The Market Research Industry in Vietnam

Vietnam is emerging as one of the most dynamic and potential markets in South East Asia after joining WTO and hosting the 2010 ASEAN congress as the chairman position.  With stable economic and political situation, and with a large pool of young, highly literate and hard working population i.e. 90 million with 50% under 25 years old, Vietnam comes within top choices for foreign investors beside China and India.   Along with these positive country outlooks, the market research industry also made quantum leaps in value over the past 15 years from some 2 million USD dollar in 1994 to reach approximately 25 million US dollars in 2009 (ESOMAR report).

History and key players:

Vietnam remained a central state planning economy until 1991 when the Vietnamese government adopted “Doi Moi” (renovation).   As a result, US embargo was lifted; new regulation was legislated allowing private businesses to be opened.  Western companies were allowed to enter domestic market.  Only by the end of 1991, Vietnamese could start familiarize themselves with drinking Coca Cola and Pepsi Cola.

The early stage of market research in Vietnam could be traced back to 1992.  In this year, several surveys were conducted by the HCMC University of Economics for international clients who wanted to measure basic usage & attitude of Vietnamese people for food, drinks and other essential consumer goods.

The very first research agency entered into Vietnam market by 1993.  This was SRG whom was globally taken over by ACNielsen in 1994.  TNS and MBL (subsequently acquired by NFO, then TNS) were amongst other market research agencies established nearly at the same time.

Until now, after 15 years of growth, the market research industry features more than 10 key players including: Nielsen Vietnam, TNS, IMS (healthcare), GfK, Cimigo, FTA, Acorn, Indochina, Mekong research, Spire research and other smaller, qualitative based agencies.  Local agencies (main source of business is from Vietnam) are FTA, Mekong and Indochina.

Most of these research agencies locate their head office in Ho Chi Minh City.  Fieldwork offices are in Hanoi (Northern Capital), Danang (Central), and Can Tho (Mekong Delta).  Some agencies including Nielsen, TNS, Indochina, and FTA also operate, mostly FW or FW subcontracting in Cambodia and Laos (countries within the Indochina region).

Research services:

Most of market players provide full customized research services including qualitative and quantitative.   Specialized services are provided by IMS (healthcare pharmacy retail audit), GfK (household appliances retail audit), Nielsen (consumer goods retail audit), and TNS (media rating and consumer panel).

Questionnaires are consistently in Vietnamese language across 65 cities and 4 regions in Vietnam.  Most of research projects are conducted in key cities including HCMC, Hanoi, Danang and Cantho.  The main methodology in quantitative surveys remains face to face interviews (more than 90%).  FGD (focus group discussion) is most prdontdontdontevalent as a methodology in qualitative research.  Standard one way mirror viewing rooms with English, Japanese, Korean simultaneous translation are available for FGD.  Clients could stay in HCMC to watch focus groups conducted in other cities via live web-based audio/video facilities.

Research users:

About sixty percents of research spending in Vietnam is from FMCG (fast moving consumer goods) clients.   Top international FMCG clients are Unilever, British American Tobacco, Coca Cola, Pepsi Cola, Nestle, Campina Friesland.  Local FMCG clients also started investing for market research.  These are leading Vietnamese corporations, including: Vinamilk, Kinh Do, Masan, Tan Hiep Phat.  Another large part of research budget share comes from pharmaceutical companies (GSK, United Pharma, Zuellig, MSD…), from government telecommunication giants (Vinaphone, MobiFone, Viettel, VNPT, SPT…), from leading banks (ANZ, HSBC, Techcombank, Vietcombank, ACB, Standard Chartered Bank…), and from key motorbike manufacturers (Honda, Yamaha, SYM, Piaggio)

Social research on poverty and development issues features a particular segment in Vietnam, Cambodia and Laos.  Most of these projects are commissioned from non-profit organizations including UNDP, World Bank, Unicef, IFC…

The MR Industry future perspectives:

The current value of market research industry in Vietnam reaches 25 million US dollars (reported by ESOMAR).  Annual growth rate has been quite consistently above 15% over the past 3 years.

Vietnam has been selected among top three destinations for foreign investment in the region (behind China & India) since joining WTO in 197.  With sustainable competitive advantages from stable political situation and favorable investment environment, Vietnam is gaining tremendous FDI shift from China, Thailand as part of investment diversification strategy from multinational corporations.  With the positive prospect of growth, the market is expected to get more competitive with the coming international entrants (Millward Brown, Synovate, Ipsos…) in 2010 and next several years.

Code of practices:

Major market players are ESOMAR members, following ICC/ESOMAR code of conduct and practices.  Several agency adopted ISO 9001 for services in general (Nielsen, TNS) and ISO 20252 for research services (FTA).  These standards are currently used as tangible proof for international quality standard of information and service.

Secondary data:

Government publications are available from the National Bureau of Statistics covering population demographics, population distribution, education, health, agriculture, trade, export import, industry and also consumer expenditures.  World Bank, VCCI (Vietnam Chamber of Commerce & Industry) and MPI (Ministry of Planning & Investment) are other good sources of information, particularly on country economic performance and business investment.

Career opportunities in market research:

Research Executives who have 1-2 years of working experience could expect an annual remuneration package equivalent to 6,000 US dollars.  At director level, the package could reach 20,000 – 30,000 US dollars.

Key facts about Vietnam:

Population:  90 million (2010)

Largest city: Ho Chi Minh City

Other key cities: Hanoi Capital in the North, Danang in the Central, Cantho in Mekong Delta region

Major religions: Buddhism, Catholics

GDP: 1,100 USD (2010)