Let´s talk about pets ! Nordesk latest interview with Wayne Capriotti, Publisher of the first Vietnamese pet magazine “Me Thu Cung” and industry expert. He provides us with interesting facts and insights about the highly potential Vietnamese market.
1) Please tell us more about yourself and your relation to the Vietnamese pet market?
My first business involvement with the pet industry begun around 2004, surprisingly, it was not from the pet industry in Canada, where I was born, but from the industry in Japan. I lived and work in Vancouver for a couple of decades before moving to Asia / Vietnam where I first became interested in the business potential of Asia. As most people within the city of Vancouver between the years of 1996 and 2000, I was employed within the booming Internet industry sector.
I soon choose to start my own business and developed a multilingual online marketing business agency for international clients in Asia, since very few agencies were offering this type of service; Vancouver was considered a business Gateway to Asia.
I soon began obtaining clients from Japan, China, S. Korea, along with local businesses interested in doing business in Asia through developing business relationships with partners in Tokyo. Clients were from various industry sectors which eventually led to the discovery of the pet industry sector in Japan.
Along with our work with clients, we developed our own projects of selling products and services from N. America to Japan, and vice versa. One particular project involved the marketing and selling of ‘Anxiety Separation’ DVD’s (new age style music loops, with a mix of soothing human voices and background noise to be played for dogs and cats that are ‘home alone’).
Since most Japanese work long hours and are away from their pets during the day these DVD’s became popular. This project began an intense period of market research into the pet markets in Japan. I found the whole venture fascinating. Japan, at the time, was the second biggest pet market globally, right after the USA. The surprising discovery of the large amount of disposable income young pet owners in Japan were spending was astonishing, especially by the demographic of women from 20 to 35 years of age.
This project ended in 2006 and by pure chance work with a business owned by Vietnamese-Canadians in Vancouver, discovering the ‘charm of Vietnam’. I then relocated to Vietnam in 2009.
My involvement in the pet industry in Vietnam began with the development of Me Thu Cung (translation from Vietnamese: a passion for pets), the first dedicated magazine for Vietnam, along with my Vietnamese wife, an experienced Journalist and Photographer employed by the largest newspaper in Vietnam, Tuoi Tre.
From prior training in Prepress and DTP (Desktop Composition) along with my marketing skills, they seem to be a perfect match with my wife’s skills in journalism and photography.
As we both shared the love of pets, with her passion of cats and with my own history of pet ownership. As most pet businesses, traditionally, are family founded and owned, it just seemed to be a natural thing to do.
Our magazine is unique in a few ways, besides being the first publication of its kind in Vietnam it is also bilingual, in Vietnamese and English. My past experience of developing bilingual website content greatly helped. However, the bigger issue of being bilingual was to create a publication that could become a teaching tool for young Vietnamese animal owners to learn English. The content of our magazine is more educational than entertaining and does have a serious tone of voice. It is not easy to be a pet owner in Vietnam. There are a myriad of dangerous situations awaiting owners and their best friends, we do take the issues of pet ownership in Vietnam seriously.
2) Can you give us a quick snapshot, strengths and weaknesses of the market?
- Growing amounts of young pet owners (65% of the population is under 35 years old) with increasing disposable incomes that want to enjoy the ‘western experience’
- Increasing significant social change in Vietnam: the rise of leisure time (time to spend with pets)
- Targeting pet markets consisting of woman from 20 to 55 age. Vietnamese women make ALL the purchases of household FMCG including pet care products and services
- First-mover opportunities for local and international businesses in the pet industry of Vietnam: service markets are not fully developed.
- Growing acceptance of pets as family members in Vietnam
- Dog and cat pet markets are growing annually, however, there are large bird and fish markets in Vietnam
- Many well organized ‘Dog Breed Clubs’ who’s members are business owners or career oriented: good for marketing pet products and services. Not only dogs but there are clubs for birds and fish
- Marketing potential of the Native of Dogs in Vietnam: Phu Quoc Ridgeback, H’mong and Bac Ha dogs, largely unknown to people outside Vietnam, generates a lot of pride in Vietnamese people.
- Complex trade and customs barriers exist for importing pet products, especially food into Vietnam
- low price points demanded by consumers stalling the development of premium pet product markets
- high price of real estate will inhibit the growth of both small and larger pet retail ‘superstores’ in the major urban centers of Vietnam: Saigon, Hanoi, Da Nang and Can Tho
- much more consumer education and awareness is required by new and older pet owners in regards to why they should buy pet care products and services, especially in the food sector
- unregulated industry sector requiring more laws and government involvement especially in the sale of ‘live animals’, laws in protecting the theft of pets and Veterinarian practices
3) How is the Vietnamese mentality towards pets evolving?
In the last five years, the quantity and quality of pet ownership in Vietnam has increased, driven by a pet social phenomena, observed in developed countries called ‘pet humanization’. In creating a ‘mature’ pet culture, a sense of social responsibility must develop between pet owner and their pet and other people, with or without pets (society). Further, as Vietnam’s middle class is expanding and evolving the amounts of disposable income spent on pets is increasing, eventually, this raises the status of a ‘pet’ from a pragmatic position within the household into becoming a family member.
One must put things into perspective in regards to the progress of pet ownership and industry in Vietnam. The first commercial ‘small companion animal’ Vet clinic was only opened in Hanoi in 2003 and the first pet retail shop opened in 2006 in Saigon. Even a few years in 2009 there were only a few good retail pet care services in Saigon, selling a limited range of products and services.
The breakout year in regard to milestones in the pet ownership and industry was 2014. In this year the first annual Vietnam Animal Welfare Conference was held at the historic Continental Hotel in downtown Saigon. The International Dog Show endorsed by Fédération Cynologique Internationale (FCI) and produced by the Vietnam Kennel Association (VKA) had the largest amount of dog entries, attendance, and number of corporate sponsors. This year also produced the first pet magazine for Vietnam, Me Thu Cung.
In the last five years (2012-2017) the growth of pet retail openings has risen exponentially, although the choice of new pet products offerings has not grown at the same pace, however, services like pet grooming, training and accommodations have grown better than expected. Young entrepreneurs who are passionate pet owners are beginning to develop new businesses for a growing pet ownership in Vietnam. Progress made.
4) Is there a difference between the southern and northern Vietnamese market?
The pet care markets are still maturing in all major urban areas in Vietnam: Hanoi (North), Da Nang (Central) and Ho Chi Minh City (Saigon in the South). There is not much data available as there is no local market research agency gathering data and monitoring the behavior, spending habits and the lifestyle of pet owners in Vietnam.
The only international marketing research agency that gathers data on the pet industry in Vietnam is the International EuroMonitor focusing on overall sales of pet care products by sector and generally the purchase of pet products (considered FMCG) at various points (channels) of sale.
To understand any differences in purchasing of products, regionally, you would have to look at the general buying habits of consumers from Hanoi, Saigon and Da Nang. It has been noted that buyers in Hanoi are more frugal, heavy savers and little more conservative and not as impulsive or daring or ‘lose’ with their money as buyers in Saigon. However, in regards to the purchase of pets (dogs) in the urban areas in the North, South, and Central Vietnam there seem to be no bounds to price.
There is a perceived heightened sense of ‘social status’ (conspicuous consumption) in the public display of large and small expensive western or ‘exotic’ breeds of dogs: Northern Dogs, German Shepherds, Labs, French Bulldogs, Pomeranians, etc. Fortunately, this is slowly transforming into an understanding that owners just want to gather with dogs of all breeds and other dog owners to ‘socialize’; creating temporary extended families of dogs and people in public spaces, a learned social responsibility of proper dog ownership.
5) Would you recommend Vietnam as an outsourcing destination for pet care product?
Yes, definitely, in both the food and non-food care product market segments. Overall, the benefits are low wages and cost-effective manufacturing of your pet products in Vietnam allowing your company to compete in the ultra-competitive global pet product markets. Apparel and footwear manufactures in Vietnam are recognized internationally for consistent high-quality manufacturing. You could also export directly to neighboring markets in East Asia & ASEAN, and consider marketing your products locally to Vietnamese owners.
Also, consider Vietnam’s abundant agricultural products as ingredients for pet food production. In this competitive industry, there is a continuous search for alternative and exotic ingredients for new pet products, demanded by discerning pet owners.
Vietnam is a country that has abundant sources of proteins, grains, fruits and vegetables. The country is the second-largest rice exporter in the world and it produces a large variety of fruits, vegetables (especially green leafy and grassy type of vegetables, high in nutrition) and a myriad of seafood and fish.
If you are sourcing new ingredients for supplements, consider Vietnam as a superior source of “super foods” that are abundant in this region. For example, consider a fruit called ‘Gac’, found in Vietnam. The Gac fruit is reduced to a liquid (oil) and mixed with other foods, or made into supplements. Gac is a powerhouse of anti-oxidants, very large amounts of Vitamin A, C, D and E and Omega 3, 6 and 9! Pet supplements can be developed or used as an ingredient in pet foods.
In summary, the following list includes a wide range of non-food pet (dog and cat) products that could be considered to be manufactured and assembled using fabric and the ‘cut and sew’ manufacturing process:
‘Cut and Sew’ Pet Apparel and Accessories Products
- All types of apparel for both dogs and cats including sweaters, coats, outdoor gear and protective wear, designer fashion clothing and accessories, shoes, and boots.
- Beds, Cushions, Rugs and Vet Bedding (Cat and Dog)
- Carriers for Dog and Cat
- Collars, Leashes, Harnesses and Muzzles
- Various Toys and Flossy Chew Toys
- Scratching Posts and Housing for Cats
6) In which segment, do you see the best potential for imported brands?
There is rising cat ownership in Vietnam and very few quality food products on the shelf at local retail stores or Vet Clinics for cats, especially wet canned food, so there is potential for Cat food products and nonfood products (not including cat litter, a product segment that is saturated in Vietnam). Also, very few premium dry or wet dog food products (non-grain, natural, etc.) sold nationally by authorized distributors in Vietnam. Veterinarian supplements have potential as dog and cat owners worry about the nutrition of their pets.
7) If you had one advice for companies willing to enter the Vietnamese market, what would it be ?
You must have a long-term business perspective and strategy for Vietnam. Never take anything for granted and it is highly likely that your business strategy that worked in other developed country’s pet markets may not work the way you want it in the emerging pet industry in Vietnam. You must adapt.
The first requirement is to begin to learn about pet ownership in Vietnam which is a relatively new concept. Besides most Vietnamese people do not have decades of consumer education and awareness especially in the selecting and purchasing of pet products and services.
Start at the beginning with the basics, educate your potential customers into why they should buy your products. Build trust over time, Vietnamese are loyal to tried and tested brands. Owners are demanding new types of pet products and services for their newly acknowledged ‘family members’.
- EuroMontior International
- TNS Consumers Pulse – Vietnam
- VietTRACK May 2011, FTA Research & Consultant
- PETS International Magazine
- Pet Business – The Most Trusted Name in the Industry
- Me Thu Cung Magazine – Vietnam
Wayne´s Linkedin profile :