FMCG Monitor Q2 2024: In-home FMCG spending stalls
Vietnam's economy in the second quarter of 2024 witnessed strong growth, signaling great momentum for the country to achieve, or even exceed the government GDP target in 2024. Echoing this optimism, consumer confidence surpassed 2023 level. However,in-home FMCG growth has stagnated since the beginning of the year, with food & beverage sectors experiencing steeper volume loss than non-food sectors.
Here are some key highlights from Kantar's VIetnam FMCG Monitor report - Q2 2024 edition:
1. Vietnam's macro economy
Fuelled by a strong economic performance in Q2'24, Vietnam’s GDP growth reached a solid performance at 6.42% in H1. This positive momentum in the first two quarters of the year bodes well for achieving the full-year GDP target in the range of 6-6.5%. In a more positive scenario, the Central Institute for Economic Management (CIEM) projects that the economy could expand by 6.95% in 2024. However, inflation pressures arerising, reaching the government’s target ceiling, which could pose a challenge in the coming months.
2. Consumer confidence
In an improving economic outlook, consumer confidence in the economy exceeded 2023 levels. In Q2, food safety and natural disasters emerged as rising concerns, while worries about income and costs continue to be relevant factors for consumers.
3. Take-home FMCG overview
Despite a strong GDP growth, urban areas have been experiencing a decline in in-home FMCG consumption volume while Rural areas also show signs of slowing growth since the beginning of the year. This disconnect between GDP and in-home FMCG spending might be due to how shoppers allocate their budgets in different economic stages. In tougher times, they prioritise necessities like FMCG, while in good times, they may spend more on discretionary categories like dining out and out-of-home (OOH) entertainment.
4. Three accelerators for brand growth
To thrive in a stagnant growth environment and navigate the increasingly complex shopper journey, brands must recruit more buyers by becoming consumers’ first choice, maximising presence at different touchpoints, and finding new space in which to serve shoppers’ unmet needs.
Discover which brands thrived in the difficult FMCG climate of 2023 and explore their growth recipes in our latest Vietnam Brand Footprint 2024 report.
5. FMCG Retail landscape
Online channels continue to gain significant value share in Urban 4 while modern retail formats gain traction in Rural. With the rise of specialised and modernised shopping demands, specialty and convenient retail formats are likely to experience significant growth in the next 2 years.
Download your copy of Kantar’s FMCG Monitor Q2 2024 report by clicking on the “Read the report” button on the side bar of this page.
Worldpanel Vietnam’s Household panel
The Vietnam FMCG Monitor series is powered by Worldpanel Vietnam’s household panel. We continuously track all information about household purchases of over 130 FMCG categories for in-home consumption.
With our single-sourced panel, we can uncover and link consumer attitudes and perspectives to actual shopping behaviour to help you develop a holistic brand strategy. Through our advanced solutions and analytics, you will understand who your shoppers are, how they shop, spend and consume.
Contact our expert team and start leveraging consumer and market insights to grow your FMCG brand in 2024.
