Vietnam’s e-commerce industry is set for growth, but surviving this market has proven to be no easy feat
The e-commerce landscape in Vietnam has witnessed steady governmental commitment in recent years. In 2010, a five year e-commerce development master plan was approved with the goal of boosting the nation’s e-commerce capabilities.
Since its implementation in 2011, Vietnam has advanced from a stage of building, to gradually forming sustainable infrastructure today. As testimony to these efforts, the number of registered e-commerce platforms and websites in 2015 exceed 10,000, doubling numbers from 2014.
It was also reported that e-commerce sales reached US$4.07 billion last year, representing a 37% growth from 2014.
On top of governmental support, Vietnam’s climbing internet penetration rates have increased the appeal of entering e-commerce.
While the industry’s promising outlook has encouraged many to jump on the bandwagon, Vietnam’s e-commerce landscape has seen several headlining shutdowns recently.
Earlier this year, Rocket Internet’s Zalora announced its withdrawal from Vietnam following poor performance. Other recent shutdowns include Foodpanda, Project Lana and Beyeu.com to name a few. These failures seemingly juxtapose Vietnam’s booming e-commerce landscape and its inflow of investments.
While it’s definitely fair to state that every situation inevitably produces winners and losers, with exits on this scale, questioning the true feasibility of entering Vietnam’s e-commerce landscape becomes paramount.
So, how can such a juxtaposition be explained?
And how can Vietnam’s e-commerce entrants navigate through its challenging landscape?
For starters, a large proportion of Vietnam’s 90million citizens live in rural areas where e-commerce does not prevail. Secondly, e-commerce requires a lot of money, which can prove overwhelming and extremely draining on both new and existing players.
While Vietnam’s e-commerce industry has picked up significantly over the last five years, supporting services have failed to keep up with the growth pace. This is most evident through a lag in local adoption of an online payment system. A majority of the population still relies on cash as a means of payment, having yet to transition to become a ‘bankable’ nation.
As such, the success of e-commerce depends on the development of an array of supporting industries.
Dr George Lam on Vietnam’s e-commerce market:
Dr Lam is the Chairman of Hong Kong Cyberport Management Company Limited. Born and raised in Saigon, Vietnam, Dr Lam holds 30 years of international experience spanning across general management, strategy consulting, corporate governance, direct investment and investment banking – to name a few.
At nine years old, Dr Lam left for Hong Kong and subsequently pursued his first undergraduate degree in Canada at age 17.
Upon identifying the vast potentials of the emerging market in Vietnam, he took the initiative to actively support foreign businesses’ FinTech investments in Vietnam. Moreover, Dr Lam expects to see new reforms and more effective rules and regulations pushed by the local government to attract more foreign investors to come to this new land of opportunities.
This Echelon Vietnam, Dr Lam will share his views on Vietnam’s e-commerce industry. Drawing on the developments of other Southeast Asian e-commerce markets, Dr Lam will explore how Vietnam can learn and leverage on the experiences of regional and neighbouring markets.
Echelon Vietnam will also bring together an array of supporting industries vital for the success of e-commerce. Expect to meet the c-suite representatives from the likes of Grab Vietnam and The Disruptive Group. Learn how these supporting industries will assist and leverage on the development of Vietnam’s e-commerce landscape.
Grab your Echelon Vietnam 2016 tickets here!
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Echelon is headed to Vietnam this 18th and 19th of November in Ho Chi Minh City. Don’t miss out on the opportunity to gain first-hand access to all the action in Vietnam!
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