E-COMMERCE IN VIETNAM - ANALYSIS
Country Report | Mar 2020

HEADLINES

Market Sizes

E-commerce sees 18% current value growth in 2019 to reach VND58.4 trillion

Sales of E-Commerce

Government seeking to create more favourable conditions for the development of
e-commerce through legislation

Retail Value RSP excl Sales Tax - VND billion - Current - 2005-2024

Mobile World JSC is the leading player in 2019, with a 22% value share

58.380

Forecast

200.000

E-commerce is forecast to see a 16% current value CAGR (11% at constant 2019
prices) over 2019-2024
150.000

PROSPECTS
Younger consumers form the core consumer base

100.000

Consumer electronics is the largest product category in e-commerce (apart from
“other”), supported by the fact that the young tech-savvy consumers who are the most
prominent online shoppers are also the most interested in new consumer electronics
products. Indeed, younger consumers often see personal electronics such as
smartphones and smartwatches as a way to express social status. Therefore, many
young urban consumers like to replace their electronics regularly in order to have the
latest products.
Younger consumers’ interest in fashion also contributes to the continued importance of
apparel and footwear to e-commerce. Digital channels, particularly social media, play
an important role in driving fashions amongst younger consumers, and it is a short step
for them to purchase fashionable apparel and footwear online. Moreover, consumers
can also compare prices between different online retailers in order to make the most
affordable purchases. Targeting this demand, many digital fashion players distribute
trendy clothing at low prices imported from neighbouring countries such as Thailand,
Cambodia and China.

50.000

0

2005

2019

2024

Sales Performance of E-Commerce
% Y-O-Y Retail Value RSP excl Sales Tax Growth 2005-2024


18.0%

Forecast

200%

Cash on delivery still popular, but electronic wallet services emerging
Cash on delivery (COD) remains one of the most common payment methods for online
businesses in Vietnam. COD allows consumers shopping online to inspect products
before making payment. Many consumers feel safer using this method, as online fraud
is still prevalent in Vietnam and many consumers are cautious about using financial
cards on e-commerce websites. Furthermore, COD also allows small businesses to set
up their shops quickly, as they do not have to invest in an online payment system.
The rise of third party electronic wallet services, such as Momo and Zalo Pay, is giving ecommerce players and consumers another choice of payment method. As these
companies focus on financial services, they are perceived to provide high levels of
security and trustworthiness. Therefore, many consumers are more willing to use their
bank accounts or financial cards through these third party services, rather than directly
on an e-commerce website. To raise awareness of these services, many retailers
collaborate with the service providers to launch promotions. For example, Tiki and Zalo
Pay give customers discounts and shopping vouchers.

New legislation may increase consumer confidence

150%

100%

50%


0%

2005

2019

2024

Sales of E-Commerce by Category
Retail Value RSP excl Sales Tax - VND billion - Current - 2019

The Vietnamese Government is making efforts to facilitate the development of ecommerce by strengthening legislation relating to internet security. In particular, the
new Law on Cybersecurity (Lu?t an ninh m?ng), which came into effect on 1 January
2019, aims to provide a more secure cyber-environment and greater control over the
contents posted on the cyber-network. The new law covers all IT infrastructure
networks, telecommunication, internet, computer systems, databases, information
processing, storage and controlling systems, and regulates activities of every enterprise
providing services in cyberspace and internet users, including e-commerce, as well as
websites, online forums, social networking and blogs. Such activity has the potential to
increase consumer confidence in e-commerce and accelerate growth in the channel.

Growth Performance

Mobile E-Commerce
27.438,5

Cross-border E-Commerce
58.379,7

E-Commerce by Product Category

58.379,7
0%

E-COMMERCE

58.379,7

CURRENT
YEAR %
GROWTH

40%
% CAGR
2014-2019

75%
% CAGR
2019-2024

COMPETITIVE LANDSCAPE
Mobile World JSC continues to grow share
Mobile World JSC retained the lead in e-commerce in 2019, as it maintained a trend of
value share growth that persisted throughout the review period. The company benefits

© Euromonitor Interna onal 2020

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from a focus on the distribution of consumer electronics and digital products, key

product areas in e-commerce. Mobile World JSC also utilises an excellent customer
database management system and many online-exclusive promotions. With a multichannel strategy, the company’s online business is supported by its extensive network
of outlets that are located in all provinces and cities of Vietnam, resulting in a localised
customer service experience and efficient delivery. Mobile World JSC places a strong
emphasis on customer service in both its stores and online. In addition, it spends
heavily on social media marketing to reach consumers and bring them directly to its
online shopping website.

Competitive Landscape
Company Shares of E-Commerce
% Share (NBO) - Retail Value RSP excl Sales Tax - 2019
Mobile World JSC

21.7%

3rd Party Merchants

13.0%

Tiki JSC

9.2%

Tiki JSC maintains strong growth

FPT Corp

5.3%

Tiki JSC remained the most dynamic player in e-commerce in the final year of the

review period. The company’s continuing efforts to strengthen its position in the
market include innovation to attract consumer attention, such as TikiSave and the
TikiNow subscription service, which generated considerable attention amongst
consumers in the country’s six major cities: Hanoi, Ho Chi Minh, Cantho, Haiphong,
Danang and Nhatrang. TikiNow targets professionals who have little time for shopping
and are willing to pay for additional services in order to increase speed and
convenience. Typically, the standard delivery time for online orders on tiki.vn and
other e-commerce sites in Vietnam is around three to five days. With an additional
service fee of VND499,000 per year, consumers in the six major cities have the option of
receiving their products within two hours, which confers a notable advantage on tiki.vn
compared with other sites in the midst of intense competition in e-commerce. Besides
rapid delivery, TikiNow also offers exclusive discount prices for certain products. Since
June 2019, TikiNow members have automatically been eligible for a new service,
TikiSave, which automatically provides a 10% discount on regular product orders such as
nappies/diapers, dairy products, and personal care products.

Nguyen Kim Trading JSC

2.0%

VinGroup JSC

1.7%

Recess Retail & Delivery...

0.8%

Pico JSC


0.7%

Others

45.6%

Shopee adopts different strategy to main rivals
Shopee entered the e-commerce market later than rivals, Tiki JSC and Lazada, and has,
therefore, employed a different strategy to establish its position in the market. The
company targets suburban and rural areas where there is less competition from Tiki JSC
and Lazada. In addition, Shopee constantly offers promotions and discounts to attract
consumers’ attention. It also looked to raise brand awareness by signing footballer,
Cristiano Ronaldo, as its regional brand ambassador.

Brand Shares of E-Commerce
% Share (LBN) - Retail Value RSP excl Sales Tax - 2019
Mobile world

21.7%

Tiki.vn

9.2%

3rd Party Merchants

7.5%

3rd Party Merchants


5.5%

FPT Shop

5.3%

Nguyenkim - Saigon Shopp...

2.0%

Vien Thong A

1.7%

Lazada

0.8%

Pico

0.7%

Others

45.6%
Increasing share

© Euromonitor Interna onal 2020

Decreasing share


No change

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