Lazada develops e-commerce ecosystem

After four years of operations in Vietnam, what has been Lazada’s greatest achievement?

Our greatest achievement over the last four years has been the recognition from our industry peers and our consumers. Since our establishment in 2012, Lazada Vietnam has built up a strong and connected ecosystem of three elements – marketing, operations, and our commercial arm that has so far attracted 3,000 sellers providing 500,000 products across 13 different categories. Lazada has received many awards from the community, such as the best shopping online website in 2014, the Smarties Global Awards 2015, and among the top 10 representative e-commerce companies in 2015. We also have received the Vietnam Trusted Brand Award in 2014, and have been named among the Top 100 Best Places to Work in Vietnam over two consecutive years (2014-2015). These rankings and awards highlight our commitment to serving Vietnamese consumers, developing the Vietnamese e-commerce ecosystem, and growing our online shopping marketplace in Vietnam.

Looking forward, what is Lazada’s plan in Vietnam?

With a vision to 2020, Lazada will grow our marketplace along four main foci. In terms of assortment, we will co-operate with many quality national retail chains and local sellers, as well as increase our cross-border activity. In terms of brand engagement, Lazada is going to establish strategic partnerships with top brands to become their number one online channel, while supporting new brands to enter the market. In logistics, we will pursue more IT development and pilot creative ways to hand over products to end-customers. The last focus is customer trust. We will continue improving the refund/return process as well as improving the quality of our customer services.

Recently, it has been rumoured that Lazada Vietnam could be acquired by another company, Alibaba, because of the company’s unsatisfying business results. Would you care to comment on this?

As you said, it’s just a rumour. Lazada doesn’t comment on any rumour. We just really want to affirm our commitment to continue serving Vietnamese consumers, developing the Vietnamese e-commerce ecosystem, and further growing our online shopping marketplace in Vietnam. We are seeing a rapid adoption of e-commerce by Vietnamese consumers, and we are excited by the prospect. We have every intention of bringing the online shopping experience to the next level for all consumers, and continue developing the local e-commerce industry to its full potential.

Do you think it is more difficult to conduct e-commerce in Vietnam than in other countries?

I think that e-commerce in Vietnam is challenging but not overly difficult. Among the six countries in Lazada’s network, Vietnam is one of the most promising markets, with a high level of internet penetration and smartphone ownership. In Vietnam, Lazada is the only international brand among the top five retail websites with more than 1.5 million visits per day (Online Revolution Day). Compared to other countries - especially within ASEAN - there are three key differences when it comes to e-commerce in Vietnam. Payment methods in other countries are far more developed when it comes to online shopping purchases via credit cards, whereas in Vietnam, cash on delivery is the preferred method of payment. The average basket size in Vietnam is lower than in other ASEAN members, but this will change with time as consumers grow to trust online shopping and established brands such as Lazada. In terms of merchant capability, we have to educate and equip Vietnamese merchants to meet quality standards and customers’ varied demands. This is a challenge to work on, to make sure that customers receive adequate services from any merchants on the Lazada marketplace.

How is the ASEAN Economic Community going to affect e-commerce in Vietnam?

I think this is a great opportunity for Vietnam’s e-commerce market to grow even bigger. The community will help Vietnam increase its international trading. With that, consumers will have more choice, higher quality, and more competitive prices.

Facebook recently announced that it will add features to facilitate e-commerce through its site and app. Will this impact online marketplaces?

To me, Facebook is a successful social network. However, consider the entire e-commerce fulfillment process – you need a platform to display products, and then you need transportation and customer services. Above all, you need a control system to manage every step of the process. So Facebook at the moment only provides customers with the first step, which is selecting merchants and products. I don’t think Facebook can substitute for other established and formalised e-commerce sites.