FMCG Monitor Q3: The recovery of beverage sector in VN
The 3rd quarter of 2022 saw robust GDP growth, nearly doubling that of the 2nd quarter of this year, indicating a promising outlook for the economy and consumer market. We also see an overall growth in the FMCG market, despite different growth patterns between urban and rural areas. The beverage sector has made an impressive comeback, contributing to total FMCG growth.
1. Economic indicators
Vietnam’s GDP in Q3 2022 grew significantly, outperforming the forecast. However, this substantial increase was mainly due to the calculation based on the negative growth of Q3 2021. Meanwhile, CPI continued to rise, which challenges the Government’s objective of controlling inflation.
2. FMCG overview
We witnessed higher growth of total FMCG in Rural while in Urban 4 Cities, the growth is slowing down compared to Q3 of last year when the fourth wave of Covid-19 hit Vietnam the hardest. Up to now, the average price paid is still the key value driver.
In Urban 4 Cities, Packaged Foods and Dairy sectors showed signs of cooling down compared to Q3 last year while Beverages & Non-Food FMCG industries have made a strong comeback after the pandemic.
In Rural, the rise of FMCG this quarter came from the strong recovery of Beverages.
3. Hot categories
Consumers are feeling more secure and going out to celebrate now that the pandemic has been successfully contained, as we see higher spending on beverages than in the pre-Covid Q3 of 2019. In particular, carbonated soft drinks (CSD) and beer showed encouraging signs of growth.
4. Retail landscape
By Q32022, large-scale stores such as Hyper & Supermarkets have recovered strongly from the significant drop in Q3 2021, along with Specialty Stores & Wet Market, which were impacted the most during the pandemic. Online growth is slowing down, but still maintaining double-digit growth.
On average, an individual in Urban consumes approx. 7 drinks a week and approx. 5 drinks in Rural, meaning they nearly choose a different drinkevery day & the gap between the 2 areas is close. Among an explosive diversity of drinks, the top 3 categories with the biggest occasion shares in both areas are Tea, Nutritional Drinks and Coffee.The questions for brands are:
How to identifygrowth potential across specific drinking occasions?
What’s your brand’sproduct personality? Is it serving the right need at the right moment?
To discover more reliable data and expert insights on the beverage market movement and consumer trends in Vietnam, please click HERE to download our report “Vietnam’s Beverage Consumption: 5 highlights in the drinking habits and 7 demand segmentations”.
To download our full Vietnam FMCG Monitor Q3 2022 report, please click on the Download button on the right side of the page.
(*) Urban 4 cities include Ho Chi Minh, Ha Noi, Da Nang and Can Tho.
(**) Data is including gift.