With strong growth in recent years, e-commerce is a potential business form that many enterprises and retailers focusing on.
Nowadays, e-commerce is no longer a new concept in society or a new field in our country. Especially in 2020, the Covid-19 pandemic has brought many fluctuations to the economy but contributed to the breakthrough growth of e-commerce.
Since then, Vietnam has become one of the most potential e-commerce markets in the ASEAN region.
E-commerce has been growing rapidly in recent years. Photo: Telecom
Explosive growth
According to a report by the Vietnam E-commerce Association (VECOM), the average growth rate of e-commerce in the period 2016-2019 is about 30%. The scale of e-commerce retailing consumer goods and services increased from 4 billion USD in 2015 to about 11.5 billion USD in 2019.
VECOM’s Vietnam E-commerce Index 2021 report also cited the Southeast Asia E-commerce 2020 report of Google, Temasek and Bain&Company, Vietnam e-commerce in 2020 increased by 16% and reached a scale of over 14 billion USD. In which, the field of online retailing of goods increased by 46%, ride-hailing and technology food increased by 34%, online marketing, entertainment and games increased by 18%, and only the online travel sector decreased by 28%.
This report also predicts an average growth rate of 29% in the period of 2020-2025 and by 2025, the scale of e-commerce in the country is set to USD 52 billion.
According to the E-commerce White Book 2020, in 2019, the number of Vietnamese people participating in online shopping has reached 44.8 million people (in 2015 it was 30.3 million people, in 2016 it was 32.7 million people, in 2017 it was 30.3 million people, 33.6 million and in 2018 39.9 million). Vietnam’s B2C e-commerce retail sales in 2019 reached 10.08 billion USD, accounting for 4.9% of the total retail sales of consumer goods and services nationwide.
Vietnam has an e-commerce growth rate in the TOP 3 in Southeast Asia. With the high growth rate of the economy, e-commerce makes a significant contribution to promoting the flow of goods and services, supporting businesses, especially small and medium enterprises, to seek business opportunities effective production processes in the context of deep integration and the spread of the 4th Industrial Revolution.
To reach the above figures, Vietnam has the strength of a young population as well as many smartphone users, and a large number of people transact e-commerce on smartphones.
Logistics has an important role in e-commerce development. Photo: Lazada Vietnam
In the growth of the e-commerce market over the past time, there has been a great contribution from the strong development of logistics services, last mile delivery and order fulfillment. Leading e-commerce platforms in Vietnam are having competition in shorten delivery time with various strategies to enhance customer experience.
According to Mr. Vu Duc Thinh – General Director of Lazada Vietnam, investment in logistics is not only for businesses but also for the future sustainable development of e-commerce. That’s why Lazada not only invests a lot in logistics but also for the long term.
Besides, the trend of online payment is also increasingly popular, with strong growth. This contributes to promoting the growth of e-commerce when the exchanges always provide online payment methods for customers.
In 2020, the Covid-19 epidemic has spreaded all over the world, causing people to restrict travel, many areas were blocked for a long time. Despite the disadvantages, this is an opportunity for e-commerce to “rise up” more than ever. People staying at home just need to pick up their smartphones to be able to shop and get the purchases.
Besides the benefits that e-commerce brings such as helping businesses expand markets, reduce costs, increase profits, and make quick payments, there are still many limitations.
The problem of counterfeit goods, contraband goods, goods infringing intellectual property rights on e-commerce trading platforms and social networks is still very much. In addition, e-commerce activities with foreign elements arise in many forms and disputes with partners in e-commerce. In particular, social networks are emerging as a popular but unregulated e-commerce transaction method, etc. The challenge of safety, network security and personal security in e-commerce transactions is also a problem that worth to worry about.
Violations in e-commerce are becoming more and more complicated, making consumers more concerned about buying and paying online. Therefore, e-commerce needs a comprehensive and synchronous legal framework in the current period.
Development trend of e-commerce in the next 10 years
The Facebook report at the end of June 2021 shows that shopping through e-commerce will become a new consumption trend instead of just a form of coping during the epidemic.
According to Facebook, it is Covid-19 that is the cause of users worldwide changing how, where and when they shop.
Like Facebook, many e-commerce experts predict that in the future, e-commerce will gradually dominate over traditional shopping methods. They believe that online shopping is not a temporary method to deal with the epidemic, but a new trend with many breakthrough improvements, bringing a more modern and smarter shopping experience to consumers; followed by the rise of cashless payments and logistics services, meeting the steady growth of e-commerce.
Leverage social media platforms and KOL
In a recent report, Facebook noted that more than half (51%) of consumers surveyed around the world choose to buy products that have been used by celebrities, bloggers, vloggers, influencers on social networks. associations (KOLs) recommend or share experiences.
The creativity and popularity and influence of KOLs have helped to attract more users, while helping to increase the prestige of the e-commerce platform and the brand.
In Vietnam, this form started three years ago with the pioneering of Lazada. Until now, many major e-commerce platforms have favored this new form of promotion, bringing bilateral benefits to both businesses and partner brands and sellers.
Digital payments evolve
Digital payment is a popular transaction method on e-commerce platforms. According to experts, the increasing access of customers to e-commerce will also promote the trend of cashless payment when shopping offline. Offline businesses are also aware of this trend and are increasingly friendly with digital payment solutions.
Logistics is more and more important
Logistics services are becoming more and more important as consumers expect more in terms of delivery quality. The significant increase in the demand for daily essential products and household appliances is a proof.
Therefore, enterprises and retail sellers need to effectively use technology to ensure goods are delivered quickly and economically. In order to support sellers and satisfy more consumers, major e-commerce platforms have been focusing on investing heavily in logistics.
The trend of livestreaming and playing mini games on e-commerce applications will continuously growth this year
Innovation in retail strategy
The pandemic has prompted businesses, from luxury brands to small businesses, to quickly implement a digital strategy to reach users amid social distancing.
As online sales become a larger revenue channel for brands and merchants, e-commerce platforms need to adapt and work with them to realize innovative retail strategies to attract customers.
According to iPrice Group, with this development momentum, e-commerce businesses will receive both opportunities and challenges as the platforms must constantly change to meet the needs of consumers.
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