Tet insight 2015

1. UNDERSTANDING RETAILER SENTIMENT
CATCH THE MOMENT OF ‘TET’

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3. WHAT IS EXPECTED IN TET 2015?
2. WHAT CHANGED IN TET 2014?
1. THE HISTORICAL TET
UNDERSTANDING

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SLUGGISH
GROWTH
GROWING
EXPORTS
MODERATE
INFLATION
THE VIETNAM MARKET IS SEEING TWO STREAMS
CPI
EXPORT
GROWTH
GDP
2013 2014 TARGET 2014 YTD
Source: GSO
Source: GSO
Source: GSO

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Fast Moving Consumer Goods market dynamics – Total Vietnam (MT2Partial)
12.4%
-5.1%
15.1%
13.6%
13.8%
7.7%
-1.3% -4.2%
-8.6%
-5.8%
-15%
-10%
-5%
0%
5%
10%
15%
20%
25%
THE VOLATILITY OF MARKET MAKES IT DIFFICULT
TO PREDICT LONG TERM TREND…
Nationwide – 15 categories
Source: Nielsen Regional Growth Reporter – Growth vs YA

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HOW WILL TET 2015 BE?

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3. WHAT IS EXPECTED IN TET 2015?
2. WHAT CHANGED IN TET 2014?
1. THE HISTORICAL TET
UNDERSTANDING

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BEER, SOFT DRINK & BISCUIT/CANDY ARE THE TOP
MOST RECALLED CATEGORIES FOR TET
BEER
CARBONATED
SOFT DRINK
BISCUIT/
CANDY
80.0
90.0
100.0
110.0
120.0
130.0
140.0
150.0
160.0
170.0
180.0
CSD
Biscuit
Pie & Sponge Cake
Beer
HCL
Granules
Soluble Coffee
VOLUME SEASONALITY INDEX – 6 CT TT
Source: Nielsen Retail Audit & Tet Study 2014 (N=192 HCMC + HN)
Question: What are the top 3 best selling categories in your stores in Tet?

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Super group_trend
6 CT TT - Stocks | Period Ending JUL14 | Share of Total Non-Food
NOV
25%
JAN
13%
DEC
45%
34% 37% 52% 20%
BIG
SMALL
MOST RETAILERS START STOCKING IN NOV/DEC
AND MAINLY STOCK FOR BEVERAGE & FOOD
WHEN?
WHAT?
Question: Which month do you normally start stocking for Tet?
Source: Nielsen Retail Audit & Tet Study 2014 (N=192 HCMC + HN)
Note: Super-groups are on different scales
Personal Care & Home Care stocks still
manage to increase, yet at lesser extent
STOCKING

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3. WHAT IS EXPECTED IN TET 2015?
2. WHAT CHANGED IN TET 2014?
1. THE HISTORICAL TET
UNDERSTANDING

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DESPITE THE INCREASE IN PURCHASES
RETAILERS NEVER SAW THE OFF TAKE IN 2014
49%
33%
17%
Less
Same
More
19
26
18 17
10
16
CSD Beer
6 CT TT - Volume % Chg vs. PP
Tet'12 Tet'13 Tet'14
14 13
9
16
9 11
Urban Rural
Granules - Volume % Chg vs. PP
Declining off-take of Tet’14 is mainly seen in
Beverage, esp. CSD
Rural seems to be more impacted than
Urban when compared with previous Tet
Question: How was the off-take of Tet'14
compared with previous Tet in your store?
Source: Nielsen Retail Audit & Tet Study 2014 (N=192 HCMC + HN)
Tet’12 (Dec-Jan-Feb); Tet’13 (Jan-Feb-Mar); Tet’14 (Dec-Jan-Feb)

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3. WHAT IS EXPECTED IN TET 2015?
2. WHAT CHANGED IN TET 2014?
1. THE HISTORICAL TET
UNDERSTANDING

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STOCKING PERIODS SHOULD REMAIN THE SAME AS
IN THE PAST, BUT SHOULD WE BE PUSHING EARLIER?
Source: Tet Study 2014
24 29
19
37
22
12
40
45
35
40
40
40
21
16
26
9
23
32
11 8
15 4
15 15
Total
(n=192)
HCM
(n=98)
HN
(n=94)
Big
(n=67)
Medium
(n=65)
Small
(n=60)
Month retailers start stocking for Tet’15
November December January Not stock for Tet
Question:Which month do you plan to start stocking for Tet’15?

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51
%
1
39
%
NEARLY HALF PLAN ON STOCKING LESS FOR TET’15
Source: Tet Study 2014
Question: What are reasons for you to plan reducing level of stock for Tet'15 compared with
Tet'14? To what extent do you plan to reduce the stock level for Tet’15 compared with Tet'14?
45%
42%
13%
Less Same More
Question: Compared with Tet'14,
how do you plan stocking for Tet’15?
HCMC
(n= 98)
Hanoi
(n= 94)
Declining
consumer demand
72%
Declining
personal finance
24%
29% 55% 16%
48% 44% 8%
Stock reduction by
(n= 38)
(n= 48)
STOCKING
WHY?

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61
%
47
%
ALARMINGLY OVER HALF ANTICIPATE LOWER OFF-
TAKE VS. TET’14
Source: Tet Study 2014
Question: To what extent do you anticipate off-take of Tet'15 will decline compared with Tet’14?
54%
34%
13%
Less Same More
Question: How do you anticipate the off-
take Tet’15 compared with previous Tet?
HCMC
(n= 98)
Hanoi
(n= 94)
37% 48% 15%
42% 44% 14%
Declining off-take by
(n= 46)
(n= 57)

15. BUT HOW CAN I WIN DESPITE
THIS DOOM AND GLOOM?

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RETAILERS WANT ASSURANCES THAT YOUR
PRODUCTS WILL SELL
Source: Tet Study 2014
Quality guarantee/
Product return/ refund
support
Provide POSM/ Decoration
materials to promote for Tet
Promotion scheme for retailers
achieving Tet sale target
Promotion scheme for retailers having
impressive display
Quality guarantee/
Product return/ refund
support
Provide POSM/ Decoration
materials to promote for Tet
Promotion activities for end-users
Promotion scheme for retailers having
impressive display
HCMC
(n= 98)
Hanoi
(n= 94)
57%
47%
39%
29%
74%
33%
32%
24%
Question: To attract more consumers in Tet, what kind of activities you would
like manufacturers to support your stores?

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STATING THE OBVIOUS – MARGINS MATTER
Source: Tet Study 2014 Question: Which retailer incentive schemes do you prefer?
Tangible gift (eg. Rice cooker, Washing machine, etc.)
% Margin on Purchase90%
47%
30%
Bonus same product if meet
sales target

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SHOPPERS ARE SEEKING INSTANT VALUE WITH
ATTRACTIVE APPEARANCE PRODUCTS
Source: Tet Study 2014
Economic Offer
(eg. Discount, super-
saving package, etc.)
Attached gifts
(toys, kitchenware,
etc.)
Nice/ eye-
catching
Tet packing
Question On the scale from 1 to 5, please rank the preference of shoppers at your
stores towards these offers?
68%
52%
66%
% Preferred & Preferred Most
Similar between
HCMC & Hanoi,
except Lucky Draw, in
which HCMC prefers
this type more than
Hanoi (44% vs. 19%)

19. WHERE TO FROM HERE

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MORE PURCHASING POWER
Source:
Monthly income per capita: GSO 2012
Occupation structure & Urbanization rate: Rural Census 2011
Education level: Nielsen Rural Syndicated Study 2009 & Nielsen Rural 2014
COMPETITION WILL GROW SO WE NEED TO
ENGAGE RETAILERS
Engage earlier e.g. XMAS and Easter
in Europe and US
Stack them high see them fly
But if it doesn’t, will you buy it back?
Times are tough but people still will
pay for value
Don’t stop innovating
This is when people try new things

21. “A PESSIMIST SEES THE DIFFICULTY IN EVERY
OPPORTUNITY; AN OPTIMIST SEES THE OPPORTUNITY
IN EVERY DIFFICULTY.” WINSTON CHURCHILL