Foreign Competition Shakes Up Vietnam’s E-Commerce Market - Vietnam Briefing News
Local players are scrambling to remain competitive as more and more foreign companies look to Vietnam as a strong growth market. Lazada has quickly become a major player in e-commerce throughout Asia; it has operations in Vietnam, Indonesia, Thailand, Singapore, the Philippines, Hong Kong and China.
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The company has seen strong growth ever since its entry into Vietnam in early and it now has a 22 percent market share.
Additional Lazada investors include Tesco, J. As part of its growth strategy, inLazada opened an e-commerce trading floor called Marketplace.
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Marketplace was created to give the company greater access to the C2C Customer-to-Customer market. Lazada is also planning to expand this online platform in order to allow for B2C Business-to-Customer transactions.
Due to the financial weight that foreign companies are able to bring to the local market, Vietnamese companies have struggled to compete with the likes of Lazada.
For example, both sites have been able to attract suppliers through such methods as not charging monthly fees and only charging fees on products. Internet penetration in the country is expected to rapidly increase — this will in-turn drive strong growth throughout the e-commerce market. As a result of this growth, it will become more and more crucial to create reliable and easy dealing centers website use payment systems.
Many Vietnamese do not have their own bank accounts. In74 percent of shoppers still paid for their purchases in cash.
- The growth of the garment industry has been impressive.
- The average ecommerce revenue per user is still relatively low, though.
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Payments made using bank accounts and those made via intermediate payments on e-commerce sites accounted for 41 percent and eight percent, respectively. An advantage for ChoDienTu lies in the fact that it has invested heavily in direct payment tools.
However, this advantage may not last for long as Lazada has announced that it intends to spend much more on its own payment tools. In fact, Lazada has apparently set up cooperation agreements with 25 Vietnamese banks and intends to formalize agreements with units that can provide card-based online payment services.
In addition, it has developed its own online payment tool, NganLuong. With a 27 percent market share, NganLuong has become the leading online payment portal in Vietnam.
Key among these are the lack of trust that many consumers feel about the products they order online — they prefer to physically touch and evaluate products before making a purchasing decision. Lazada is countering this sensibility through its launch, last year, of Lazada Trust Service.
This service allows customers to receive and evaluate the product before they buy. It also allows them to return the product within 30 days if they do not want to keep it.
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Lazada and ChoDientTu are not the only players competing for the Vietnamese e-commerce market; cryptomat buy notable companies include VatGia, Hotdeal, and Tiki. Vietnam Online Vietnam is quickly becoming a prime market for foreign investment in e-commerce activities.
Technology and home appliances also make up fairly sizable markets. According to the market analysis firm EuroMonitor, byinternet penetration in Vietnam will reach 43 million people — percent of the total population.
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