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Baby Food in Vietnam

Baby Food in Vietnam

Summary

The baby food market in Vietnam has been growing rapidly over the last few years. Higher incomes, particularly in urban areas, greater product diversity and better retail distribution boosted the growth of this market. In 2015, sales of milks accounted for 84%, cereals and dried meals for a further 13.2%, with wet meals, drinks and snacks making up the remaining 2.7%. Growth in both value and volume terms has been strong in all three major sectors. As the economy is predicted to experience healthy growth, leading to higher disposable incomes, the sales of baby food are expected to grow by 76% at current prices, equivalent to real value growth of 40% and total volume sales by 35.5% by 2021.

“Baby Food in Vietnam” is an analytical report by GlobalData which provides extensive and highly detailed current and future market trends in the Vietnam market.

What else does this report offer?

  • Consumption data based upon a unique combination of industry research, fieldwork, market sizing work and our in-house expertise to offer extensive data about the trends and dynamics affecting the industry.
  • Detailed profile of the companies operating and new companies considering entry in the industry along with their key focus product sectors.
  • Market profile of the various product sectors with the key features & developments, segmentation, per capita trends and the various manufacturers & brands.
  • Overview of baby food retailing with a mention of the major retailers in the country along with the distribution channel.
  • Future projections considering various trends which are likely to affect the industry.
Scope
  • Consumption of baby food in Vietnam has increased by 48.8% since 2009. Market value reached 144.4% more than in 2009, and equivalent to growth of 54.1% at constant prices.
  • Consumption levels remain higher in the two main urban centers, Hanoi and Ho Chi Minh City, than in other smaller cities or the rural parts of the country.
  • Milks constitute the bulk of the market and high volume growth is registered in cereals and dry meals.
  • Growing-up milk constitutes the largest part of the milks sector.
  • Vinamilk is the only one significant domestic supplier of baby food.
  • Sales remain dominated by four companies, which together accounted for 83% of sales value in 2015.
Reasons to buy
  • Evaluate important changes in consumer behavior and identify profitable markets and areas for product innovation.
  • Analyze current and forecast behavior trends in each category to identify the best opportunities to exploit.
  • Detailed understanding of consumption by individual product categories in order to align your sales and marketing efforts with the latest trends in the market.
  • Investigates which categories are performing the best and how this is changing market dynamics.


  • Introduction
    • Executive Summary
    • Definitions: Market Sectors
    • Definitions: Terminology
  • Background to the market
    • Births - Live Birth Rates: GlobalData estimates that in 2015, 1.5 million babies were born in Vietnam
      • Table Birth & Population Trends, 2005-2015
    • Births - Measures to control the birth rate: For many years the government has tried to limit population growth via its Population Ordinance
    • Births - Birth Rates by Region: In 2015, 30% of all babies born in Vietnam - equivalent to approximately 441,000 babies - were born in urban areas
      • Table Urban & Rural Population, 2005-2015
    • Births - Birth Rates by Region: Ho Chi Minh City is the largest city, with a population of eight million in 2014, ahead of Hanoi, with a population of 7.1 million
      • Table Population by Area & Major Cities, 2014
    • The Consumer: Average incomes have been rising rapidly, almost trebling between 2008 and 2014
      • Table Trends in Annual Per Capita Income, 2008-2014
    • The Consumer: In 2013, for the first time in recent years fewer than 10% of the population was living in poverty
      • Table Poverty Rates by Region, 2010-2014
    • The Consumer: More women have been drawn into the urban workplace, and these mothers have found they have less time to spend preparing food
    • The Consumer: Price is no longer the main influencer on Vietnamese consumers' purchase decisions
    • Socio-demographic Trends - Family Structure: The size of families continues to vary according to the area and socio-economic factors
      • Table Marital Status of Women of Child-Bearing Age, %, 2013
    • Socio-demographic Trends - Births by Age of Mother: In the fourth quarter of 2015, there were 23.8 million women of child-bearing age
      • Table Women of Child-Bearing Age, by Age Groups, 2015
    • Working Women - Female Employment: Vietnam has been praised in recent years for its efforts at promoting gender equality
      • Table Trends in Women's Employment, 2009-2015
    • Working Women - Legislation: The government has been making efforts to promote breastfeeding for many years
    • Breastfeeding Trends - Prevalence: Despite Government efforts, rates of exclusive breastfeeding remain low
      • Table Breastfeeding Rates in Urban and Rural Hanoi, 2008-2010
    • Breastfeeding Trends - Prevalence: In 2014, 24.3% of mothers breastfed their babies exclusively in the first six months of life, a slight increase on 2010
      • Table Breastfeeding Rates by Socio-Economic Criteria, 2014
    • Breastfeeding Trends - Duration: The median duration of any breastfeeding stood at 15.8 months in 2014
      • Table Median Duration of Breastfeeding by Socio-Economic Criteria, 2014
    • Regulations: Although the government has tightened controls on the promotion of infant formula, violations remain widespread
    • Regulations: The International Code of Marketing of Breast-milk Substitutes is fully enshrined in law
    • Regulations: In June 2012, a new Price Law made milk prices for children under six years old subject to government regulation
    • Regulations: Restrictions on importing and distributing goods are gradually being lifted
  • Market overview
    • Market Overview: The Vietnamese baby food market remains underdeveloped, although it has grown rapidly over the last few years
    • Market Overview: The market is by no means uniform: consumption levels remain higher in the two main urban centers, Hanoi and Ho Chi Minh City
      • Table Market Size, 2015, &Growth Rates, 2009-2015
    • Manufacturer shares: Although still relatively small and underdeveloped, the potential for future growth has attracted a large number of multinational players
      • Table Baby Food: Manufacturer Shares by Sector, %, 2015
    • Manufacturer Shares: Vinamilk and Nestlé have a higher share in volume than in value
      • Table Baby Food: Manufacturer Shares by Sector, % Value, 2015
    • The Future: The value of the baby food market in Vietnam is expected to grow by 76% between 2015 and 2021
      • Table Projected Market Size, 2021, &Growth Rates, 2015-2021
  • Sector analysis
    • Sector analysis: Baby Milks
    • Milks Sector Trends: Infant formula makes up the vast bulk of the baby food market in Vietnam, accounting for 84% of market value in 2015
    • Milks Sector Trends: Retail prices of infant formula in Vietnam are high and have risen steeply over the last decade
    • Milks Sector Trends: In 2016, consumers continued to complain about high prices whilst manufacturers claimed their businesses were unprofitable
    • Milks Sector Trends: The market is centered on the main cities, in particular Ho Chi Minh City and, to a lesser extent, Hanoi
    • Milks Per Capita Trends: Per capita expenditure on milks rose sharply between 2009 and 2015, to VND9 million (US$409) in 2015
    • Milks Segmentation: Growing-up milk constitutes the largest part of the milks sector; it is gaining share, boosted by products specifically for toddlers aged 2+
    • Milks Segmentation: In 2014, a large number of brands began to stress that their products helped babies gain weight and muscle
    • Milks Segmentation: The sector is notable for its extremely wide price range, from US$8.43 per kg to approaching US$33 per kg at the top end
      • Table Baby Milks: Brand Price Positioning Analysis, 2016
    • Milks Segmentation: At the very lowest price level (under US$15 per kg) are a number of locally produced milks from Nutifood, TUV, and Vinamilk
      • Table Baby Milks: Brand Price Positioning Analysis, 2016 (Cont'd)
    • Milks Segmentation: Two sizes predominate for infant formula: 900g packs, which accounted for 46% of facings, and 400g packs, which accounted for a further 35%
      • Table Baby Milks: Facings by Pack Type, 2016
      • Table Baby Milks: Facings by Pack Size, 2016
    • Milks Manufacturer Shares: Sales remain dominated by four companies, which together accounted for 83% of sales value in 2015
      • Table Baby Milks: Manufacturer Shares, % Value & Volume , 2010-2015
    • Milks Manufacturers: Abbott leads from FrieslandCampina's Dutch Lady in value, whereas local player Vimamilk tops the table in terms of volume
    • Milks Manufacturers: A large number of other players are also present but currently hold small shares
      • Table Baby Milks: Manufacturer Shares by Segment (Value), %, 2015
    • Milks Manufacturers: Competition is greatest within the second-stage baby milks sector
      • Table First Stage Baby Milks: Manufacturer Shares by Value, 2009-2015
      • Table Second Stage Baby Milks: Manufacturer Shares by Value, 2009-2015
    • Milks Manufacturers: Vinamilk is dominant within the specialist milks sector, while Abbott and FrieslandCampina together hold over half of the third-stage sector
      • Table Special Dietary Baby Milks: Manufacturer Shares by Value, 2009-2015
      • Table Third Stage Baby Milks: Manufacturer Shares by Value, 2010-2015
    • Milks Brands: A large number of brands are also present on the market, with most of the major suppliers fielding several umbrella brands
    • Milks Brands: Similac IQ (Abbott) heads up the first-stage sector in value but lies in third place in volume terms
      • Table First Stage Baby Milks: Brand Shares, 2009 & 2011
    • Milks Manufacturers & Brands: Vinamilk's Dielac Alpha 2 leads the second-stage sector in both volume and value terms
      • Table Second Stage Baby Milks: Brand Shares, 2009 & 2011
    • Milks Manufacturers & Brands: The best-selling specialist milk brand - Dielac Pedia - is marketed by Vinamilk
      • Table Special Baby Milks: Brand Shares, 2009 & 2011
    • Sector analysis: Cereals & Dry Meals
    • Cereals & Dry Meals Sector Trends: Consumption of cereals & dried meals has increased rapidly in recent years
    • Cereals & Dry Meals Per capita Trends: GlobalData estimate per capita consumption of baby cereals & dried meals was at 5.3 kg per baby in 2015
    • Cereals & Dry Meals Segmentation: Of volume sales, 60-70% comprise cereals, plain or with fruit, with the remaining 30-40% is taken up by savory dishes
      • Table Baby Cereals, Prices by Manufacturer and Brand, 2016
    • Cereals & Dry Meals Segmentation: The most popular size for cereal packs is 200g, which accounted for over a half of all cereals facings in 2016
      • Table Baby Cereals: Facings by Pack Type, 2016
      • Table Baby Cereals: Facings by Pack Size, 2016
    • Cereals & Dry Meals Manufacturer Shares: Vinamilk and Nestlé continue to dominate the market, with a combined 76% of value sales in 2015
      • Table Baby Cereals & Dry Meals: Manufacturer Shares, Value & Volume, %, 2010-
    • Cereals & Dry Meals Manufacturers & Brands: A large number of other brands are present on the market, although these tend to be less widely available
    • Sector analysis: Wet Meals & Others
    • Baby Wet Meals & Others Sector Trends: Compared with other baby food, wet meals are expensive and beyond the reach of most households
    • Baby Meals & Others Per Capita Trends: In volume terms, consumption is estimated at 885g per baby in 2015, equivalent to just seven 125g jars
    • Baby Meals Segmentation: The bulk of the market, in both volume and value terms, consists of wet meals
      • Table Breakdown of Sales by Product Type, 2015
    • Baby Meals Segmentation: The majority of jars of baby meals ranged in price between VND250,000 and VND350,000 per kilogram
      • Table Baby Meals, Prices by Manufacturer and Brand, 2016
    • Baby Meals Segmentation: The diverse nature of finger foods means that their average price per kilogram varies hugely
      • Table Finger Foods, Prices by Manufacturer and Brand, 2016
      • Table Baby Drinks, Prices by Manufacturer and Brand, 2016
    • Baby Meals Segmentation: The most popular size for baby meals is 110g jars, while finger foods are mainly presented in boxes, as well as in bags and tubs
      • Table Finger Foods: Facings by Pack Type, 2016
      • Table Baby Meals: Facings by Pack Size, 2016
      • Table Finger Foods: Facings by Pack Size, 2016
    • Baby Meals Segmentation: The most popular size for baby meals is 110g jars
      • Table Baby Drinks: Facings by Pack Type, 2016
      • Table Baby Drinks: Facings by Pack Size, 2016
    • Baby Meals Manufacturer Shares: Hipp has a share of 39% in volume terms and a higher 48% in terms of value
      • Table Baby Meals & Others : Manufacturer Shares, Value & Volume, %,
    • Baby Meals Manufacturers & Brands: The finger foods segment has attracted a growing number of participants as the market becomes more segmented
  • Production and trade
    • Production: There is only one significant domestic supplier of baby food - Vinamilk
    • Imports: The majority of imports in 2014 originated from Thailand, Singapore, and Ireland
    • Exports: Exports of milks and all other types of baby food are very low
  • Company profiles
    • Industry Structure: The Vietnamese market has attracted a large number of multinational players, drawn by its potential for future growth
    • Company Profiles: Abbott Nutrition Vietnam
    • Company Profiles: Friesland Campina Dutch Lady Vietnam
    • Company Profiles: Vietnam Dairy Products Joint Stock Company - Vinamilk
    • Company Profiles: Vietnam Dairy Products Joint Stock Company - Vinamilk
      • Table Vinamilk: Financial Performance, 2009-2015
    • Company Profiles: Mead Johnson Vietnam Company Ltd
    • Company Profiles: Nestlé Vietnam Ltd.
    • Company Profiles: Hipp
    • Company Profiles: Dumex Vietnam - Danone Vietnam Company Ltd
    • Company Profiles: Other Suppliers
  • Distribution
    • Baby Food Retailing: Baby food is sold primarily in grocery outlets, with supermarkets and hypermarkets gaining share, and baby specialists are on the up
      • Table Baby Food Retail Distribution by Channel, 2010-2015
  • Economic background
    • Economic Background: The government is committed to promoting economic reform and to opening the economy to the outside world
      • Table Key Macro-Economic Forecasts, 2015-2021
    • Key Macro-economic Forecasts: Most growth occurs in urban areas, and the gap between living conditions in the cities and in rural areas remains pronounced
      • Table Key Macro-Economic Forecasts, 2015-2021
  • Prospects and forecasts
    • Birth and Population Projections: The overall trend has been a reduction in the number of births and this is likely to resume over the period to 2021
      • Table Birth & Population Projections, 2009-2021
    • Birth and Population Projections: The number of women of childbearing age is forecast to increase by 7.6% between 2015 and 2020, to 25.6 million
      • Table Women of Child-Bearing Age, by Age Groups, 2015 and 2020
    • Forecast Overview: Forecasts for the period 2015-2021 remain very positive: real growth in GDP is expected to be around 6-7% per year for the next few years
    • Future Trends: Consumption levels of all baby foods are low, so potential for growth - given higher incomes - is good
  • Appendix
    • Appendix - The Baby Population: The overall size of the baby population (0-3 years) is expected to decline slightly from 2015 to 2021
      • Table Baby Food: Market Value, Current Prices, 2009-2015
    • Appendix - Market Value: The market was worth VND15,673 billion in 2015, up 144% over 2009
      • Table Baby Food: Market Value, Constant Prices, 2009-2015
    • Appendix - Market Value: In real terms, the market increased by 54% between 2009 and 2015
      • Table Baby Food: Market Value, US$, 2009-2015
    • Appendix - Market Value: Since 2009, the value of the market has increased by 90% to reach US$715.4 million by the end of 2015
      • Table Baby Food: Market Value, US$, 2009-2015
    • Appendix - Market Volume: Market volume grew by 49% between 2009 and 2015 to 38,268 tons
      • Table Baby Food: Market Volume, Tons, 2009-2015
    • Appendix - Per Capita Expenditure: In current price terms, expenditure levels increased by 155% between 2009 and 2015 to VND10.7 million
      • Table Baby Food: Per Capita Expenditure, Current Prices, 2009-2015
    • Appendix - Per Capita Expenditure: In constant price terms, expenditure rose by 61% between 2009 and 2015
      • Table Baby Food: Per Capita Expenditure, Constant Prices, 2009-2015
    • Appendix - Per Capita Expenditure: By 2015 expenditure per baby amounted to US$487, almost doubling over 2009
      • Table Baby Food: Per Capita Expenditure, US$, 2009-2015
    • Appendix - Per Capita Consumption: Per capita consumption increased strongly over the historic period to reach 26kg per baby in 2015
      • Table Baby Food: Per Capita Consumption, Grams, 2009-2015
    • Appendix - Milks: Infant formula makes up the vast bulk of the baby food market, with 84% of market value and 76% of volume sales in 2015
      • Table Baby Milks: Sector Trends, 2009-2015
    • Appendix - Milks: Follow-on formula accounts for 27% of value terms and firststage formula for 24%, with growing-up milks dominant and expanding
      • Table Baby Milks: Segmentation By Type, Value & Volume, 2010-2016
    • Appendix - Milks: There is an extremely wide range of prices, ranging from US$8.4 per kg at the lowest end to approaching US$33 per kg at the top end
      • Table Brand/Manufacturer Stage Pack size Price/Pack Price/Kg
    • Appendix - Milks: Nestlé's Lactogen and FrieslandCampina's Dutch Lady were considered low-priced in 2014 but have now moved into the medium-price range
      • Table Baby Milks: Brand Price Analysis, 2016 (Cont..)
    • Appendix - Milks: The bulk of products fall into the price range between US$15 and US$30, including the standard ranges from Nestlé, Abbott, and Mead Johnson
      • Table Baby Milks: Brand Price Analysis, 2016 (Cont..)
    • Appendix - Milks: At the very lowest price level (under US$15 per kg) are a number of locally produced milks such as those from Vinamilk
      • Table Baby Milks: Brand Price Analysis, 2016 (Cont..)
    • Appendix - Cereals & Dry Meals: During the period 2009-2015, consumption rose by 29% and value sales by 136%
      • Table Baby Cereals & Dry Meals: Sector Trends, 2009-2015
    • Appendix - Wet Meals & Others: Growth rates are high, with retail sales having increased by 144% since 2009 and volume sales by 53.5%
      • Table Baby Wet Meals & Others: Sector Trends, 2009-2015
    • Appendix - Imports: The majority of imports of milks & cereals in 2014 originated from Thailand, Singapore, and Ireland (63% of total imports between them)
      • Table Imports of Baby Milks & Cereals by Country of Origin, Value, 2011-
    • Appendix - Imports: New Zealand and Germany also feature strongly, although a large number of other countries also supplied products to the market
      • Table Imports of Baby Milks & Cereals by Country of Origin, Volume, 2011 &
    • Appendix - Imports: Imports of other types of baby food are very low, amounting to just US$0.5 million in 2014
      • Table Baby Meals: Import Trends, Value, 2009-2014
    • Appendix - Value Forecasts: The value of the baby food market is expected to reach VND27,500 billion, with milks accounting for 84% of this
      • Table Baby Food: Market Value Forecasts, Constant Prices, 2015-2021
    • Appendix - Value Forecasts: Value growth in real terms is expected to amount to 39.5% between 2015 and 2021
      • Table Baby Food: Market Value Forecasts, US$, 2015-2021
    • Appendix - Value Forecasts: Between 2015 and 2021 the market is expected to show a 75.5% increase
      • Table Baby Food: Market Volume Forecasts, Tons, 2015-2021
    • Appendix - Volume Forecasts: In terms of volume, GlobalData forecasts that the market will expand by a more restrained 35.5%, to 51,869 tons
      • Table Baby Food: Per Capita Expenditure, Current Prices, 2015-2021
    • Appendix - Per Capita Forecasts: In current price terms, expenditure per baby is forecast at VND19.2 million by the end of 2021
      • Table Baby Food: Per Capita Expenditure, Constant Prices, 2015-2021
    • Appendix - Per Capita Forecasts: In real terms, expenditure is forecast to increase by nearly 43%
      • Table Baby Food: Per Capita Expenditure, US$, 2015-2021
    • Appendix - Per Capita Forecasts: By 2021 per capita expenditure is forecast to rise by nearly 80% over the 2015 level
      • Table Baby Food: Per Capita Consumption, Grams, 2015-2021
    • Appendix - Per Capita Forecasts: Per capita intake of baby food is forecast to amount to 36.1kg by 2021, a 39% increase over 2015
      • Table Baby Food: Facings Allocation by Product Type and by City
    • Appendix - Storechecks: Baby milks predominated, accounting for 55% of all facings in Hanoi, and 83% in Ho Chi Minh City
      • Table Baby Food: Facings Allocation by Product Type and by City
    • Summary Methodology

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