Though 2021 was painful for Vietnam, its economy is expected to bounce back this year thanks to continued manufacturing growth and a more promising Covid-19 situation as a growing majority of the country’s citizens become fully vaccinated.
Accounting for roughly 35% of the country’s population, Vietnamese millennials – those aged 18 to 38 years – are playing an increasingly more influential role in the economy and Dynam Capital continues to closely monitor their telling consumption trends.
As the first digital-native generation, they are driving widespread use of e-commerce platforms and other planks of the digital economy, and the pandemic has only accelerated this.
Interestingly, 60% of the participants in Dynam Capital’s recent survey on retail investors were in the 18-34 age group indicating further their prominent interest in investing. In addition, about a third of current millennial consumers are expectedto join the middle class by 2030.
This means businesses will have to adapt to the demands of the millennial generation, which has much different needs and expectations than their predecessors.
“There is more sophisticated demand from millennials,” said Nguyen Hai Khoi, head of investment at Digiworld. “Instead of saying ‘I need a laptop,’ it is more common to hear ‘I need a gaming laptop’ or ‘I need a laptop for design purposes’.”
The customer experience has also evolved in this respect, with millennial consumers shying away from products that cost less but have no after-sales service, or that have powerful specs but are hard to use.
“Another aspect of the customer experience means that consumers want to try, touch and feel products before buying them,” Khoi added. “We have seen lots of millennial consumers visit Xiaomi and Huawei stores to try out our new products.”
Hanh Tran wears two important hats on this issue. She is a millennial herself, and over the last 12 years she has worked on marketing campaigns for major brands such as Durex, Dutch Lady, Nivea and Samsung aimed directly at her generation.
“When we talk about young audiences, they’re all about trends and they’re ahead of the curve, and as marketers we have to be 10 steps ahead of them,” she explained. “We look at the time they spend on social media platforms, which tells you the quality of interaction, and we need to understand what would help us to capture their attention and move to action.”
Unsurprisingly, the rise of the millennial consumer has also spurred significant shifts in how companies advertise, with some moving completely away from traditional marketing channels, such as TV.
“Everything now centers around digital,” Hanh emphasises. “TV costs a huge amount of money, and companies are cutting that and moving to digital, where they can do so much more.”
The core relationship between brands and consumers continues to grow these trends. “It used to be that brands talked and consumers listened – a one-way pitch – but now it’s more about allowing the consumer to join a conversation,” she notes.
Hanh referred to the example of Coca-Cola allowing customers to print their name on Coke cans and how it allowed them to be part of a campaign. “You can’t do that with TV. Consumers feel like they identify with the brand, and they start interacting with it more.”
One brand that has had to reimagine its relationship with millennial consumers is Biti’s, the Vietnamese footwear company established in 1982. Through the 2000s and 2010s, Biti’s fell out of favour with younger customers thanks to stiff competition from leading global brands.
According to Nguyen Phu Cuong, marketing director at Biti’s, five years ago the company created a sub-brand – Biti’s Hunter – directly aimed at the new generation of consumers.
“The ultimate goal was shifting the product’s perception of ‘durable, but outdated and cheap’ into ‘international-standard quality, cool, and value-for-money’,” he added. “Achieving that goal led us to a holistic change in our approach to young consumers.”
Biti’s senior management discovered that these consumers are more pragmatic, prefer aspirational brands and have non-linear, multi-touchpoint shopping habits that demand fulfilling experiences.
In an effort to transform their product, brand and system, Cuong and his colleagues took a number of major steps, such as borrowing ‘cool’ equity by partnering with icons of the millennial generation, for example, Marvel, superstar singer Son Tung M-TP, and top fashion designer Cong Tri.
The company also emphasised its Vietnamese values, while also completely overhauling its retail operations to embrace e-commerce and provide more customised shopping experiences.
These moves have paid off. Biti’s Hunter has released a number of hugely popular shoes and is now attracting a younger audience.
Stories like this will be the way forward as millennials take over Vietnam’s consumer economy.
“In 2022, after going through many changes due to the pandemic, millennials will pay more attention to health issues,” Khoi said. “This includes items that help improve the quality of a living space, exercise equipment, and equipment to help make food healthier.”
“This is also the generation that lives with technology, and has the habit of shopping online,” he added. “In the coming years, this will continue to be developed.”