Hanoi and HCM City are still the most important cities for milk powdersales, while smaller cities/towns and rural areas also play an equallyimportant role, according to a survey released by Nielsen Vietnam onJuly 22.
The Nielsen Vietnam's milk powder retail measurementsurvey reported during the 12 months ending June 30, 2015, that totalmilk powder volume sales reached approximately 14,700 tonnes in six keycities, a decrease of 11 percent in comparison to the same period in theprevious year.
The six cities included Hanoi, HCM City, and Hai Phong, apart from Da Nang, Nha Trang and Can Tho.
Accordingto General Statistics Office and Nielsen Vietnam, over 70 percent ofthe population is located in small cities and towns and rural areas,including 3.6 million children under the age of three, living in smallcities and towns and rural areas and 950,000 children in both Hanoi andHCM City.
Meanwhile, there are 34,000 milk powder stores in smallcities and towns and rural areas, four times higher than the totalnumber in Hanoi and HCM City.
Furthermore, Nielsen research intorural consumers found that their income had been improving, and thathealth is one of the key areas of concern for them. Indeed, Nielsen'sresearch found that rural parents have a particular desire to improvethe lives of their children.
The Nielsen Vietnam's milk powder retail measurementsurvey reported during the 12 months ending June 30, 2015, that totalmilk powder volume sales reached approximately 14,700 tonnes in six keycities, a decrease of 11 percent in comparison to the same period in theprevious year.
The six cities included Hanoi, HCM City, and Hai Phong, apart from Da Nang, Nha Trang and Can Tho.
Accordingto General Statistics Office and Nielsen Vietnam, over 70 percent ofthe population is located in small cities and towns and rural areas,including 3.6 million children under the age of three, living in smallcities and towns and rural areas and 950,000 children in both Hanoi andHCM City.
Meanwhile, there are 34,000 milk powder stores in smallcities and towns and rural areas, four times higher than the totalnumber in Hanoi and HCM City.
However, many foreign manufacturershave mainly invested their business in urban areas, with only domesticmanufacturers fully expanding their scope into Vietnam's secondarycities and rural areas.
Indeed, the opportunity to succeed inrural areas is highlighted by the fact that stores in rural areas tendto carry fewer milk powder products with 33 kinds of milk productsagainst 59 kinds at stores in urban areas.
"Nielsen Vietnamsuggests that manufacturers should focus on differentiated strategies toidentify new opportunities in the small cities and rural area – a keypotential market to restore growth, particularly when consumption withinsix key cities is saturated," Le Huu Minh Quan, Associate Director ofRetail Measurement Services, Nielsen Vietnam said.
"However,there are some issues for latecomers to the rural market. Firstly,stores in rural areas tend to be smaller, and more dispersed – requiringa high sales team investment. Secondly, 30 percent of shoppers buyproducts that are recommended by retailers, so winning the retailer'sheart and loyalty is essential to helping manufacturers expand theirscope to rural successfully," the official said.
Nielsen conductsthe retail measurement survey across traditional trade channel(traditional groceries, wet market, and drug stores, in addition to milkpowder stores, confectioneries) and modern trade (super/hyper market,minimart and convenience stores).-VNA
