Vietnam remains key market for brands and retailers in Asia-Pacific: Report
Vietnam remains key market for brands and retailers in Asia-Pacific: Report
The country is poised to become the fastest-growing digital economy in Southeast Asia by 2023.
Vietnam remains a key market for brands and retailers in Asia-Pacific in 2023, according to a report from global consumer trends forecaster WGSN.
Customers at Aeon Mall Long Bien Hanoi. Photo: Pham Hung/The Hanoi Times |
According to the report titled "Asia Shopper Forecast," Vietnam has gained popularity among multinational companies due to its minimal production disruptions during the pandemic, positioning it as a preferred destination for investment.
The country has seen a significant increase in the number of startups, doubling from the onset of the Covid-19 pandemic to mid-2022, according to WGSN.
Furthermore, the growth of Vietnam's e-commerce industry, which is expected to reach a value of US$49 billion by 2025, has been aided by the improvement of logistics infrastructure.
With an expected GDP growth rate of around 6.2% in 2023, WGSN experts predict that Vietnam is on track to become the fastest-growing digital economy in Southeast Asia and one of the fastest-growing economies in Asia.
A survey conducted by McKinsey & Company earlier this year found that up to 70% of young millennials (born between 1981 and 1996) in Vietnam expressed a positive outlook on the country's economic future, the highest rate among Asian countries surveyed.
Helen Sac, WGSN's Regional Consulting Director for Asia Pacific, suggested a growing trust among Vietnamese consumers in domestic brands and products, with 76% showing a preference for goods branded and made in Vietnam over foreign brands.
"Brands need to allocate resources to initiatives that celebrate local communities and connect with Vietnamese youth," Helen said.
WGSN's annual Asia Shopper Forecast shows that by 2023, Vietnamese consumers' retail spending patterns will have two distinct elements. On the one hand, there will be a focus on seeking immediate gratification, while on the other, efforts will be made to increase savings.
To effectively engage customers in 2023, brands and businesses are advised to integrate in-store and online channels. This can be achieved by strategically investing in online presence, implementing convenient services such as click-and-collect (online ordering with in-store pickup), facilitating in-store payment for online orders, and providing multiple service enhancements to improve the overall shopping experience, according to the report.
Vietnamese consumers are increasingly adopting digital payment methods, valuing the convenience and simplicity they offer. In light of this, brands are encouraged to integrate digital payments and multiple payment options across their channels. This strategic move will help alleviate problems and increase conversion rates, especially considering the projected decline in the use of cash in the future.
In addition, companies should prioritize building brand equity by implementing membership programs or forming loyalty partnerships with relevant brands. This approach will align with Vietnamese consumers' evolving retail spending patterns and enable businesses to cater to their preferences and demands effectively.
