In-depth look at Vietnam's middle class and business opportunities
Asia Report Column: Finance and Banking Journal, August Issue (Issue 508)
In Vietnam, key shopping trends are concentrated in the food and beverage industry. and increased spending on high-end products To improve the quality of life As a result, there is an increased demand for foreign luxury products.
"Vietnam" It wants to become an upper middle-income country by 2573 and achieve high-income country status by 2593. Vietnam's middle class is expected to expand to 26% by 2569, up from 13% (about 13 million people) in 2566. XNUMX, which will create huge opportunities for businesses.
Vietnam's economic direction
Vietnam emerges in global supply chain It is considered important to the direction of the economy. This is driven by a strong manufacturing sector and growing exports. Between 2555 and 2565, Vietnam's exports expanded at an average annual rate of 12%, far outpacing the world average growth rate. In just the first half of 2567, the national export turnover is expected to reach 190,080 billion US dollars, an increase of 14.5% compared to last year. due to global demand recovering
Major multinational companies such as Samsung, Google, Microsoft, Apple, Nike, Adidas have integrated Vietnam into their supply chains as part of their diversification strategies, such as “China plus one” (CHINA +), while investment Direct foreign investment increased to 11,070 billion US dollars in the first 5 months of 2567, reflecting an increase of 2% compared to the same period last year. The manufacturing and processing sector led the way with investments valued at approximately USD 7,430 billion. This is considered a strong growth of 11.9% compared to 2566, followed by the real estate sector with investments of nearly 1,980 million USD. This is a significant increase of 70.8% compared to last year.
In September 2566, the United States entered into a comprehensive strategic partnership with Vietnam. This partnership has led Vietnam's middle class to grow rapidly and become an economic driving force in Southeast Asia and beyond. Between 2545 and 2565, Vietnam's average per capita income Vietnam's poverty rate increased 3.6 times to US$4,179, while the poverty rate decreased from 14% in 2553 to 5.7% in 2566. Per capita income reached US$4,346.8.
Characteristic characteristics of the middle class in Vietnam
World Data Lab (WDL) defines Vietnam's middle class as: Individuals with daily expenses exceeding US$12. In the first quarter of 2567, the average salary of workers and employees increased to approximately US$334.42, with male workers earning approximately US$318.68 per month. and female workers earn approximately 236.06 US dollars.
With an average age of approximately 35 years, they are young, savvy in leveraging technology and eager to participate in the global market. Including having a high level of education which is a large number of tertiary students compared to the general population Education not only helps raise income levels but also drives the desire to move up in social status.
in geographic terms The middle class is concentrated in various urban areas. Especially in big cities such as Hanoi and Ho Chi Minh City. Their concentration in cities drives huge demand for a wide range of products and services, influencing market trends and opportunities. Vietnam's middle-class consumers value investment in education, Health care, housing, which reflects the desire to improve the quality of life. In addition, there is more emphasis on entertainment activities. Tourism that emphasizes experiences and personal development which emphasizes various preferences and priorities of consumers
Vietnam's middle class is growing rapidly.
Vietnam's middle class is expanding, especially in urban areas. It is driven by economic growth. expansion into industry Wealth and a growing young population The important factors that cause the expansion include an expanding youth population. The economy is strong. Household size is smaller Out-of-town consumers are increasing and living standards are rising. And with a population that is nearly 100 million people and the average age is young. And this young age group is entering the workforce. can make money Therefore, it has contributed to the rapid growth of the middle class.
Vietnam's economy has enjoyed impressive annual growth rates over the past decade, creating many jobs and increasing incomes. Vietnam's expanding middle class is having a profound economic and social impact. of the nation By pushing for increased demand for new products and services. while investing heavily in education and real estate In terms of politics and society The middle class has more influence and contributes to national development and stability. On the world stage, Vietnam's middle class has become an important force, playing a large role in international trade and investment.
Spending patterns of the middle class
Urban populations are creating new opportunities. Especially in the service and manufacturing sectors, while incomes continue to increase. Driven by economic growth and higher incomes which leads to spending on education maintaining health and more entertainment
The middle class is more complicated. and clearly understand their own consumption habits This has led to increased demand for high-quality products and international brands, while e-commerce has grown, driven by widespread internet access and mobile phone use. It has become an important shopping channel for the middle class and has greatly promoted the country's retail sector.
The increase in wealth is reflected in the purchase of durable goods such as cars and motorcycles. and home appliances And consumers are increasingly willing to pay for well-known brands. Moreover, online shopping has become a popular choice because of its convenience. There are discounts and a variety of products. In addition to products in tangible form Products that open up various experiences such as tourism Eating out And entertainment was made a top priority. Including spending, it has changed to spending more on non-essential products compared to spending during the COVID-19 crisis. The emphasis is on saving money and consuming only essential goods.
Consumer trends and insights for business
As consumers increasingly use digital channels, businesses can align their products and distribution channels to meet “value for money” needs, including offering a wider range of products and exploring new retail formats. For example, Discounter stores that sell a variety of products at reasonable prices along with promotional activities. In the current situation, it is ideal to sell on e-commerce platforms to reach a wider consumer base.
All businesses Can offer premium products To attract wealthy customers Especially the younger generation who are willing to pay for quality products. As the Vietnamese consumer market grows, it opens up more opportunities for premium brands to enter the market. Companies with popular brands and distribution networks should consider releasing premium products suitable for Vietnamese people to seize business opportunities in this group.
Additionally, according to a 2564 consumer survey, 84% of respondents prioritize sustainability. This indicates a desire to invest in organic products. Healthier and more sustainable despite higher prices, businesses should focus on organic ingredients and local brands, which strong local players currently dominate the market. Developing products in this way can accelerate growth by aligning with consumer values and preferences.
In Vietnam, major shopping trends are concentrated in the food and beverage industry and increased spending on high-end products to improve quality of life. As a result, there is an increased demand for foreign luxury products. And the fastest growing spending segments in Vietnam include food and non-alcoholic beverages, health products, medical services. and clothes and shoes
Follow and read other columns. Available in the August 2567 issue of Finance and Banking Journal. Issue 508 In digital format: https://goo.gl/U6OnIi
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