Vietnam is projected by Google to be the fastest-growing e-commerce market in Southeast Asia by 2025.
Along with that highly positive prediction comes a heated competition for the dominance of the market. With Lazada and Shopee’s deep pockets, there have been concerns for the future of local e-commerce players.
However, the latest numbers from iPrice Group’s Map of E-commerce show that local companies like Tiki and Sendo have all the reasons to believe in a bright future ahead.
A fierce competition
The biggest news happened last quarter for the e-commerce market is perhaps the closure of the online fashion merchant Robins.vn (formerly Zalora Vietnam).
Compared to Vuivui’s closure back in December, Robins.vn’s acquired even more attention and speculation. The reason is according to iPrice’s data, until Q4/2018, Robins.vn was still doing well, traffic-wise. They were the highest ranking among online fashion-only merchants in the country in terms of monthly website traffic. Moreover, the website also showed increase in traffic for the previous two quarters. But apparently that was not enough for them to keep the business going.
This abrupt end to Robins.vn’s online business once again emphasized the fierceness and unpredictability of the e-commerce competition in Vietnam. Before Robins.vn and Vuivui, there have been a string of local players failing to keep up with the competition, namely Beyeu.com, Deca.vn, Lingo.vn…
Positive progresses at the top
Put behind the bad news, this past quareter also marks several positive trends for the surviving local players, especially Tiki, Sendo, and Adayroi.
iPrice’s latest data shows that even though this past quarter includes the Tet Holiday period, which is usually a struggling time for e-commerce business in general, those three merchants still managed to maintain their good results traffic-wise from the previous quarters.
Website traffic of Tiki, Sendo, and Adayroi have grown exponentially since Q2/2018, Source: iPrice
Doing the best in this regard is Tiki. Similar to the previous Q4/2018, the website continued to achieve over 35 million visits per month on average for this quarter, which puts them solidly at the 2nd position nationally, higher than international competitor Lazada Vietnam and not too far away from the 1st-ranking Shopee. This result also means that Tiki’s web traffic has been growing at a rate of 23% per quarter on average since last year quarter 2.
These signs help confirm the upward direction that Tiki have been taking in recent time, ever since they acquired investment from JD at the beginning of 2018.
Aside from Tiki, the other notable local companies Sendo and Adayroi also have been showing encouraging signs. According to iPrice’s Map of E-commerce, the two companies both have an average traffic growth rate of over 16% per quarter for the past four quarters.
Not only that, in his latest interview with Tech in Asia, Sendo’s CEO Tran Hai Linh also confidently announced that his company was on track to achieve one billion USD in GMV (Gross Merchandise Volume) much earlier than the previously projected target of 2020.
Local players are fighting strong
In that same interview. Tran Hai Linh also asserted that: “[2019] will be an inflection point. The market will grow much faster, we will see sizable businesses [becoming] comparable to regional players [and] customers becoming more familiar with ecommerce.”
iPrice’s previous report for 2018 is completely in agreement with this prediction. In particular, iPrice showed that Sendo, Tiki, Thegioididong, three local e-commerce players from Vietnam did well enough in 2018 to be ranked among the 10 of Southeast Asia in terms of website traffic.
Tiki, Sendo, and Thegioididong among the top 10 most visited e-commerce websites in Southeast Asia in 2018, source: iPrice
This ranking on one hand helps prove the enormous interest in online shopping from Vietnamese consumers, and on the other hand shows that local players such as these three are totally capable of surviving the fierce competition against regional giants.
Talking about the chance of local one-market e-commerce players, Jeremy Chew – regional market analyst from iPrice, explained that a familiarity with the market and the consumers’ mindset is particularly important when it comes to e-commerce. And that is exactly the strength of local players who choose to focus on one single market like Tiki, Sendo, and the likes.
A proof for this comment can be found in their successful campaigns for Tet Holiday, a very important period for Vietnamese consumers. Sendo’s “Chợ Tết” campaign proved to be a success on social media when it gathered a strong wave of support from locals, which led to it being included in Buzzmetric’s top 10 most influential social campaigns last January. Not to be overtaken, Tiki’s video campaign in the same period was noted by Google themselves for its success.
iPrice Group is a meta-search website operating in seven countries across Southeast Asia namely in: HongKong, Malaysia Singapore, Indonesia, Thailand, Philippines, and Vietnam. On a regular basis, iPrice Group releases key insights on topics pertaining e-commerce, startups, and others. As such, iPrice concluded in their report that once the local e-commerce companies gain access to more funding, they have all the abilities to fight strong and win big in the e-commerce competition.