Vietnamese cosmetic loses in local market

Statistically, turnover of  local cosmetic industry produces VND26 trillion a year; however, because lack of promotional strategies and innovation of products to meet with current market trends led to these cosmetic brands being overshadowed by aggressively marketed multinational brand names.
 

A customer is choosing cosmetics at a supermarket. (Photo: SGGP)

A customer is choosing cosmetics at a supermarket. (Photo: SGGP)

Lately, local cosmetic market has welcomed hundreds of internationally famous brand names which opened representative offices in Vietnam, distributors, agents, or built factories.
Unlikely Vietnamese cosmetic enterprises which struggled to find distributors, foreign cosmetic brand names are visible in commercial centers, supermarkets, convenience stores. Consumers have many choices when they want to have abroad cosmetic products such as Shiseido, L’Oreal, DeBon.
Experts said that abroad brand names increased market access to Vietnam by direct investment or franchise. Foreign-invested companies take advantage of incentives of free commercial trade agreement and policies to attract more investment in a bid to dominate the market.
Despite efforts to improve technology, Vietnamese small and medium cosmetic enterprises have not been able to catch up with their FDI counterparts. Accordingly, in the high-end segment, foreign companies have almost dominated the local market share while Vietnamese cosmetic products are for consumers in the low and average-income segment in countryside and exports to neighboring countries.
Vietnamese-made cosmetic Thorakao has strength in producing turmeric face-cream and cleanser extracted from herbs or Lana has the odds of make-up removers or skin tonic cream. Others local enterprises are quick to grasp consumers’ taste of natural cosmetics made from natural ingredients such as ginger, grapefruit or coconut oil, lemon, citronella, mint, and turmeric.
Saigon Cosmetic Company said that its products are distributed widely in the countryside and traditional markets with consumption of 500,000 perfume bottle yet till now, the brand name has not entered giant commercial centers. Not only Saigon Cosmetic Company but also Vietnamese brand names have not displayed their products in big centers.
According to Deputy Chairman of the Vietnam Essential Oils, Aromatherapy and Cosmetics Association Dr. Nguyen Van Minh, Vietnamese enterprises just concentrate on improving quality but not invest in eye-catching package which is a weakness. Some companies neglect advertising in local market because they considered exports is more important.

By VIET THU – Translated by UYEN PHUONG

Other news

Most view

Banking-finance

Economy

Self - introduction

Stock market

VN-Index rockets to near 926 points this morning

After increasing 13 points to exceed 900 points on the previous session, VN-Index continued raising 21.27 points this morning to hit 924.89 points with a slew of major stocks advancing in the HCMC Stock Exchange.