Consumer Update Nov 2014
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This document provides an overview of the Vietnamese consumer market, banking sector, and employment landscape based on a consumer survey conducted in November 2014. Key findings include: - Only about 1/3 of Vietnamese have contact with banking despite high levels of savings, indicating an opportunity for banks to expand access. - Consumers are concerned about current job availability, with 29% saying there are fewer jobs now compared to a year ago. - 42% of respondents have no savings, increasing to 55% among lower-income households, representing another opportunity for banks. - Shower gel is a popular personal care product, with Dove being the most recognized brand at 85% awareness.
Consumer Update Nov 2014
- 1. Discover the difference between information and insight Prepared by InsightAsia Research Group (Vietnam) Consumer Update November 2014 Singapore Indonesia Malaysia Thailand China Philippines Vietnam Overview In the 20 years or so since Vietnam opened its doors to a market-based economy, the way that Vietnamese Consumers live and work has dramatically changed. This is a far reaching transformation that has affected every area of the economy including personal and commercial banking, saving and borrowing. The number of financial institutions has skyrocketed giving its population of 90 million people access to a range of financial and banking services which is at the heart of a modern and integrated economy. While commercial banks are very visible (especially in Vietnams cities), they are yet to connect with the majority of low and the emerging middle-income Vietnamese. It is estimated that only about a third of the population uses or has contact with banking services. This is an interesting paradox because while many Vietnamese consumers have little contact with banking institutions they are all the same actively borrowing and saving. Our Consumer Survey indicates that about 60% of respondents have savings (our survey was conducted in HCM and Hanoi), yet it is important to remember that for those people without a bank, they keep their savings at home, or they send it back to their families in their home town . So as Vietnam continues to grow its financial institutions have the opportunity to expand and develop and reach out to the low and emerging middle income groups in urban and rural areas. In this edition of our Consumer Update we also explore the employment landscape in terms of the current sentiment among consumers about the availability of jobs in the market at the moment THE TAKE AWAY Vietnamese Consumers are concerned about the number of current jobs available, with 29% saying there are more jobs and the same percentage saying there are less jobs compared to 12 months ago. 42% of respondents mentioned that they dont have any savings. That percentage increases to 55% among households with an income of 7.5 million or less per month. Vietnamese Consumers care about their skin with 28% buying shower gel products at least on a monthly basis. The most popular brand of shower gel in the market is Dove with 85% of consumers aware of the brand. CONTENTS Overview 1 The Take Away 1 Employment 1 Savings and Investments 2 Consumer Profile 3 Market Focus Shower Gel 3 Brand Health Funnel (Top 4 Brands) 4 Employment Similar to other countries, Vietnam measures its unemployment rate in terms of the number of people who are actively looking for a job as a percentage of the labour force. Vietnams unemployment rate is very low compared to other markets, reported to be 2.14% in December 2014. Official figures also show that another 3% of the working population experience underemployment. Many are in part time jobs, or in jobs where they are underutilized, and some have simply left formal jobs in industry and services and have joined the countrys growing ranks of casual labour. 0% 10% 20% 30% 40% 50% Decreased Strongly Decreased Somewhat Same/ Don't know Increased Somewhat Increased Strongly 9% 20% 42% 26% 3% Jobs Available Compared to 12 Months Ago 40 42 44 46 48 50 52 54 Jan-05 Jan-07 Jan-09 Jan-11 Jan-13 41.6 42.8 44.0 45.2 46.5 47.7 49.0 50.4 51.7 52.2 Vietnam Employed Persons (in millions) Source: General Statistics Office
- 2. We are small enough to care, big enough to trust Prepared by InsightAsia Research Group (Vietnam) HCM Hanoi 52% 24% 40% 42% 8% 34% Increase Same Decrease Job Expectations x Location 27% 73% HCM Yes No Thinking of Changing Jobs x Location 8% 92% Hanoi > 15 Million 7.5-15 Million < 7.5 Million 30% 26% 23% 35% 22% 18% 10% 14% 4% 25% 38% 55% Increase Same Decrease No Saving 0% 10% 20% 30% 40% 50% Decrease Strongly Decrease Somewhat Same/ Don't know Increase Somewhat Increase Strongly 2% 20% 40% 36% 2% Jobs Available in 12 Months from Now Up to Secondary Tertiary 45% 61% 42% 31% 13% 8% Increase Same Decrease Income Expectations x Education Savings and Investments In this months survey we asked respondents to tell us about their savings and investment practices, especially compared to 12 months ago. Interestingly 42% of respondents mentioned that they dont have savings at all and understandably that was predominantly among households with a lower income. Also more males mentioned having savings compared to females but that is expected as a third more male respondents were employed full time compared to females. 20% 22% 13% 45% Female Increased Same Decreased No savings Savings x Gender 30% 23%5% 42% Male Savings x Income 6 11 6 Increased Same Decreased Changes in Investments (n=23) 0% 10% 20% 30% 40% 50% No Savings Decrease Strongly Decrease Somewhat Same Increase Somewhat Increase Strongly 42% 2% 7% 23% 25% 1% Savings
- 3. Delivering actionable insights to add value to your business Prepared by InsightAsia Research Group (Vietnam) Consumer Profile Our Consumer Profile for November is 27 years old Nguyen Thi Mai Trang from Binh Thanh District in Ho Chi Minh city. Trang was born in Binh Thuan province and she moved to Ho Chi Minh to study and work. After graduating with a Financial Accounting Degree from Saigon University, Trang took a job as an accountant for a printing and advertising company where and she has for the last 4 years. She is happy with her job where she gets about $450 a month, so she is not thinking of changing employment any time soon my job suits me well, I believe that working in this company can help me grow professionally and I have the opportunity to be promoted. Indeed Trang thinks that in the current economic conditions it would be difficult to find a job with a similar salary. Trang is very confident about her job my salary will increased in the next 12 months because my company already announced employee salaries for the next year, so I will continue in my job and try to do a Masters degree, having higher education will help me get a higher salary and better opportunities for my career. Trang tries to save money to do a Masters degree abroad, is not much, but my savings have increased a bit in the last 12 months. Trang likes to buy shower gel I use it everyday, it is very important to me and I am very satisfied with the quality of the shower gel I am using at the moment She is currently using Dove and about every two months she buys a 520ml bottle for which she pays about 99.900 VND. The qualities that Trang looks for when choosing a brand of shower gel include: I look for the right scent which should not be too strong but still be able to last long on my skin and clothes. Also after showering the right shower gel has to moisturize my skin, it needs to be for sensitive skin and if it causes any irritation I stop using it. Trang only started using Dove in the last 12 months, Before I used to often change the brand of shower gel I was using, but now I have been using Dove for almost one year and will keep using it for a long time. Across Asia the beauty and personal care industry continues to grow across all categories with skin care, mens grooming and fragrances being the main movers in terms of growth. Bath and shower gel products also continue to grow with increasing interest in mens bath and shower products among manufacturers and consumers. This growth in male grooming products is across the region where nearly 80 per cent of men claim they care about their looks, yet the value share of the for men segment in the personal care category is just 4 per cent. This highlights an opportunity for personal care brands to launch new variants specially designed for male users. Market Focus Shower Gel 0% 10% 20% 30% 40% 50% Less often Every 3 months Every 2 months At least monthly 17% 22% 33% 28% Shopping Frequency of Shower Gel 20% 22% 13% 45% Female Increased Same Decreased No savings Shower Gel Shopping Frequency x Gender 30% 23%5% 42% Male Price Brand Long Lasting Scent Preferred Scent Promotion Natural Moisturising Comes with scrub Less irritation 56% 48% 43% 41% 22% 22% 21% 19% 16% Top Qualities Considered When Buying Shower Gel The Vietnamese cosmetic and personal care industry is estimated to be worth only about USD $150 million per year, but it has been enjoying a growth rate of about 30% for the past few years. This represents an attractive market for the personal care industry; the country has a population of over 90 million with over half aged 30 and below. Vietnamese males in large cities are increasingly paying more attention to their personal grooming and appearance, in line with higher living standards and rising levels of disposable income.
- 4. 85 50 20 13 Conversion Rate 59% Adoption Rate 65% Retention Rate 40% Average price paid - 100,000 VND Awareness Ever tried Purchased P3M Last Purchased 79 42 22 17 Conversion Rate 53% Adoption Rate 77% Retention Rate 52% 75 35 19 16 Conversion Rate 47% Adoption Rate 84% Retention Rate 54% Top 4 Brands Health Funnel From Awareness to Last Purchase Average price paid 80,000 VND Average price paid - 85,000 VND 73 36 20 12 Conversion Rate 49% Adoption Rate 60% Retention Rate 56% Average price paid - 75,000 VND 21% 79% Gender Distribution Per Brand 58% 42% 97% 3% 100% 0% Ben Tre Ho Chi Minh Can Tho Thai Nguyen Bien Hoa Da Lat Da Nang Hue Binh Dinh Nha Trang Vung Tau Ha Noi Hai Phong Vinh Ngh畛 An The InsightAsia Minibus A survey designed to collect the data you need, with a sample size you can afford. Our minibus runs every month with data and charts for your questions delivered on the 1st Monday of each month: Excellent coverage Representative sample Fast turnaround Best price in the market Just data or full report Full support available Cost for 3 questions n=200 (Hanoi and HCM) $330 n=500 (4 main cities) $800 n=1,000 (National) $1,500 *Contacts us for more information Anubha Gupta - Qualitative Director with more than 20 years living and working across South and South East Asian countries. Anubha has deep knowledge of these markets, maintaining brands and developing businesses with strategic insights. email: anubha.gupta@insightasia.com mob: +84 (0) 909 266-563 Patrick Meza - Research Director with 20 years experience in the design and execution of Research projects across Australia and Vietnam. Patrick values are; Quality, Integrity and Personal Service to all clients. email: patrick.meza@insightasia.com mob: +84 (0) 903 650-588 Male Female Reasons Not to Change Brands of Shower Gel This is the Brand I like 62% I like this scent/Aroma 44% The one I use is good for my skin 33% The price is ok 10% Other 5% Reasons to Change Brands of Shower Gel I like to try different scents 61% I like to buy different Brands 43% I want something better for my skin 36% The price is better 13% Other 7% Change of Shower Gel Brand Frequency 58% 42% Never Changes Male Female 46% 54% Changes 0% 10% 20% 30% 40% 50% Never Every time Every 2nd time Less often 41% 27% 17% 15%