Page 1 Copyright 2011. INTAGE (Thailand)

Issue # 09

October 2012.

is INTAGE (Thailand)’s regular publishing to our valued clients to inspire them with insightful information about the current issues or topics of interest in the market place.

No one can deny the fact that Vietnam is an emerging country during the past 3-4 years. Not only in terms of overall economic expansion, but also in consumption and social behavior which has apparently changed consequentially. When we talk about social drinking, we usually think about alcoholic drink such as beer, wine and whisky. Accordingly a research study conducted by INTAGE (Thailand) Co., Ltd. among 200 men and women (50:50) aged 20-49 in Thailand and Vietnam (50:50) in September 2012, the outcome can be summarized as below. The research revealed that beer is the most popular social drink in both countries, while the 2nd and 3rd preferences, differ; that is, whisky ranked 2nd among Thai drinkers while wine was the 2nd preferred choice among Vietnamese drinkers.

Voice of Thai consumers from INTAGE (Thailand) Co., Ltd.

Whisky

Wine

Beer

Wine

Vodka

Beer

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333 Asahi Beer Hanoi BGI Bitburger Budweiser Carbsberg Corona

Dai Viet Gambrinus Grolsch Halida Heineken Heineken Import Huda Larue Do

Larue Xanh Peroni Pilsner Urquell Royal Dutch Saigon Do Saigon Special Saigon Xanh San Miguel

Sapporo Serepok Thanh Hoa Tiger Tiger Crystal Tuborg Vida Zorok

The list of brand logos confirms that the beer market in Vietnam is indeed full of varieties, widely open, and very attractive. Japan Sapporo Beer's Managing Director Toshiyuki Mochida once said that, "Vietnam population has an average age at only 28 years old and they love drinking beer very much." At present, Vietnam is the world's 13th largest beer producer (up from ranking 30th in 2000)1, and the top 3 beer drinking country in Asia. Only China and Japan outrank Vietnam. Euromonitor2 forecasts that the beer market in Vietnam will grow to as high as 4,600 million dollars in 2012. The market growth rate has already reached 9-11% this year, and is expected to increase to 12-15% in 2013-2015, then 8% in 2016-20253.

1 Pomegranate Asia, Beer & Beverage Consulting 2 Euromonitor, an international marketing research agency with a head office in London and over 600 centres in 62 countries around the world. 3 Pomegranate Asia, Beer & Beverage Consulting

Sources: Kirin, APB, Habeco, VBA

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The continuing growth rate in Vietnam beer market has several supporting factors, as follow:

1st factor - Average population age 70% of the population has the average age lower than 40 years old. Vietnam is indeed a country of youth that is fast-growing.

2nd factor - Beer drinking behavior Only 57% of the population drink beer in Vietnam, which is considered as quite low. It means that the beer market still has much room to grow, especially when comparing to other countries whose drinking population is already high. 3rd factor - Changing situation of the beer market Currently Sabeco, owner of 333 and Saigon Special, is the one who owns the majority of the beer market in Vietnam at 33%. Together with income growth of the population during the past several years, Vietnamese people have progressively shifted their drinking consumption towards premium brands. Heineken, for example, enjoys the growth of 3.5% within one year, now holding the share of 7.7% of the market. At present, Vietnam is the 2nd top market of Heineken beer in Asia Pacific. 4th factor - Changing social condition The beer consumption pattern in Vietnam is similar to that of Thailand about 10-15 years ago, due to more or less the same development direction in terms of lifestyle, and stronger role of women in the society. We can therefore foresee the increase in alcohol consumption among women, which is now still as low as 26%. As a consequence, alcohol market in Vietnam especially that of beer products is viewed as a paradise for investors. Leading beer manufacturers from all over the world have already moved in to get their lucrative shares in this country. We can foresee an intense competition of Vietnamese beer market from now, especially when AEC formation becomes materialized in the near future. Now, it is up to the Vietnamese who will make their own decision on which brand to be their WOW drink.

Sources: Kirin, APB, Habeco, VBA

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