A post shared recently on Facebook kicked off the biggest scandal in the nearly 30 years of smooth operations at Khaisilk, Vietnam’s largest silk retailer. Its owner, a regular Facebook user, had said he never had trouble from social networks and saw their power in the technological age. 

His turnaround in fortune is a major lesson for other local entrepreneurs in being cautious about social networks, whether used for marketing or at a personal level. 

Khaisilk is a well-known, high-end brand in the domestic luxury goods segment, famed for its high-quality “Made in Vietnam” silk products since the 1990s. Owner Mr. Hoang Khai also invested and saw success in real estate, tourism, and food. 

Every morning he posted “Good morning” on his Facebook page before sharing stories or his philosophy on life, business, and ethics. He usually expressed appreciation of values in business such as passion, honesty, integrity, trust, and transparency, and criticized deception and greed. His shares usually received thousands of “Likes” and positive comments from his 130,000 followers. 

In an interview with local media, Mr. Khai had previously said that although he could be guilty of overstatement at times, people seemed to overlook it and he was confident that Facebook would never cause him problems. Just a few months later, however, he was proved wrong. 

A Facebook user posted photos of 60 scarves the user’s sister’s company had bought at a Khaisilk shop, which cost VND644,000 ($28) each, including one with two tags: “Khaisilk Made in Vietnam” and “Made in China”. An imported Chinese scarf costs about VND28,000 ($1.2), according to the General Department of Vietnam Customs. 

The shop manager explained that only 59 scarves were available to fill the order of 60, so staff had added a “Made in China” scarf. Other consumers then began to post on Facebook that they had found signs of one tag having being removed and replaced with a “Khaisilk Made in Vietnam” tag. Mr. Khai then admitted Khaisilk had sold Chinese products since the 1990s, when Vietnam’s silk sector was doing poorly and supplies were limited. 

While Mr. Khai was honest and straightforward, there was a price to pay. He closed both his private Facebook account and fanpage, possibly to avoid thousands of “Unlikes” and negative comments. After closing for a few days, all Khaisilk shops reopened to accept returns and refund customers. 

Effective channel

Vietnam has opened its doors to Silicon Valley during integration and globalization, including social media platforms such as Facebook, Google, and Twitter, of which Facebook is the most popular in the country.  

Vietnam ranks seventh among countries with the largest number of Facebook users, at around 64 million, or 3 per cent of all Facebook users, according to a July report from We Are Social, a social media marketing and advertising agency. 

Overall, the country has a 40 per cent active social media penetration rate. Ho Chi Minh City was among the Top 10 cities globally with the most Facebook users, at 14 million. More than half of Vietnam’s population of nearly 92 million have access to the internet, and people spend more than two hours each day on average on social media, according to the report.

Under the circumstances, Facebook has paved the way for many Vietnamese to open an online business and market their products and services. 

Like Ms. Thu Ha, a 28-year-old media content writer, who quit her job to open an online kid’s fashion shop. She pays nothing on shop rentals or marketing and earns much more than she did in her old job. 

“Before Facebook appeared, I never thought I would be involved in business,” she said. “I couldn’t afford to invest in anything. I thought I would work as an employee my whole life. But Facebook changed everything. I started my online shop with just $500.” 

Many businesses in the fashion sector begin at a small scale and social networks are their simplest and most inexpensive marketing tool, according to Ms. Nguyen Huong, Founder of Ferosh, the first online shopping store solely distributing local high-class clothing and accessories and which won First Prize at the Vietnam Future Startup Contest 2017. 

Moreover, fashion marketing focuses on form. “If you have a ‘good look’, interaction with others will be high,” she told VET. “Advertising and marketing fashion via Facebook is therefore very common.”  

Ms. Huong uses Facebook, Instagram, and Pinterest to update 40 per cent of the information in her private account for her business, such as the development and achievements of the company, upcoming fashion shows, and the sharing of ideas with designers or ideas about e-commerce and startups. 

Social networks are also used in many other sectors. Ms. Esther Delbreil, Online Marketing Executive at Luxury Travel, one of the leading tour operators in the country, has Linkedin and Facebook accounts and usually posts new travel experiences, services, and destinations as well as helpful tips along with personal updates. 

Through these platforms, she enriches her knowledge and supports the company’s partners and friends in the tourism industry as well as follows hotels, travel companies and travel news, to stay up to date on the latest tourism trends in Southeast Asia. 

Social media also helps her engage with customers, such as when she receives messages on Facebook from people interested in tours or with questions on destinations.

Luxury Travel also has Facebook and Twitter accounts to share their success, articles, the company’s travel philosophy and values, recommendations on new tours and activities, information and highlights on each destination, and topics popular among her followers. “We get to have more transparency and better communications between the company and different teams,” she told VET. 

With their strong development today, social networks have shown the role they play as an effective channel for enterprises to promote products and approach customers easily and quickly, particularly in a country like Vietnam and its 95 million people. 

The Vietnam e-Business Index 2017, released by the Vietnam E-Commerce Association (VECOM), revealed that social networks surpassed search engines as the most popular online advertising medium in 2016, as used by 47 per cent of businesses.

Another VECOM survey released this year also revealed that 67 per cent of consumers shop online on websites or mobile apps after checking reviews and comments on social media, which ranks ahead of introductions by friends and relatives (47 per cent) and advertisements on media (33 per cent).

Ms. Delbreil said that today you are trusted if you are on social media. If you can’t be found online, you will lose legitimacy and people will be distrustful. This allows consumers to have a closer relationship with what your company is providing. 

This is even more so in the tourism industry. People follow social media pages to be inspired by pictures of destinations and can dream a little while scrolling through their phones during their day.

Stronger consumer rights 

Different from other marketing tools, social networks not only support enterprises in their interactions with customers but also vice-versa, as customers can easily share their experiences about products and services. 

This increases the rights of consumers and promotes the development of user-generated content (UGC), which is a good means for enterprises to improve their product and service quality, according to Ms. Huong. 

The rights of consumers have developed for a long time in other countries. In the UK, a customer once posted about a bad experience they had with British Airways on Twitter, forcing the airline to review their services and issue an apology. UGC has a very strong impact on a brand, especially in the high-end segments, she added.

VN Economic Times