Posts

Vietnam has been chosen as the top priority market for future business expansion in Southeast Asia by 40% of US enterprises according to the recent ASEAN Business Outlook Survey released by US Chamber of Commerce.

The country has passed Indonesia, the largest market in the region, to become the first market US companies are looking to expand in across Southeast Asia. Indonesia ranked second with 38%, followed by Myanmar (34%) and Thailand (30%).

More than half of the respondents (53%) believed the ASEAN markets have become more important in terms of their companies’ worldwide revenue over the past two years. 49% expected to increase their ASEAN workforce by the end of 2016.

Expanding business in Vietnam for foreign companies

84% of respondents have a positive outlook for the country in 2016.

84% of respondents have a positive outlook for the country in 2016.

According to the survey, Vietnam has many competitive advantages for foreign companies, especially from the US, to expanding their business there. Among them are:

  • Low labor costs (64%)
  • Personal security (62%)
  • Positive sentiments towards the US (58%)
  • Stable government and political system (45%)

Nevertheless, the country still faces many problems that could hinder their growth and discourage foreign investors in the future, such as corruption (66%), lack of infrastructure (59%), legislations (55%). In addition, more than 40% of respondents said they were dissatisfied with government agencies, especially customs and tax authorities.

Among the top three industries that consider Vietnam as an attractive destination for expansion are:

  • Consumer Goods (41.9%)
  • Pharmaceutical (40%)
  • Wholesale/Retail (37.5%).

Vietnam was also voted the second market for moving investments from China into ASEAN with 17% of the vote, following Malaysia at 19%.

Until April 2016, US investment in Vietnam has reached $30.5 million, placing US at 17th in the ranking of Vietnam’s FDI partners. Top three investors in Vietnam is still held by South Korea with more than $48 billion investment; Japan, over $39 billion; and Singapore, over $36 billion.

A version of this appeared in VN Express on August 15. Read the full article here and access the full report here

SuperAwesome Ecommerce Study

The latest finding of SuperAwesome children’s ecommerce study has revealed that despite the sharp rise of ecommerce activity in the region, Southeast Asian children don’t spend much online. According to the ‘kids safe’ digital marketing platform, Southeast Asian kids are also far more likely to spend money on snacks or confectionary than books compared to children in the West.

64% of 6­-14 year old’s in the region claim never to make purchases online or spend their pocket money on digital products.

In the study of 1,800 kids in Indonesia, Malaysia, Singapore, Thailand and Vietnam by kids platform SuperAwesome, on average 65% of 6­14 year old’s claim to spend their pocket money on drinks and snacks, and only 44% spend on toys and less than 15% on computer games.

Contrast to British kids of the same age, who favor spending their pocket money on games (63%), clothes (45%) and eating out (33%).

SuperAwesome Ecommerce Study

Kids in Southeast Asia like to snacks more than buying toys.

Brand awareness of snacks and meal brands such as KFC and McDonald’s in Southeast Asia is far higher (75%) than of global toy brands (35%) such as My Little Pony and Hot Wheels. Singapore and Malaysia are the exceptions, as the kids there are familiar with toy brands such as Lego.

Vietnam stands out as a market where books are a popular item for kids to spend pocket money on, Thailand for eating out and Indonesia for drinks, snacks and confectionery. Quan Nguyen, director of SuperAwesome, said this is because FMCG companies were much earlier to enter ASEAN markets and toy brands have been sold through local distributors and have far smaller marketing budgets.

Thailand is the only country where kids do spend money on apps.

Digital activity is low among youngsters in the region because you don’t need to go online to buy snacks and online spending, particularly for kids under the age of 13, starts with parents, however this may change with apps like PokemonGo. The trust of online transactions remains relatively low and cash is still the preferred payment method in fear of fraud. Plus, many shops load free apps for customers on to your phone without the need for an account or a credit card.

Click to see the full Children’s Ecommerce infographic.

 

A version of this appeared in Mumbrella Asia on August 9. Read the full article here.