December 8, 2014 8:10 pm JST
National online shopping day
Vietnam launched Online Black Friday to promote e-commerce market
Vietnam's first "Online Black Friday" offered free shipping and other promotions for shoppers on Dec. 5 only.
HO CHI MINH CITY -- Vietnam launched its first national online shopping day on Dec. 5, with more than 900 local businesses and shopping websites participating in the event.
"Online Black Friday" kicked off sales at 12:00 am on Dec. 5 and lasted for 24 hours. Various promotions, including free shipping on all orders, were offered in hopes of attracting consumers who have so far seen online shopping websites as unreliable.
The day was organized by Vietnam E-commerce and Information Technology Agency, or VECITA, to help local businesses and e-commerce websites tap into a potentially huge market. An estimated 44% of Vietnam's Internet users have never shopped online, according to a Google-backed online behavior study released in November.
"VECITA picked the first Friday of December for the program, and plans to make it an annual event to encourage the e-commerce market in Vietnam," said Tran Hung Linh, head of VECITA.
VnExpress, the country's leading online newspaper and a main sponsor of the campaign, reported that more than 6,400 orders, valued at 8 billion dong ($400,000), were made on the day. In the first 12 hours, 550,000 users accessed participating websites, and ads were clicked 3.5 million times. Also, 77% of users accessed the sites through PCs, while 19% used smartphones and tablets. Netizens in Ho Chi Minh City and Hanoi were the most active, accounting for 40% and 36% of users respectively.
However, the number of participants was far below the expected 10 million.
Waiting to take off
Vietnam is expected to become a promising market for new e-commerce players.
According to a Vietnam E-commerce 2013 report, the country's retail e-commerce trade reached $2.2 billion in 2013, with the average shopper spending $120. The total is expected to hit $4 billion in 2015.
Cosmetics, electronics, consumer goods and airline tickets were among the product most commonly purchased online. As for payment methods, 74% of buyers paid in cash, while 41% used bank transfers. Only 8% paid through e-commerce websites.
Online shopping is growing more popular in Vietnam, particularly among white-collar workers and busy housewives, because it is convenient. But major hurdles to its widespread adoption remain. These include the overall low quality of products, late deliveries, unfriendly exchange and refund policies, and a lack of protection for online buyers.
Many Vietnamese shoppers, burned once by local websites, have turned to foreign sellers, such as Amazon.com and eBay. Buying from a reliable Facebook fan page is another common option.
Shop where you know
Social networks were introduced in Vietnam five or six years ago and immediately took off. In October 2012, Facebook overtook local player ZingMe, which had 8 million users, as the biggest social network in Vietnam, with 8.5 million accounts. Less than a year later, that figure jumped to 19.6 million. According to Socialbakers, Vietnam ranked 15th among major countries in terms of number of Facebook users in 2013.
Having worked for one of first local e-commercial websites for years, a woman in her 30s living in Hanoi said she does 90% of her shopping online. She said she and her friends regularly trade goods on foreign sites, or on reliable private websites and Facebook pages.
"I had enough experience with local online shopping companies. They left products dust-covered until orders are placed, and delivered goods turned out to be poorer in quality than what was shown in websites' photos. There are neither recommendations nor ratings on products by previous buyers. There is little selection, and most items are made in China," she said.
For others, speed is the biggest factor. A man in Ho Chi Minh City complained that it took three days to receive a razor from an online shop, while it takes just 10 minutes to walk to a convenience store and buy one.
There are 91 delivery service providers in Vietnam, including three big names: Vietnam Post, DHL-VNPT Express and Viettel Post. However, the a government official acknowledged that the country's delivery services are not up to the requirements of the e-commerce market, as there is a lack of ports, transport means and a professional and dedicated labor force.
More comfortable offline
Online Black Friday was also aimed at improving Vietnamese shoppers' trust in online shopping's security. A third of consumers say they are concerned that their personal information might be compromised by shopping online. The Vietnam government has been upgrading regulations and guidelines to manage the e-commerce market, regulate online ads and curb fake and illegal items. It has also taken measures to protect online shoppers.
For the majority of Vietnam population, however, the Internet remains nothing more than a tool for comparing prices, colors and other aspects of goods before heading out to brick-and-mortar shops.
http://asia.nikkei.com/Business/Consumers/Vietnam-launched-Online-Black-Friday-to-promote-e-commerce-market
