E-commerce platform races for market share

Many industries recorded impressive growth thanks to e-commerce. Source: Internet

Forestalling this trend, many advertising campaigns and heavy investments in technology are being deployed by e-commerce exchanges to win a bigger slice of this growing market.

Rapid growth

In recent years, e-commerce is emerging as a growth pillar for the digital economy of Southeast Asian countries, including Vietnam. For example, if in 2016, B2C e-commerce revenue reached US$5 billion, by 2019, the revenue was doubled, reaching more than US$10 billion, and it was US$11.8 billion in 2020 and US$13.7 billion in 2021.

Mrs. Ngo Thi Truc Anh, Director of Lazada Logistics Vietnam, said that the report "Changing shopping journey in Southeast Asia "From search demand to receiving experience" conducted by Lazada in September 2022 showed that 76% of Vietnamese consumers go shopping once a month on e-commerce, 83% of Vietnamese users have a habit of searching for products directly on e-commerce platforms, 50% orders on e-commerce in Vietnam are purchased without contemplation.

This shows that consumers' shopping habits have changed, and e-commerce platforms have shaped these habits, Mrs. Ngo Thi Truc Anh said. Accordingly, e-commerce exchange continues to be the foundation for businesses to approach consumers effectively.

Nguyen The Quang, Deputy Director of the Department of E-commerce and Digital Economy, also assessed that e-commerce was a platform to effectively forestall the trend of consumption and sustainable development, despite the difficulties of the global economy. In that shifting trend, businesses and brands have turned to e-commerce to expand their business models and grow. The last two years under the impact of Covid-19 have greatly affected the retail market. Without the development of e-commerce in the past, it may take longer for Vietnam to recover its economy after the Covid-19 pandemic. Specifically, according to Mr. Nguyen The Quang, the growth rate of FMCG industry on e-commerce is higher than that of other channels by five times. Fast-growing e-commerce is the driving force behind the growth of the FMCG industry.

Racing for market share

To meet the rapidly increasing demand of consumers, e-commerce platforms have quickly invested, applied new technology and implemented many campaigns to attract more users and expand market share. For example, Lazada has built integrated management and operation centres for sellers, conducting live sales on the platform to help sellers increase revenue; an advanced analytics system helps sellers track order status.

In terms of infrastructure, Lazada has proactively removed the cost and geographic barriers in forwarding by building a logistics network with four automated selection centres and 120 satellite sorting centres to help goods to be shipped to consumers as quickly as possible. To do this, businesses have invested in artificial intelligence technology in operation. At the same time, they are implementing green logistics initiatives to protect the environment, such as delivery by electric bicycles and electric motorbikes.

Mrs. Ngo Thi Truc Anh said that many brands had succeeded thanks to sustainable development. For example, FoodMap, since its listing on the e-commerce platform, this seller has always maintained a growth rate of 1.5 times per month; like Cocoon, on the e-commerce floor from May 2020, the annual growth rate is more than 3 times.

Similarly, starting from a mobile application, Grab has become a leading multi-service "super app" in Southeast Asia, providing essential daily services such as delivery, transportation, and services. Up to now, Grab has an ecosystem with millions of users in 48 provinces/cities, actively contributing to digital transformation, especially in the agricultural sector.

Mrs. Nguyen Thi My Hanh, Director of Grab Vietnam, said that since 2021, Grab has carried out many campaigns, typically the campaign to promote and support Bac Giang lychee consumption in 2021 with the purchase from cooperatives and delivered to users through driver partners. Or like the summer fruit festival in 2022, through promotional and communication activities and obtained impressive results such as more than 100 tons of specialty fruits consumed, more than 800 cooperatives have been trained and supported for digital transformation.

At the same time, to support people, Grab also implements many programs to join hands for Vietnamese agricultural products, such as supporting farmers to open online stores, strengthening the technological capacity of farmers, supporting the consumption of agricultural products by bringing agricultural products to the hands of users and contributing to the promotion of digital transformation. In addition, Grab cooperates with relevant agencies to equip farmers with e-commerce knowledge and skills, helping farmers to access users, increase sales, and help farmers gain access to consumers and support reducing mediators to help users access high-quality products.

Meanwhile, Beamin Vietnam has cooperated with online payment applications to facilitate customers in the payment process, attracting many young users who are "connoisseurs" in technology and willing to experience convenient methods. Mr. Jinwoo Song, General Director of Beamin Vietnam, said that before cooperating with online payment applications, up to 80% of Beamin's customers who buy food usually use cash. However, since this business combined with Momo or other online payment applications, this rate has decreased to only 30%.

However, Mr. Jinwoo Song also raised some challenges Beamin Vietnam encountered in the development process. Accordingly, this enterprise has successfully developed delivery robots in Korea. However, in Vietnam, one of the biggest concerns of enterprises when researching and developing this application is the legal framework to manage and operate in the market. "We hope to get approval from state management agencies to bring this application to the Vietnamese market soon. There should have a focal point to share about the application of technology in delivery development in Vietnam," Mr. Jinwoo Song said.