Nielsen presentation q42014 fmcg update

VIETNAM FMCG
TODAY AND TOMORROW
Vaughan Ryan, Christoph Michel
2nd March 2015
A SHARING SESSION WITH METRO C&C VIETNAM

Copyright©2012TheNielsenCompany.Confidentialandproprietary.
2
SLUGGISH
GROWTH
GROWING
EXPORTS
MODERATE
INFLATION
CPI
EXPORT
GROWTH
GDP
2013 2014 TARGET 2014 ACTUAL
Source: GSO
Source: GSO
Source: GSO
Source: GSO
TWO STREAMS ARE DRIVING VIETNAM'S ECONOMY

3
.
4.1%
-1.4%
18.5%
13.1% 14.5%
7.4%
-1.5% -2.5%
-5.4%
-2.0%
1.3%
1.1%
8.1%
1.0%
25.9%
18.0% 18.8%
11.5%
2.1%
1.1%
-2.2%
0.3% 3.4% 2.4%
-10%
-5%
0%
5%
10%
15%
20%
25%
30%
Unit value change Volume change Nominal growth
Fast Moving Consumer Goods dynamics - total 6 cities (TT+MT excl. Coop)
Source: Nielsen Retail Index – Versus year ago
VOLATILITY MAKES IT HARD TO PREDICT FUTURE
TRENDS

4
-1.5%
15.4%
4.2%
-1.1%-2.2%
-5.7%
-1.7%
1.0%
-1.1%
1.3%
19.7%
8.2%
2.6%2.1%
-2.1%
1.3% 3.3%
-0.7%
-10%
-5%
0%
5%
10%
15%
20%
25%
30%
35%
40%
Traditional Trade 6 cities
Fast Moving Consumer Goods dynamics - Traditional Trade vs Modern Trade
Unite Value change Volume change Nominal growth
-3.8% -3.4% -7.1%
-1.6% -2.8% -1.2%
-3.9%
-3.2%
-6.0%
-2.8%
1.0%
-3.1%
0.9% 0.3%-0.5%
-3.2%
-3.2%
-4.8%
-10%
-5%
0%
5%
10%
15%
20%
25%
30%
35%
40%
MT HCM and HN excl. Coop Mart
Like-for-like
2014 WAS CHALLENGING ESPECIALLY IN MT

5
-4.8%
-1.5%
3.1%
-0.8%
-9.7%
-10.2% -9.9%
-2.1%
2.7%
3.8%
-0.2% 1.1%
7.8%
4.2%
-5.4%
-6.4% -6.8%
-0.1%
5.0%
6.5%
-15%
-10%
-5%
0%
5%
10%
15%
On Premise - 6 cities
Unit value change Volume change Nominal growth
On-Premise Categories include Soft drinks, Gums, Beer, Energy Drinks, RTDM, RTDT, RTDC, Fruit Juice, Package Water, Sport Drinks and Cigarette
Off -premise retrieved for all on-going tracking categories
Fast Moving Consumer Goods dynamics - On premise
ON PREMISE DRIVES RECENT FMCG GROWTH

6
97 98 99 98
102
106
Source: Asia Pacific Consumer Confidence Report (Q4 - 2014) All respondents n = 10134
CONFIDENCE REACHES A 4-YEAR-HIGH LEVEL…
Vietnam is among top 10 most confident countries globally
CCI Q4’14 - Top 10 countries globally
INDONESIA
INDIA
PHILIPPINES
UAE
THAILAND
CHINA
UNITED STATES
HONG KONG
VIETNAM
DENMARK
129
121
120
114
111
106
108
107
107
104
CCI Vietnam - from Q3’13 to Q4’14

7
…YET PEOPLE REMAIN CAUTIOUS
Source: Nielsen Consumer Confidence Index – Q4’14 Note: Q: How to utilize spare cash after covering essential living expenses
: All respondents who answered Yes to Q11 (1 Code) n=500
1
2
3
4
5
Health
The Economy
Job security
Work/life Balance
Increase food
price
VIETNAM TOP CONCERN
Q4’14
32
34
35
40
77
Out of home
entertainment
New
Technology
Products
New Clothes
Holidays/
Vacations
Put into saving
+1
+7
+9
+2
Q4 - 2014
Change from
Q4’13
+3

8
NIELSEN TRACKED CATEGORIES
Total 50 categories
BEVERAGE
Beer
CSD
Fruit juice
Instant coffee
Package water
Ready to drink coffee
Ready to drink tea
Sport drink
Tea bag
Tonic food drink
HOUSEHOLD CARE
Dishwashing liquids
Fabric softener
Household cleaner
Household Insec.
Aerosol & Coil
Laundry products
Tissue
(Napkin, Toilet,
Kitchen )
PERSONAL CARE
Body Cream Lotion
Deodorants
Eyecare
Facial Care Products
Feminine Protection
Hair Conditioner
Mouth Wash Personal
Wash Shampoo
Toilet Soap
Toothbrush
Toothpaste
Insec. Lotion
Facial tissue
Hair colorant
FOOD
Biscuits & Pie
Bouillon MSG Cheese
Chilli Sauce
Cooking Oil
Gums
Instant Noodles
Mayonnaise
Meal Maker
Sauces (Soy, Fish &
Oyster)
Snack
Candy
MILK-BASED
PRODUCTS
Milk Powder
Spoon Yoghurt
Sweetened Condense
Milk
Ready to drink milk
BABY PRODUCTS
Baby Cereal
Baby Diaper
CIG
Cigarette

9
37%
BEVERAGE
ONLY BEVERAGE HAS BEEN ABLE TO REALLY RECOVER
MILK BASE
17%
FOOD
15%
Super Category Contribution and Growth - total 6 cities (TT+MT excl. Coop)
Source: Nielsen Retail Index – Versus year ago. Beverage: includes On-Premise
-1.7% -2.8%
-4.0%
3.0%
8.8%
11.0%
1.4%
3.8%
-3.1% -3.2%
-1.8%
-5.6%
3.2%
0.9%
-2.3%
0.0% 0.2% 1.1%

10
8%
CIGARETTE
14%
WHILST OTHER CATEGORIES STILL SUFFER
PERSONAL
CARE
6%
HOME CARE BABY CARE
4%
10.0%
4.8%
0.6%
2.6% 3.6%
-1.9%
16.3%
8.3%
-1.3% -1.1%
2.4%
-0.9%
15.5%
19.6%
12.5%
4.5% 4.1%
-4.6%
-1.2 -1.3 -2.0 -1.9 -1.4
-2.8
Super Category Contribution and Growth - total 6 cities (TT+MT excl. Coop)

THREE TRENDS TO WATCH FOR
Urbanization
Upgradation
Sophistication
Convenience ExperienceValue

12Source: Banners’ official website
+5%
+0%
Q4’14 vs. Q3’14
Number of Stores
MINIMARTS ARE GAINING MOMENTUM

13Source: Banners’ official website / Shopper Trends
Number of Stores
CONVENIENCE STORES EXPAND RAPIDLY
• Notable expansions in Q4 are from Family Mart and Circle K. +6%
+2%
+10%
+29%
Q4’14 vs. Q3’14
Need it now… On-the-go… Hanging out

14
3%
12%
0%
43%
Q4’14 vs. Q3’14
Number of Stores
7%
SUPERMARKET STORES ARE EXPANDING THEIR
FOOTPRINT
Source: Banners’ official website

15
E-COMMERCE OPPORTUNITY IS EMERGING
2014 vs 2011: Laptop grows ~ 4x, Smartphone grows ~ 8x
TOP 4 SUPPORTED PLATFORMS FOR INTERNET ACCESS
81%
OWN LAPTOPS
74 %
OWN DESKTOPS
37 %
OWN
SMART TVs
82%
OWN
SMARTPHONES
Cross-platform study in 2014 in 6 key cities, internet access from respondents; Global e-commerce study 2014
51%
Airline ticket/ reservation
28%
Clothes/ Shoes/ Accessories
26%
Digital devices (TV, cameras...)
TOP 3 CATEGORIES WITH INTENTION TO SHOP ONLINE
TOP 3 TIPING POINTS
SAFE SIMPLE SAVING

16
SHOPPERS GET INCREASINGLY PRICE SAVVY
Lowest price perception Store attribute ranking
1. Convenient to get to
2. Good deals and promos
3. Easy to find what I need
4. Low prices
39%
“I know the price of most of the
items and always notice when the
price changes”
33%
“I actively search for promotions”
2008 2014
Source: Shopper Trends study 2008-2014, HCMC, HN, DaNang, Can Tho

17
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
BUT ALSO DON’T FORGET THE MASSES
Of the population live in rural Vietnam
68%

18
Source:
Monthly income per capita: GSO 2012
Occupation structure & Urbanization rate: Rural Census 2011
Education level: Nielsen Rural Syndicated Study 2009 & Nielsen Rural 2014
TO BE SUCCESSFUL IN VIETNAM YOU MUST
EMBRACE RURAL
More than 2X the size of urban
Young and increasingly dynamic
Over 750K stores
Watch TV everyday
Not going to go away

19
2.0%
-4.4%
5.9%
-1.9%
-4.4%
-7.9%
-4.1%
-0.8%
0.1%
6.7%
0.5%
10.8%
2.1%
-0.4%
-3.3%0.1%
2.7%
2.7%
-10%
-5%
0%
5%
10%
15%
20%
Total Urban
5.1%
-5.2%
9.4%
-0.2%
-3.7%
-8.6%
-6.3%
-2.7%-2.4%
8.1%
-1.4%
11.8%
2.2%
0.0%
-3.7%
-1.5%
0.4%
-0.7%
-10%
-5%
0%
5%
10%
15%
20%
Total Rural
Unit Value change Volume change Nominal growth
Fast Moving Consumer Goods dynamics - Urban vs Rural
Note: This slide only includes Feminine Protection, Hair Conditioner, Shampoo, Toothpaste, Toothbrush, Personal Wash, Dishwashing Liquids,
Fabric Softener, Laundry Products, Bouillon-MSG, RTDM, Soft Drink, Energy Drink, RTDT, Cigarette
RURAL IS MORE ‘EXPRESSIVE’ THAN URBAN
GREW FASTER IN UPTURN BUT DECLINES STEEPER IN DOWNTURN
55%
45%
Rural
Urban

20
WHAT DOES IT MEAN FOR METRO
Brick
& click
Bang for
the buck
Customer
Connection

21
YOU NEED KNOW WHAT MAKES THEM TICK
REACH
WHO WHAT HOW
REACTRESONATE
Driving differentiated outcomes for your business in Vietnam

Nielsen presentation q42014 fmcg update

Nielsen presentation q42014 fmcg update

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