According to a report by the Department of E-Commerce and Digital Economy (Ministry of Industry and Trade), with 53% of the population go shopping online, the e-commerce market in Vietnam in 2020 will grow 18%, reaching 11.8 billion USD and accounting for 5.5% of the total retail sales of consumer goods and services nationwide.
Nielsen's research shows that, since the outbreak of the COVID-19 pandemic, the demand for shopping on e-commerce platforms has increased sharply. Last year, 70% of Vietnamese people had access to the Internet, and 53% of e-wallet users paid for online purchases, increasing by 28% compared to 2019. Also, 50.6% of the Vietnamese population has participated in online shopping activities. This proves that Vietnamese people are increasingly interested in using online services, from traveling, dining to entertainment.
In particular, in the two largest cities, Hanoi and Ho Chi Minh City, e-commerce activities grew strongly and accounted for 70% of the country's total e-commerce transactions.
Compared to other countries in Southeast Asia, Vietnam is in the top three countries with the highest growth rate of retail market share in the region. From 2015 up to now, the growth rates of the three largest Internet economies in Southeast Asia have averaged 35 - 36%. Indonesia ranked first with a growth rate of 41%, followed by Vietnam (36%) and the Philippines (30%). According to the "The Internet Economy of Southeast Asia" 2020 report by Google and Temasek, the Internet economy of Southeast Asia was estimated at USD 105 billion in 2020 and expected to reach USD 309 billion in 2025, becoming one of the regions with the fastest growth of online commerce in the world.
As seen from these reports, e-commerce has had an impressive year of growth and is forecasted to continue to flourish in 2021 and the following years. In the current digital economy era, e-commerce companies in Vietnam have many opportunities to develop.
Shopee has made three general predictions for the Vietnamese e-commerce market in 2021.
Firstly, digital payments will evolve. Digital payment is the preferred method of transactions on e-commerce platforms. According to Shopee, the total amount of orders paid via Airpay e-wallet across the region has quadrupled. Notably, the strongest growth customer group was users over the age of 50.
The increasing number of customers accessing e-commerce will also motivate the trend of cashless payments when they shop at stores. Offline business units are also aware of this trend and becoming more and more familiar with digital payment solutions.
Secondly, logistics services are increasingly important, as consumers expect very high delivery quality, shown by the increasing demand for essential products and home appliances. In Vietnam, goods related to food, health, and home appliances shipped from Shopee's warehouse have doubled.
Therefore, businesses and sellers need to use technology effectively to ensure that goods are delivered quickly at a reasonable cost. To support sellers and satisfy consumers, major e-commerce platforms have been heavily investing in logistics.
Thirdly, the retail strategy is innovated. Due to the pandemic, businesses from high-end brands to small businesses have quickly adopted a digital strategy to reach users in the context of social dislocations. Therefore, e-commerce businesses need to adapt to realize innovative retail strategies that attract customers, for example, live stream, mini-game, technology integration.
With this growth momentum, e-commerce companies in Vietnam will take opportunities and also challenges as they need to constantly adapt to meet the needs of consumers.
Compiled by VietnamCredit