The miracle journey of G7
Trung Nguyen talk growth in the soluble coffee market.
Over the past few decades, global experts have questioned the future of instant coffee, predicting a decline in market share.
However, recent statistics have shown that instant coffee is rising rapidly, growing at an average rate of about 29 per cent per year.
Since Vietnam’s emergence as a major coffee producer on the world stage in the 1990s, the fortunes of one small, gourmet instant coffee label, G7, have reflected those of the Vietnamese coffee industry itself, making an impact across the world and extending its market share in important markets on the global stage, such as China, the US and Japan.
The impressive breakthrough of G7
The World Coffee Organization says growth of soluble coffee production worldwide increased by between 8 to 10 per cent since the emergence of Vietnam as a major producer.
In that time, Vietnam’s industry has grown at an annual rate of 12 to 15 per cent, a great feat achieved through a series of both domestic and foreign enterprises boldly aimed at increasing and owning a slice of the lucrative market.
Within the Vietnamese market, which is itself fiercely competitive, G7 has fought hard against global giants and local challengers to capture significant market share, achieving a growth rate of 29 per cent across the country. G7’s success has been particularly strong in the northern part of the country, which accounts for 80 per cent of its total sales and achieved growth of 200 per cent over the past year.
In November 2014, G7 became Vietnam’s first coffee brand to export its product to the lucrative Dubai market. It achieved this in cooperation with Global Hotels Management Corporation (GHM), a world-leading food and beverage company with a strong reputation for superior, luxurious service in the Middle East.
Thanks to the strength and success of this partnership, G7 has been able to fly the flag for the superior quality of Vietnamese coffee and increase the market share of Vietnam’s coffee exports to the world.
After proving that it could meet the strict quality standards imposed by the world’s largest retailer, Walmart, G7 made its first sale to the US-based supermarket giant in April 2015. This has led to a strong growth in the awareness of Vietnam’s capabilities, with members of the G7 coffee team being the only representatives from South-East Asia invited to the Walmart Suppliers Conference in March 2015.
This is a clear signal of the strength of the growing relationship between Walmart and Trung Nguyen, with the retailer now looking to introduce G7 products into its supermarkets around the globe.
For some years now, the G7 coffee brand has been a favourite in the Chinese market, which is the company’s largest export market.
The construction of G7’s factory, which is also the largest instant coffee facility in Asia, close to the Chinese market in Bac Giang in early 2012 was a groundbreaking step for the company.
G7 has set itself the ambitious goal of capturing at least US$2 per year from every citizen in China by 2020.
China has been the major growth story for coffee consumption over the past decade.
With an average coffee consumption of two cups per person, per year, China is already the fourth largest market globally for ready-to-drink coffee.
As of 2017, the ready-to-drink coffee market in China is forecast to grow by 129 per cent.
Add this to the other markets in Asia, such as Japan and Hong Kong where G7’s products are already loved and trusted, and the extent of our ambition in the Asian region becomes clear.
In order to cater to this growing international demand, Trung Nguyen has now established a factory specialising in manufacturing G7 instant coffee in Malaysia.
The spirit of David vs Goliath
In its struggle for market share in instant coffee, G7 coffee has adopted the attitude of David taking on Goliath.
Starting almost completely from scratch – no plants, no experience, no distribution system – G7 has taken very little time to overcome its global rivals and win over customers.
By 2011, G7 had spectacularly soared in popularity to capture the most market share in Vietnam three years in a row. In particular, G7 completely conquered the northern market, where people view the brand as one of their own and have absolute trust in G7’s pledge to authentically represent Vietnamese coffee on the international stage.
Unbound by convention, and facing an uphill battle against entrenched competition, G7 has captured the hearts and minds of consumers. Such has been its impact, that the ASEAN Brand Book has presented G7 as a case study of success, and G7 is also used as an example for the best practice in business courses all over Asia.
G7’s official events and presence in the market are testament to the dedication of Trung Nguyen’s team of research and production experts. This team dedicate their lives to coffee, coupled with a commitment to excellent customer service.
With great strength of spirit and a commitment to quality and customer satisfaction, the G7 team copes with any challenges that come its way and have overcome all difficulties.
G7’s trusted brand identity means that the Vietnamese public is proud to use a product that represents the Vietnamese national spirit on the international stage, demonstrating a commitment to quality, hard work and creativity.
From this success, the people of Vietnam – one of the world’s leading coffee exporters – speak with pride of the homegrown David that defeated the global Goliath with more than 100 years of powerful global influence, Nescafé, on its home turf.
Serving as an inspiration for many other brands in Vietnam who share these aspirations and ambitions to go global, G7 is also continuously launching many pioneering products such as herbal coffee, and Italian-style cappuccino coffee.
Always taking the lead in the game, daring to try new things with blue-sky thinking and creative action to build success, G7 is widely loved in Vietnam, especially with the young generation of consumers.
Dynamic, confident and creative, the new generation are people driven by dreams of self-made entrepreneurship, establishing their position in life and love through the pursuit of adventure and mesmerising experience, are highly innovative, and passionate about the challenges ahead.
By capturing this spirit, G7 will continue to conquer consumers in more than 60 countries as a choice for a new generation of the world’s coffee.
The success of the brand will continue to symbolise the success of Vietnam’s world-leading coffee industry, continuing its achievements in overcoming the odds to rise to a position of global prominence.
Through this process, we will continue to participate in the whole value-added chain of the global coffee sector, pursuing the general aim of Trung Nguyen and Vietnam to increase the total value of Vietnam’s coffee sector from US$3.6 billion to US$20 billion by 2030. GCR