by Anh H. Nguyen
There is no greater time to be a beauty fanatic in Vietnam than in the present. Consumers now have easy access to the coolest trends and the latest products, literally at their fingertips. More importantly, they possess both the knowledge and means to select, buy, and utilize said products. The cosmetics market in Vietnam, therefore, has excellent potential for growth, and is actually growing at an impressive 7% per year on average, outpacing the fast moving consumer goods sector.
A Vietnamese beauty store
Take sunscreen, for example. 20 years ago, Vietnamese folks treated sunscreen mostly as an afterthought, having only the most vague idea about its usage and benefits. The variety was also abysmal: when pressed for one sunscreen they could name, most people would jump to Sunplay since it was the only one advertised on TV.
But now? Most females under 50, especially those who live in urban areas, are well-versed in the danger of skin cancer and other sun-induced damages. Articles and videos reviewing different sunscreens, complete with tips and tricks, are numerous and informative. There are literally hundreds of sunscreen options available for purchase both online and offline, from the most high-end to the most affordable. Walk in any department stores or shopping malls and customers would be floored: there are premium and budget-friendly brands from Japan, Korea, Europe, the US, and Vietnam, there are different formats (physical and chemical), there are separate types for face and for body, there are novel formulas like quick-dry spray, oil-free fluid, and powder. Some forms of sunscreen even double up as makeup, some may be taken orally. And we have not even scratched the surface of the range of personal care products in Vietnam - everyday offers a new makeup style, a new skincare routine, a new beauty gadget to aspire to.
Product selection for a guide to sunscreen at trustreview.vn
There are several factors that brought about this momentous change, and understanding them is quite essential for those wanting a share of the beauty market. For multi-brand beauty & health care chains that have entered Vietnam during the last few years such as Watsons, Hello Beauty, and Guardian, this is especially important. At some point, all business owners must face the conundrum: Are you going to master the circumstances, or are you going to let them be the master of you?
Influences that are reshaping the Vietnam beauty market
1. People's attitude towards skincare and makeup has evolved
Over the course of three decades, Vietnam's economy has gone under massive reform and emerged as one of the fastest growing in Asia. As a result, the mindset among urban dwellers has shifted from "having enough to eat and wear" to "eating well and dressing fashionably." Rapid growth stimulates demand: a higher living standard ensures that people may stop worrying about basic necessities and devote more resources to their appearance. Beautification, and to a larger extent, personal care, have ceased to be optional - they have become the new must-do.
Shoppers buying personal care at a supermarket - beauty has become nearly as essential and accessible as groceries.
The scope of personal care is not limited to face makeup and skincare, either: nail care, body care, dental care, hair care are all significant segments of the grooming business. There are plenty of categories for beauty retailers to expand to: in fact, the more diversified they are, the better chance they have of competing with online shopping. But to truly stand apart, retailers need to provide shoppers with exclusive experience they could not get from online stores: physical testing and demonstrations of products, professional recommendations, add-ons like quick facials and free skin checkup.
A live makeup demo drew a large crowd at the opening of Hello Beauty in Binh Duong
2. People have become more knowledgeable and selective about their products
Beauty and health are closely intertwined. As science has shown again and again, sacrificing one's mental and physical well-being for the sake of temporary good looks is neither sustainable nor advisable. With the Internet and other channels including beauty-focused books, magazines, and workshops at their disposal, Vietnamese consumers have become more conscious about what they put on (and in) their bodies. Savvy consumers do careful researches to decide the best routine for both appearance and health improvements. Before purchasing, they would cautiously examine each product's chemical makeup, its long-term effects on their bodies, even its impact on the environment.
The lucrative beauty market of Vietnam offers rich opportunities for diversification
The implications? There are many directions for beauty retailers to explore, and they could take them as far as they want to. For example, newbies to skincare and beauty may feel intimidated by the overwhelming array of products. For this segment, beginners' small-size kits would be appreciated, and staff should be close by to give adequate advice and hand out samples. Believers of the "beauty comes from within" school of thought put much stock in collagen booster, evening primrose oil, and vitamin capsules, so it would be remiss for retailers not to allocate at least one section to skin and hair supplements. The small but visible rise of organic skincare and makeup in Vietnam is also proof that there is much unexplored (green) terrain in the market.
3. People are catching up to trends
Although Hanoi and Saigon have not yet reached the status of beauty meccas like Tokyo or Seoul, the new products bearing Asian labels popping up everyday tells a fun story. The popularity of Hallyu (Korean wave) in particular could be seen across multiple aspects of Vietnam's modern culture: people watch Korean dramas, listen to K-pop, travel to Korea, and sample Korean cuisines. It is inevitable that Vietnamese consumers would strive to follow their idols' fashion, beauty and fitness routine, even their cosmetic surgeries. Little Korean fads such as the 12-step skincare regimen, the sheet mask craze, or the cushion compact have all gained steady followings among Vietnamese beauty devotees. Statistics do not lie: South Korea ranked first among countries exporting cosmetics to Vietnam with nearly a third of the market.
As more Korean brands hope to enter the market, Korean beauty shows become popular as a strategy to introduce products and magnify presence.
Thanks to the prevalence of Korean music and movies, Korean celebrities have become beauty icons in Vietnam.
In order to better anticipate and control market movement, retailers need to keep their finger not only on the pulse of the beauty industry, but also cultural phenomena as well. They may also employ the help of KOLs like beauty experts, vloggers, and celebrities to stay in vogue and bridge the gap between retail stores and the online world.
How beauty retailers may factor AI in their business plans
While the above action items may seem a lot to take in at first, the good news is that they could all be made easy with the aid of digital transformation. There are four areas in which Artificial Intelligence could remarkably streamline, improve, and transform the retail experience:
1. Staff interaction: In the beauty retail industry, this is the one area that could make a huge positive effect on the customer experience. Competent beauty consultants could educate customers on pros and cons of products, give lessons and meaningful advice, suggest suitable makeup and skincare based on a customer's complexion, features, age, and taste. AI technology could help retailers monitor staff performance and fine-tune staff training for maximum outcome.
Tracking staff interaction rate and CVR with AI
2. Product stocking: The beauty industry is a notoriously fickle beast. New variants come and go more quickly than you can say A, B, C. It makes sense, too: since cosmetics and skincare tend not to break the bank, people could buy what strikes their fancy without too much planning and forethought. This encourages spending, but also poses a big challenge for retailers: it would be a nightmare to sit on a big pile of products that turn out to be outdated or unwanted. AI technology based on store camera streaming could help retailers avoid this by gauging the demand in real time and plan their product selection accordingly.
3. Online marketing: Omni-channel shopping is real and thriving in Vietnam thanks to the widespread use of the Internet and social media. While people who frequent brick-and-mortar stores benefit from physical interactions with staff and products, online shoppers get convenience. These two channels should work in tandem and complement each other. Using data from traffic and sales, retailers could correctly judge the success of their online marketing campaigns and make adjustments quickly. See more.
4. Retail design: Customers buy with their eyes. For an industry that makes outer beauty its focal point, this is even more accurate. Attractive displays, eye-catching promotions, ergonomic layouts all contribute to the retail experience and help increase sales. Retailers could use AI technology to constantly test out different layouts and displays and see what works best for each customer demographics.
Measuring the results of difference retail layouts with AI
Vietnam beauty market's shining prospects do not go unnoticed. According to U.K. market research firm Mintel, it is estimated to be worth around $2.3 billion. For local and foreign enterprises vying to tap in the fresh demand of this 95-million population, it would be wise to invest in solutions that have immediate, verifiable, and scalable results. A data-based course of action is a good starting point. For more information, visit https://www.palexy.com/solutions.