According to data from the Ministry of Industry and Trade, the total size of Vietnam’s retail market is over $140 billion, and is expected to increase to about $350 billion by 2025. Similarly, the e-gift market in Vietnam, including gift cards and in-kind gifts, is worth $3 billion per year.
|Retailers weigh up the perks of e-voucher models, illustration photo/ Source: freepik.com
However, e-vouchers only account for 4-5 per cent of the total, mainly coming from businesses using various services.
“Giving each other digitalised gifts contributes to making the prospects of a cashless society more interesting,” said Ngo Trung Linh, CEO of VietUnion, which is tapping into Vietnam’s mobile payment market with the Payoo platform.
Payoo provides a digital gift store that helps end users exchange e-vouchers to pay bills, buy scratch card codes, and pay when dining and shopping at more than 200 locations.
However, Linh admits that the growth data is still tiny because the model is still in the early stages of development here.
According to Le Truong Son, deputy general director of Saigon Co.op, e-vouchers are one of a series of digitalisation activities launched by this enterprise last year. Two months ago, Saigon Co.op teamed up with a domestic solution provider to issue e-vouchers to all individual customers when shopping at the brand’s retail systems.
“The partnership can help us connect with millions of customers who are using e-vouchers, thereby digitalising the gift experience, contributing to diversifying promotions, and increasing the shopping experience for customers in our retail system,” Son said.
Saigon Co.op is the oldest retailer in Vietnam and currently owns more than 500 Co.op Food stores and more than 50 active supermarkets.
Meanwhile, Thailand’s MM Mega Market has also started accepting e-voucher payments at its system of more than 20 supermarkets.
Bruno Jousselin, managing director of MM Mega Market Vietnam, said that for many years, the company has been looking for sustainable and environmentally friendly solutions to replace traditional paper vouchers, and e-vouchers are deemed an excellent choice.
“After integrating to the supermarket’s MCard shopping application, e-vouchers will benefit both the supermarket and the solution provider,” Jousselin said.
“The diverse gift store from the supplier will create a motivation to stimulate shopping demand and accumulate points for MCard App members, thereby keeping customers for longer,” he said.
Conversely, the e-voucher solution provider will also expand its gift portfolio, meeting the needs of corporate customers and increasing brand recognition with consumers at MM Mega Market system.
However, a representative of one retail business shared with VIR that although they have received many cooperation proposals from e-voucher solution providers, they still have not accepted any offers yet because they have not seen many benefits.
“We carefully calculated the liquidity of the e-vouchers at the supermarket and discussed it twice with our partners, but we couldn’t reach an agreement, so we had to postpone any changes,” the representative shared.
Bui Hoai Nam, founder and CEO of digital rewards startup UrBox which has recently launched strategic partnership with Saigon Co.op & MM Mega Market, explained that e-vouchers are at early stage of growth in Vietnam and businesses should not consider it as a counterweight; on the contrary, e-vouchers can complement other electronic payment methods to boost their end-users’ transaction performance.
“The giving of electronic gifts in Vietnam is also quite new compared to traditional gifts. Most customers are not actively acquiring e-vouchers, but through gift programmes or corporate loyalty programmes. A few actively buy e-vouchers to use but want to get a deep discount. This is something that is not very healthy in the long run so not all e-voucher providers have the strategy or resources to meet," Nam said.
With eight years of experience in e-voucher development, Nam admits that it takes more time for businesses in the market to get used to the application of e-vouchers in gift programmes for loyal customers.
“However, with the ongoing 4.0 Revolution and green – sustainable lifestyle, e-voucher adoption is gaining traction faster than ever before. The application of e-vouchers when compared with traditional gifting helps retailers reduce logistics - operation costs and provides them with important customer data and information, helping them better understand the tastes and shopping behaviour of customers, thereby creating an effective business and customer care strategy.” Nam said.
UrBox saw a growth rate of 100 per cent last year in terms of e-vouchers sales and number of accepted merchants. The startup also received investment from VinaCapital Ventures in 2019, and more recently, a pre-series A funding of $2.2 million from Pavilion Capital and Touchstone Partners.
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