FMCG brands reshuffle in Vietnam’s growing consumer market

VIETNAM'S TOP 100 BRANDS: RANKING ANALYSIS

With the fastest GDP growth in Southeast Asia, a highly urban population and a budding middle class, Vietnam consumers are among the most sought after for brands. But with more choice and expendable income, loyalty isn’t as strong among Vietnamese, with sudden and sizeable shifts occurring across various categories in this year’s top 100 brands list.

“Fluidity is an obvious theme in a high-velocity, new consumer market like Vietnam, which is moving enormous chunks of its 94 million population into the branded consumer class for the first time,” says MullenLowe Mishra president and chief executive Saby Mishra.

This is fuelled by a 6.8% GDP growth rate, according to the Asian Development Bank, leading to rising household incomes and private consumption. Consumer expenditure in Vietnam was US$171 billion in 2018, more than double its $80 billion expenditure in 2010.

FMCG experienced the biggest shifts in Vietnam’s top 100 brands this year. Heinz (82) was down a significant 49 slots, while its parent company Kraft (118) fell 57 to drop out of the top 100. The Kraft-Heinz conglomerate has cut global ad spend since it merged the two companies in 2015, which could explain its waning share in Vietnam.

Elsewhere in food and drink, Doublemint (136) was down 52, Nutella (76) was down 33 slots, Maggi (87) was down 29, Cosy (11) was down 25 and Pepsi (90) fell 18.

In beauty, Sunsilk (144), Clear (131), Olay (103), Japanese cosmetics brand Shiseido and Lux fell 67, 55, 44, 37 and 26 places respectively, while L’Oreal (39) gained 43 places.

Unilever’s local toothpaste brand P/S (119) dropped 52 slots as Oral B (100) enjoyed some of the biggest success, up 57 places. Similarly, as Kimberly-Clark's nappy brand Huggies (77) fell 17, Procter & Gamble's Pampers (84) gained 16 places.

Other gains included Lipton (49), Red Bull (80), Panadol (29) and Nescafe (51), up 50, 23, 22, and 18 slots, respectively.

There were also some significant falls among fashion and luxury brands. Louis Vuitton (155) and Lacoste (174) both tumbled out of the top 100, down 85 slots and 80 slots. Higher up the ranking, Zara (37) and Calvin Klein (38) fell by seven and nine slots, respectively.

Rolex (70) and Adidas (11) were among the biggest successes in these categories, up 15 and 11 places, respectively.

Elsewhere, ride-hailing brand EasyTaxi (44) gained 135 places, while Grab (16) gained one slot. Uber, which was 23rd in last year’s ranking, did not appear in the 2019 list.

In the top local brands list, Grab was among the biggest triumphs, up 94 places to 28, while its Indonesian competitor Gojek climbed 13 places to 58. Grab tops the list in the ride-sharing category in Vietnam, followed by EasyTaxi and PingTaxi.

Explaining Grab’s rise in prominence as a local brand, Mishra explains: “Young urban Vietnamese are fervent trialists of convenience focused, tech enabled value propositions. Grab is seen as renovating the commute/delivery infra in high-density, urban Vietnam so the brand has a clear purpose, and that resonates.”