BATH AND SHOWER IN VIETNAM

Euromonitor International October 2012

BATH AND SHOWER IN VIETNAM

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LIST OF CONTENTS AND TABLES

Headlines ..................................................................................................................................... 1 Trends .......................................................................................................................................... 1 Competitive Landscape ................................................................................................................ 2 Prospects ..................................................................................................................................... 2 Category Data .............................................................................................................................. 3 Table 1 Table 2 Table 3 Table 4 Table 5 Table 6 Table 7 Table 8 Table 9 Sales of Bath and Shower by Category: Value 2006-2011 .......................... 3 Sales of Bath and Shower by Category: % Value Growth 2006-2011 .......... 3 Bath and Shower Premium Vs Mass % Analysis 2006-2011 ....................... 4 Bath and Shower Company Shares 2007-2011 ........................................... 4 Bath and Shower Brand Shares 2008-2011 ................................................. 5 Bath and Shower Premium Brand Shares 2008-2011.................................. 6 Forecast Sales of Bath and Shower by Category: Value 2011-2016 ........... 6 Forecast Sales of Bath and Shower by Category: % Value Growth 2011-2016 .................................................................................................... 6 Forecast Bath and Shower Premium Vs Mass % Analysis 2011-2016 ........ 7

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BATH AND SHOWER IN VIETNAM

HEADLINES
Bath and shower increased by 15% in current value terms in 2011 to VND1.6 trillion New products with added benefits were introduced Liquid soaps registered the highest growth in 2011, up 23% in current value terms Unit prices increased slightly because of high inflation and production costs Unilever remained the leading player in 2011, with a 35% value share Bath and shower is expected to register a CAGR of 1% in constant value terms over the forecast period

TRENDS
In 2011, bath and shower continued to see strong growth. The volume growth rate of most categories was slightly lower whereas the value growth rate was significantly higher compared with 2010. In 2011, consumers were presented with a wide range of bath and shower products, many of which came from imported and premium brands that had much higher prices compared to the mass-market products. As living standards improved and consumers started paying more attention to personal care, they became attracted to these new products, which had extra usages and added ingredients such as extra moisturising, firming, anti-stress, exfoliating, anti-ageing, and whitening. In the past, Vietnamese consumers in rural areas had a habit of using bar soaps for both hand cleansing and body washing. Over the review period, consumers showed more interest in liquid soaps and body wash/shower gel products as they are more convenient and contain moisturising ingredients that make skin feel better. Therefore, liquid soaps enjoyed the fastest growth followed by body wash/shower gel, whereas bar soap registered the lowest growth in retail value terms. Unit prices in all categories increased in 2011 due to high inflation. However, bath and shower products are considered necessities and consumers did not stop purchasing them. Therefore, higher prices had little impact on retail sales in 2011. Since bath and shower products were commodities in Vietnam and had entered maturity, there was no significant change in performance. Mass products were favoured over premium brands for their affordable prices and can be purchased easily at supermarkets and hypermarkets whereas premium products were usually found at large department stores or expensive salons. In Vietnam, family members usually share the same shampoo and body wash/shower gel products. Individuals rarely buy products for their exclusive use. As such, age segmentation was not apparent for bath and shower products. On the other hand, mens brands such as Xmen and Romano gained popularity as their specialised formulas and scents appealed to men. Gender segmentation is expected to develop over the forecast period. For bathing, Vietnamese consumers typically purchase only basic products. Since exfoliators/scrubs are not widely used, only premium brands carry such products, which are unaffordable for most consumers. Additionally, consumers are unfamiliar with the benefits of exfoliators/scrubs.

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COMPETITIVE LANDSCAPE
Unilever remained the leading player in bath and shower in 2011, with a 35% value share. Unilevers success was thanks to its strong foundation and brand awareness, as well as effective distribution channels and marketing activities. Procter & Gamble ranked second with a 12% value share. Both players were very active with marketing campaigns and public relations events. They continuously advertised their brands in the mass media. Pigeon Corp registered the biggest increase in value share in 2011 thanks to its popular Pigeon baby powder. In 2011, the company cooperated with supermarkets and hypermarkets to launch many promotions and discounts to increase consumer awareness of the Pigeon brand, including Pigeon baby powder, and to encourage new consumers to purchase and try its products. Pigeon baby powder slowly gained consumer loyalty because of its high quality and pleasant scent. International Consumer Products continued to register strong growth in 2011 thanks to the increasing popularity of its mens grooming brand, X-Men. Despite being a domestic manufacturer, International Consumer Products undertook various marketing activities to increase brand awareness. The company was one of the first to focus on developing mens grooming products in the country. In 2011, it continued to improve its packaging design to present a more premium image and increase its appeal. International brands such as Lux, Dove and Lifebuoy remained dominant in bath and shower in 2011 thanks to their constant marketing and advertising activities. While the majority of bath and shower products carried widely recognised brands, they were manufactured in Vietnam. International players such as Unilever and Procter & Gamble typically had a local office whose job was to understand the market, enabling them to react flexibly to local trends, and conduct appropriate marketing campaigns. As such, local brands had little chance of competing with international brands due to the lack of expertise and resources. Since bath and shower products are commodities in Vietnam, advertising campaigns were regular in 2011. Companies all tried their best to attract customers and gain share. They advertised on television, in newspapers, on websites and billboards and offered free samples at supermarkets and hypermarkets to introduce their products. Leading players Unilever and Procter & Gamble registered the highest advertising expenditure. While mass products dominated bath and shower, it is expected that there will be a niche market for premium brands due to increasing expenditure on personal care as a result of improving living standards and higher incomes. In 2011, premium brands such as Shiseido recorded strong growth in terms of retail value.

PROSPECTS
Bath and shower is expected to see modest growth over the forecast period, with constant value CAGR of 1%. The slow growth was due to the fact that bath and shower is already mature. Only bar soap is expected to register a negative CAGR, of 1% in constant value terms, over the forecast period. While bar soap is slowly being replaced by liquid soaps and body wash/shower gel, it accounted for 52% of all total bath and shower value sales in 2011, so this prediction will affect the overall performance of bath and shower. Liquid soap is expected to record the highest growth over the forecast period, with a constant value CAGR of 7%. While liquid soap contributed the least to the total value of bath and shower, it also means the category has a lot of room to grow. On the other hand, body wash/shower gel, which contributed 34% to the total value of bath and shower, is expected to register a CAGR of 3% in constant value terms, signifying good growth within the mature context of the market. Growth of both liquid soap and body wash/shower gel is in accordance

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with predicted decline of bar soap. Both products are advertised regularly in the mass media and are perceived to offer better quality than bar soap, which is appealing to urban consumers. Since the market is already mature, companies will want to keep a fresh image and make innovative moves to attract consumers. For example, improving product quality with new and special ingredients, introducing new lines of products or ones with added-value benefits, and running marketing campaigns to educate consumers about new products. Unit price is expected to marginally decrease over the forecast period. As the market becomes saturated, players will want to expand their consumer bases and gain share. Companies will want to extend their distribution networks to more rural areas. Since residents in rural areas have modest incomes compared to those in urban areas, price is an important factor in attracting consumers. Companies will want to introduce less expensive products here, thus lowering unit price in general. Heightened competition is foreseen, as the companies work to maintain and expand their shares while trying to satisfy increasingly demanding consumers. Manufacturers will try to introduce better products with new features, while other players will focus on marketing and PR campaigns to make their brands memorable in a crowded and saturated market.

CATEGORY DATA
Table 1 VND billion 2006 Bar Soap Bath Additives - Bath Foam/Gel - Bath Oil/Pearls - Bath Salts/Powder - Other Bath Additives Body Wash/Shower Gel Intimate Hygiene - Intimate Washes - Intimate Wipes Liquid Soap Talcum Powder Bath and Shower
Source:

Sales of Bath and Shower by Category: Value 2006-2011

2007 684.2 328.2 13.2 141.3 1,166.9

2008 711.5 365.9 14.4 151.2 1,243.1

2009 736.4 406.2 16.0 161.1 1,319.7

2010 760.0 461.0 18.2 170.7 1,410.0

2011 848.8 558.7 22.4 195.7 1,625.6

654.7 293.0 12.1 131.5 1,091.3

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 2

Sales of Bath and Shower by Category: % Value Growth 2006-2011

% current value growth 2010/11 Bar Soap Bath Additives - Bath Foam/Gel - Bath Oil/Pearls - Bath Salts/Powder - Other Bath Additives 11.7 2006-11 CAGR 5.3 2006/11 Total 29.6 -

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Body Wash/Shower Gel Intimate Hygiene - Intimate Washes - Intimate Wipes Liquid Soap Talcum Powder Bath and Shower
Source:

21.2 23.0 14.7 15.3

13.8 13.2 8.3 8.3

90.7 85.7 48.9 49.0

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Table 3 % retail value rsp

Bath and Shower Premium Vs Mass % Analysis 2006-2011

2006 Premium Mass Total

Source:

2007 1.7 98.3 100.0

2008 1.8 98.2 100.0

2009 1.9 98.1 100.0

2010 2.0 98.0 100.0

2011 2.1 97.9 100.0

1.7 98.3 100.0

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Table 4 % retail value rsp Company

Bath and Shower Company Shares 2007-2011

2007 31.4 13.5 8.4 7.9 5.1 5.2 1.4 1.5 1.8 0.9 0.6 0.4 0.3 1.2 1.0 0.9 0.3 0.2 0.1 0.6 1.1 0.1 -

2008 32.5 13.3 8.4 7.8 5.2 4.9 1.8 1.6 1.7 0.6 0.6 0.6 0.4 1.1 0.7 0.7 0.2 0.2 0.1 0.7 0.6 -

2009 32.8 12.8 10.1 7.2 5.2 4.5 1.9 1.6 1.7 0.8 0.6 0.6 0.5 1.0 0.5 0.4 0.2 0.2 0.1 0.8 0.3 -

2010 33.8 12.2 10.7 7.4 5.3 4.0 2.1 1.6 1.8 0.9 1.0 0.6 0.7 0.6 0.8 0.4 0.3 0.2 0.1 0.1 -

2011 35.2 11.7 11.3 7.4 5.4 3.9 2.3 1.7 1.4 1.0 1.0 0.7 0.7 0.7 0.7 0.4 0.2 0.2 0.1 0.1 -

Unilever Vietnam International Co Ltd Procter & Gamble Vietnam Ltd Unza Vietnam Co Ltd Henkel Vietnam Co Ltd Johnson & Johnson Vietnam Co Ltd Colgate-Palmolive (Vietnam) Co Ltd Beiersdorf AG Pure Labs Inc LG Vina Cosmetics Co Ltd Oriflame Vietnam Ltd Shiseido Cosmetics Vietnam Co Ltd Pigeon Corp Kanebo Cosmetics Inc International Consumer Products Ltd Daso Group Ascendia Brands Inc Saigon Cosmetics Corp Avon Cosmetics Vietnam Ltd Elizabeth Arden Inc Lana Cosmetics Shiseido Co Ltd Freeman Cosmetics Corp Dragoco Group First Pacific Co Ltd

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Kanebo Ltd Lander Co Inc Others Total

Source:

16.3 100.0

16.2 100.0

16.1 100.0

15.2 100.0

13.7 100.0

Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

Table 5 % retail value rsp Brand Lux Lifebuoy Enchanteur Dove Safeguard Johnson's Baby Fa Camay Palmolive Olay Nivea Bath Care Pureen Dial Romano Coast Eversoft Double Rich Protex Oriflame Shiseido Gervenne Pigeon Nave X-Men Dacco Zest Lander Johnson's pH 5.5 Cleopatra Avon Red Door Fresh Gel Handsep

Bath and Shower Brand Shares 2008-2011

Company Unilever Vietnam International Co Ltd Unilever Vietnam International Co Ltd Unza Vietnam Co Ltd Unilever Vietnam International Co Ltd Procter & Gamble Vietnam Ltd Johnson & Johnson Vietnam Co Ltd Henkel Vietnam Co Ltd Procter & Gamble Vietnam Ltd Colgate-Palmolive (Vietnam) Co Ltd Procter & Gamble Vietnam Ltd Beiersdorf AG Pure Labs Inc Henkel Vietnam Co Ltd Unza Vietnam Co Ltd Henkel Vietnam Co Ltd Unza Vietnam Co Ltd LG Vina Cosmetics Co Ltd Colgate-Palmolive (Vietnam) Co Ltd Oriflame Vietnam Ltd Shiseido Cosmetics Vietnam Co Ltd Unza Vietnam Co Ltd Pigeon Corp Kanebo Cosmetics Inc International Consumer Products Ltd Daso Group Procter & Gamble Vietnam Ltd Ascendia Brands Inc Johnson & Johnson Vietnam Co Ltd Colgate-Palmolive (Vietnam) Co Ltd Avon Cosmetics Vietnam Ltd Elizabeth Arden Inc Saigon Cosmetics Corp Lana Cosmetics

2008 14.4 10.6 5.0 6.5 6.0 4.8 5.5 4.5 2.4 2.3 1.8 1.6 1.2 1.2 1.1 1.4 1.2 1.7 0.6 0.7 0.6 0.6 0.4 1.1 0.6 0.7 0.4 0.9 0.2 0.2 0.4 0.1

2009 14.7 10.7 6.2 6.6 5.7 4.9 4.8 4.2 2.3 2.3 1.9 1.6 1.3 1.5 1.1 1.5 1.3 1.5 0.8 0.8 0.6 0.6 0.5 1.0 0.5 0.5 0.3 0.7 0.2 0.2 0.3 0.1

2010 15.3 10.8 6.8 6.7 5.4 5.0 4.4 4.0 2.3 2.3 2.1 1.6 1.5 1.6 1.5 1.5 1.4 1.3 0.9 1.0 0.9 0.6 0.7 0.6 0.8 0.5 0.4 0.3 0.4 0.2 0.1 0.2 0.1

2011 15.8 11.5 7.3 6.8 5.2 5.1 4.3 3.8 2.4 2.3 2.3 1.7 1.6 1.6 1.6 1.5 1.4 1.3 1.0 1.0 0.9 0.7 0.7 0.7 0.7 0.4 0.4 0.4 0.3 0.2 0.1 0.1 0.1

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Spring Debon Shiseido Freeman Dial Fa Men Coast Others Total

Source:

Saigon Cosmetics Corp LG Vina Cosmetics Co Ltd Shiseido Co Ltd Freeman Cosmetics Corp Freeman Cosmetics Corp Henkel Vietnam Co Ltd Procter & Gamble Vietnam Ltd

0.3 0.6 0.7 0.6 17.2 100.0

0.1 0.5 0.8 0.3 17.0 100.0

0.1 0.4 16.3 100.0

0.1 14.8 100.0

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Table 6 % retail value rsp Brand Shiseido Red Door Shiseido Others Total
Source:

Bath and Shower Premium Brand Shares 2008-2011

Company Shiseido Cosmetics Vietnam Co Ltd Elizabeth Arden Inc Shiseido Co Ltd

2008 10.1 40.9 49.0 100.0

2009 9.0 44.2 46.8 100.0

2010 48.2 7.3 44.5 100.0

2011 48.3 6.6 45.1 100.0

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Table 7 VND billion

Forecast Sales of Bath and Shower by Category: Value 2011-2016

2011 Bar Soap Bath Additives - Bath Foam/Gel - Bath Oil/Pearls - Bath Salts/Powder - Other Bath Additives Body Wash/Shower Gel Intimate Hygiene - Intimate Washes - Intimate Wipes Liquid Soap Talcum Powder Bath and Shower
Source:

2012 844.5 578.8 24.1 197.3 1,644.8

2013 839.5 598.5 25.9 198.7 1,662.5

2014 833.6 617.7 27.7 199.9 1,678.8

2015 826.9 636.2 29.5 200.9 1,693.5

2016 819.5 654.0 31.4 201.7 1,706.6

848.8 558.7 22.4 195.7 1,625.6

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Table 8

Forecast Sales of Bath and Shower by Category: % Value Growth 2011-2016

% constant value growth 2011-16 CAGR Bar Soap Bath Additives -0.7 2011/16 TOTAL -3.5 -

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- Bath Foam/Gel - Bath Oil/Pearls - Bath Salts/Powder - Other Bath Additives Body Wash/Shower Gel Intimate Hygiene - Intimate Washes - Intimate Wipes Liquid Soap Talcum Powder Bath and Shower
Source:

3.2 7.0 0.6 1.0

17.1 40.1 3.0 5.0

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Table 9 % retail value rsp

Forecast Bath and Shower Premium Vs Mass % Analysis 2011-2016

2011 Premium Mass Total

Source:

2012 2.2 97.8 100.0

2013 2.3 97.7 100.0

2014 2.4 97.6 100.0

2015 2.5 97.5 100.0

2016 2.6 97.4 100.0

2.1 97.9 100.0

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