Based on the aforementioned information, including financial reports of listed companies and reports from the Vietnam Beer – Alcohol – Beverage Association, several factors have collectively pointed to the negative impact on the 2023 revenue of the alcoholic beverage industry, including Decree No. 100/2019/ND-CP on administrative sanctions in the field of road and rail traffic, consumers cutting back on spending for alcoholic beverages, and higher rental prices affecting the on-trade channel.
Amidst these challenges, data collected and processed by YouNet ECI shows that the revenue of alcoholic beverages on e-commerce platforms still grew by 12% in the last 6 months of 2023 compared to the previous 6 months (although the first 6 months of 2023 saw the peak season of the industry due to the Lunar New Year).
In particular, alcoholic beverage companies operating on the platforms achieved a total revenue of VND 351 billion in 2023. Although this figure is still modest compared to the total market volume of beer, the important point is the 11% revenue growth in the second half of 2023 compared to the first half.
Growth rate of alcoholic beverage industry on E-commerce in the second half of 2023 vs. the first half of 2023 (YouNet ECI, 2023)
Especially, if Shopee platform alone is considered, the growth rate of the beer industry reached 154%: from only VND 34.9 billion in the first 6 months of the year, it jumped to VND 88.7 billion in the last 6 months of 2023.
Explaining this impressive growth, Mr. Nguyen Phuong Lam – Head of the E-commerce Market Analysis department at YouNet ECI, pointed out three main reasons.
Firstly, the effort to find compensatory growth channels for traditional channels of many beer brands in the last season of the year. These brands have intensified their promotion and marketing activities on e-commerce platforms, especially on Shopee Mall.
A notable example is Sabeco. Although this manufacturer only opened its Shopee Mall store in November 2023, thanks to a combination of intensive promotion and a strong brand, its revenue on e-commerce platforms increased by 9.5% in December 2023. Sabeco was among the top 5 best-selling beer brands on e-commerce platforms in 2023, and its Saigon Lager was also among the top 6 best-selling alcoholic beverages.
Sabeco is expected to shift its consumer channel from on-trade to off-trade, as it has a relatively stronger position in the off-trade channel. Although a small amount of beer was sold through these e-commerce platforms in 2023, the company hopes to achieve higher sales through this channel in 2024.
2023 revenue of top beer brands on E-commerce (right) compared to offline channels (left).
“Nowadays, consumers are concerned about the origin of products when shopping. They want to buy from official stores to avoid counterfeit or expired products. This is a signal for brands to boost their official stores on e-commerce platforms because the data shows that consumers trust these channels,” Mr. Nguyen Phuong Lam said.
The second reason is the large-scale promotions on the platforms and by individual brands, which are attracting consumers. YouNet ECI’s data shows that on average, during the Super Sale events on the platforms (10/10, 11/11, 12/12, etc.), the beer industry earned VND 8.1 billion per week – a 35% increase compared to normal weeks without events.
Thus, Super Sale events on the platforms are still a good stimulus factor for consumers, especially during the current period of frugality and reduced spending.
The third factor mentioned by Mr. Lam is the familiarity of Gen Z and Gen Y customers with e-commerce.
“For these groups, speed and convenience are essential. E-commerce has the ability to meet these demands with cashless payment methods and fast delivery,” he said.
“Furthermore, Gen Z is more likely to switch brands and will tend to change frequently. YouNet ECI’s data shows that there are more than 500 different beer and alcoholic beverage brands being sold on e-commerce platforms, while the average traditional supermarket only has about 60 brands. This means that the product range on e-commerce platforms is much more diverse,” he added.
Top best-selling beer and cider products on E-commerce platforms in 2023 (YouNet ECI, 2023).
