Credit by Deloitte
In late 2018, Deloitte conducted a retail survey to uncover some of the latest consumption patterns in Vietnam, including consumer preferences for the different purchasing channels across several key consumer product categories, and some of the consumer’s digital behaviours and attitudes towards online shopping. Using a combination of online and offline questionnaires, the survey covered 700 households in the two key cities of Hanoi
and Ho Chi Minh City, which are currently the focus of many domestic and foreign retail players, given their rapid uptake of Modern Trade channels and e-commerce.
1. Purchasing channels
1.1. Clothing, footwear and personal accessories
The entry and expansion of international fast-fashion brands in Vietnam has contributed to a vibrant retail scene, and an increasing preference for Modern Trade channels, such as commercial centres, for the purchase of clothing, footwear and personal accessories. Online retail channels, most of whom offer delivery services, are also rising in popularity amongst survey respondents (see Figure 13).
1.2. Cosmetics and personal hygiene products
With the rise of middle-class consumers in Vietnam, there has been an increasing demand for cosmetics and personal hygiene products, including skincare and makeup products. Although survey respondents typically visit supermarkets to make these purchases, they are also increasingly moving towards online channels (see Figure 14). In response, many companies are deploying social media marketing campaigns to appeal to these consumers.
1.3. Electronics products
Electronics chain stores are the overall preferred channel for the purchase of electronics products by survey respondents (see Figure 15). For these products, consumers may also adopt “showrooming” purchase behaviours, where they browse or try items in physical stores, but ultimately make the purchase online to benefit from promotional deals. Alternatively, they may also adopt “webrooming” purchasing behaviours, where they browse
products online, but make the purchase in a physical store.
1.4. Food and beverages
For the majority of survey respondents, supermarkets and wet markets are the preferred purchasing channels for food and beverages, closely followed by convenience stores (see Figure 16). Nevertheless, Traditional Trade outlets, such as street stores, remain familiar places to shop, even as online channels gain popularity, especially with the rise of mobile applications, such as Foody and Lozi.
1.5. Home appliances
Supermarkets and electronics chain stores are the survey respondents’ most popular purchasing channels for home appliances (see Figure 18). Competition in this product category appears to be intensifying, as evidenced by the recent closure of numerous smaller electronics chain store players.
2. Digital behaviours
2.1. Perceptions of online shopping
Consumers in Vietnam are accustomed to the use of digital channels: nearly three-quarters of survey respondents have indicated familiarity with online
shopping (see Figure 19).
In general, survey respondents perceived online shopping to be convenient – as it enables them to save time, and shop from anywhere as long as they have their phones and Internet access – and felt that online shopping gives them access to a greater variety of products (see Figure 20).
However, several concerns remain around delivery time and product quality. For instance, the need to wait for delivery and difficulties in ascertaining product quality online are some of the issues that have been raised by survey respondents.
2.2. Drivers of online shopping
For the majority of survey respondents, promotional offers are the top driver of online shipping, implying that price is the top consideration. This is followed by delivery times, as well as the availability of a wider range of merchandise (see Figure 21).
In terms of B2C channels, Lazada and Tiki emerged as the most popular platforms amongst survey respondents (see Figure 22). Nonetheless, we are also witnessing the rise of C2C platforms, as 45% of survey respondents reported having purchased items on social media channels, such as Facebook and Instagram. Indeed, these social networks are not only useful for consumers to search for reviews and compare products: for many smaller businesses, these platforms can be easy and cost-effective ways to increase consumer awareness and drive sales.
2.3. Online payment methods
Even as they do their shopping online, the majority of survey respondents still continue to prefer pay with cash on delivery (see Figure 23). This was followed by bank transfers, as well as credit cards and debit cards, implying that several concerns still remain around issues such as payment security.