Ipsos Uncovers Consumers’ Sentiments And New Habits Established Post Social Distancing

2020 has posed many challenges. That said, for a lot of businesses the pandemic has opened up opportunities as new consumer habits are being unveiled. On October 22nd, Ipsos, the third largest market research company in the world, hosted a webinar in Saigon to discuss the changes in Vietnamese consumer sentiment after the first COVID-19 wave. The experts also examined consumer habits that are expected to form ahead for the upcoming Tet holiday.

Key points from the Webinar 

• Consumers in Vietnam feel optimistic towards the economy compared to its counterparts in South East Asia. 55% think that economy will be stronger in the next six months (compared to 45% average of the region)
• Comparing with May 2020 (Wave 1), the number of households that suffer a lower income reduces from 90% to 80%, in September (Wave 2)
• The lifestyle established during the first wave of Covid-19 seems to be persistent until now: consumers are ‘less out’ and ‘more in’. They consider more carefully about where to go, keep a healthy lifestyle and have more online connections.
• Online shopping, take-away, delivery and cashless payment is a newly established strong trend. 86% of consumers use a cashless payment method and upto 60% have paid using a cashless route during last week, because of its convenience and speed.
• Despite more difficulties, consumers still have a plan to spend some money for Tet, although spending levels vary between income segments. High-income segment tends to spend more and the low-income segment tends to cut on their expenses.

Ho Chi Minh City, October 22, 2020 

Vietnam has experienced two strong outbreaks in March, April and July, but with the determination of the government and the participation of the whole nation, the epidemic in Vietnam has remained under control. 

Over the past 50 days, Vietnam has not recorded any new cases. This good news makes Vietnamese people more optimistic about the future as 55% think that the economy will get better in the next 6 months (compared to the average of 45% in the other 6 countries in Southeast Asia). In addition, over 60% think that their household income will increase, even more in the high-income segment (66%). When Ipsos conducted the survey in May, up to 90% of people said that their household income had decreased, but the survey results in September show that this number has dropped below 80%.

The lifestyle established during the first wave of Covid-19 seems to be persistent until now

Consumers are less out and more in. They consider more carefully about where to go, how to keep a healthy lifestyle, and favor more online connections.

Like the survey in May, Vietnamese consumers are willing to have outside activities such as going to a restaurant or joining a cultural event/gathering or visiting friends & family in Q4. Meanwhile, 73% of consumers will do less shopping and entertainment activities. This means consumers will be more selective about where to go, and companies still need to keep moving to be one of the consumers’ choices. Tourism activities are not promising until next year and overseas travelling will be even more delayed as most do not intend to travel before the next summer.

Vietnamese people continue to maintain a healthier lifestyle - through eating, adding nutrients, exercising, reducing alcohol and tobacco. (65% eat more healthy foods; 63% use nutritional supplements, 52% do more exercise, and over 60% stopped smoking and drinking alcohol).

As people stay more at home, they continue to have more online connections. 61% continue to engage on Facebook; 59% update the news on TV and 54% watch entertainment programs on TV. The rate of viewing online news is still high at 59%.

Online shopping, take-away, delivery and cashless payment is a newly established strong trend

Since May, we have seen a big shift in shopping habits - less visit to physical stores and more online shopping, take-away, and home delivery, and the trend continues. (shopping in the wet market decreases by 44%, shopping in supermarkets/ convenience stores decreases by 15%, while order from E-commerce increases 41%, online orders of supermarkets / convenience stores increases by 27% and take-away increases by 21%).

Along with online shopping, cashless payment is a "new normal". Cash usage has decreased by 41% while online payment methods increased by 48%, E-wallets and POS have been up to 45%. Currently, there were about 86% of users using cashless payment service and up to 60% using it right in the past week because of its convenience and speed.

Cut back on big shopping and investment, more consideration when shopping

Despite being optimistic, Vietnamese consumers are still worried about whether their job is stable or not, so up to a quarter of them said they are not confident to make big purchases. Investment activities are also included in the reduction category (-39% real estate; -35% stock, -32% loan; -28% gold investments and -23% savings).

81% of consumers think that they will be more mindful while shopping. Therefore, they continue to give priority to essential things such as eating at home, household items, and personal care products (44%). Spending on entertainment and enjoyment continued to decline (45% reduction in spending on activities outside the home).

Although their income is affected and they consider carefully when shopping, up to 80% continue to choose the brands they usually buy. This demonstrates again how brands, and their equity, matter in those times. Up to 20-30% of consumers choose other products instead, but still their favourite brand. The percentage of people choosing to replace their usual brands is below 20%. Brands have to strengthen connections with consumers and showcase products that are suitable to their new habits.

Despite going through a challenging year, Tet is still a special occasion

Everyone's spending intention for Tet is almost the same as last year, though there are differences between income groups. Compared to the previous Tet, spending intentions for Tet are somewhat higher among the high-income quintile, mostly the same in the middle-income quintile, and down to 15 percent in the low-income quintile. Travel abroad this year accounts for only a small proportion (9% of the high-income group, 7% of the low-income group). Nearly 50% will still focus on the tradition of "going home to celebrate Tet".   

"Going home to celebrate Tet" is an opportunity to increase consumption for food and drink (confectionery, dried fruit, nuts). However, tobacco, alcohol, confectionery and instant foods are goods that consumers intend to reduce buying.

“Traditional gift” products are still maintained. Even beer, soft drinks: while reduced in individuals’ repertoire, Vietnamese people still intend to buy as gifts.

2020 is a year of many surprises, many changes and no one can predict with certainty what COVID-19 will be in the future. But one thing is for sure: the lifestyle changes will become the new habits. Companies will need to embrace change and create opportunities for themselves by:

• Encouraging and creating conditions for consumers to have a healthy lifestyle.
• Quickly adjust strategy to catch up with the new habits of online shopping, and how to find information - omni-channel shopping.
• Invest in building cashless payment platforms to create convenience for users.
• Stay connected with consumers, introduce products in line with new habits.
• For the upcoming Tet, connect early with consumers to become their top of mind choice.

About the study

This study was conducted through online research from 18 September to 22 September 2020 in Indonesia, Malaysia, Philippines, Singapore, Thailand, Vietnam. The sample was 500 representatives of online connecters aged 18 and over.

For more information or setting an interview with Ipsos Managers, please contact:

Nguyễn Thị Thu Thủy – Head of Communication

Email: Thuy.nguyenthu@ipsos.com

Mobile: 0902147576