Illustrative image (Photo: ndh.vn) Hanoi (VNS/VNA) - Twelve large ecosystems will be established acrossretail and institutional services in Vietnam by 2025, constituting a revenuepool of about 2.4 trillion VND (100 billion USD).
The information was released in a recently published economic research paper byMcKinsey and Company. It points out how an ecosystem economy will transform Vietnam’seconomy in the years to come.
Ecosystem growth will be essentially driven by a significant decrease in thecost of customer acquisitions (CAC).
The information was released in a recently published economic research paper byMcKinsey and Company. It points out how an ecosystem economy will transform Vietnam’seconomy in the years to come.
Ecosystem growth will be essentially driven by a significant decrease in thecost of customer acquisitions (CAC).
Ecosystems enable automation on a largescale and integrate purchasing pathways, giving customers access to a varietyof products and services within a single platform. This consolidation ofchannels has the potential to reduce CAC. For example, in the bankingindustry, ecosystems can generate (CAC) savings of 10 to 20 percent.
Ecosystems enable companies to generate insights from a wide range of data andmake the most out of it. Leading companies from multiple sectors to add newservices to existing offerings, develop new business models, and even directlysell data-based products or utilities. For instance, companies with access todata will have greater visibility into customer preferences.
The report said one of the selling points of an ecosystem is that itfundamentally changes the way companies engage with customers and maintaincompetitiveness.
The trend is already happening. In 2019, three of the seven largest Vietnamesecompanies, Massan Group, Techcombank and VinGroup, established One Mount Groupto create the country’s greatest ecosystem. Instead of competing in thealready-crowded e-commerce space, One Mount Group’s newly formed venture, VinShop,captures value in the Business to Business to Consumer (B2B2C) market byaddressing inefficiencies in the supply chain. VinShop offers thousands oftraditional store owners a digital platform where they can order fast-movingconsumer goods from suppliers and vendors. The ecosystem then benefits from itsfounding companies' pre-existing assets and diverse industry presence,potentially enabling it to scale faster than digital natives.
Telecommunications player, Viettel, meanwhile, has started to developinstitutional ecosystems, serving public and private enterprises. With accessto large-enterprise customers and in-house engineering talent, the company isseeking to acquire new customers with its core products: IT software andbusiness solutions. At the same time, Viettel seeks to cross-sell new,currently noncore products such as security suites, cloud networks, and theInternet of Things. Various ventures into consumer-facing applications inpayments, loyalty, and logistics could give Viettel an additional way toleverage its large consumer base to broaden the scope of its Business toConsumer (B2C) offerings.
According to McKinsey’s research, today, the combined size of Vietnameseecosystems is about a hundredth of Chinese ecosystems (50 billion USD in Vietnamversus 4.9 trillion USD in China). Importantly, the landscape in Vietnamremains fragmented, illustrated by more than 30 e-wallets already in themarket, and yet it is still unclear who will emerge as the leading aggregatorin the country.
Embracing ecosystems will require companies to adjust their business strategy.Six principles can aid executives in this transition.
First, companies need to widen their perspective of competitors andopportunities, adopting a truly multisectoral lens and defining the ecosystemsand industries where change will be fastest. They should also identify criticalnew sources that bring the most meaningful value for an expanding consumer base.
In a borderless world, data serves as valuable currency. Competing effectivelyas an ecosystem means aggregating massive volumes of data and buildingcapabilities to store, process, and analyse that data to generate actionablebusiness insights. Companies can gain deeper data insights from ideas thatsound good on the surface but often fall short of their potential to becomewinning models.
Today, winning customers’ loyalty through an emotional connection is theultimate prize. Businesses are investing in tools to do so, such as data tocustomise their product and service offerings, content to engage customers, anddigital models to support seamless customer journeys and address pain points.By building emotional connections with customers, companies can also occupy anattractive space in critical ecosystems.
In Vietnam specifically, where top digital talent is in high demand, this meanscompanies across industries will increasingly need to spend resources torecruit, onboard, and train these talents, while also ensuring they are placedin an environment where they can perform and deliver.
An ecosystem economy offers new opportunities for specialisation. To takeadvantage of them, companies need more and diverse partners. In a dozen marketsacross the globe - including Brazil, Russia, Turkey, and Vietnam, where datasets are currently less robust compared with those of other regions - a newwave of partnerships is aiming to make the whole greater than the sum of itsparts.
Any business leader in Vietnam will soon need to define their ecosystemstrategy, understand how their industry is getting disrupted, and make achoice. They can defend the business as is, modernise and digitise it, partnerwith others to develop the same competitive advantage as an ecosystem, or join(or even build) an ecosystem./.
Ecosystems enable companies to generate insights from a wide range of data andmake the most out of it. Leading companies from multiple sectors to add newservices to existing offerings, develop new business models, and even directlysell data-based products or utilities. For instance, companies with access todata will have greater visibility into customer preferences.
The report said one of the selling points of an ecosystem is that itfundamentally changes the way companies engage with customers and maintaincompetitiveness.
The trend is already happening. In 2019, three of the seven largest Vietnamesecompanies, Massan Group, Techcombank and VinGroup, established One Mount Groupto create the country’s greatest ecosystem. Instead of competing in thealready-crowded e-commerce space, One Mount Group’s newly formed venture, VinShop,captures value in the Business to Business to Consumer (B2B2C) market byaddressing inefficiencies in the supply chain. VinShop offers thousands oftraditional store owners a digital platform where they can order fast-movingconsumer goods from suppliers and vendors. The ecosystem then benefits from itsfounding companies' pre-existing assets and diverse industry presence,potentially enabling it to scale faster than digital natives.
Telecommunications player, Viettel, meanwhile, has started to developinstitutional ecosystems, serving public and private enterprises. With accessto large-enterprise customers and in-house engineering talent, the company isseeking to acquire new customers with its core products: IT software andbusiness solutions. At the same time, Viettel seeks to cross-sell new,currently noncore products such as security suites, cloud networks, and theInternet of Things. Various ventures into consumer-facing applications inpayments, loyalty, and logistics could give Viettel an additional way toleverage its large consumer base to broaden the scope of its Business toConsumer (B2C) offerings.
According to McKinsey’s research, today, the combined size of Vietnameseecosystems is about a hundredth of Chinese ecosystems (50 billion USD in Vietnamversus 4.9 trillion USD in China). Importantly, the landscape in Vietnamremains fragmented, illustrated by more than 30 e-wallets already in themarket, and yet it is still unclear who will emerge as the leading aggregatorin the country.
Embracing ecosystems will require companies to adjust their business strategy.Six principles can aid executives in this transition.
First, companies need to widen their perspective of competitors andopportunities, adopting a truly multisectoral lens and defining the ecosystemsand industries where change will be fastest. They should also identify criticalnew sources that bring the most meaningful value for an expanding consumer base.
In a borderless world, data serves as valuable currency. Competing effectivelyas an ecosystem means aggregating massive volumes of data and buildingcapabilities to store, process, and analyse that data to generate actionablebusiness insights. Companies can gain deeper data insights from ideas thatsound good on the surface but often fall short of their potential to becomewinning models.
Today, winning customers’ loyalty through an emotional connection is theultimate prize. Businesses are investing in tools to do so, such as data tocustomise their product and service offerings, content to engage customers, anddigital models to support seamless customer journeys and address pain points.By building emotional connections with customers, companies can also occupy anattractive space in critical ecosystems.
In Vietnam specifically, where top digital talent is in high demand, this meanscompanies across industries will increasingly need to spend resources torecruit, onboard, and train these talents, while also ensuring they are placedin an environment where they can perform and deliver.
An ecosystem economy offers new opportunities for specialisation. To takeadvantage of them, companies need more and diverse partners. In a dozen marketsacross the globe - including Brazil, Russia, Turkey, and Vietnam, where datasets are currently less robust compared with those of other regions - a newwave of partnerships is aiming to make the whole greater than the sum of itsparts.
Any business leader in Vietnam will soon need to define their ecosystemstrategy, understand how their industry is getting disrupted, and make achoice. They can defend the business as is, modernise and digitise it, partnerwith others to develop the same competitive advantage as an ecosystem, or join(or even build) an ecosystem./.
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