Education

Education 

Families in major cities are spending more for their children to study in developed countries. According to the Japan Student Support Organisation (JASSO), there are 3,597 Vietnamese students studying in Japan, an increase of 12.4 per cent compared to 2009. The Institute of International Education (IIE) indicated that the number of Vietnamese students studying at universities and colleges in the United States in 2009-2010 increased slightly from 12,823 to 13,112, equal to 2.3 per cent.

In addition, spending in the food and beverage sector experienced over 21 per cent growth in 2010 from 2009, even with inflation at 11 per cent, organic growth was still 10 per cent, the highest in Asia.

The only real loser appears to be entertainment and dining out, where the trend leans more towards eating and entertaining oneself at home and less about frivolous spending on fast food or going to the cinema. However, some entertainers and eateries, such as KFC and Mega Star Cinema, are reporting record growth, as they have been able to attract consumers by investing in understanding consumer needs and hence providing their customers with the right mix between their offers at a reasonable price and the services they provide.

Spending priorities

When asking consumers what products they really wish to buy, it becomes clear that aspirations, convenience, transport and communications are the key trends which will drive consumer spending in 2011 (Chart 7).

For the most desired items (not owned), consumers in Hanoi and Ho Chi Minh City showed different expectations. According to a study by TNS Vietnam, the percentage of consumers in Hanoi wanting to own a car, an air conditioner and an LCD/Plasma TV was much higher than that of Ho Chi Minh City.

This indicated that consumers in Hanoi seemed to focus more on appearance and status than consumers in Ho Chi Minh City. Twenty-five per cent of consumers in Hanoi wanted to own laptops, while this rate in Ho Chi Minh City was 14 per cent.

The global economic recession has indeed had an impact on consumer spending and consumer trends in Vietnam. Vietnamese consumers today are more cautious about spending their devalued, inflation-ravaged dong and hence are saving more.

2011 forecast

However, Vietnamese consumers are also feeling more secure about the economy and their lot, and having saved more for the past two years, it is anticipated that Vietnamese purse strings will loosen in 2011. Spending patterns, though not as frivolous as pre-2008 economic boon periods, will see an increase this year.