Although the retail industry is seen as having great potential, most analysts believe that “the pie is not for everyone”. The market will witness the breakthrough of large-scale, well-strategic consumer groups.

FMCG is forecasted to recover quickly

After more than two years of being afflicted by the COVID-19 pandemic, Vietnam’s economy is expected to prosper in the coming years. The group of Fast Moving Consumer Goods (FMCG) is expected to recover quickly in 2022, after two years of downturn.

Viet Capital Securities Company (VCSC) believes that FMCG consumption in 2022 will recover to almost the same level as before the pandemic, only 5-10% lower than in 2019.

With a young population structure, Vietnamese consumers are not only more willing to spend but also easily adapt to multi-channel selling methods, as long as it brings convenience. VCSC evaluates two important models that create success for retailers, which will be mini supermarkets and e-commerce.

Minimart is located closer to consumers, which is an advantage compared to large supermarkets due to the increasingly hectic lifestyle of Vietnamese people. In contrast to supermarkets and hypermarkets, minimart businesses may locate sites more easily because of the smaller store size.

Meanwhile, e-commerce and digital utilities are becoming more and more popular, the percentage of consumers using digital services in Vietnam increased rapidly in the period 2020-2021. To improve company sustainability and take advantage of new development prospects, major organizations in every industry, from banking to retail, are investing more and more in information technology.

The game of the leading enterprise

The retail industry is assessed to be full of potential. Accordingly, the market will witness a breakthrough of large-scale and strategic consumer groups. 

One of them is Masan Group. After acquiring supermarket chains VinMart, VinMart+ in 2019 (now renamed WinMart, WinMart+), Masan has introduced significant changes in customer approach.

Masan began installing several utilities within WinMart+ mini-marts in the middle of 2021, including Phuc Long and Reddi kiosks, pharmacy kiosks, and Techcombank’s banking utilities.

According to Mr. Danny Le – CEO of Masan Group: The mini-mall model will include all in one platform, meeting the needs of consumers’ life, necessities, entertainment, and finance. Masan wants to add additional value instead of only serving as a marketplace for basic items. “We understand the retail market and create differences”. The  replication of this model will profit a higher margin.

The mini-mall model is expected to rapidly increase its selling point in the coming years. Each point of sale will be suitable for the needs of each locality. This model has recorded positive effects when increasing the number of customers per store by 30%, revenue growth by 40% and is expected to continue to improve in the coming period.

The mini-mall’s goal is to serve 30-50 million consumers by 2025. Towards 30,000 stores nationwide and annual revenue of 7-8 billion USD, accounting for 50% of the retail market share in Vietnam.

The goal of meeting 80% of Vietnamese’s consumption needs is also reinforced by Masan through the application of technology. During this year’s shareholder meeting, the company introduced a new development strategy with a technology consumer ecosystem integrating high technologies such as artificial intelligence – AI, machine learning – Machine Learning.

Masan invested $65 million to buy 25% of the shares of Trusting Social Joint Stock Company, a technology company specializing in AI and Machine Learning development in the fields of consumer and personal finance.

At Masan shareholder meeting, Mr. Nguyen An Nguyen, founder of Trusting Social, said that the first platform that the company will build with Masan is about hyper-personalization.

“We know exactly what customers are going to buy before they even think about it. This happened in the US, when sellers sent goods to consumers. If customers refuse to buy, they have the right to return. However, because the forecasting ability is too accuracy, the return rate is very low”, Mr. Nguyen shared.

The second platform is customer loyalty. The third platform is Masan and Trusting Social will launch a financial access platform for consumers by issuing credit cards to everyone (common customers) EVO without proof of income.

Trusting Social and Masan also set a goal by 2022 to open 1 million new 3in1 cards: credit card, loyalty card, and reddi telecommunications account. This will be the foundation for Masan to rise to become a “Consumer of Things” supplier. The scope of the company’s activities will not stop at a company that only sells consumer products, F&B chains, but also expand into the financial, telecommunications and entertainment sectors, through each stage of the consumer from the time they were born, raised, matured and old age.

Source: Tuoitre