Carbonates in Vietnam

2021 DEVELOPMENTS

Carbonates maintains a positive retail performance over the time of the pandemic, thanks to on-trade to off-trade switch

Carbonates has maintained a positive performance in retail value and volume over the time of the pandemic in 2020 and 2021, in contrast to foodservice sales which slumped into negative-figure declines. During the pandemic lockdowns, all on-trade channels were required to close and thus consumers switched their carbonates consumption from foodservice to off-trade.

Other low-calorie cola carbonates gain attention from health-conscious consumers

One important trend to have emerged from the COVID-19 pandemic is the stronger focus on health and wellness among many consumers. At the same time, consumers are becoming less interested in sugary beverages, with carbonates having been linked to a variety of lifestyle diseases, notably type II diabetes, heart disease and metabolic syndrome.

Pepsi x Black Pink limited-edition is successful to attract attention from young and trendy consumers who follow Korean culture

Suntory PepsiCo Vietnam Beverage Co Ltd maintains its small lead in carbonates in 2021, just a few decimal places ahead of second-placed Coca-Cola Beverages Vietnam Co Ltd and, between them, the global giants of Coca Cola and Pepsi hold the majority of shares in the category. In March 2021, the leading player introduced a limited-edition Pepsi x Black Pink in Vietnam, targeting a young and trendy consumer audience which follows Korean culture and attracting them to the Pepsi brand.

PROSPECTS AND OPPORTUNITIES

On-trade sales expected to rebound to positive figures in 2022, in line with the recovery of foodservice channels

On-trade sales in carbonates are expected to rebound to positive growth figures in 2022. This is attributed to a loosening of pandemic restrictions as the Vietnamese government aims to reach high COVID-19 vaccination rates by mid-2022.

Players set to strengthen their online offerings in response to the fast development of the e-commerce channel

The e-commerce channel has been boosted during the time of the pandemic, due to higher numbers of consumers embracing this channel due to both necessity and convenience. Within this, consumers have become accustomed to using the online channel for their shopping, attracted by offers and the ability to purchase groceries in bulk and have them home-delivered.

Strong and targeted marketing, social responsibility, and health and wellness trends will drive developments over the forecast period

Key players such as Coca-Cola Beverages Vietnam Co Ltd and Suntory PepsiCo Vietnam Beverage Co Ltd are expected to ramp up their marketing and advertising activities, especially involving Korean celebrities and popular game shows, in order to attract young and trendy consumers who are typically willing to spend money on sophisticated products. Furthermore, since this is the main consumer audience for carbonates in Vietnam, Korean celebrities and TV shows such as Rap Viet are able to attract strong attention.