FMCG Monitor October 2017
FMCG market maintains stable growth in Urban 4 cities while seeing positive movements in Rural
The FMCG market is expected to swell up with Beer as a star performer
Key market highlights in October 2017 issues:
Vietnam economy is showing positive signals in the rest months with the improved domestic demand, the rebound of agricultural production and the continued increase of Export, FDI and Retail. The GDP growth accelerated in the third quarter to above 7% and is forecasted to keep growing at this pace for the last quarter. The Vietnam’s economic growth seems to be able to reach the 2017’s target of 6.5% by the end of the year.
Urban 4 cities FMCG market maintains stable growth. Rural FMCG market is seeing positive movements though its consumption still recovers slowly. Overall, both Urban and Rural market would be more likely to swell up in the last months.
The continued development of non-food categories in both Urban 4 cities and Rural is attributable to the rising trends of convenience and hygiene such as Box Tissue, Liquid Detergent, Hand Wash, etc.… Meanwhile, Beverages achieve a remarkable growth in Urban 4 cities market, mostly driven by the strong performance of Beer and refreshment drinks.
Products helping improve the Vietnamese’s quality of life are on the rise. Consumers care more about hygiene amidst the rising levels of environmental pollution and diseases. Urban citizens upgrade their consumption for hygiene products while Rural people are more familiar with the goods to keep everything around them cleaner.
Modern shopping formats keep riding the Urban market growth, 2017 seems to be the stunning year of the retail market as a result of lots of M&A deals and foreign investments in recent times. Specialty stores continue expanding in terms of share thanks to the shoppers’ spending uplift. Meanwhile, in Rural, upgraded street shops remain a magnet to Rural consumers. And wet market is still growing back, driven by non food sectors.
Spotlight of the Month – Beer market: A star performer!
Beer is the key driver of Beverage growth, achieving a great performance thanks to the up-trading trend as consumers are now heading more towards premium beer products. For in-home purchases, Tet has been playing an important role to total Beer revenue in a year and is projected to keep up the pace in Tet 2018. In order to win this hot season, innovation in gift packaging or gift sets should get more attention, especially in Urban because more than half of total Tet value sales has earned via gifting.
Urban 4 cities include Ho Chi Minh, Ha Noi, Da Nang and Can Tho.
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