Illustrative image (Source: thoibaonganhang.vn) HCM City (VNA) - The e-commerce market has takenoff in Vietnam thanks to booming internet usage and smartphone ownership, alongwith massive investments from key retail players, local media reported.
Vietnam is one of the world’s fastest growing e-commerce countries, accordingto Lai Viet Anh, Deputy Director of Vietnam E-commerce and InformationTechnology Agency (Vecita) under the Ministry of Industry and Trade. Thecountry’s e-commerce is growing 35 percent per year, 2.5 times faster thanJapan, he said.
The number of Vietnamese businesses capable of taking advantage of the internetand technology has grown 2.1 times faster than those with less use of theinternet.
Small- and medium-sized enterprises (SMEs) that spend more than 30 percent oftheir budget on technological innovation are growing nine times faster thanthose spending less than 10 percent of their budget.
Vietnam’s e-commerce retail sales growth in the 2016-20 period is estimated at20 percent per year, and the country’s total retail e-commerce sales isexpected to reach 10 billion USD by 2020, Anh said.
However, e-commerce has faced several barriers deterring its sustainabledevelopment, including low consumer trust in products and services, and worriesover online payment security.
In addition, most Vietnamese e-commerce websites provide only basic services,such as information about products and modes of payment. Services such asdigital marketing optimisation and connecting online with offline sales need tobe added.
Logistics is expected to be a game changer for the Vietnamese e-commerce marketin 2018 as new entrants are coming in, and existing operators are expanding toimprove their delivery services.
According to Kantar Worldpanel, a global expert in shoppers’ behaviour, thepercentage of e-commerce shoppers grew from 5.4 percent to 8.8 percent in thelargest four cities last year alone.
In light of this trend, many foreign logistics providers and e-commerceoperators are making efforts not to miss an opportunity to provide e-logisticsand meet the rapidly growing demand.
As e-commerce is growing at a robust pace, logistics providers have to come upwith new business models to deal with a soaring number of frequent and small-sizeorders. They are investing in technology and infrastructure to counter thechallenges from traffic congestion to failed deliveries, as well as the higherlogistical costs in rural areas.
These dynamics will fuel some of 2018’s most important trends includingcustomer collection points, designed for customers to receive an order from adesignated collection point. Such collection points allow customers to pick uptheir orders at any time, without being required to wait at home.
DHL eCommerce launched a nationwide network of service points in Vietnam lastNovember, with a plan to expand up to over 1,000 outlets by the end of nextyear. Similar to the concept of customer collection points, the firm uses theshop-in-shop model by opening DHL eCommerce counters in grocery stores,minimarts, and coffee shops.
Giao Hang Nhanh Company (GHN) also plans to extend its network of customercollection points in local shops, convenience stores and buildings. Thelast-mile delivery startup plans to reach 1,500 outlets by the end of 2018.
In the third quarter of 2017, Lazada launched its first automated sortingcentre in HCM City, with its second centre was opened in the first quarter of2018 in Hanoi. Lazada will also upgrade its existing sorting centre next year,tripling its sorting capacity.-VNA
VNA
