Korean food companies innovate to compete in Vietnam
Korean food chains are making a go of it in Vietnam — a foodie destination in its own right — by catering to younger customers with innovative spaces, high-quality products and a spin on services.
With CJ Foodville's bakeries and GS25 convenience stores designed like cafes and Jinro soju bars decorated with a Korean touch, Korean companies are finding ways to provide Vietnam with unique and interesting locations.
The Khan Hoi branch of Tous les Jours in Ho Chi Minh City has a wide parking lot with a capacity for 10 motorcycles and bicycles, the main modes of transportation in Vietnam. The store provides a complimentary valet parking service, a rarity in Vietnam.
“Normally customers park their vehicles by themselves and pay for a parking fee when they use parking lots at restaurants,” said a spokesperson for the Tous les Jours Khan Hoi branch.
“The free valet parking service became very popular in the country, and other major local restaurants are following the trend.”
All 37 Tous les Jours branches in Vietnam are more than bakeries. They are cafes with tables and seats for customers to spend some time at the store.
As date spots can be hard to find in Vietnam, the brand has advertised its stores as perfect for young couples, which has been successful in bringing in more customers.
GS25 branches are also cafe-like stores with unique facilities, such as the automatic ramyeon cooking machines. The company has highlighted not only its snacks but how it provides a clean space in which to enjoy them.
The strategy has proven successful as sales of Korean food companies have rapidly soared in Vietnam recently.
According to Orion, a confectionery maker, Orion Vietnam’s sales reached 102.5 billion won ($81.7 million won) in the first quarter of 2022, a 23.7 percent increase on year. Its operating profit was 18.6 billion won, an 18.6 percent increase on year.
CJ CheilJedang’s sales of kimchi have increased by 30 percent every year in Vietnam for the past three years.
Tous les Jours registered members reached 52,000 just after a month it was launched in April, according to CJ Foodville.
One of the biggest contributing factors to the rising popularity of Korean food in Vietnam is the country’s demographics. About half of the population in Vietnam is younger than 35, with one out of four people being under 15.
As such, Korean food brands have marketed their products and services targeting these young consumers who have been heavily influenced by the Korean wave through the rise of digital media showing them Korea's latest trends and media content.
Food products targeting the local consumer base also contributed to rising sales.
Hite Jinro has appealed to the local consumers by introducing fruit-flavored soju to Vietnam, catering to the local preference for sweet products due to the hot weather. The company introduced grapefruit, white grape, plum and strawberry flavors to Vietnam so far.
The beverage company opened a restaurant called Jinro BBQ in Hanoi in 2017, where customers order drinks produced by Hite Jinro and Korean food. The store's interior design was inspired by pojang macha food tents, the company said. Due to its popularity, three branches were opened in just three years.
Different-flavored potato chips have become popular with choices that cannot be found in Korea.
O’Star, a Vietnamese version of Orion’s Poca Chip, became No.1 in the Vietnamese potato chip market in 2017. Sales of O’Star recorded 31.8 billion won last year, with a 27 percent on-year sales increase in the first quarter of 2022. Orion’s Choco Pie also has the largest share in the Vietnamese snack market.
“The domestic food product market has already been saturated, so companies do not have any other option but to turn their eyes to the overseas market,” said an industry insider.
“The approach of studying the local culture and targeting the niche market has been working very well.”
BY CHOI HYUN-JOO [firstname.lastname@example.org]