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VIETNAM ECONOMY * 2022 Forecast

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Vietnamese Consumers & TET – Lunar New Year 2022

 

The outbreak of COVID-19 has brought upon unprecedented challenges and is having a significant impact on Vietnam in many aspects. GDP grew only 1.42% this year through September, with its performance particularly poor in the third quarter. Final consumption, which accounts for about 70% of Vietnam GDP, fell 2.83% in the third quarter due to severe travel restrictions. With the easing of constraints on movement from the 1st of October, relief and excitement are the two emotions most Vietnamese feeling now; however, many are still being cautious about going out and meeting people. This complexity is expected to generate changes in the way Vietnamese celebrate 2022 Tet – the most significant festival in a year. Consumers would change the way they celebrate Tet in 2022 compared to previous years.

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The pandemic has made a significant change of the Vietnamese shopping habits

 

The pandemic has made a significant change in Tet activities, and it will continue to change what people do in the coming 2022 Tet. People plan to stay home more, less travel and less go back to hometown. They will probably go around the city to enjoy Tet with families or friends. When being asked about plans of traveling or visiting your hometown during the coming Tet holiday, 68% of the people says they would go around the city to enjoy Tet with families or friends, 18% says they would ONLY stay at home during Tet.

More activities to celebrate Tet at home: cooking, playing games, watching movies, video calls with friends or families, home decorations, having meals with neighbors/friends. Tet activities shift from offline to online, posing major opportunity for brands, occasion association online campaign.

Over the last two Tets which were impacted by the pandemic, FMCG growth was quite humble with the average performance of most categories. Only packaged food was able to maintain the growth rate. FMCG excluding gifts in all previous years, people used to shop for Tet about 3-4 weeks before 1st day of Lunar New Year with very high spending level, which making 1 month before Tet two times more valuable than average. After experiencing almost half year of staying home, suffering financial difficulties, and having no big celebrations, people are looking forward to Tet and they say they will shop for Tet as early as before. Over the past few months, people shopped less frequently but more per trip. This new habit will change the way people shop for Tet 2022. If we wait until people going to stores or ecommerce sites, there will be less chance to interact with them and trigger their purchases. Instead, brands need to be appealing in multi-channels where consumers are spending their time from studying, working, entertaining to connecting with others. In terms of product offers, brands and retailers should push more combos to maximize the potential of bulky trip trend.

Hyper markets and supermarkets used to be the channel benefiting the most from high spending before Tet. With the rapid changes in recent months, people are getting more familiar with mini marts and online which are expected to accelerate in Tet 2022. There were some changes in food and drink choices in past Tet as people were appreciating more being-together moments and individual appetite. From a recent survey, many of them said they will consume more healthy products. They also buy more products what can make their cooking more convenient and add new dishes into their Tet menu to satisfy more the appetite of their family members.

Because restrictions ease, people are looking forward to reuniting with family and friends; however, they are still worried about the risk of infection and a possible resurgence of Covid-19. As a result, the recovery of gifting remains questionable. Nevertheless, gifting is always a very typical tradition of Vietnamese, esp. during Tet. The key thing is people might have new choices in terms of products and ways to give to others. Practicality in product choices is more adapted. Apart from the top three criteria in gifting choices, practical for Tet usage and health care products are being considered in view of the rising health concern in pandemic time. Meanwhile, though remaining as an essential factor, packaging and being high in value are seeing reduction in importance in gifting criteria. The way people give presents to others in coming Tet could be changed. They will use more delivery service and money transferring, which offer some opportunities to brands and service providers.

 

 

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Luu Nguyen News

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VIETNAM ECONOMY * 2022 Forecast

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VIETNAM ECONOMY * 2022 Forecast

Vietnam Economy * 2022 Forecast NDO - With trade and domestic production bouncing back despite negative impacts of the health crisis, the government is making its great efforts to continue reviving the economy, which is expected to take the lead in the region in...

read more

VIETNAM ECONOMY * 2022 Forecast

Vietnam Economy * 2022 Forecast NDO - With trade and domestic production bouncing back despite negative impacts of the health crisis, the government is making its great efforts to continue reviving the economy, which is expected to take the lead in the region in...

read more

VIETNAM ECONOMY * 2022 Forecast

Vietnam Economy * 2022 Forecast NDO - With trade and domestic production bouncing back despite negative impacts of the health crisis, the government is making its great efforts to continue reviving the economy, which is expected to take the lead in the region in...

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