Naked ambition and street smarts make Laughing Cow the Big Cheese in Vietnam

Vietnam’s dairy market is worth over $5b and consumption is forecast to increase by 40% over the next five years. The cheese sub-segment is dominated by French multinational Groupe Bel with over 85% share.

Bel have played a long and patient game in Vietnam first entering the market 65 years ago. 

Bel’s hero product in Vietnam is Laughing Cow, “La Vache qui rit”. Undoubtedly one reason for its success has been local manufacturing (investments worth over $25m) producing formats with nutritional claims to meet local market needs and price points.

Laughing Cow Billboard in Ho Chi Minh, Vietnam

Another equally important driver has been Bel’s strategy of targeting low to middle income consumers. To reach this segment, Bel has built an innovative Route to Market programme called ‘Sharing Cities’ that focuses on street vendors selling vegetables and local favourites like Banh Mi (a baguette sandwich).

Laughing Cow Banh Mi Vendor in Vietnam

Bel has a network of over 2000 street vendors in Ho Chi Minh alone and this channel accounts for over 30% of turnover. Bel’s research has shown that the repeat sales rate and loyalty to street vendors is high; vendors typically enjoy a personal relationship with their customers, entrenching Bel ever deeper into the community.

Laughing Cow’s Sharing Cities Programme, Vietnam

Bel’s CEO Antoine Fievet openly states, “We are aiming to turn the Vietnamese market into Bel’s cradle in Asia!”

Outside of Japan, Vietnam is Bel’s only other Asian manufacturing facility. Bel’s two Vietnamese factories have an annual capacity in excess of 25,000 tons and supply the SE Asia region.

Many foreign brands focus on the modern trade for growth, even in less developed markets. Bel’s success shows the Modern Trade isn’t the only way to make hay. I’ve worked with another major beverage business in Vietnam who like Bel have made the traditional trade the lynchpin of their success.

To paraphrase the French saying, perhaps we can now understand, Pourquoi La Vache Qui Rit rit?

Thanks to my colleague John Cathcart who inspired this blog post and provided photographs.

If you have ambitions to grow your business internationally, check out the book or feel free to get in touch.

Will CEO-Musician play his winning ‘wow wow no cow’ number to enter the US market?

Hippy Swedish non dairy milk brand Oatly has shot up the beverage charts. Now its sales are well over $50million, quadruple 3 years ago. Capacity at its Malmo plant is doubling and a new factory is coming on stream on the US East coast this spring.

With a cult packaging design, and bohemian positioning that extols the benefits of switching from cow’s milk to save the planet, Oatly has a laser focused marketing strategy, targeting Baristas and coffee afficondos to win new converts. 

Oatly ‘billboard’ in Shoreditch, London

Oatly is led by Tony Petersson. Hired by the board who wanted a fresh perspective for a small staid business. Tony lacked the baggage of a typical food industry executive, and immediately instigated a revolutionary brand reboot, despite internal scepticism, and stuck with his conviction that the ‘oats are key to everything.’

Such is the strength of his convictions, Tony has taken to writing, composing and starring in his own Youtube commercials. 

Globally sales of non dairy milks are worth around $16billion. Whilst a relatively new phenomenon in the West where the dairy culture has traditionally held sway, they are perceived to be healthier, lower in sugar and calories yet full of calcium and other nutrients.

Although Oatly is privately held, boutique Strand equity partners is a major investor. Strand claim to invest in the ‘next generation of iconic consumer brands.’ It would seem their bet on Oatly and Tony is set to pay very handsome dividends. There is huge growth headroom for Oatly in category, channel and market expansion, not to forget Oat milks are amongst the most expensive in the non dairy segment.

Whether Oatly will be releasing an album of Tony the CEO’s greatest hits has not been disclosed…

Want to expand your business globally? Check out my book here