"Golden season" of sales

Grasping consumer psychology in a difficult economic context, businesses focus on improving convenient experiences and investing in highly applicable products so they can attract more customers during the upcoming Tet 2024.

Ngo Bich Quyen, Executive Director of Van Son Thinh Phat Joint Stock Company (an organic food store chain), said that the company is preparing Tet gift baskets of dry foods, while traditional foods for the Tet season will continue.

According to Quyen, last year, Organicfood's Tet gift baskets cost no less than VND500,000, but this year they only prepared gift baskets for VND300,000. To get the above price, businesses must design smaller gift baskets and change suppliers of cheaper goods, but still ensure they are organic.
 
Smaller and cheaper
 
“As a chain of stores specializing in organic food belonging to the high-end group, we have to make efforts to reduce prices to suit the majority of consumers. In addition, we replace imported goods from Europe and the US with goods from Vietnam and neighboring countries such as Malaysia and Thailand. In particular, Vietnamese products now have very good prices, and the quality and packaging are no less than imported products," Ms. Quyen stated the solution.

The Department of Industry and Trade's Concentrated Promotion Month attracted nearly 3,000 businesses with 7,000 discount programs, demonstrating sales effectiveness and boosting purchasing power. Businesses also expanded new sales channels through e-commerce. The commodity market in October is more vibrant, with increased demand for garments and household equipment. Retail distribution systems offer promotions and discounts to promote consumption. 

Song Huong Technology Food Processing Company (Song Huong Foods) plans to promote sales through the TikTok Shop channel for Tet this year, targeting overseas Vietnamese and American consumers. The company will offer traditional Tet gifts priced between VND100,000 and 120,000, aiming to match the new consumption trends of this year's Tet.

Even businesses like Vissan are increasing sales through e-commerce channels such as Sen Do and Lazada... with many diverse products, providing for many different consumer segments. This Tet, Vissan prepared more than 1,100 tons of fresh pork, up 5% over the same period last year, and 3,800 tons of processed food.

My Hao Cosmetic Chemical Company's General Director, Luong Van Vinh, has observed a shift in consumer needs, shifting from large-weight products to smaller, lower-priced options. The company is now investing in these products to attract consumers. As of September 2023, the company has completed 50% of its revenue, with an expectation of completing 80% in the last few months.

Consumer needs have changed a lot compared to previous years. Photo: Quy Hoa.

Although facing increased raw material prices, to retain customers, My Hao decided to maintain the same selling price during the Tet season. “The current experience in attracting customers is that goods must have good quality and affordable prices so that buyers feel beneficial. Employees must regularly take care of customers and cover the market to make it convenient for customers to shop," Mr. Vinh shared.
 
Stronger promotions
 
In the first 10 months of 2023, total retail sales of consumer goods and services at current prices are estimated to reach more than VND5,100 billion, an increase of 9.4% (the same period in 2022 increased by 20.8%).

In particular, the main increase in the essential goods group is food (up 11.2%) and the tourism and service goods group (up from 10.4–47.6%) due to the demand for services. This case is still recovering from the COVID-19 pandemic. Other product groups increased from 5.5 to 13.6%.

Director of Ho Chi Minh City Department of Industry and Trade, Mr. Le Nguyen Ngoc, announced recent policies to ease production and business challenges, including a 10% reduction in value-added tax for various goods, thereby reducing costs, lowering prices, and increasing product competitiveness. 

Vietnam's macroeconomy showed recovery in Q3, but the rising consumer price index may hinder growth. Businesses are implementing policies to stimulate consumer demand, such as big promotions like buy 2 for 1, happy hour, and discounts of up to 90%. Saigon Trading Corporation's retail system also offers discounts from 10% to the highest level, and companies like Co.opmart and WinMart participate in monthly discount promotions.

Saigon Co.op, General Director of Ho Chi Minh City Federation of Trading Cooperatives, has rejected suppliers' requests for increased product prices due to weak market demand. The supermarket is promoting sharing with suppliers and strengthening promotions until Tet.

Kantar Vietnam predicts that consumers will prioritize high-applicability products like food and fast-moving consumer goods. Up to 28% of households are facing financial difficulties, with nearly half reducing spending and using entertainment services. 40% of FMCG industries cannot retain consumers, impacting both small and large industries.

Consumers now prioritize health, home experience, personalization, and optimizing spending when shopping. They maximize spending by choosing discounted products and comparing prices across distribution channels. Kantar Vietnam suggests consumers may not cut spending on essential items or Tet gifts but instead search for lower-segment items or promotions.