Players continue to come and go in Vietnam’s ecommerce

February 01, 2017 | 13:41
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As soon as and closed, and were launched. There is no lack of vibrancy in Vietnam's e-commerce arena.

Players keep popping up

In Vietnam today there are three popular e-commerce models: C2C (which connects customers to customers), B2C (business to customer) and Marketplace (which provides a platform to process transactions).

In the pure C2C model, similar to classified advertisements which connects the buyers and the sellers only in terms of information, remains the most prominent.

However, to Vietnam's e-commerce, buyer's trust and delivery have been the issues, and supplying information seems not enough. Many companies provide a platform with third-party services such as shipping or payment.

Among this group,, owned by tech giant FPT Group, is a prime example. Recently Zalo of VNG Corporation, a technology company, also ventured into this market. But the name that has received the most attention recently was Shopee, a company started by Singaporean tech company Garena.

After nearly two years in Vietnam, this company has been downloaded two million times on mobile and processed 10,000 orders per day. Customer base and volume of orders have been growing 20 per cent per month.

In the B2C group, after the departures of, and earlier, and while of property giant VinGroup has not made any breakthrough and remained an unknown, has continued to be the leader.

Founded in 2010 as an online bookstore, has expanded into other fields such as cosmetics and electronics.

According to Tran Ngoc Thai Son, chief executive officer of, book sales accounted for 70 per cent of the company's revenue in 2014, but that ratio is only 30 per cent today with the rest of revenue coming from other fields. Now, Tiki receives 15,000 to 20,000 orders per day.

Even though, the online shop of Big C supermarket which was acquired by Thailand's retail giant Central Group, was closed and merged with Zalora, the e-commerce space remains attractive to other retail companies.

Not long after Korea's Lotte Group entered Vietnam's e-commerce with the website, Japan's biggest retailer Aeon also arrived with at the beginning of the year.

Finally, in the Marketplace group, has seen no match with its 30 per cent market share (by revenue) in Vietnam's online retail market.

Fierce competition

The race will intensify in the coming months, because up to now no company has made a profit in e-commerce in Vietnam, so they will compete fiercely for larger market share. The prizes await the final winners of this race.

Alexandre Dardy, chief executive officer of Lazada Vietnam, said Lazada will focus on attracting more brands to do business on its website in 2017. Its goal is to attract 10,000 companies, triple the current number.

As for, the focus will be on sustainable growth. In 2017, will continue to invest heavily in fulfillment, a service in which sellers just need to send their products to Tiki's warehouses and let Tiki handle marketing and sales. Currently the company has two warehouses in Ho Chi Minh City and one in Hanoi, with total area of 10,000 square meters.

Meanwhile, although arriving late, traditional retail companies are always considered strong contenders. While focuses on cosmetics and fashion that are the strength of Korean brands, targets electronics and baby products carrying Japanese brands. Currently owns a chain of large modern retail stores from shopping centers to convenience stores.

In addition directly owning four shopping centers in Ho Chi Minh City and Hanoi, Aeon bought 30 per cent stake in Fivimart and 49 per cent share of Citimart in 2015, and now indirectly owns 18 Fivimart stores in Hanoi and 66 mini-shops in Ho Chi Minh City.

In essence, the race between purely e-commerce companies and traditional retail companies in Vietnam has not seen the clear winners, and purely e-commerce firms currently have an edge. However, with the determination of retail companies to expand online, the competition will be exciting to watch in 2017.

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