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Recognizing consumer differences key to marketing in Vietnam
Key differences in their outlook and attitudes toward life warrant product concepts and marketing strategies that are specific to consumers in different regions in the country, marketing experts say.
Asha Phillips, Marketing and Communications Manager, Vietnam for marketing research firm Nielsen, told Thanh Nien Daily Monday that recognizing and responding to the difference will help Vietnamese brands position themselves far more effectively in the Vietnamese consumers’ minds.
This will offer both immediate and long-term returns, she said.
A Nielsen report released earlier this month said cultural diversity between consumers translates to differences in attitudes, behaviors and lifestyles.
The differences between consumers in Vietnam’s two economic hubs – Hanoi and Ho Chi Minh City, are manifested in their brand choice, decision-making, shopping habits, and confidence levels, it said
In HCMC, individualism is dominant as people care less about other’s opinions, an intensive cross-region study carried out in April and May 2009 showed.
When it comes to making purchasing decisions, their own desires and needs are the biggest influence, the study said. HCMC residents are more open to change and like to try new things and as a result are a mixed consumer group, it added.
On the other hand, the study pointed out the homogeneity of consumers and a collective spirit in Hanoi where people listen to their peers and are influenced by their opinions and recommendations, with social conformity accorded high priority.
As many as 94 percent of Hanoians surveyed said recommendations from neighbors are very important in their decision-making process.
It cited an example in which one respondent from Nielsen’s focus groups said: “I want to buy a new TV and if some of my neighbors tell me that the TV is not high quality, then I would be turned off from that TV right away.”
By contrast, Saigonese (as HCMC residents are commonly known) do not accord too much weight to others’ opinions.
The study also pointed out that Hanoians are complex consumers, saying they want to be noticed and impress their friends, but want to do so without breaking what is socially acceptable.
What will be will be
The study stressed a major difference in planning between people of the two cities.
Saigonese live for the moment and plan little for the future compared to Hanoians, it said. Hanoians save their money for the future, while Saigonese will spend it to get what they need today and worry about tomorrow later.
According to Nielsen’s Personal Finance Monitor 2008, consumers in Saigon are more willing to take out loans from the bank or other financial institutions; while more than half (57 percent) of Hanoians are not willing to borrow.
This can be attributed to a more collective spirit in Hanoi, whereby consumers are more conscious of and influenced by what other people think of them – and in the eyes of Hanoians, having to rely on an institution to take out a loan to purchase something may result in “losing face,” the research found.
Somewhat contradictorily, Hanoians love premium goods (71 percent claim they love premium products) particularly when it comes to big-ticket items such as mobile phones and cosmetics, Nielsen said.
As a result, they are willing to spend more to purchase premium products. Due to the fact that they tend to be savers and long-term thinkers, Hanoians have the ability to afford these premium goods when they want them, it added.
“Despite a tougher economy, Hanoians are keen on keeping up with the latest trends and are still willing to spend on what some would classify as ‘nice to have’ or ‘luxury’ products,” said Aaron Cross, Managing Director of Nielsen Vietnam.
On the other hand, the firm said Saigonese are impulse buyers – they buy what they need at the time they need it.
They still like premium products, but 48 percent of those surveyed say they believe premium products are for people who want to “show off”; and they would rather spend their money on necessary items, Nielsen said.
“Brands in Vietnam need to adopt different product concepts and marketing strategies for the two cities: one size will not fit all across Vietnam,” said Cross.
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