Nguyen Dang Quang, president of Masan, a consumer goods manufacturer, which holds 24% of the instant noodle market share, said the competition in the instant noodle market has become fierce and his company saw no growth in the sector in 2016.
Masan, which held 25% in 2015 and 24% in 2016, said that it does not try to compete in prices, but focuses on upgrading products to make them more convenient and have higher quality.
One of the products with ‘higher quality’ is the ‘instant noodle with real pieces of meat inside’ which has just been launched. It is VND1,000 higher per package.
Masan is not the pioneer in the ‘noodle with real meat’ movement. Vifon launched a series of products with real meat (pork, chicken and beef), including, instant noodle, rice vermicelli, noodle soup and gruel.
Acecook, which holds 50% of the instant noodle market in Vietnam, has also launched cup of noodles with real shrimp and meat, priced at around VND15,000.
Saigon Food is famous for gruel products with different flavors, priced at around 25,000 per 240gr package.
Analysts commented that the stiff competition in the market had prompted manufacturers to create new products which must be delicious, but also suitable to fast consumption.
On the shelves at supermarkets and convenience stores, instant noodle packages have been replaced with noodles in bowls or cups.
Acecook is targeting the mid-end and high-end market segments. In mid-2016, the manufacturer marketed cup of noodles with real meat and vegetables, retailing at VND8,000 per product, double the price of the packaged product of the brand.
A report from Asia Plus showed that U30 consumers tend to use more noodles in cups than U20 consumers, 63% vs 48%, while men use more cup of noodles than women, 52% vs 45%.
Phap Luat cited a report from the world’s instant noodle association as showing that Vietnam consumed 4.8 billion packs in 2015, while the figure was 5.2 billion packs in 2012.
There has been no official report about consumption in 2016, but some sources said sales decreased by 20%. The sharpest sales decrease was seen in the low-cost market segment, where the products sell less than VND2,500 per pack.
Consumers today have more choices for processed food compared to the past when it primarily was instant noodles.