Vietnam’s FMCG market poised to heat up: Kantar Worldpanel
Vietnam’s FMCG market poised to heat up: Kantar Worldpanel
Over the long term, the Vietnamese fast-moving consumer goods (FMCG) market is expected to heat up, even doubling the pace of last year in rural areas, said market research consultant Kantar Worldpanel in its latest FMCG Monitor edition.
The firm stated in the report that coupled with the low consumer price index, Vietnam’s economy and domestic demand are at a slightly slower momentum than that seen in the same period last year.
However, more effort is needed to make the most of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership and the European Union-Vietnam Free Trade Agreement to further boost economic growth and reach the gross domestic product growth target of 6.8% for 2019.
Over the short term, FMCG spending and consumption continued to grow strongly in the second quarter of this year and is likely to keep pace with economic growth of 6%-7% for the full year of 2019, according to the firm.
All sectors except beverages are performing very well, especially personal care with its double-digit growth rate, in Hanoi, the central coastal city of Danang, HCMC and the Mekong Delta city of Can Tho.
In rural areas, dairy products are still enjoying impressive growth and leading the FMCG market growth.
The firm said dairy growth is partly driven by the robust development of ready-to-drink milk, especially in rural areas, thanks to its convenience.
Also, the category has just reached more than 10% of the total consumer base, with new players jumping in, showing strong potential.
In quarter two, almost all channels showed good performance in urban areas. Consumers continuously purchased FMCG products through multiple shopping channels, reinforcing the notion that the omnichannel strategy is a necessity for brands and retailers.
“Shoppers now prefer to shop across multiple channels, even for staple items. And their choices are different when shopping on different channels. Offering the right portfolio on the right channels will give manufacturers a significant opportunity to grow their shopper base, drive repeat purchases and increase their value spend,” said the consultant.
