Carbonates in Vietnam

PROSPECTS

Healthier lifestyles begin to limit retail volume growth of carbonates

Although carbonates continued to record strong growth in 2019, retail volume development was lower than the average of the review period, with the forecast period also likely to register lower average growth. An increasing number of Vietnamese are leading healthier lifestyles, which is limiting the growth rate of carbonates as consumers with greater health awareness are tending to reduce their sugar consumption in order to improve their health and avoid the potential risks involved in over-consumption of sugar.

Low calorie cola carbonates set to record the strongest consumption increase as the health trend begins to kick in

Low calorie cola carbonates have not traditionally been popular in Vietnam for a number of reasons. Firstly, in a country characterised by its price-sensitive consumers, low calorie cola carbonates are significantly more expensive than regular cola carbonates, and this makes the format unaffordable to many.

High levels of marketing in carbonates in an attempt to overcome the negative image

The key players in carbonates, such as Suntory PepsiCo Vietnam Beverage Co and Coca-Cola Beverages Vietnam Co, used a number of methods to boost sales of carbonates by dealing with the rising concerns of Vietnamese consumers about the possible detrimental effects of these products on their overall health. Key players targeted young consumers such as students and young working professionals who are generally less concerned about their health than middle-aged and elderly consumers.

COMPETITIVE LANDSCAPE

Suntory PepsiCo Vietnam Beverage Co continues to lead

Suntory PepsiCo Vietnam Beverage Co continued to lead carbonates at the end of review period thanks to its dynamic marketing activities, wide distribution network and a diversified product range. In 2019, the company mainly focused on increasing its presence in the Vietnamese market through various marketing campaigns, social activities, posters and advertising.

International players retain their strong lead

International players retained their strong lead in carbonates in 2019 due to their strong financial budgets, wide distribution networks and strong marketing activities. These companies are also highly active in terms of innovation and new product launches in order to attract consumer attention and maintain share in this highly competitive category.

Domestic players mostly focus on suburban and rural areas

Many of the most popular brand names within carbonates are owned by the international players, Suntory PepsiCo Vietnam Beverage Co and Coca-Cola Beverages Vietnam Co, which accounted for the vast majority of retail value sales in 2019, with the remaining sales spread among various local companies. Domestic players continued to struggle to make headway in the overall category and therefore tended to mostly focus on suburban and rural areas in order to avoid intensely competitive markets such as Ho Chi Minh and Hanoi.

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