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Vietnam Technology Trends
- Recruits panelists - Conducts home visits - Collects receipts - Enters data online TNS: - Designs questionnaires - Trains assistants - Manages data collection - Analyses data - Reports insights Client: - Subscribes to reports - Gains competitive intelligence - Understands consumer needs - Tracks own performance - Plans marketing strategies 35 VietCycle ‘06 TNS Worldpanel Telecoms What information is collected? - Demographics of panelists - Mobile phone purchases - Contract details - Handset models - Monthly spend - Service provider details - Monthly
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Vietnam Technology Trends
- 1. Vietnam Telecoms & Technology October 19, 2006 Sheraton Hotel HCMC, Vietnam 1 VietCycle ‘06
- 2. Telecoms & TechnologyAgenda Vietnam Technology trends Emotional Technology drivers Future shapers of Telecoms Harnessing consumer sentiment Ralf Matthaes managing director TNS Vietnam 2 VietCycle ‘06
- 3. A young population Male Vietnam 2005 Female 80+ 75 - 79 70 - 74 Vietnam’s 65 - 69 future consumer 60 - 64 55 - 59 base is huge 50 - 54 45 - 49 40 - 44 35 - 39 30 - 34 25 - 29 20 - 24 15 - 19 10 - 14 5-9 0-4 General Economy: Population Source: U.S. Central Bureau, International Data Base 58% of Vietnam’s population is under 30 years old Vietnam’s consumption days are still ahead 3 VietCycle ‘06
- 4. SEC Scale The emergenceof A = US $1,001 + B = US $1,000 - 501 an urban middle class C = US $500 - 351 D = US $350 - 251 E = US $250 - 151 F = US $150 below 2006 21 55 24 2003 14 36 50 2001 12 32 56 1999 7 31 62 0% 20% 40% 60% 80% 100% SEC AB SEC CD SEC EF Monthly declared household income The majority in Hanoi & HCMC now belong to the middle class Source: TNS VietCyle – N = 2000 Urban 4 VietCycle ‘06
- 5. Vietnam Technology Trends 2006 © VietCycleTM 2006
- 6. Surfing the web 2006 53 47 2005 45 55 2004 40 60 2001 28 72 0% 20% 40% 60% 80% 100% Have used the internet Not yet Internet user-ship has reached over 50% in urban Vietnam Source: TNS VietCyle – N = 2000 Urban 6 VietCycle ‘06
- 7. Internet & e-mailownership Personal email in - home penetration n=2,000 81 16 21 non 1email account 2 email account 2 Plus emails Internet subscribed at home n=1,014 28 19 53 Have subscribed Intend to subscribe internet at Not intend to subscribe internet at home home in the next 12 months internet at home Teen Internet usage n=401 84 16 Have used the internet Not yet Urban Vietnamese are becoming cyber-connected Source: TNS VietCyle – N = 2000 Urban 7 VietCycle ‘06
- 8. In-home computer penetration byCity & Income All, n=2000 56 42 21 45% in-home computer ownership HCMC, n=600 48 46 4 2 Hanoi, n=600 55 44 1 0 Danang, n=400 54 44 20 Cantho, n=400 70 28 11 SEC AB, n=346 29 63 6 2 SEC CD, n=1060 53 44 21 SEC EF, n=594 76 24 0 None 1 computer 2 computers > 2 computers In home computer penetration is driven by HCMC (52%)and AB incomes (71%) Base: All respondents 8 VietCycle ‘06
- 9. Technology embracers 100 84 80 74 68 58 60 53 49 40 40 26 24 21 22 20 17 16 1 1 0 1999 2004 2006 DVD Player Plat screen TV Personal computer Mobile phone Video disk VCD PC’s & mobile phones are reaching half of the population Source: TNS VietCyle – N = 2000 Urban 9 VietCycle ‘06
- 10. The mobile phone market 10 VietCycle ‘06
- 11. Mobile phone ownership– by Income Nearly a half of urban Vietnamese currently own a mobile phone 14% intend to purchase in the next 12 months All, n=2000 45 14 41 Income is the single largest driver of mobile phone ownership, with 2/3rds of all wealthy consumers already owning handsets 64 9 28 SEC AB, n=346 50 14 36 SEC CD, n=1060 26 16 58 SEC EF, n=594 Owner Prospect Rejecter Base: All respondents 11 VietCycle ‘06
- 12. Handset brand usedmost often Nokia is the leader in total market. However, the market is becoming much more competitive, as due to new entrants and other factors LG S-Fone 1.0% Citi phone 1.3% Others Sony Ericsson / 2.0% 3.4% Ericsson 4.9% Motorola 11.3% Nokia Samsung 56.8% Brands 2003 2004 2006 19.3% Nokia 71% 69% 57% Samsung 7% 15% 19% Motorola 9% 4% 11% Base: Mobile owners only 12 VietCycle ‘06
- 13. 4 reasons tochoose current brand – Next brand - by income Purchasing behavior is changing amongst the wealthier consumers Current Next Insight on Next brand Brand Brand Good looks / attractive 38% 46% Attractiveness will really attract Lots of features 38% 40% Features remain essential Value for money will become a Good value for money 38% 20% non issue for these consumers 31% 29% Reliability & Quality Reliable / high quality remain important Significantly different to average, or to the average of other breaks within the same group Base: Mobile owners only 13 VietCycle ‘06
- 14. Network used mostoften At present Mobifone has half of the market of users Others 2.4% S-Fone 6.1% Viettel 16.6% Mobifone 50.0% Vinaphone 24.9% Base: Mobile owners only 14 VietCycle ‘06
- 15. Synopsis Mobilephone ownership is growing steadily, (20 – 45 yr olds) Ownership should double by 2010 Payment terms will become more post-paid Brand share will continue to shift Features & looks will drive high end sales Price will be key for the emerging middle class Hygiene factors will now longer be part of the consideration set Thus, understanding consumer needs such as Aspirations VietCycle 2006__________ •N = 2,000 Face to face Interviews Brand values •Hanoi / HCMC / Danang / Can Tho •Conducted every 18 months since 1998 Price sensitivities •Trend data available Features and sex appeal 15 VietCycle ‘06
- 16. Consumer Emotional Technology Drivers Nguyen NuTuyet Hong Technology Sector Head, TNS VN Alison Dexter Research Director, Quali Division, TNS VN © VietCycleTM 2006
- 17. Introduction TNS conductsaround 500 focus group discussions a year and close to 600 in depth interviews across Vietnam We talk to a range of people from kids, to students, to housewives, to mums of different aged children, to young working males to the older generation They share with us their dreams, aspirations, attitudes and behaviour Following is some snapshot analysis on the following: What advantages does technology bring? How are brands assessed? Purchase decision factors Summary of implications to you… 17 VietCycle ‘06
- 18. What advantages doestechnology bring? Convenience For daily needs, communication Entertainment “It’s a necessity” Business Symbolic/image indicator Technology is fundamental to daily life, especially for communication “We are able to know a Both business and entertainment is becoming more reliant on technology person's status and wealth Methods of access to products and via his /her handphone” services merging/changing Greater automation Desire for technology to further “I can use it to show deliver my social status and The image aspects of technology continue personality” to grow, with hand phones a key image symbol…brands that can cater to this will win… 18 VietCycle ‘06
- 19. Assessing brands Oneof the common exercises we do with consumers is to ask them to group different brands together…, eg. technology brands, computer brands, TV brands, mobile phone brands, service providers, printer brands, camera brands They tell us the different reasons they group certain brands together In the presentation we looked at the segmentation themes of: The broad category dimensions Image cues Advertising and promotions Technology Fashion and design cues 19 VietCycle ‘06
- 20. Purchase decision factors $ Authenticity seal Functionality, value Quality Durability Design WORD OF MOUTH Advertising & Promotions “Even though my preference might lie somewhere else, I have to The implication… choose the price that fits Pricing is critical to get right… my pocket at the moment” Authenticity needs to be obvious and easily discernible… Word of mouth is critical to “Most manufacturers are delivering leverage… Take care of above and below the line the same good quality of their Quality is fundamental; take care to products nowadays, so function is ensure differentiation and triggers to of the most importance to me” purchase on other variables… 20 VietCycle ‘06
- 21. What drives the future? Futureshapers of Vietnam’s telecoms market Lester Sualog Senior Research Manager © VietCycleTM 2006
- 22. We check thepulse of people shaping the future of your market: through males and females, aged 15-45 years old, all socio-economic classes, 4 major Vietnam cities 22 VietCycle ‘06
- 23. The hierarchical modelof future influence Curiosity and Advocacy Characteristics Influential Uninfluential Early Adopters Laggards New Consumers Understanding how these (Informed, Active) leading consumers are Future Shapers different to the rest gives us a glimpse of future opportunities Future Makers Today Consumers Yesterday Consumers (Uninformed, Passive) Old Consumers Yesteryear Consumers 23 VietCycle ‘06
- 24. Let’s begin byjumping to conclusions. © VietCycleTM 2006
- 25. The future shaperswant Good looks Good friends Good time 25 VietCycle ‘06
- 26. The needs havenot changed Acceptance Understanding Fun 26 VietCycle ‘06
- 27. But the “enablers”have changed Hang-out places Handset brands The Internet Digital cameras MP3 players Music Personal care items Shoes and clothing Motorbike, toys and games Etc. 27 VietCycle ‘06
- 28. Future shapers aresustaining the growth of most handset brands Brand Used Most Often 52 Nokia 57 21 Samsung 19 14 Motorola 11 Sony Ericsson / 6 Ericsson 5 1 LG 1 1 SK Sky 0 1 S-Fone Future Shapers The Rest 1 Base: Mobile owners only VietCycle 2006 28 VietCycle ‘06
- 29. Handset brands aremeans of self-expression; sms- ing a language, graphics and tones add fun. Future shapers appear insensitive about price. Reasons for Choosing a Handset Brand All Future The Rest Shapers Good looks/ attractive 38% 41% 38% Lots of features 38% 39% 38% Good value for money 38% 29% 39% Reliable/ high quality 31% 28% 31% Durable/ long lasting 30% 24% 31% Easy to use 27% 19% 28% Good promotion 18% 10% 19% Small size 18% 25% 17% Modern 16% 17% 16% Nice/ unique color 11% 15% 11% Base: Mobile owners only VietCycle 2006 29 VietCycle ‘06
- 30. Future shapers tendto look at what’s new in the market Service Provider Used Most Often 49 Mobifone 50 22 Viettel 16 20 Vinaphone 25 9 S Fone 6 Cityphone Hanoi 2 Cityphone HCMC 0.5 E-Mobile/ EVN Telecoms 0.3 Future Shapers The Rest Base: Mobile owners only VietCycle 2006 30 VietCycle ‘06
- 31. The reasons arestill fundamental - coverage, price, call quality; but the savvy ones demand sophistication Again, the future shapers are willing to cash it in Reasons for Choosing a Service Provider All Future The Rest Shapers Superior coverage 78% 79% 78% More competitive charges/ cheaper 49% 42% 50% Superior reception/clarity 45% 45% 45% A good promotion/ deal/ offer 35% 29% 36% Good customer service/ reliable 34% 36% 34% Popular in the market 16% 11% 16% More services/ applications/ features 10% 15% 9% My friends/ family are on this network 10% 11% 10% Better security 8% 13% 8% Get the handset for free/ subsidized 8% 5% 8% Base: Mobile owners only VietCycle 2006 31 VietCycle ‘06
- 32. TNS Worldpanel Telecoms Introductionto service © VietCycleTM 2006
- 33. What is aPanel? – basic ingredients We take a population of individuals / households We then take a representative sample ..and record their purchasing behaviour on a regular basis... 33 VietCycle ‘06
- 34. TNS Telecoms panel is a syndicated Tracking tool mobile phone marketplace To To understand identify market consumer trends behaviour Expected launch in Vietnam Q1/07 34 VietCycle ‘06
- 35. TNS Worldpanel Telecoms Howis the information collected? End consumer Fast & Accurate N = 5,000 + Interviewed every consumers 2 weeks, with weekly information updated every 4/8 weeks 4 key Urban Cities Representative of the Vietnam population, Full Demographic split 36 VietCycle ‘06
- 36. TNS Worldpanel Telecoms Informationcollected: the consumer Marital Status Social Age Grade THE CONSUMER Gender Employment Status Presence of Region Children 37 VietCycle ‘06
- 37. TNS Worldpanel Telecoms Informationcollected: the phone measurement of change over time Ownership Purchasing / replacement Handset ownership handsets (what, where, why, Age of the handset, purchase place price) Brand network (churn) what Model where why price Network Prepaid vs Contract Bills Airtime Monthly expenditure Call costs fixed / mobile Usage (number of users) network Voice, SMS, MMS, GPRS National, International 38 VietCycle ‘06
- 38. Worldpanel Telecoms Measures - Age - Gender - Number of buyers/ users - S.E.C - Market value - Mobile phone used - Market share - Service provider - Share of trade - Connection type - Switching - Monthly spend - Services used - Where purchased © VietCycleTM 2006
- 39. TNS Worldpanel Telecoms Importantthings to remember sample only not doesn’t counts census account for active business handsets spend frequent robust updated sample every size 4/8 weeks great at User friendly Data identifying delivery trends 40 VietCycle ‘06
- 40. Worldpanel Telecoms Clients 41 VietCycle ‘06
- 41. For enquiries, regarding… •VietCycle • Qualitative / Quantitative technology research • TNS Asia Pacific Telecoms Index • Futureview please contact: Ralf Matthaes TNS Manager Director Tel: +84-903-949-531 Email: ralf.matthaes@tns-global.com For enquiries, regarding… • Technology syndicated panel Please contact Fabrice Carrasco WorldPanel General Manager Tel: +848 9141228 Email: fabrice.carrasco@tns-global.com © VietCycleTM 2006