New product choices drive lower brand loyalty in Vietnam

Kantar data shows Vietnam’s surge in options fuels consumers' shifting brand preferences.

Brand loyalty in Vietnam is rapidly declining as consumers become increasingly price-sensitive, driven by inflation and a wider array of choices, according to Peter Christou, General Manager of Kantar Vietnam, Worldpanel Division.

With more options at their fingertips, shoppers are rethinking their brand preferences, making it harder for companies to maintain customer loyalty.

"Brand loyalty is being challenged, and I don't think that's because consumers don't care, but it's because they have more power, more pressure, and also more options than ever before," Christou said. The result? Vietnamese consumers are making more affordable decisions as economic pressures mount, making it crucial for retailers to adapt.

He cited Kantar’s data revealing that "the sheer number of products hitting the shelves has doubled over the last 10 years, but the success of those products is halved."

Additionally, the rise of online, offline, and hybrid shopping channels has made it easier for consumers to compare prices and deals. "There's more and more options available to me in terms of online, offline and different channels, and that makes it easy for me to shop around, compare deals, compare prices," Christou said.

Retailers facing this challenge must adapt to a new reality where brand loyalty is no longer a given. Christou suggests that in this "low loyalty environment," retailers must focus on three key areas: being data-driven, understanding consumer missions, and delivering personalised value.

Looking ahead, Christou also highlights emerging e-commerce trends that retailers should watch. He points to the rise of social commerce platforms like TikTok, the importance of hyper-personalisation powered by AI, the growing demand for quick commerce, and the future potential of augmented and virtual reality in retail.