Innovation in Vietnam’s e-commerce industry this year will focus primarily on payments, logistics, and digital technology.
A delivery man on a street in Ho Chi Minh City. (Photo: Hai Dang)
In 2020, major online shopping platforms in Vietnam added games and livestream services.
Tran Tuan Anh, managing director at Shopee Vietnam, said during the time of social distancing, Vietnamese consumers began to switch to online platforms for both essential goods and entertainment purposes.
E-commerce applications, therefore, must integrate many interactive elements such as games and livestream to increase connections with users.
In 2021, Shopee predicts three main development trends in the e-commerce industry, including the development of digital payments, logistic services, and changing of selling methods.
As noted by Shopee, the total number of orders paid through Airpay e-wallet across Southeast Asia grew by four times. In particular, the strongest growth rate was for buyers over 50 years old, which demonstrates the easy accessibility of Airpay wallet.
As the government is moving towards a cashless society, epidemics have become a driving force behind this process in some areas where most consumer transactions are done in cash.
In addition to increasing wallet usage in online shopping, traditional stores are also accepting more payments via e-wallets. The number of stores in Vietnam using AirPay wallet payments doubled in 2020.
In the year 2021, Shopee said, consumers expect more efficient deliveries. Businesses and sellers need to use technology effectively to ensure that goods are delivered quickly and at cost savings. To do this, it is necessary to monitor the entire process from moderation to delivery, including improvement of logistics networks and warehouse capacity.
In 2020, many businesses transported goods from warehouses at a rate that was three times higher.
In Vietnam, goods related to food, health and home transported from Shopee's warehouse doubled last year.
Delivery is the key to many online shopping platforms so it is incorporated into Tiki's development strategy in 2021. Chief Financial Officer at Tiki Richard Trieu Pham said that Tiki has invested tens of millions of US dollars in technology and logistics systems each year, and will continue to increase in the future.
Technology and the end-to-end supply chain at Tiki help ensure the shortest order and delivery times at the lowest cost, thanks to the reduction of intermediary steps and optimization of the use of raw materials and identification of the fastest route.
In 2020, Tiki recorded a reduction of more than 25% in logistics costs per order and a return rate of less than 1%.
The Covid-19 pandemic has prompted businesses, from high-end brands to small businesses, to promote online businesses. This has led to the third trend where businesses and sellers have had to adopt an innovative digital strategy to reach customers in the context of social distancing.
For example, last year Shopee combined with Pond to integrate AI into shopping consulting and skin care consulting for customers.
According to the Department of E-Commerce and Digital Economy under the Ministry of Industry and Trade, Vietnam's e-commerce in 2020 increased by 18% - the highest level in the region.
Market size reached $11.8 billion, accounting for about 5.5% of total retail sales of consumer goods and services nationwide.
Vietnam was also the only country in Southeast Asia with double-digit e-commerce growth rate last year. Although the number of transactions increased over the same period, due to the epidemic, people mainly bought low-value goods, leading to a decrease in revenue.
The Vietnamese e-commerce market is forecast to continue to boom in 2021, with revenue surpassing last year's figure.
The B2C E-commerce Index 2020 of Vietnam has climbed one rank over the last year, remaining among the top 10 developing and transition economies in the region.