Nielsen Case Competition 2019 _ Round 1 _ Lâm Tiên Khải

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Team Kantan
13/10/2019
SHOULD LION CORPORATION
ENTER VIETNAM?
Nielsen Case Competition 2019 – First Round

Copyright©2019TheNielsenCompany(US),LLC.Confidentialandproprietary.Donotdistribute.
2
OVERVIEW
• Lion Corporation is a Japanese company with a vision to help making everyday
healthy and comfortable for everyone. Lion Corp intends to enter Vietnam.
CONTEXT
• Is Vietnam a potential market for Lion Corp to enter? If yes, Which category Lion
should firstly bring into Vietnam.
• How are Vietnamese consumers and what does it mean to Lion.
• Which city/ region/ area and which channel they should focus.
KEY QUESTION
• Provide market insights & recommendations for client business planning &
strategy
OUR ROLE
OUTLINE
Market & Consumer
Overview
Category & Target
Customer Analysis
Strategic Region
& Channel
Recommendations

3
Vietnam’s FMCG industry is growing big
Vietnam – FMCG dynamic – Growth vs.YA(3)
Prepared for: Lion Corporation
Source: (1) GSO Vietnam. Economist Intelligence Unit. Nielsen Quarter by number report Q1’19 (3) Nielsen Retail Audit data
(2) Euromonitor International, Interviews (*) Monthly household income from USD 833
Middle class & rich segment*
is growing by 88%(2)
(2010 – 2020)
+4.4%
FMCG growth(1)
(MAT Q1’19 vs.YA)
Unit value growth
Volume change (Weighted Value)
Nominal value growth
Vietnam’s economy outlook and market indicators are promising, with the growth
rate of 4.4% in FMCG and middle class & rich segment growing by 88% (2010-
2020), presenting significant opportunities for international FMCG firms
+6.7% GDP(1)
(Q1’2019 vs.YA)

4
% Consumers stating Health as top 2 biggest concerns
– Q4’18(1)
43% of Vietnamese consumers regard Health as top 2 biggest concerns,
x2 greater than that of global ones on average. Especially, spending on
health goods and medical services is among the fastest growing.
Spending on health goods and medical services (%)(2)
5.9
7.1
9.9
2012 2016 2022
43% 22%
VIET NAM GLOBAL
Source: (1) Nielsen Consumer Confidence Report. *APAC figures. Nielsen Global Health Survey 2014. Nielsen The dirt on cleaning report 2016
(2) The Swedish trade & invest council “Capturing the Vietnamese consumer market 2018”
Vietnamese people increasingly concern about their
Health

5
ASIA PACIFIC
Vietnamese consumers concern much about Quality, Innovation and Origin of a
product compared to other Asian countries;
As a result, they prefer international brands, which are High Quality & Innovative
as assumed.
HIGH QUALITY /
ASSURANCES
& STANDARDS
SUPERIOR
FUNCTION OR
PERFORMANCE
DOES
SOMETHING NO
OTHER PRODUCT
DOES
ORIGINATES
FROM A SPECIFIC
COUNTRY
56% 52% 42% 27%
Indonesia (65%)
Vietnam (65%)
Thailand (63%)
Indonesia (63%)
India (59%)
Vietnam (58%)
Vietnam (49%)
Indonesia (49%)
China (47%)
Vietnam (50%)
India (37%)
I trust health claims on food packages
Health claims are just a way for
manufacturers to charge more
Vietnam is a potential market for Lion Corp to enter
Source: (1) Nielsen Global Ingredient and Dining-out Trends Report 2016. Nielsen Global Survey We are what we eat 2015
(2) Nielsen Global Premiumization Study (2018). How willing are you to pay a premium (more than average price) for products that provide the following attributes or
benefits? % of consumers highly willing.
Therefore, they become more rational in their
purchase decision

6
Vietnamese Population % by Age(1)
Millenials are the most sizeable consumer base, and
they are increasingly aware of personal care
Source: (1) United States Census Bureau, GSO Vietnam, 2018 (2) Kantar World Planet “Lifestyle of today’s Vietnamese consumers 2016”
Millenials are well educated, tech-savy,
open-minded and early adopters of
healthy lifestyles(1)
“ “
Senior
population
~22%
~20
millions
~30%
>29
millions
Centennials
~35%
~33
millions
Millenials
I would like to see more new products take care of my health(2)
I like products that have a additional “active ingredient:
vitamins, ginseng, calcium,…(2)
I often take vitamin supplements/ OTC products(2)
I am ready to pay higher price for healthier foods(2)
79 76
69 70
5858
81 76
Urban 4 cities Rural (% agree)

7
Source: (1) Data ending: Mar’19. Cigarette is MT Partial. FMCG including 37 categories: Shampoo, Hair Conditioner, Toothpaste, Toothbrush, Feminine Protection, Laundry,
Dishwashing Liquid, Fabric Softener, Household Cleaner, and more
(2) Statista Market Forecast 2019 (statista.com)
Vietnam - FMCG - Value Contribution(1)
7%
-2%
1%
5%
2%
5%
MAT YA MAT TY
Baby Care
Household Care
Personal Care
Vietnam - FMCG – Value Growth vs. YA(1)
Personal care’s
indicators
Personal Care’s indicators are upbeat with
US$980.9m in revenue and 5% in value
growth, presenting a highly potential market
Lion has capacities to
enter Baby Care,
Household Care and
Personal Care
6.2 6.2
6.4 6.3
2.4 2.4
14.6 14.6
13.1 12.3
16.5 16.5
19.8 20.3
21.1 21.4
MAT YA MAT TY
Household
Care
Personal
Care
Baby care
Cigarette
Milk Base
Food
Beverage
Beer
Moreover, Personal Care sector is on the rising trend
Personal Care is a promising sector for Lion
Revenue
US$980.9m
(2019)
Value growth
+5%
Personal Care(2)

8
With the largest proportion 40 mil of VN population and nearly 50%
contribution to FMCG Value, South region also shows great potential
due to consumers’ appeal to new product and MT significant role.
22%
24%
49%
FMCG Value
Contribution (%)(1)
Population Value
by Region (mil)(1)
33
21
40
North Central South
South is the strategic region for Lion’s first product
launch
Southern Characteristic(1)
Diversity Appeals
Retailers: more importance of MT
More experimentation
ATL Activities
HAPPY-GO-LUCKY
LIVE FOR THE MOMENT
Source: Slide 19_North Central South Difference, [NCC 2019] - First Round_ Case Study

9
TT vs MT dynamics
FMCG GROWTH +5% +14%
Trad. Grocery
Store
Wet
Market
Super
market
Minimart CVS
PENETRATION 81% | +0
1,486,261 | +0.3%
97% | +19 51% | +34 46% | +4
% shoppers
QUANTITY
# of stores
86% | +5
5,397| +34%
Growth of MT channels is much more remarkable at stella 34% and
has more potential to tap into than the already slowing down TT channels.
1.6% 1.3% 2.4%
2.8%
1.9% 12.8%
4.4% 3.2%
15.1%
vs YA vs YA vs YA
Unit Value Growth Volume Change (Weighted Value) Nominal Value Growth
Viet Nam (TT VN + MT Urban)
TT Vietnam
MT Urban
Retail landscape of the future is MT-driven
Source: Nielsen Retail Audit data ending Mar’19. Nielsen shopper trend 2018 - 2019

10
Urbanization and Media coverage drive more common values between urban and rural
values, including equally high access to MT channels
%Urban/Rural population
0%
20%
40%
60%
80%
100%
120%
2015 Est. 2025 Est. 2040
Rural
Urban
By 2040, 50% of Vietnamese population will be living in urban areas. The currently
~62M rural shoppers will move towards urban consumption trends and gain easier
access to MT retail.
With urban as the 1st move, Lion can recruit rural consumers in the long run.
Growing Urbanization
Source: 1) United States Census Bureau, GSO Vietnam, 2018 (2) Nielsen Smartphone Insights study 2016
Growing Media Coverage
Mobile
phone
users
TV
owners
90%
Urban residents’ access to media
90%
Therefore, urban should be the first move

11
Top E-commerce penetration
61%
45%
40%
38%
36%
34%
31%
29%
24%
23%
Fashion
Beauty & Personal…
Books & Music
IT & Mobile
Consumer Electronics
Household care
Packaged grocery…
Travel
Children & baby…
Event Tickets
Shoppers now go to more channels to serve different shopping missions, with
ONLINE playing a growing important role
VARIOUS TYPES OF STORES
CVS
Modern Drugtore
Minimart
Mom & Baby
Prepare for: Lion Corporation
Source: Internet Penetration: Demand Daily Time Spent: We Are Social & Hootsuite, Digital in 2018, , Nielsen Global Commerce Study 2018
Ecommerce and Omni-channel are driving factors of
FMCG retail
77% Internet users shop ONLINE
E-COMMERCE sales’ growth
TECHNOLOGY AFFECTED
30%
Retail in Urban South should make use of MT channels, E-commerce and Omni-
channel to coordinate online and offline platforms for better shopping experience.

12
Copyright©2017TheNielsenCompany.Confidentialandproprietary.
10Prepare for: Lion Corporation
PROMOTION
PRODUCT
PRICE PLACE
Vietnam at a glance and Recommendations
OVERALL SCENARIO
VIETNAM MARKET
• Growing FMCG industry
• PERSONAL CARE & HOUSEHOLD CARE are the
rising FMCG trend
VIETNAMESE
CONSUMERS
• More HEALTH concerns
• MILLENIALS : high awareness of personal care
• Southern consumers are open to new products
PRODUCT PRICE PLACE
PERSONAL CARE is a
promising category with
stable growth rate & high
demand
SOUTH URBAN should be
the first move
• Oral Care
• Premium Segment
• High quality with
natural/herbal
ingredients
• Clearly stated origin
• Premium price to
differentiate
products
LION SHOULD ENTER VIETNAM - a promising FMCG market
with rising consumption and potential customers
• MT-driven
• E-commerce
utilisation
• Omni-channel
ABOVE THE LINE
• TVC/KOLs/PR
• Affiliate marketing
• Sponsorship
• Testimonials
BELOW THE LINE
• Weighted distribution
• Salesman
Recommendation
• POSM
• Sampling

13
Oral Care is a potential sector in Personal Care
Source: (1) Nielsen Retail Audit data - Data ending: Mar’19 (2)Statista Market Forecast 2019 (statista.com) (*) 2019-2023
Vietnam – Personal Care – Value Contribution (1)
20.3 19.9
2.2 2.2
5.7 5.6
0.1 0.1
33.7 33.8
6.3 6.3
13.8 14.2
17.8 17.9
MAT YA MAT TY
Personal
Wash
Toothpaste
Toothbrush
Shampoo
Insecticide
Control
Hair
Conditioner
Facial Tissue
Feminine
Protection
-6%
6%
7%
10%
MAT YA MAT TY
Oral care
Hair care
Vietnam – Personal Care – Value Growth vs. YA(1)
Value
US$327.1m
(2019)
Value growth
+4%*
Oral care’s
revenue(2)
Value
US$212.6m
(2019)
Value growth
+3.6%*
Hair care’s
revenue(2)
Oral Care’s value contribution ranked 2nd in
Personal Care category with stable growth rate
and high promising revenue
Moreover, Hair Care market is more saturated
with many major players

14
Low & Medium price segment is dominated by
P/S & Colgate, which is highly competitive
compared to Premium segment.
Moreover, Premiumization is on the trend;
Consumers prefer international brands and
consider them as Premium.
“International brand is of higher quality”(1) (%)
54 58
29
34
2014 2016
Urban(*)
Rural
HIGH QUALITY /
ASSURANCES
& STANDARDS
SUPERIOR
FUNCTION OR
PERFORMANCE
DOES SOMETHING
NO OTHER
PRODUCT DOES
CLEARLY STATED
ORIGINS AND
NATURAL
INGREDIENTS
HOW TO MAKE PRODUCTS CAPTURING CONSUMERS’ PREFERENCE?(2)
Source: (1) Kantar World Planet “Lifestyle of today’s Vietnamese consumers 2016” (2) Nielsen Global Premiumization Study (2018). How willing are you to
pay a premium (more than average price) for products that provide the following attributes or benefits? % of consumers highly willing.
LOW
PREMIUM
Premium Segment is a step in the right direction

15
Increase of MT stores by store type
MT is reaching specialty and smaller scale formats. Among MT, Minimarts and
Modern Drug stores are the fastest growing.
367 461
2,042
2,980
898
985
235
354
489
617
4,031
5,397
Mar'18 Mar'19
Mom & Baby
Drugstore
CVS
Minimart
Supermarket
Total MT
Health/beauty and Modern Drug Stores have expanded quickly. Todays’
shoppers find high-quality products or trusted brands in these stores(1).
MODERN DRUGSTORE
Attractive channel for young females
25.6
45.9
9.7
50.6
26.2Mom & Baby
Drugstore
CVS
Minimart
Supermarket
MT Stores – Growth Rate vs. YA
• Service: Consultancy & Quality
• Pleasant environment
• Variety and international brands
• Innovative and premium products
Source: Nielsen – Shopper trend insights 2018
Modern Drug Store is the new growth engine for MT

16
BRAND AWARENESS
• KOL
• TVC
• PR
• Affiliate marketing
• Sponsorship
• Testimonials
• Convey messages to
target customers
through media
• Cultivate the image of
high quality, natural
ingredients, premium
PHYSICAL APPROACH
• Weighted distribution
• Product display
• POSM
• Modern store
recommendation
• Sampling
• Increase purchasers’
trust and loyalty
through direct product
advice
• Increase sale revenue
OBJECTIVE
CHANNELS
EXPECTED
OUTCOME
ABOVE THE LINE BELOW THE LINE
Omni-channel should be utilized to deliver shopper
experience
E-commerce and Omni-channel should be used to coordinate online and offline
platforms for better shopping experience.

Nielsen Case Competition 2019 _ Round 1 _ Lâm Tiên Khải

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