Vietnamese people will prioritize products that are convenient, practical and save time and money during the upcoming Tet holiday, according to experts.
Comments were made by Ms. Nguyen Phuong Nga, Senior Business Development Director of Kantar Worldpanel Vietnam market research company, stated in the conference on December 2. This expert predicts that total spending for the fast-moving consumer goods (FMCG) industry during Tet 2025 will grow by about 5% compared to Tet 2024.
With the upcoming Lunar New Year, people will have 9 days off, from December 26 to January 5 (January 25-February 2, 2025). Shopping activities usually start 4-5 weeks before Tet, meaning the market will be vibrant from the end of this month. Some consumers also feel the 2025 Lunar New Year will be more positive, but plan to keep shopping simple.
“This year is not as difficult as last year. I plan to spend on necessary things and buy a few more home decorations and Tet snacks but not travel,” Ms. Thanh Phuong, 36 years old (Binh Thanh district, Ho Chi Minh City) said.
Meanwhile, “just enough” is the criterion for celebrating Tet 2025 of Ms. Ngoc Thu’s family (Hoang Mai district, Hanoi). “This year, my family focuses on essential goods at a moderate level, simpler than previous years. In general, we will lean towards health care products and not buy too many Tet gifts,” she said. know.
People shop for candy during the 2023 Lunar New Year in Hanoi. Image: Ngoc Thanh
According to Kantar, Vietnamese people are able to buy Tet At Ty more easily due to many reasons ranging from consumer psychology, household financial situation to changes in the way they celebrate Tet.
In the fourth quarter of 2019, 84% of households surveyed by Kantar were optimistic about the future economy, but this rate has fluctuated continuously since the epidemic, down to 69% in the third quarter. “Consumer psychology is not as optimistic as before. Any changes that occur will have an impact, leading to the tendency to look for bargain prices,” Ms. Nga explained.
The survey shows that household finances are gradually stabilizing after Covid-19 but are not completely strong. According to data from the General Statistics Office, by the third quarter, the average income of workers in urban areas was 9.3 million VND and in rural areas was 6.6 million VND, an increase of 4.49% and 6.45% respectively. % compared to the same period last year.
But when Kantar asked, 24% of households said they needed to reduce spending, compared to 19% in the third quarter of 2019. On the contrary, 20% said there was no need to reduce, 2 percentage points lower than before the epidemic. “The trend of buying cheap items is covering more industries,” Ms. Nga said.
In addition, the Vietnamese way of “celebrating Tet” is gradually changing, towards compactness. The top 3 reasons they spend less on Tet 2024 are: wanting to simplify Tet procedures, spending more time resting and reducing gatherings, which is forecast to be a long-term trend.
In fact, over the past 3 years, the contribution value of the two months of Tet to the whole year’s results in the FMCG industry has gradually decreased, from 21% to 19% in urban areas and 24% to 21% in rural areas.
Families’ rate of receiving Tet gifts has also decreased, forcing them to purchase products according to their priorities in terms of necessity and budget. “With these trends, it is predicted that there cannot be a surge in shopping, so the 2025 Tet season will be economical and practical,” Ms. Nga said.
Also a small online grocery trader, Ms. Thanh Phuong believes that the criteria for next Tet food is “compact – delicious”. “During Tet, I took the opportunity to sell more dried fish and popsicles because more and more customers prefer things that are not boring, can be eaten immediately or with little processing,” she said.
According to experts, the simple Tet shopping trend opens up opportunities for a number of essential goods industries and shopping channels to have competitive advantages in price. Last year, Tet gift baskets tended to gradually shift to healthy or practical products such as cooking oil, spices, instant noodles, MSG and reduce consumption of beer, candy, soft drinks, and energy drinks. .
According to Ms. Nga, this year’s selection trend also continues to be “healthy and meaningful” goods, helping to take care of mental and physical health and balance life. For shopping channels, grocery will still maintain competitiveness while traditional markets are losing appeal. During the Tet season, supermarkets and hypermarkets are also popular.
However, with the explosion of mini supermarkets (area of 300-500 m2 per store), large supermarkets will have difficulty expanding their customer base, according to Mr. Pham Trong Chinh, Head of the market expert group of Association of High Quality Vietnamese Products and Center for Business Research and Business Support (BSA).
This channel is also reducing the scale of promotions. Before the epidemic, on average 72-75% of products sold in supermarkets had promotions but now only about 65%, according to Mr. Chinh. “Large supermarkets’ happy hour revolves around key products. While it is difficult to find new customers, they should focus on taking good care of their existing customer group through increasing the shopping experience,” he said.
Meanwhile, e-commerce is expected to continue to boom and be the earliest channel for Tet shopping activities, possibly from early December. The advantage of this channel is that the average value of FMCG orders is often higher when Consumers buy directly at supermarkets due to the attractiveness of promotions, free shipping conditions or accompanying gifts if the purchase meets the prescribed minimum value.
According to Mr. Chinh, in the long term, e-commerce still has the ability to grow 15-20% per year but the proportion in the entire retail industry is still small and traditional channels (except markets) still compete well. Therefore, businesses can diversify sales channels but should not worry too much about the dominance of online channels.
Even currently, when selling via livestream, there are not many cases where a formula can be found that can balance the three factors of sales, growth and profit because most are still losing money to do marketing. “Businesses should consider livestream as a sales channel but don’t idolize it and worry too much,” Mr. Chinh recommended.