Today in the ever-expanding digitalized world, ordering food home through online services is extremely popular. As a matter of fact, the market for food delivery service is growing strong all over the world; Vietnam is not an exception. With the next great buying power coming from Millennials and Generation Zs (Gen Zs), food delivery services in Vietnam need to understand what these two generations need and want to capture their interest and loyalty.

Authors: My Nguyen and Marja Viljanen

Millennials and Gen Z as Consumers

According to Pew Research Center (2019) specified, Millennials are those who were born in 1981-1996 (23-37 of age as of 2019) and Generation Zs begins with those who were born starting from 1997 (22 of age as of 2019). In Vietnam, as of 2018, Millennials and Gen Zs accounts for 35% of the country’s population.

Millennials are and will have a major impact on the economy. Their spending is projected to amount at $1.4 trillion (=€1.2 trillion) in the US by 2020, accounting for 30% of retail sale. (Gapper 2018.). When marketing to Millennials, there are a few characteristics of this generation that brands and businesses need to be aware of. Millennials love having their opinions listened to, they want to have a part in creating the products with the brands. When Millennials shop, they utilize online platforms in every stage of the decision journey from searching online, making payment to signing up for membership card. Millennials don’t just acquire food, products, services or media silently; they share the experience with their friends through both offline and online means. Millennials value experience and seek adventure and newness. They are also driven by values, meaning that they integrate their beliefs when choosing products. Over 50% of US Millennials pick companies that support the causes they care about. (Solomon 2018.) It is extremely hard to gain Millennials’ loyalty but they make especially loyal customers, if they feel like they are treated right by the companies (Donnelly 2018).

The clean line that cut between Millennials and Gen Zs is that Gen Z never knows a world before digital access. This sets Gen Z’ expectation for brands to be as digital-savvy as they are, demanding even more seamless shopping experience with up-to-date technologies. Gen Z are more entrepreneurial than their predecessor generation. (Hodgson 2018). Gen Z love brands with a personality and fun brand voice. Ads for Gen Z are no longer a showcase of product, it must be something entertaining to attract Gen Zs’ attention and make an impact. (Watson 2018.) While Gen Z can be reached predominantly via social medias, forming connection with them takes a lot more work. Marketing messages must be tailored to specific social medias while maintaining the same message across platforms as each social media is used for different purposes by Gen Z. (Perlstein 2017.)

How food delivery services in Vietnam accommodate Millennials and Generation Z

As the food and beverage sector in Vietnam experience an exponential growth, the market share of food delivery service also expands. A survey was carried out to learn about the behaviors of Vietnamese Millennials and Gen Zs towards food delivery services (Nguyen 2019). Out of 134 respondents, 57% of Vietnamese Millennials and Gen Zs take to Google and social medias and 38% turn to friends and family members to decide which food delivery service to use. They don’t trust online advertisements as a valid information source. Instagram and Facebook are the most used social media by Vietnamese Millennials and Gen Zs.

When picking a food delivery service, there are a few elements that Millennials and Gen Zs value over others. Respondents were asked to rate a series of seven elements on the scale of one to five, with one being strongly disagree and five being strongly agree. Speed and quality of delivery is the most valued element when Millennials and Gen Z pick a food delivery service. In addition, high quantity of promotions, recommendations from friends and relative, and easy-to-use ordering system are also highly considered. (Nguyen 2019.)

As Millennials and Gen Zs in Vietnam trust recommendations from someone they know in real life, it will do food delivery services in Vietnam well to focus on deepening the bonds that they already have with existing customers. Word-of-mouth phenomenon will draw in new customers and earn their trust instantly. Food delivery services should concentrate on addressing the needs and wants for convenience and seamless online and offline experience of Millennials and Gen Zs to create instant connection with them. A little fun and characteristics to a social media post is what keep Millennials and Gen Zs interested. Shareable, valuable contents such as infographic, trendy memes are highly valued.  (Nguyen 2019.)

References

Dimock, M. 2019. Where Millennials end and Generation Z Begins. Pew Research Center. [cited 14 February 2019]. Available at: http://www.pewresearch.org/fact-tank/2019/01/17/where-Millennials-end-and-generation-z-begins/

Donnelly, C. 2018. Who are the millennial shoppers? And what do they really want? Accenture. [Cited 14 February 2019]. Available at: https://www.accenture.com/fi-en/insight-outlook-who-are-millennial-shoppers-what-do-they-really-want-retail

Gapper, J. 2018. How Millennials became the world’s most powerful consumers. Financial Times. [Cited 14 February 2019]. Available at: https://www.ft.com/content/194cd1c8-6583-11e8-a39d-4df188287fff

Hodgson, A. 2018. Generation Z: The Next Wave of Consumers. Euromonitor International. [Cited 14 February 2018]. Available at: https://blog.euromonitor.com/generation-z-next-wave-consumers/

Nguyen, M. 2019. How food delivery services in Vietnam accommodate millennials and generation Z. Bachelor’s Thesis. Lahti University of Applied Sciences, Business Administration. [Cited 14 February 2019]. Available at: http://urn.fi/URN:NBN:fi:amk-201902142351

Perlstein, J. 2017. Engaging Generation Z: Marketing to a New Brand of Consumer. AdWeek. [Cited 14 February 2019]. Available at: https://www.adweek.com/digital/josh-perlstein-response-media-guest-post-generation-z/

Solomon, M. 2018. For Small Business Week: All About Millennial Consumers And Millennial-Friendly Customer Experiences. Forbes. [Cited 14 February 2019]. Available at: https://www.forbes.com/sites/micahsolomon/2018/05/03/for-small-business-week-all-about-millennial-consumers-and-millennial-friendly-customer-experiences/#1409ef62f91a

Watson, H. 2018. How does gen Z actually use YouTube? The Center for Generational Kinetics. [Cited 14 February 2019]. Available at: https://genhq.com/how-does-gen-z-actually-use-youtube/

Authors

My Nguyen has studied Business and Administration at Faculty of Business and Hospitality Management at Lahti University of Applied Sciences and has graduated and received a BBA degree in February 2019.

Marja Viljanen works as a Senior Lecturer at the Faculty of Business and Hospitality Management, Lahti University of Applied Sciences.

Illustration: https://pxhere.com/en/photo/1459569 (CC0)

Published 27.3.2019

Reference to this publication

Nguyen, M. & Viljanen, M. 2019. Inside Food Delivery Services Market in Vietnam: Connecting and Understanding Generation Z and Millennials as Customers. LAMK Pro. [Cited and date of citation]. Available at: http://www.lamkpub.fi/2019/03/27/inside-food-delivery-services-market-in-vietnam/