Is Vietnam The Next Asian Dot-Com Success Story?

Vietnam might have been a slightly late entrant in the online shopping niche but it seems that with an increasing consumer inclination towards online stores and group-buying sites, the nation is on the verge of an e-commerce boom.

More and more online entrepreneurs in Vietnam are endorsing the idea that the timing to tap into the growing online retail niche is just right. Consumer enthusiasm is pointing towards a forthcoming dot-com revolution which could create another Asian internet success story—the type that was witnessed in China with portals like Baidu.

Most e-merchant sites in Vietnam are seeing increasing volumes. Online shoppers have realized that rather than fighting their way through congested and trafficked streets of Vietnam, it is easier to shop from Vietnam’s indigenous clones of Groupon, i.e. sites like Muachung and NhomMua. These sites offer virtually everything that a homemaker or a sporting enthusiast would need, listing goods like cooking pots, facial kits and sports shoes. NhomMua has reasonable numbers to show with one million registered users. Many other clone sites have emerged, like VietnamWorks, a job portal that seems remarkably similar to Monster.com.

Consumer trends that surfaced during the online retail boom in the West are now emerging in Vietnam where many consumers say that they end-up buying goods that they don’t really need but find the discounts irresistible.

Vietnam has decent statistics to underline its potential for sustaining and maximizing online purchases with nearly one-third of its 88-million population online. Among these, a large portion is accounted for by urban dwellers that are most likely to shop.

However, there are some challenges for e-commerce entrepreneurs who need to understand that unlike the systematic and infrastructure-backed online segment of the US, group-buying needs to be simplified in Vietnam. For instance, with most Vietnamese lacking printers, vouchers need to be hand-couriered leading to additional costs.

Though online payment facilities like PayPal exist, many purchases need collection of cash payment. Add to this, a less-organized banking segment, government interference with social media and profit-sharing with middlemen, there is no lack of roadblocks to the rising crescendo of Vietnam’s e-commerce boom.

Source: SFGate