According to iPrice Group and App Annie’s data for Android phone users, the total number of sessions on online shopping applications in Vietnam reached 12.7 billion in Q2, the highest ever and up 43 per cent compared to the Q1 2020.
This amazing growth rate is also higher than that of most other countries in the region.
Their data also shows that shopping activity in all of Southeast Asia (SEA) increased by 39 per cent quarter-over-quarter. In Singapore, it increased by 25 per cent while Indonesia is increased by 34 per cent.
In terms of specific numbers, Vietnam also ranks third in SEA in terms of the total sessions on shopping applications (Android phone), accounting for a whopping 19.5 per cent of the region’s market share. Vietnam ranks only behind Indonesia and Thailand, missing the second place by only 0.2 billion sessions.
This major development is not a big surprise for anyone who has been following Vietnamese e-commerce closely.
As with many of the e-commerce startups in SEA, online retailers in Vietnam have achieved phenomenal growth in recent years. According to the e-conomy Southeast Asia report 2019 by Google, Temasek, and Bain, the internet economy of Vietnam has reached a value of US$12 billion in 2019, with an annual growth rate of 38 per cent since 2015 and is expected to surge to US$43 billion by 2025.
Adsota’s 2019 report also put Vietnam among the top 15 countries in the world with the biggest number of smartphone users. With an adoption rate of 44.9 per cent, even higher than Indonesia’s 31.1 per cent, Vietnam is truly a mobile-first country and online shopping is not an exception.
Also Read: 3 trends that will drive Vietnam’s e-commerce sector in 2019
E-commerce spreading to mobile applications has been predicted for a long time. By the end of 2019, major e-commerce startups in the country have all started to apply their own new features aiming at mobile users: Tiki has TikiLive, Shopee has Shopee Feed, Sendo has SenLive, etcetera.
Majority of these features encourage users to interact more and stay longer with the shopping apps through entertaining activities such as video games, livestreaming, or flash sales, some of which might not even look like something you would expect from a shopping app.
Last year, for 11.11 campaign, Lazada Vietnam live streamed an entire concert on their app. This year, Sendo experimented with streaming online classes for students who had to stay at home for social distancing.
The sudden arrival of COVID-19 in early 2020 became of definitive turning point for Vietnam’s e-commerce to accelerate the process. With more people staying at home, and with the increasing demand for online entertainment, Q2 became the ideal condition for e-commerce startups to apply the features they have been testing.
And as data now shows, these efforts have been bringing in great successes.
Notably, at the same time, the total number of visits to the top 50 e-commerce websites in Vietnam decreased slightly by one per cent compared to Q1, according to SimilarWeb’s data.
In that context, the competition, unfortunately, seems to be overwhelmed by foreign businesses. According to iPrice Group and App Annie, the top 10 most used online shopping apps in Vietnam in Q2 were Shopee, Lazada, Tiki and Sendo, followed by a series of foreign apps.
Thegioididong is the only domestic app apart from Tiki and Sendo in the top 10.
Also Read: How Vietnam’s e-commerce firm Tiki manages to keep employee churn rate healthy
There are then certainly big opportunities for local startups to move in and truly take advantage of this jump in mobile shopping usage.
One such player is VinShop by Vietnam’s conglomerate Vingroup who launched their mobile app right this October. Aiming at traditional mom-and-pop retail stores, VinShop wants to connect manufacturers and shops through their app with a B2B2C model.
Expect to see more exciting movements from the m-commerce scene in Vietnam in the near future.
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