Vietnam's e-commerce sector becomes the fastest-growing market in East Asia
In the era of globalisation, e-commerce is rapidly becoming a popular shopping channel in Vietnam. However, the strong presence of international e-commerce giants, particularly from China, poses significant challenges for Vietnamese enterprises.
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| E-commerce is dominating markets across the globe. (Source: VNA) |
Domestic businesses are not only at risk of losing market share but also face stiff competition in terms of pricing, technology, and logistics.
The expansion of large Chinese platforms like Taobao, Tmall, Pinduoduo, and JD.com, with Vietnamese-language interfaces, signals their intent to dominate the market.
Recently, Vietnamese consumers have become increasingly familiar with Chinese retail platforms such as Taobao, 1688, and Temu, which support direct purchases.
Temu, for instance, offers attractive discounts, free shipping, and promotional codes for buyers across Vietnam, while 1688 has fully localised its transactions, making it easier for Vietnamese customers to shop without language barriers.
The localisation of these platforms gives Chinese companies a competitive edge, forcing Vietnamese businesses to contend with fierce international rivals.
Vietnam's e-commerce sector grew by 25% last year, making it the fastest-growing market in East Asia and one of the top 10 fastest-growing e-commerce markets globally. Currently, over 80% of internet users in the country shop online, and e-commerce continues to expand, attracting small and medium-sized enterprises, and individual businesses alike.
The Vietnam Industry and Trade Information Centre under the Ministry of Industry and Trade forecast that total e-commerce revenue from retail sales of goods could increase by 45% this year, reaching nearly 30 billion USD and accounting for about 14% of the country's total retail sales.
This robust growth has drawn not only domestic businesses but also international giants, especially from China. Experts believe that the increasing number of players in the e-commerce field will lead to positive competition, offering consumers more choices.
More diversity in options enhances the shopping experience and accelerates the development of Vietnam’s e-commerce market, experts said. Additionally, the presence of foreign platforms compels domestic businesses to innovate, improve product quality, and enhance services.
Phan Dang Tuat, Chairman of the Vietnam Association for Supporting Industries, expressed concern about the entry of Chinese retail giants, as reported by Dai Doan Ket Newspaper.
Meanwhile, Nguyen Van Vung, CEO of BigX, a service partner of TikTok Shop, remained optimistic, stating that the market still has significant growth potential.
“With more consumers using online shopping, and others gradually joining the trend, the e-commerce market pie will continue to expand,” Vung added.
One of the main advantages of Chinese platforms is their ability to offer competitive prices due to low production costs. This puts pressure on Vietnamese businesses to adjust their pricing strategies to avoid losing customers.
International platforms also have a technological advantage, applying innovations like AI, big data, and automated logistics systems. Without prompt digital transformation, Vietnamese companies may struggle to keep up, experts warn.
Moreover, while international businesses can easily expand globally due to their infrastructure and partner networks, Vietnamese companies often face challenges in scaling regionally or internationally due to limited resources.
Opportunities for ‘Made-in-Vietnam’ brands
Despite these challenges, there are significant opportunities for Vietnamese enterprises to leverage the global ecosystem and expand their market presence.
Pham Bao Trung, business director of Metric, suggested that domestic sellers should focus on optimising internal capacities and promoting local specialities to adapt and thrive.
“Consistency in product quality and proper brand-building can help local businesses survive and grow in the face of competition,” Trung added.
Nguyen Thanh Duong, Deputy Director of the Information Technology Application Centre under the Vietnam Trade Promotion Agency, said that global e-commerce platforms like Alibaba, Amazon, and eBay were opening doors for Vietnamese businesses to export their products.
Cross-border e-commerce is no longer a novel concept, and many Vietnamese businesses have successfully tapped into this channel, particularly in developed markets such as the US, Europe, and Japan.
Sustainable consumption trends are gaining traction globally, and products from Vietnam, including handicrafts, agricultural goods, and wooden products, are increasingly attracting international customers.
Building a strong ‘Made-in-Vietnam’ brand on e-commerce platforms will help enhance the value of Vietnamese products, creating a competitive edge over goods from other countries.
At the same time, competition with international platforms will drive Vietnamese businesses to accelerate their digital transformation efforts. Instead of viewing international platforms solely as competitors, local businesses can explore partnerships.
Many global platforms are looking for local suppliers to meet diverse consumer needs, offering Vietnamese companies access to global distribution networks and logistics systems to scale up rapidly.
The competition between domestic and international e-commerce businesses will undoubtedly intensify in the coming years. However, the opportunities for Vietnamese businesses to grow stronger are immense, particularly when they harness the power of global e-commerce channels.
Participating in global supply chains, building international brands, and adopting modern technologies will help Vietnamese businesses overcome challenges and integrate them into the global ecosystem.
