reach as many shoppers as possible by winning together with
the quarter retailers. That is why it is vital for both to understand shoppers' drivers and motivations in channel selection.

Understanding shoppers’ paths to purchase enables you

to win at each stage of the shopper journey

• Planned or impulsive
trip?
• How does that impact
overall store choice?
• What draws shoppers to
• Which retailers meet
the chosen store?
consumers' needs?
• What prompts shoppers
buy brand A? • What is the conversion
• Identify what other rate of each retailer for
categories are my brand?
purchased on the same • Where are the missing
trip? opportunities and how
Transforming from offer-centric to more
to grab them? shopper-centric solutions with our experts.

Source: Worldpanel Division | Households Panel | Expert Solution | Urban 4 cities Vietnam | Total FMCG
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For further information, please visit us at

www.kantarworldpanel.com/vn

Contact us
Jane Ha – Senior Marketing Manager
Worldpanel Division, Vietnam
E: Jane.Ha@kantar.com
58 Vo Van Tan St., Dist. 3, Ho Chi Minh City, Vietnam
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