Vietnam’s mobile phone industry flourishes despite inflation: GfK

Research from GfK Vietnam shows that while people are cutting back on their personal spending, the mobile phone sector continues to thrive.

According to GfK, the combined sales of smart phones and feature phones expanded by healthy double-digits of 27 per cent in units and 21 per cent in value in the first seven months of the year.

While both segments registered positive growth, it was the smart phone category that propelled the industry’s good performance. Over 73 per cent more units of smart phones were sold this year over the same period last year, correspondingly boosting the value of the smart phone industry to hit nearly USD280 million, up 67 per cent from last year’s USD168 million.

Although the feature phone segment continued to expand, momentum has slowed down to 24 per cent in unit and 6 per cent value growth as compared to 34 per cent and 7 per cent the year before.

“Vietnam’s high inflation has reduced cautious consumers’ spending in many aspects, and we have observed declined sales across the other areas that GfK tracks, including IT, home appliances and consumer electronics,” commented Van Tran Khoa, general manager of GfK Vietnam.

The mobile phone sector has remained unaffected, and instead has continued to thrive, continued Van.

“Even as prices of basic living necessities such as food and fuel soared, the situation did not deter Vietnamese consumers from splurging on the latest phone technology. GfK findings reported the average price of a smart phone at USD330 - five times more than a feature phone which averaged around USD66. Overall, 1 in 10 mobile phones purchased in 2011 was a smart phone and its value share in the market has grown by 10 per cent to now occupy 34 per cent.”