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Monday, 18 March 2019 04:46


Figures show that online shopping has already reached 60 per cent of the Vietnamese population in 2019 so far, dominated by only a handful of e-commerce websites and social media pages. Richard Burrage, CEO of market research firm Cimigo Vietnam, discusses the trends.

Cimigo recently interviewed 300 men and women from Hanoi and Ho Chi Minh City, aged between 18 and 55. Results showed that food and ­beverage purchases are still by far the most common online purchases, being made by shoppers every three days on average. This represents a huge ­cultural shift in Vietnam’s eating and dining habits.

In fact, taking all online food and beverage items into account, the figure rises to almost 20 purchases a month. This is remarkable, considering that food delivery companies only begun to gain traction in Vietnam around five years ago, when there was very little scope for online ordering of general food and drink items.

As Vietnam zooms ahead of the novelty stage of e-commerce, there is really nothing that cannot be ­purchased online and Vietnam’s online shoppers are taking full advantage of the choice available to them. On the back of the familiarity and security of ordering food online several times a month, consumers now have ­confidence and trust in the wider ­shopping services available to them online and via mobile devices.

Two key factors are driving this ­retail revolution. Firstly, as commonly reported, Vietnam’s economy is ­booming and we are in an era of young professionals having larger disposable incomes. Alongside this are the ­technological advances that not only give us the platforms to shop on but the means to access them, in the form of mobile devices.

However, most purchases are still low in value. Currently, almost half of the transactions have a value of under VND300,000 ($13), with less than 10 per cent of purchases being over VND2 million ($87).

Websites versus apps

Currently, Vietnam’s online market for general purchases is dominated by four companies – Lazada, Shopee, Tiki, and Sendo – who have each built huge online marketplaces supported by ­sophisticated web technology and apps.

In 2018, these four online retailers enjoyed significant uptake of their apps, but this area is still dominated by the big social media companies in the country, Facebook and Zalo. Around 80 to 90 per cent of online shoppers have these apps installed, giving them immediate access to ­shopping at the swipe of a finger.

Mobile apps for online retailers, unsurprisingly, don’t come close to these percentages but around 40 per cent of online shoppers across all ages have installed the Lazada and Shopee apps. In the case of Shopee, over half of shoppers aged 18-35 have ­downloaded its mobile app.

With apps becoming such a ­fundamental part of our lives, we have to believe that online retailers will look to these channels as a way of increasing market share in what will become an increasingly competitive arena.

From Cimigo’s research, ­Facebook is now commonly used for fashion, which accounts for almost two-thirds of purchases made through the portal. The social media giant ­enjoys an omnipresent position and the ease with which independent retailers can create fan pages and online stores. As a result, it is not surprising that younger, fashion-conscious shoppers are migrating to Facebook instead of the malls.

Online platforms are finding their niches as well. Lazada relies heavily on fashion sales but nearly a quarter of their sales are from electronics, including gadgets and accessories, making them the leading marketplace in this sector.

Meanwhile Shopee is also big on fashion, and they are the strongest marketplace when it comes to ­cosmetics and personal care items. However, if we want to look at an ­online company that has truly captured a market segment then that would be Tiki, whose books and stationery ­market share exceeds all other ­marketplaces combined.

With online shopping still in its ­infancy in Vietnam, these channels have the opportunity to both strengthen their areas of specialisation as well as gain sizeable growth in the smaller segments. Product lines that are maybe not eye-catching now could well provide significant revenue streams as more Vietnamese ­consumers shop online.

Lazada under crossfire

Last week was a difficult one for as the platform’s administrative oversight allowed the trading of dangerous toy guns. Several inspections have been conducted to clarify the origin of the goods, their distribution channels, as well as the identity of the sellers and buyers of the prohibited goods.

Several days ago, the Ho Chi Minh City Department of Industry and Trade visited the headquarters of Recess Co., Ltd., the operator of to stage an inspection related to the selling of these toy guns and components that could cause serious physical injury.

“We have asked this company to provide documents and data. When the investigation is finished, we will report to the Ho Chi Minh City People’s Committee,” said a representative of the department.

Meanwhile, the Department of E-commerce and Digital Economy, in collaboration with the General Department of Market Surveillance under the Ministry of Industry and Trade, are also considering looking into the severity of the violation.

Earlier, dozens (even hundreds) of toy guns and components were displayed on e-commerce websites like and These JinMing toy guns are 1:1 plastic replicas of M4A1 rifles produced in China and can shoot bullets made of plaster. The toy guns pack quite a punch as they can puncture beer cans at close range or break a plastic case – which means they are more than capable of causing bodily harm.

A question of loyalty

As online retail finds its feet, it is understandable that shopping ­platforms and online stores make ­massive investments in technology and marketing. Winning customers, and keeping them loyal, is key. ­However, in this period of early ­success for e-commerce in Vietnam it seems customers are responding more to convenience and pricing than ­customer service and brand loyalty.

Indeed, savvy Vietnamese ­consumers will put their purses and wallets ahead of brand loyalty; they understand the importance of ­comparing prices, and looking for ­bargains and promotions. With so much information available at the touch of a screen or click of a mouse, it is quick and easy to compare prices between products as well as brands. Online shopping allows for much ­easier browsing and comparison than the traditional brick-and-mortar ­shopping ­experience.

In Cimigo’s research around 30 per cent of shoppers rated their preferred channel or marketplace highly, leaving a very large chunk of business ­potentially lost. Online shopping ­platforms have an average net promoter score of only 19 in Vietnam. In the United States, the score is 45. The dynamics and technology of online shopping in Vietnam may be hugely different from traditional shopping but customer service and loyalty is not.

The fact is that no single ­e-commerce website has yet cracked it. With companies continuing to understand the very new market of Vietnam, ­diverse strengths and weaknesses are apparent, making it interesting to see whether they continue to play to their strengths or look to improve in weaker areas in order to build market share.

Feedback from online shoppers shows that customer service is the one area where e-commerce providers can make significant improvements. As with other online services, customer satisfaction is of course ultimately the key to success and should not be ­ignored for the sake of revenue.

The signs are that where there is a wide product selection, backed up with strong search and comparison ­functionality, shoppers are happy to stay with one marketplace and not hop around looking for better prices.


Thursday, 14 March 2019 03:38

The northern province of Quang Ninh is set on beginning construction of the Van Don-Mong Cai highway in the first quarter of this year. 

About 97 percent of the land clearance work has been completed, with the remaining 3 percent mostly in Mong Cai city, where local households are refusing to hand over their land. 
According to Vu Van Kinh, Chairman of the People’s Committee of Mong Cai city, the locality is taking steps to complete the clearance work.

The Van Don-Mong Cai highway will be constructed under the build-operate-transfer (BOT) and public-private partnership (PPP) contract at total cost of more than 11 trillion VND (474.4 million USD).

Quang Ninh People’s Committee has signed the contract with the joint venture of Long Van Infrastructure Investment and Development Co.,Ltd, Van Don Sun JSC and Cong Thanh Transportation and Construction Corporation.

The 80.2km-long highway will have four lanes and will run through the districts of Van Don, Tien Yen, Dam Ha and Hai Ha and Mong Cai city.

Construction is expected to be completed within 22 months. Fees will be collected for 20 years on the road.

Once the road is completed, it will connect with the Hai Phong-Ha Long and Ha Long-Van Don highways, creating the longest highway in Vietnam that runs from Lao Cai in the northern mountainous province of Lao Cai to Mong Cai via Hanoi and Hai Phong. The highway will serve as an important transport gateway linking Vietnam and China and countries in the Association of Southeast Asian Nations (ASEAN), helping boost cross-border trade and turn Quang Ninh into a trade and service hub.   

The Van Don-Mong Cai highway is also expected to facilitate access to Van Don international airport, which is slated to open in late December.  

To accelerate the project’s progress, Quang Ninh has made land clearance a sub-project, used the local budget to implement the work and assigned Van Don, Tien Yen, Dam Ha and Hai Ha districts and Mong Cai city to be investors of the sub-project. 

The province has also set up two working groups to remove difficulties facing the project and help the main investor implement legal procedures. 

The Ha Long-Hai Phong Expressway was put into service in September 2018, while the Ha Long-Van Don Expressway became operational in December the same year.-VNA

Tuesday, 12 March 2019 07:00

The Ministry of Transport has sent to the prime minister the prefeasibility study for the north-south high-speed railway project, which requires an estimated investment of US$58.71 billion.

According to the report signed by Minister Nguyen Van The, the railway, connecting Hanoi and HCMC, will run through 20 localities, covering 1,559 kilometers.

The 14-kilometer section in Hanoi will share the rails of the city’s urban railway line No. 1 (Hanoi station-Ngoc Hoi station), while along the 1,545-kilometer north-south track from Ngoc Hoi station to Thu Thiem station in HCMC are 24 stations, five depots, 42 maintenance centers, as well as three potential stations.

The north-south railway is designed to accommodate trains running at 320 kilometers per hour and will serve passenger trains.

The project’s first phase will require VND561.6 trillion (US$24.71 billion) in funding, and the estimated investment for phase two is some VND772.6 trillion (US$34 billion).

According to the ministry’s report, this is an important project for the country, and given its huge scale, the project needs approval of the National Assembly.

As planned, phase one, 2020-2032, will involve studying and building railways from Hanoi to Vinh and from Nha Trang to HCMC. Meanwhile, the section from Vinh to Nha Trang will be constructed in phase two, 2032-2050, with the Vinh-Danang railway scheduled for completion in 2040 and Danang-Nha Trang in 2050.

Regarding funding, it is proposed that State funds will make up some 80% and private sources 20%.

The report also mentions impact assessments for the economy and public debt.

With the possibility of using only local funding, the annual investment value will account for, at most, 0.7% of the gross domestic product in phase one and 0.55% in phase two. If the whole project uses loans, it will not push the public debt past the 65% ceiling.

The selection of technologies for the project will ensure consistency and convenience for future receptions and transfers.

At a speed of 320 kilometers per hour, rail travel between Hanoi and HCMC will take five hours 20 minutes, excluding stopovers at certain stations, and six hours 55 minutes if stopovers at all stations are included.

A State firm will be responsible for managing the railway infrastructure, and transport firms will be in charge of operating the railway.

For the project to gain the approval of the National Assembly at its next sitting late this year, the ministry has proposed the prime minister consider the early establishment of an evaluation council.

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