In order to keep up the pace with the world, the Vietnamese government has made efforts to boost the development and even set up a new institute to handle
As many have discussed in the past, Southeast Asia is a harsh, yet simple-entry region for e-commerce players to sustain. Harsh because of segmented geography and cultural issues, which possibly deter merchants from investing more. On the other hand, the reasons for the second point lies in the human nature— such as price sensitivity and better customer journey— we all share.
To our surprise, as soon as we published a series of content in a column on Facebook, it brought up several comments and engagements on the Internet. Netizen talked about it and thought the sorted contents are quite suitable to readers from different levels.
Some of them even mentioned the desire to know more about e-commerce in other countries. As a result, today we are moving on to the so-called Eastern France— Vietnam— to have an exploring trip, making you understand Vietnam thoroughly within the time you spend on bus public transit.
Fasten your seat belt and we’re ready to take off!
1. The restrictive and changing regulations and rules
As compared to other countries in Southeast Asia, it seems that the development of appropriate regulations is still in the pipeline to catch up the latest retailing trend in Vietnam. In order to keep up the pace with the world, the Vietnamese government has made efforts to boost the development and even set up a new institute to handle.
However, the ever-changing rules could be a stumbling rock if one doesn’t stick to the updated information carefully, Vietnam in particular. Notable examples were the case taking place in November 2014. It was reported that 17 local e-commerce websites in charge were fined for breaking the regulations. This incident, perhaps, was credited to the ruling party which belong to communism. While we see the downside of doing business in Vietnam, it is undeniable that Vietnam is one of the promising supernovas.
2. Lower rate in credit card use
Source : VIETA
According to a survey conducted by VIETA (Vietnam E-commerce and Information Technology Agency), one of the reasons why Vietnamese are not willing to make online purchase is “Not having credit card” which takes up 42 per cent. Other reasons, such as trustability, are already known by people.
Personally, I have made some inquiries about the customer habits to Viennese friends of mine. Unsurprisingly, what they spoke exactly corresponded with the result of the survey — it’s rare to see a credit card in one’s wallet. The reason for this is related to the rigorous censorship of the tiny plastic card. Hence, COD(Cash On Delivery) remains popular among people.
3. The limited access to western brands or product types
Source: Official website of Lazada
Even though there are numerous e-commerce marketplaces, they are unable to offer as many as people desire for. Because of the product shortage or the unavailability of desirable products, this become the power to push people to come up with ideas to satisfy their mental desire. Hence, people develop another way to solve the problem.
That said, people relies on individual retailers to get the product they want by ordering in China marketplace. This phenomenon partially unveils one of the problems why there doesn’t exist any dominant e-commerce players in Vietnam. Obviously, the recruitment of new sellers and flagships brands are the first priorities of those e-commerce players.
4. Websites and social networks triggers the most effective sales
Source : VIETA
From the surveys, again, one can clearly see the effectiveness of each main channel. Website performed the best of all, getting over 60 per cent of upwards of moderate satisfaction from selected e-commerce players. Moreover, the performance of social networks gained 56 per cent of trustable reaction in total. In comparison with other types of channels, it clearly indicates the the best choices in the eyes of existing merchant are website and social networks.
5. The best marketing budget should be directed to search engines
Source : VIETA
Among four types of advertisements, traffic of paid search is the most acceptable method for advertising, triggering almost 40 per cent of high “effectiveness”. This statistics, undoubtedly, is followed by the other figure, 28 per cent, of other type of advertisement, social network.
Other than the excellent performance we discussed, the effectiveness in advertisement of mobile apps is far from being adequate, indicating the future tendency in reduction of marketing budget implemented in to mobile apps. Therefore, based on the paid lessons learnt from of those merchants in Vietnam, one should keep this in mind and take it as one’s cornerstone.
In a nutshell, the advancement of e-commerce and Vietnam startups is as rapid as one is able to imagine. There was even a news media hail this country as a “future leader of startups spring ” because of a promising fintech teams receiving first round of funding that was estimated to be US$28 million.
Do all of these really point out that the Vietnamese startups and e-commerce is going to fly ? Well, it will not take a long time to be seen!
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