1. Consumer Lifestyles in Vietnam
7 Oct 2008
CONSUMER SEGMENTATION
Babies and Infants
In 2007, there were an estimated 4.9 million babies and infants in Vietnam, representing a decline of 10.4% since 1995.
Babies and infants constituted nearly 6%of the total population in 2007.
Although the number of babies and infants decreased over the review period, the birth rate in Vietnam remained high, at
18.4% in 2007 compared to the 14.5% average for CLIFE countries.
Impact
Thanks to economic development, Vietnamese disposable income has increased. Additionally, family planning policies has
resulted in fewer babies and infants in each family than was the case in the previous decade. Together, these trends mean
that parents tend to spend more money now on fewer babies and infants.
Infant nutritional products are experiencing growth in demand as some image-conscious mothers increasingly avoid
breastfeeding, believing it has a negative impact on their figures.
Spending on infant toys has increased. Well-known foreign toy-makers have only a small market share, however, because
their products tend to be too expensive for most Vietnamese consumers. Toys made domestically also have only a small
market share, since they often tend to be of poor quality. As a result, the toy market in Vietnam has been dominated by
Chinese brands producing a wide range of toys and selling them at reasonable prices.
Traditionally, clothing products for infants, including infant clothes, socks, and hats, were made by family members. However,
this time-consuming process has fallen by the wayside as work now takes up too much of people’s time. Families are turning
instead to ready-made products, and demand has increased over the review period. In addition to domestically made
products, Vietnamese consumers can also buy infant clothing imported from China, Thailand or South Korea, although prices
of imported products are higher.
As well, in the past nappies were made with cloth by family members. Following the consumer trend towards buying ready-
made products, many parents began purchasing and using cotton nappies. However, using cotton nappies is becoming less
popular, and Vietnamese traders have now started to import disposable nappies. The convenience of disposable nappies has
led to a surge in demand, and domestic manufacturers have started to produce them to help meet that increasing demand.
According to Kimberly Clark’s Vietnamese subsidiary and the leading maker of paper nappies in the country, sales increased
by 20% in 2007 over prior year. Currently, popular domestic brands include Bobby Fresh, Huggies, Mummy, XiXi, Pureen,
Nannys and Pampers.
Children
In 2007, it was reported that there were 9.03 million children in Vietnam, compared to 11.2 million in 1995, representing a
decline of nearly 20%.This trend, however is expected to reverse itself in the coming years, as the number of children in the
population grows at a projected rate of 4.4% between 2007 and 2015, reaching 9.4 million. In 2007, children accounted for
10.6% of the total population.
Impact
Traditional Confucian values dictate that children must follow their parents’ decisions. Children in Vietnam, therefore, have
little say in decisions affecting them, including purchasing decisions. The few decisions children are allowed to make on their
own usually involve the pocket money that some parents give their children for little things at school, such as sweets, biscuits
and games.
Children today are generally more educated than those in previous generations. They are quickly introduced to advanced
technologies and computers, and many can manage everyday devices, such as televisions, air-conditioning units and
telephones. Many children in urban areas are addicted to video games, spending more time playing inside rather than outside
their homes. Although it is widely believed that video games are not beneficial and not quite suitable for children, busy parents
nevertheless often use them as entertainment alternatives because they often do not have enough time to spend with their
children. As well, authorities have yet to establish age limits or other regulations related to their use.
Milk producers currently are targeting their marketing and promotion efforts at children, using mass advertising involving child
actors to portray infant prodigies. Most Vietnamese parents want their children to grow up to be outstanding people, so they
are happy to buy milk as an “investment.” Some consumers in Vietnam disapprove of these advertisements, but authorities
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2. have done nothing to stop them and most Vietnamese just accept them.
Tweenagers
As a result of successful government family-planning policies, the number of tweenagers declined over the review period. In
2007, there were 6.6 million tweenagers in Vietnam, compared to 6.8 million in 1995, representing a decline of 4.41% over the
period. This trend is expected to continue through the forecast period. It’s projected that there will be 6.3 million tweenagers in
Vietnam in 2015, representing a decline of 3.6% from 2007.
The designated age group (and consumer group) “tweenagers” is largely unknown in Vietnam. Most in this age group are
regarded and treated as children. However, they do have a little more freedom than younger children because of their age.
Impact
Like children, tweenagers do not make their own life decisions. Therefore, marketing and advertising of most consumer goods
developed for this group, such as clothing, footwear, toys and consumer electronics products, are normally targeted to
parents. Many parents will generally give tweenagers daily pocket money for breakfast or for snacks like fruit or ice cream.
In past years, tweenagers often found playing football or other traditional games outside the home. However, due to growing
urbanisation and the resulting decrease in open public space, children now often stay at home, watching TV and playing
computer or video games.
Teens
In 2007, there were 12.7 million teens in Vietnam, accounting for around 15% of the total population. This number represented
growth of more than 18% between 1995 and 2007. However, as a result of the government family planning programmes
implemented for many years in Vietnam, this growth trend is expected to reverse. Between 2007 and 2015, the number of
teens is projected to decline by 16.13%, reaching a total of 10.7 million in 2015.
Impact
Between the ages of 13 and 18, most teens in Vietnam are in upper secondary education. Many parents give their teens
money weekly instead of daily. Teens may make some of their own decisions on what to buy, what to eat and where to go for
leisure. They have more freedom and are often easily influenced by external factors. Currently, the many Korean movies on
TV have an influence on many Vietnamese teens, particularly when it comes to choice of clothes, hairstyle and make-up.
Teens are influenced by fashion trends from other countries, as well, such those from Japan. While Japanese fashion is not
popular on TV or in magazines in Vietnam, it has penetrated and influenced Vietnamese consciousness through cartoon strips.
Since 2006, four Japanese fashion trends – harajuku, cosplay, unisex and lolita – became among the hottest fashion styles for
teens. Of course, as in many countries, while parents make sure their teens leave the home wearing clothes they’ve chosen
and approved, some teens secretly change their clothes to the ones they prefer once leaving home for the day.
Teen psychology is as complicated in Vietnam as it is in the rest of the world. Some teens tend towards adolescent rebellion,
while others go into seclusion. Those who become 'rebels' may smoke, wear unusual clothes, have strange hair styles and
even fight with their friends or argue with their parents and teachers. Emerging and cutting-edge fashion styles, such as those
from Japan, are usually targeted at this group.
Students
Between 2000 and 2007, the scale of higher education in Vietnam increased significantly. According to statistics from the
Ministry of Education and Training, there were 1.5 million students in higher education institutions in the 2006-2007 academic
year, an increase of 72.3% from 1999-2000. Between 1999 and 2007, the number of universities and colleges increased by
more than 100%. Over this same period, Vietnam has experienced high economic growth, and companies, factories and other
institutions needed highly trained people more than ever. This need for an increasingly educated workforce has driven growth
in the number of Vietnamese pursuing higher education.
More than 75% of students in Vietnam attend universities rather than colleges. The Vietnamese prefer universities, as they are
thought to train leaders and white collar professionals while colleges are meant to train workers. In both categories, Vietnam is
facing a shortage of workers.
Students’ income is derived from many different sources. Most Vietnamese students receive monthly financial support from
their parents during their time at university. Additionally, some students earn money from part-time jobs, including waiting on
tables at restaurants, seasonal work in companies or working as family tutors for pupils. They are typically free to spend their
money in any way they like, managing their lives like adults.
According to a student lifestyle survey conducted by the Ho Chi Minh City University of Science, Society and Humanities,
students now can be divided into three groups. The first group consists of 'loners,' students who tend to keep to themselves
and seldom join social activities. It was estimated that 60% of students belong to this group. Loners concentrate on their
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3. studies while keeping in touch with their small circle of close friends and relatives. For leisure, they typically read books and
magazines or watch TV. Many are indifferent to much of what happens around them.
The second group is more social, and it is made up of those who tend to want to entertain and enjoy life rather than study. It
is estimated that 10% of students belong to this group. Often, they wealthier than their contemporaries thanks to successful
parents. In their minds, the most important things are fashion, movies and the latest models of mobile phones, motorbikes
and cars. Members of this group are dynamic and up-to-date.
The third and final group accounts for 30% of students. They have a passion for studying and are normally eager and
ambitious when it comes to studies. In addition to taking their main university courses, they usually take additional classes,
such as English or IT, or spend time in the library. Members of this group also participate in social activities, such as the Green
Summer Campaign, and take part in traditional festivals.
Impact
Most universities and colleges in Vietnam are located in big cities such as Ho Chi Minh City and Hanoi. Students frequently
have to relocate to these cities to study at a tertiary level. However, the number of dormitories offered by universities and
colleges are limited and cannot meet the overwhelming demand for housing from students. Therefore those who cannot live in
university dormitories have to board at residents’ houses in these cities. This has resulted in a significant market for student
boarding houses in big cities. Annually, when the Vietnamese government organises the national university entrance exam and
when an academic year starts, this market becomes vibrant, although facilities in some of boarding houses are of poor quality.
When they have time, most students spend their time in libraries. They may also go to coffee shops, cinemas or cultural
centres where live music or drama events are organised. Tickets to such events are usually affordable for students. Currently,
some singers have organised live shows in many universities and students attend these free of charge.
Overall, students find they must allocate their scarce resources efficiently. They must pay for their housing, food, clothes,
books, tuition fees at extra classes (such as English or computer skills) and others. As a result, student spending power is
generally low.
People in Their 20s
People in their 20s account for quite a high proportion of Vietnam’s population due to the unplanned and uncontrolled birth rate
of the 1970s and 1980s. In 2007, the number of people in their 20s was estimated to be more than 16 million, accounting for
18.8% of the total population.
This group mostly consists of those who have finished their studies and started to work in different institutions and factories.
They earn their own income, so they are mostly independent from their parents. Some of them get married and have their
own families.
People in this group usually have high spending power and can make their own decisions on what they buy and what they do.
However, they are still young and most of their spending is on discretionary goods such as fashionable clothes, mobile phones
and motorbikes, while necessary goods are usually bought by their parents since most single people in Vietnam live with their
parents until they get married.
Impact
Fashionable clothes and shoes are the favourite goods of people in their 20s. Thanks to their increasing income, the
Vietnamese have changed from dressing in durable clothes to dressing in fashionable and beautiful ones. People in their 20s
are yet to mature and sometimes make decisions on a whim. Therefore they change clothes and shoes regularly. It is not
necessary that such products be extremely high fashion or durable – what people in their 20s want are products that are
trendy.
Mobile phones and motorbikes are also another favourite of consumers in their 20s. Currently, they are not only tools for
communication or transportation but also fashionable products to show the social status and wealth of their owners.
Vietnamese people, including people in their 20s, prefer scooters and mobile phones that are multifunctional. In fact, mobile
phone and motorbike markets are high-growth ones in Vietnam.
People in their 20s usually go to coffee shops, movies, shopping malls or markets for shopping and the restaurants when they
have free time. Like other people, they may eat out with their friends after work and visit coffee shops to chat with their
friends in the morning or at weekends.
People in Their 30s
People in their 30s account for around 13%-15% of the total population in Vietnam. It is estimated there were 13.1 million
people in their 30s in 2007, accounting for 15.4% of the total population. This was an increase of 30% from 1995.
People are usually married by the time they reach their 30s and have their own lives and families. Additionally, their social
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4. status is more solid after several years of working. Some of them are very successful in their careers and can be absolutely
independent and their spending power is high.
However, people in their 30s do have to take care of their own families, and their decisions become increasingly more rational
and are less influenced by external factors. Most of the things they purchase are goods that are necessary for their families;
the luxury goods and services they purchase are meant to make their lives better.
Impact
This group has to take care of their families. They therefore spend more on consumer goods such as foods, detergents and
clothes. The Vietnam Living Standard Survey 2006 conducted by the GSO estimates that Vietnamese people spend
approximately 48% their income on food. However, because consumers in their 30s having to work everyday, they usually go
to the markets or supermarkets every Saturday or Sunday to do the shopping for the week, and markets and supermarkets
are usually very crowded at the weekend.
Vietnamese mothers have to take care of children and housework and, even if they have maids, they have to go home to do
so work. Men usually spend more time on their career than women, and often go to coffee shops, bars or pubs with their
friends or partners to maintain social relationships after work. Many coffee shops and bars have opened in Vietnam in recent
years.
Middle and high income families may take tours on holidays when they are off. There are two high seasons for travel in
Vietnam: the summer and the Tet holiday. In the summer, pupils and students have time off. Their parents usually take them
to beach cities such as Vung Tau, Phan Thiet or Nha Trang or to highland cities such as Da Lat since it is very hot in the
summer in Vietnam. During the traditional Tet holiday, all family members are off and may take a domestic or foreign holiday
together. Thanks to increasing income and promotions offered by tour operators, the demand for travel has been increasing
significantly in Vietnam.
Middle-Aged Adults
There were an estimated 18.2 million middle-aged people in Vietnam in 2007, accounting for 21.4% of the total population.
This number represented an increase of 63.9% from 1995 to 2007. This group shares some characteristics with the group of
people in their 30s. They have their own families, financial independence and children to take care of.
Middle-aged adults have built up their social status and reputation through many years of work. With extensive work
experience, they may become experts in specialised fields. Unlike those in their 30swho may be more adventurous when it
comes to pursuing new opportunities, middle-aged consumers are usually more cautious. The older they are, the more their
thinking will be characterised by cautiousness and maturity.
Impact
When their careers and financial situation is solidly established, middle-aged adults have high spending power and usually
spend on highly priced or premium goods. They want their purchases to be worth the money they spend. An influential
segment of this group now can buy cars, LCD TVs to replace their analogue TVs, expensive mobile phones and other premium
products.
However, not all middle-aged Vietnamese consumers can spend their money on premium products. Most middle-aged
Vietnamese are not rich, as Vietnam is still a poor country. Most middle-aged people now normally spend their money on
products they need to accumulate property for their life after retirement as well as for their children.
Like people in their 30s, middle-aged adults usually go to coffee shops, bars or restaurants after work with their friends or
business partners to maintain these social relationships. More and more families in Vietnam take tours to go somewhere in the
country or abroad for their holidays.
Pensioners
The retirement age in Vietnam is 55 for women and 60 for men. However, these are not compulsory retirement ages. In many
cases, if people want to continue working and they are healthy enough, they can work until the age of 65.
Only people who work in the public sector (including state-owned companies) can get pensions after retirement; those who
work for the private or foreign sector do not. However, government pensions are not sufficient for retired life. Therefore in
order to ensure their financial security in retirement, Vietnamese people have to accumulate money during their working years
work; otherwise they have to rely on their children.
Pensioners in Vietnam seldom live in homes for the elderly because Vietnamese people must be dutiful toward their parents;
most live with their children and grandchildren, which is traditional. They help their children and look after the house, garden,
maids or children. Meanwhile, those who do live in homes for the elderly are normally seen as unlucky in old age because
some of them have no children and no house; some of them do but their children are not dutiful towards them.
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5. Impact
Since most of pensioners cannot earn money, their spending power is very low. They spend very little and their children buy
most of things for them; when they do spend money, they will buy only what they really need because they are economical.
For high income families, pensioners may travel by joining tours. The number of old aged people taking tours is increasing in
recent years.
Pensioners in cities usually exercise in parks early every morning. They gather into different groups and exercise with
instructors. Currently, due to the increasingly polluted air and shrinking public space in cities, older persons have to make
more of an effort to take care of their heath through exercise. As a result the number of older persons doing exercise is
increasing and, as a result, there have been more jobs for instructors.
Table 23 Babies and Infants: 1995/2000/2005/2007/2010/2015
'000/as stated 1995 2000 2005 2007 2010 2015
Babies/infants 5,481 4,391 4,957 4,913 4,670 4,714
as % of total Population 7.57 5.65 5.96 5.75 5.26 5.00
Source: National statistics, Euromonitor International
Table 24 Babies and Infants (% growth): 1995-2007/2007-2015
% change 1995-2007 2007-2015
Babies/infants -10.35 -4.06
Source: National statistics, Euromonitor International
Table 25 Children: 1995/2000/2005/2007/2010/2015
'000/as stated 1995 2000 2005 2007 2010 2015
Kids 11,256 10,662 8,973 9,036 9,531 9,437
as % of total Population 15.55 13.71 10.78 10.58 10.74 10.00
Source: National statistics, Euromonitor International
Table 26 Children (% growth): 1995-2007/2007-2015
% change 1995-2007 2007-2015
Kids -19.72 4.44
Source: National statistics, Euromonitor International
Table 27 Tweenagers: 1995/2000/2005/2007/2010/2015
'000/as stated 1995 2000 2005 2007 2010 2015
Tweenagers 6,853 7,452 6,996 6,550 6,006 6,313
as % of total Population 9.47 9.58 8.41 7.67 6.77 6.69
Source: National statistics, Euromonitor International
Table 28 Tweenagers (% growth): 1995-2007/2007-2015
% change 1995-2007 2007-2015
Tweenagers -4.41 -3.63
Source: National statistics, Euromonitor International
Table 29 Teens: 1995/2000/2005/2007/2010/2015
'000/as stated 1995 2000 2005 2007 2010 2015
Teens 10,800 11,766 12,790 12,751 12,182 10,694
as % of total Population 14.92 15.13 15.37 14.93 13.73 11.33
Source: National statistics, Euromonitor International
Table 30 Teens (% growth): 1995-2007/2007-2015
% change 1995-2007 2007-2015
Teens 18.06 -16.13
Source: National statistics, Euromonitor International
Table 31 People in their Twenties: 1995/2000/2005/2007/2010/2015
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