Technology products remain ‘gold mine’ for retailers
Hi-tech products, which are frequently updated and offer new features, remain in high demand, generating big profits.
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| The mobile phone retail market in Q1 2016 |
The other 10% of the market share is being held by home appliance centers and online shops. Meanwhile, privately run small shops hold the remaining 20.2%.
This, according to analysts, means that the big companies still have opportunities to expand their market share by scrambling with small shops for the remaining 20% share.
Seeing big opportunities, retail chains have been trying to expand their networks at lightning speed in recent years.
FPT Shop’s expansion increased by 71% per annum in the last four years, while its revenue grew by 97% per annum. The Gioi Di Dong also saw its number of shops and revenue increasing by 40% and 50%, respectively, in the last four years.
Vinpro+, the new home appliance chain newly set up by Vingroup, has also been expanding with 100 shops set up just after one year of operation.
Spending on mobile phones equal to spending on beer or lottery
According to GfK, in 2015, the main engine of market growth, like in other previous years, came from mobile phones, the sales of which accounted for 40% of total revenue.
The revenue growth rate reported for mobile phones was 32% in 2015, from VND15.9 trillion to VND65.7 trillion, or $3 billion.
According to Huynh Phuoc Cuong from GfK, the Vietnamese spending on mobile phone has increased to the level equal to the spending on beer or lottery.
It is expected that by 2017, mobile phone revenue would reach VND82 trillion, which represents a 3-fold or 5-fold increase after five years.
Tablets would also see growth, but at a lower pace with the expected revenue of VND9.8 trillion by 2017.
Recovering economy boosts consumption
Analysts said they were confident about the continued growth of technology product sales because of the strong recovery of the national economy.
Meanwhile, Ericson Mobility Report showed that 40% of mobile subscribers used smartphones in 2015, while the figure would be 70% by 2018.
Nguyen Duc Tai, president of The Gioi Di Dong, denied that the technology product market is getting saturated.
“New inventions always stimulate consumers to spend money on new technology products,” Tai said.
