Kantar Worldpanel

KANTAR WORLDPANEL DAIRY TALK

8. 5. 2013 | 8: 30 AM 11: 00 AM | Sher at on Sai gon
Kantar Worldpanel
CONSUMER PULSE 2013
BETWEEN CHALLENGES & OPPORTUNITIES
Urban 4 Key Cities and Rural Vietnam
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VIETNAM DID YOU KNOW?

DYNAMIC ECOMOMY

A member of the new
BRICS: CIVETS and
VISTA
GDP ranking: No. 57


SURFACE AREA
331 thousands km
2
Global ranking: No. 66

YOUNG AGE
Over 50% population
is under their 30s



HUGE POPULATION
88 Millions
Global ranking: No. 14

ON-GOING
URBANIZATION
% urban pop: 32%
Urbanization rate: 3%


YOUNG
POTENTIAL
DYNAMIC
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CHALLENGES: ECONOMIC SLOWDOWN 2012
LOWER FDI
11 11
10
2010 2011 2012
Implemented FDI
(Billion USD)
Source: GSO
WEAKER DEMAND
79
68
56
2010 2011 2012
Source: TNS CCIP Urban Only
Consumer Confidence %
LOWEST GDP GROWTH
IN 2 DECADES
Source: GSO
7
6
5
2010 2011 2012
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BRIGHT SPOTS
TO PAVE THE WAY FOR A REBOUND IN 2013
CURBED INFLATION
STRONGER EXTERNAL
POSITION
2008 2009 2010 2011 2012
TRADE BALANCE OF
+284 MLN USD
TREMENDOUS
OPPORTUNITY
9.2%
18.6%
CPI Growth %
Source: GSO
Source: GSO
New entrants 2012:
1
st
time in 20 years:
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A TWO TIERS SOCIETY IS EMERGING, CREATING DISPARITIES
Fabrice Carrasco
Modern vs.
Traditional
VIBRANT & HI-TECH
TRADITIONAL
Rich vs. Poor
EMERGING NEEDS
BASIC NEEDS
Urban vs. Rural
MORE COMPLEX
PRIMARY & REMOTE
North vs. South
CAUTIOUS & FACE
DRIVEN
MODERN, NEW NEWS
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Personal demands need to be taken care more, to satisfy different needs by different
consumer clusters
FROM MASS TO SEGMENTATION
6.9 mln 7.0 mln
7.1 mln
~ population of
Switzerland
2015 2010 2020
Over 1 million newborns every year
CLUSTER 1: BABIES <4YO CLUSTER 2: KIDS 5-14 YO

I tend to buy what
my children want
~ 70% Vietnamese women agree
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Kantar Worldpanel
~ 70% Vietnamese women agree
Personal demands need to be taken care more, to satisfy different needs by different
consumer clusters
FROM MASS TO SEGMENTATION
CLUSTER 3: TEENS
Having fun is one of our
highest priorities.
(TNS TRU report)
CLUSTER 4
YOUNG ADULTS
The main base of
Vietnam population in the
next 10 years.
CLUSTER 5
MIDDLE AGE & SENIORS
83% of middle aged
housewives agree:
I buy brands that are of
good quality, even more
expensive.
vs. 78% of young housewives
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CHANGING RETAIL LANDSCAPE
MODERN TRADE KEEPS EXPANDING
RURAL EMERGENCE REGIONAL ROADMAP URBAN GROWTH
Source: Kantar Worldpanel Households Panel Urban Vietnam 4 key cities & Rural Total FMCG excluding Gift Value %
PHILIPPINES
28%
CHINA UB
41%
THAILAND
53%
KOREA UB
80%
VIETNAM UB
18%
13.0
17.5
18.1
2006 2011 2012
MT value contribution %
17.7
24.2
84.7
MT Penetration %
1.8% MT Value Share in Rural
Urban
Rural
MT value contribution %
10
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-20
-10
0
10
20
30
40
50
Avg. Price per pack Value Volume (packs)
FMCG IN URBAN MONTHLY YEAR-ON-YEAR CHANGE (%)
After a half-year recovery, there is a signal of growth slow-down in both value and
volume in the latest 6 months, most significantly for Personal care.
M
A
T

P
3

1
2

J
a
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1
1

J
u
n

1
1

D
e
c

1
1

J
u
n

1
2

D
e
c

1
2

Source: Kantar Worldpanel Households Panel Vietnam 4 key urban cities Total FMCG excluding Gift
Vol growth (pack) 6m vs. YA
URBAN 4 3%
HCM 3%
HANOI 4%
DANANG 7%
CANTHO 3%
Vol growth (pack) 6m vs. YA
DAIRY
4%
BEVERAGE
10%
PACK. FOOD
1%
PERSONAL CARE
-4%
HOME CARE
2%
Make-up
Facial Moisturizer
M
A
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P
3

1
3

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The situation is worse in rural as the growth is consistently going down, and reached
the lowest point lately, happening most significantly for Personal care products.
-60
-40
-20
0
20
40
60
80
100
120
Avg. Price per pack Value Volume (packs)
J
a
n

1
1

J
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1
1

D
e
c

1
1

J
u
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1
2

D
e
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1
2

FMCG IN RURAL MONTHLY YEAR-ON-YEAR CHANGE (%)
Source: Kantar Worldpanel Households Panel Rural Vietnam Total FMCG excluding Gift
Vol growth (pack) 6m vs. YA
RURAL 3%
NORTH 4%
CENTRAL 8%
SOUTH -2%
Vol growth (pack) 6m vs. YA
DAIRY
10%
BEVERAGE
10%
PACK. FOOD
2%
PERSONAL CARE
-9%
HOME CARE
9%
Mouth rinse
Hair Conditioner
Facial moisturizer
M
A
T

P
3

1
2

M
A
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P
3

1
3

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6%
9%
0%
5%
6%
6%
3%
6%
8%
3%
4%
1%
2%
3%
5%
4%
3%
6%
-2%
0%
2%
4%
6%
8%
10%
URBAN 4 HCMC HANOI DANANG CANTHO RURAL NORTH CENTRAL SOUTH
Half year ending Q3/2012
Half year ending Q1/2013
Pragmatic behaviour is observed in short-term.
CONSUMER REACT
BULKY PURCHASE?
1
YES, but much less stock up vs. before
Number of FMCG packs bought per trip - % change vs. YA
Source: Kantar Worldpanel Households Panel Total FMCG excluding Gift
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UPSIZE OR DOWNSIZE?
Pragmatic behaviour is observed in short-term.
CONSUMER REACT
2
Source: Kantar Worldpanel Households Panel Total FMCG excluding Gift Updated to Q1/2013
Upsizing trend in volume switching % - Rolling MAT YOY trend
(10)
(5)
-
5
10
15
20
25
30
35
40
45
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1
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1
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9
1
2
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0
1
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1
1
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1
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V
o
l
u
m
e

s
w
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h
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p
e
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c
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a
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c
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%

Shower gel 600-999ML - Hanoi
Facial Foam >50G/ML - Hanoi
Dishwashing 4-4.9L - Hanoi
Functional Adult Milk Powder >500G - Hanoi
Granules >500G - North & Central Rural
Fabcon Non-sachet - Rural
Still upsizing trend in long-term,
yet slowing down signal is
observed in Hanoi and North
Rural
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VALUE-FOR-MONEY OPTIONS?
Pragmatic behaviour is observed in short-term.
CONSUMER REACT
3
Source: Kantar Worldpanel Households Panel Total FMCG excluding Gift
PRIVATE
LABEL
IS GAINING
GROUND
34%
35%
40%
2010
2011
2012
Penetration %
NUMEROUS PROMOTION CAMPAIGNS & LOW PRICE OFFERS
56% 57%
64%
Repurchase rate %
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CHANNEL SHIFTING?
Pragmatic behaviour is observed in short-term.
CONSUMER REACT
4
Source: Kantar Worldpanel Households Panel Total FMCG excluding Gift
-500000
0
500000
1000000
1500000
2000000
2500000
P
3
1
2
P
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1
2
P
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1
2
P
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1
2
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1
2
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1
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9
1
2
P
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0
1
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1
1
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1
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1
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1
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1
3
Provision Store
Mom&Pop store
Switching trend from Street shop to H+S - Rolling MAT YOY trend
S
w
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h
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g

o
c
c
a
s
i
o
n
s

Slowing down shifting trend
from street shop to Hyper
Supermarket.
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VIETNAMESE CONSUMER TRENDS
TOWARDS FMCG
SPEED &
CONVENIENCE
HEALTH &
WELLNESS
FROM BASIC
TO ADDED VALUE
INNOVATION
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Rice soup enters
more Urban
families, especially
households with
Kid <12YO
CONVENIENCE SEEKING
Incremental
recruitment of
90,000 urban
households in
2012
Ground coffee
Soluble coffee
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LIQUID MILK
KNOWLEDGABLE CONSUMERS | HEALTH CARE
Urban 4 cities
Rural
Non-fried products
reach
22%
Urban households
in 8 months
Penetration %
INSTANT NOODLES
Volume per buyer
57 Liter
(vs. 50L in 2010)
27 Liter
(vs. 19L in 2010)
41%
(vs. 34% in 2010)
40%
(vs. 25% in 2010)
Urban 4 cities
Rural
SOYA MILK
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SOPHISTICATED NEEDS | READY TO PAY FOR ADDED VALUE
Source: Kantar Worldpanel Household Panel Urban 4 key cities & Rural Vietnam excluding gift
Beauty Cup yogurt
reaches
12% Urban
families
in 10 months
~ 270,000
households
Cup yogurt Liquid detergent
10 Liter per
Urban family
(FY12)

doubled FY10
figure
Price index: 112
Price index: 135
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MARKET DYNAMICS
Nowadays, consumers are exposed to many choices, esp. in personal products.
More new packsizes are offered to satisfy consumers different needs
In FMCG only, over 3,500
launches of new products / SKUs
in 2012 (13% active SKUs)
SHAMPOO
172
new packsizes
Source: Kantar Worldpanel Vietnam Urban 4 key cities - Total FMCG 2012
# new SKUs
LIQUID BATH
101
new packsizes
PACK SIZE
1,530
#1
VARIANT
1,017
#2
LIQUID BATH
80
new variants
SHAMPOO
69
new variants
BRAND
937
#3
GROUND
COFEE
50
new brands
BISCUITS
60
new brands
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VIETNAM CONSUMER PULSE
KEY TAKE-AWAY
CHALLENGES OPPORTUNITIES
MODERN
RETAIL
LANDSCAPE
RURAL
CONVENIENCE
HEALTH
ADDED VALUE
INNOVATION