VN E-Commerce Report 2014
VN E-Commerce Report 2014
VN E-Commerce Report 2014
2
d. Adoption of online payment function ................................................................................ 73
2. Website policies and support services ................................................................................... 74
a. Delivery policy .................................................................................................................. 74
b. Dispute settlement ............................................................................................................. 74
c. Advertising methods .......................................................................................................... 75
III. EXPENSE AND REVENUE OF E-COMMERCE SALE WEBSITE ............................ 77
1. Expense ................................................................................................................................. 77
2. Revenue ................................................................................................................................. 77
3
CHAPTER I
MANAGEMENT OF E-COMMERCE ACTIVITIES
4
I. LEGAL FRAMEWORK FOR E-COMMERCE APPLICATION IN VIETNAM
E-commerce is basically defined as the application of electronic means in business and
commerce. The subjects of e-commerce activities have to comply with the provisions on e-
commerce as well as the other relevant related to the investment, commercial, civil provisions…
On 26 November 2014, regarding the legal framework of business, the National Assembly of
Vietnam passed two new laws: Law No.67/2014/QH13 on Investment (Investment Law 2014)
and Law No.68/2014/QH13 on Enterprises (Enterprise Law 2014), both will take effect from 01
July 2015. Regarding the specialized provisions of e-commerce, on 05 December 2014, the
Ministry of Industry and Trade promulgated Circular No.47/2014/TT-BCT stipulating on the
management of e-commerce websites. 2014 has been a remarkable year for the appearance of
these two laws and Circular No.47/2014/TT-BCT with many changes on the legal framework of
e-commerce activities in Vietnam1.
1
Introduction of related legal documents are provided in part II of this report
5
Telecommunication
13/06/2011 Decree No. 43/2011/ND-CP detailing regulations on the IT
provision of online information and services on websites or e-
portals of State agencies
23/11/2011 Decree No. 106/2011/ND-CP amending and supplementing E-transactions
Decree No. 26/2007/ND-CP on Digital Signature and
Certification Authority services
5/10/2012 Decree No. 77/2012/ND-CP amending and supplementing E-transactions
Decree No. 90/2008/ND-CP on Anti-spam
22/11/2012 Decree No 101/2012/ND-CP on non-cash payment (supersedes IT Law
Decree No.64/2001/ND-CP on payment operations via the
payment service providers)
16/5/2013 Decree No. 52/2013/ND-CP on E-commerce E-transactions
15/7/2013 Decree No. 72/2013/ND-CP on management, provision and IT Law
use of Internet services and online information
08/11/2013 Decree No.154/2013/ND-CP stipulation on the concentrated IT Law
zones of information technology
13/11/2013 Decree No.170/2013/ND-CP amending, supplementing some E-transactions
articles of Decree No.26/2007/ND-CP dated 15 February 2007
of the Government detailing on implementation of Law on
Electronic Transactions on Digital signature and certification
services of digital signature services and Decree
No.106/2011/ND-CP dated 23 November 2011 of the
Government amending and supplementing some articles of
Decree No.26/2007/ND-CP dated 15 February 2007.
14/11/2013 Decree No. 181/2013/ND-CP detailing some articles of Law on Advertising Law
Advertising
Decree on handling administrative violations Over riding texts
7
publicizing information related to e-commerce websites)
8
II. INTRODUCTION OF NEW LEGAL DOCUMENTS CONCERNING TO E-
COMMERCE ACTIVITIES
1. The Investment Law and Enterprises Law 2014
The Enterprises Law 2014 has various key changes in the concepts compared to the Enterprises
Law 2005, reflecting the right of freedom of enterprises in the Constitution 2013 when
conducting business. According to the Constitution, the enterprises have the right and may do
what the law does not prohibit2.
1 The procedures for establishment of enterpries will be separated with others on the
investment projects, investment certificate and creating opportunities for enterprises to
join the market.
2 The provisions of providing the sector code when registering business will be
deregulated. It means the enterprises have the right to do business and actively select the
forms, the sectors as well as the geographic when conducting business and they may also
self-actively adjust the scale of sectors and businesses.
3 According to the development trends in the means of electronic transactions, the use of
seals are significant reformed in this law. The enterprises have the right to decide on the
form, the number and the content of their seals accordance with the law; at the same time,
the enterprises are obliged to inform their seal forms to the business registration agency to
publicize on the National portal of business registration. According to this law, not all the
business texts have to be sealed but only on those texts that prescribed by law or required
by the partners.
4 The provisions on the proportion of state holding in the state enterprises now changing
from 50% to 100% of the charter capital.
2
Quote of the Ministry of Justice Gazette on 03 December 2014 at the Portal of Justice
9
There are 07 chapters and 76 articles in the Investment Law 2014, a part thereof has several new
changes ensuring that the legal framework are wide-open and attractive to the investment,
contributing a transparent environment, ensuring the interests of the holders and creating the best
benefit for the social and economic development.
The standing concept in the Investment Law 2014 consist of provisions which related to the
principle of freedom of business, as enterprises will have the right to conduct freely business in
sectors which are not prohibited by law.
The Investment Law 2014 gathers and governs the list of conditional and prohibited business
sectors according to the methods of exclusion, which has contributed to innovate the basic
principles of application in recent law. According to this law, the investors have the right to
conduct business freely in any sectors not prohibited by law, which has changed from the
principal provisions of investors could only conducting business that accepted by law3.
Evaluation and
Sales e- E-commerce certification of
commerce services policy on personal
websites websites information
protection in e-
commerce
E-commerce websites
which have both forms
Trust evaluation
of operations: sales e- of e-commerce E-contract
commerce websites and websites certification
e-commerce services
websites
11
Figure 5: Allocating responsibility for management of specific websites
REGISTERING E-MARKETPLACES
12
Figure 7: Management of conducting conditional and restricted goods or services on e-
commerce websites
4
Responsibilities of the owners of e-commerce services websites are governed in Article 4 of the Circular
No.47/2014/TT-BCT
13
Figure 8: The type of intermediary payment services
LICENSING
Circular No.39/TT-NHNN clarifying the type of intermediary payment services and providing
specific provisions related to these services, including: the risk management, safety and security;
fiscal solvency; e-wallet activities. The intermediary service providers have to comply with the
provisions of the risk management, safety, security as follows:
90
60
13 13 14
15
2 Organizing marketing and promotion network for e-commerce 20,3% 1,3%
services in which each participants shall have to pay an initial
amount of money to buy services and receive commission, bonus
or other economic benefits from mobilizing others join the
network
3 Violation of information on e-commerce websites 7,2% 4,5%
In 2014, the complaints via the E-commerce Administration Portal reflected primarily on the
operation of e-commerce websites without any notification or registration to the Ministry of
Industry and Trade (87%). The rest of complaints (13%) were scattered related on providing
violated information (4.5 %) and selling counterfeit or prohibited goods (3.5%) on e-commerce
websites…
16
CHAPTER II
E-COMMERCE APPLICATION IN COMMUNITY
17
I. VIETNAM’S B2C MARKET SIZE IN COMPARISON WITH THE WORLD
1. United States
The Census Bureau of the Department of Ecommerce announced that the estimate of online retail
sales for the first 3 quarters of 2014 was 224.3 billion US dollars, and the total online retail sales
of 2014 could reach 305.5 billion dollars. In the third quarter of 2014, the online retail sale was
estimated to increase by 4% comparing to the second quarter, and up 16.2% comparing with the
same period last year. Online retail sales of this quarter accounted for 6.1% of the total retail
sales of US in the third quarter.
2. Korea
The regular Online Shopping Report by Statistics Korea in quarter 3 2014 announced that the
online transaction value increased 17.8% from the third quarter 2013, which recorded 11.4
thousand billion won (equivalent to US $ 10.5 billion)5. E-commerce sale accounted for 12.8%
of total sale, increased from 10.9% in quarter 3 2013.
Compared to the third quarter 2013, the share of online shopping for “Travel arrangement and
reservation services”, “Household goods, motor vehicle parts and accessories”, and “Home
electric appliances, electronic and telecommunication equipment” grew by 2.5%, 0.9%, and
0.5%, respectively. The share for “Food and beverages”, “Computer and computer-related
appliances”, “Agricultural and fishery products” experienced the slight decrease, but still among
the most popular group of commodity.
5
Converted at the exchange rate of $1 = Won 1088.33
18
Figure 14: B2C e-commerce sales in Korea of Q3 2014
10.6 20%
17,8%
10.4 18%
16,6%
16%
10.2 10,46
14,4% 14%
10 12%
9.8 9,72 10%
9,61
9.6 8%
6%
9.4
4%
9.2 2%
9 0%
Q1 Q2 Q3
Online retail sales ( billion USD) Growth rate comparing to same period last year
3. China
According to the report on China E-Commerce Market of eMarketer, online retail sales of this
country grew 63.9% over the previous year, with the expected sales of 217.39 billion. This
growing rate will still be kept until 2018.
According to the report, in 2014, online retail sales in China accounted for more than 50% of the
total revenue of the Asia – Pacific. It is expected that in 2018, this figure will reach 70%.
Also as the content of the 33th Report on the development of Internet China data on the
development of 33 of the Internet’s Network Information Center of China Internet, the number
of online shoppers in the country at present is 302 million people. According to a survey of
Group M in June 2014, nearly 75% of online shoppers said they prefer buying online in brick-
and-mortal stores.
19
Figure 15: Revenue from online retail sales in China 2013-20186
600 100%
527,06
90%
87,1%
500 455,88 80%
377,24 70%
400
63,9%
60%
298,38
300 50%
217,39 40%
37,3%
200
132,61 30%
26,4%
20,8% 20%
100 15,6%
10%
0 0%
2013 2014 2015 2016 2017 2018
Source: www.eMarketer.com
4. India
According to the statistic of Internetworldstats, in 2014, the number of Internet users in India
was at around 195 million people, accounted 15.8% of the population. As eMarketer announced,
the number of online shoppers was 30 million people. The growth in e-commerce transactions in
2014 was 31.5%, B2C retail sales reached 20.7 billion USD. eMarketer said that each Indian
spent 691 USD for online shopping.
Source: www.eMarketer.com
6
The data include products and services that were ordered via the Internet using any devices, regardless of
payment method or manner of implementation; not include travel; not include Hong Kong.
20
5. Indonesia
Indonesia was the 4th populated country in the world, with an estimated population of 253
million in 2014. Of which, there was 29.8% of the population, equivalent to about 74.6 million
people using Internet7 . According to eMarketer, the number of Internet users in Indonesia was
growing at an average rate of 20% a year in the period of 2013-2016. Currently, about 5.9
million people had been shopping online at least once.
As eMarketer predicted, online retail sales in Indonesia in 2014 would reach 2.6 billion USD,
accounting for 0.6% of total annual retail sales.
These items were most popular for online shopping in Indonesia including clothing, shoes,
handbags, watches, airline tickets, cell phones, gadgets for cars.
Source: www.eMarketer.com
6. Australia
According to Online Retail Sales Index by the National Bank Australia (NAB) announced, the
online retail sales in Australia increased from 14.9 billion USD in 2013 to 16.3 billion USD in
2014. Online retail sales were accounted for approximately 6.6% of total retail sales in Australia.
According to NAB, products and services such as communications, food, fashion, were shopped
the most in this country. The item that currently had the highest growth rate was toys and games,
up 39.4% in November, though accounted to only 3% of share of the online retail market.
7
Data Miniwatts Marketing Group in 2014 in www.internetworldstats.com
21
Figure 18: Growth of online shopping in Australia 2014
13,1% 14,4%
11,8% 12,1%
10,2%
9%
8,3% 8,3%
6,7%
5,1%
3,9%
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov
7. Vietnam
According to the survey by Vietnam E-commerce and Information Technology Agency
(VECITA) in 2014, online purchasing of each person a year was estimated at about 145 USD,
and B2C sales revenues reached 2.97 billion USD, accounting for 2, 12% of total retail sales.
Products that were chosen the most are furniture and electronic technology (60%), fashion and
cosmetics (60%), appliances (34%), books, stationery (31%) and some other items. In Vietnam,
most of online shoppers, after ordering, still chose cash payments (64%), the form of payment
via electronic wallet accounts for 37%, and the form of payment via bank accounts for 14%.
8
According to GSO "socio-economic situation in 2014" - www.gso.gov.vn
22
II. THE STATUS OF E-COMMERCE APPLICATION IN THE COMMUNITY
In 2014, VECITA – Ministry of Industry and Trade surveyed the status of e-commerce
application with more than 900 Internet users in the country. Most of survey questionnaires were
answered online and filled in the form directly. All the data and analysis in this section was
drawn from the result of the survey mentioned above.
1. The use of Internet
According to a survey of VECITA with more than 900 internet users in the whole country, 10%
of correspondents replied that they use Internet less than 3 hours per day. 36% used Internet 3-5
hours per day.
21%
17% 15%
10%
Under3 3giờ
Dưới Từ33-5- 5hrs
giờ Từ5 5- 7hrs
- 7 giờ Từ 7 - 9 giờ Trên 9 giờ
hrs 7 – 9 hrs Above 9 hrs
The period that people accessed Internet the most was from 8pm to 12am (53%), followed by the
period of 8am to 12am (24%), and 4pm to 8pm (13%).
24%
13%
9%
1%
8am - 12pm 12pm - 4pm 4pm - 8pm 8pm - 12am 12am - 8am
Laptops and mobile phones continued to be the most popular devices to access Internet, the
proportion was 75% and 65% respectively. The number of people accessing Internet via other
devices, such as tablets, also increased by 19% from 2010 to 2014. Desktops were used to be the
most popular device in 2010, accounting for 84% of users; in 2014, only 33% of respondents
accessed Internet via this device.
23
Figure 22: The device for Internet access
33% 38%
27%
19%
0%
90% of respondents said that their most frequent location for Internet access was at home. The
second most frequent one was workplace (48%). The public place, school, and Internet store
took the corresponding proportion as 22%, 16% and 5%.
Figure 23: Location of Internet access
90%
48%
16% 22%
5% 8%
At Tại
homenhà At work
Tại chỗ làm Tại
At trường
school họcTại cửa Điểm
hàng
Internet Internet
công cộng
store (nhàplaces
Public hàng, kháchChỗ
sạn…)
khác
Others
(restaurants,...)
Update information continued to be the major purpose of using Internet daily, up from 87% in
2013 to 93% in 2014. The majority of respondents used Internet to participate in forums, social
network (81%), to access email (73%), to watch movies, listen to music (64%), and to research
(63%). For activities such as personal purchases, most of respondents operated monthly (36%).
24
Figure 24: Frequency of using Internet for activities
25.6%
Others
Hoạt động khác 20.7%
19.8% Không dùng
Not use
33.9%
3.6% Hàng
Dailyngày
Tham gia diễn
Participate đàn, mạng
in forum, socialxã 4.3%
hội
network 10.8%
81.2%
0.6%
Access email 7.0%
Truy cập email 18.7%
73.8%
36.2%
Play games
Chơi game 12.1%
18.6%
33.1%
1.5%
XemWatch
phim, movies
ảnh, nghe nhạc 7.7%
26.1%
, photos, listen to music 64.8%
1.6%
Nghiên cứu,
Research học tập
& Study 5.8%
28.7%
63.9%
0.5%
Update
cậpinformation
nhật thông tin 1.2%
4.8%
93.5%
58%
42%
25
The type of goods which were purchased online the most, was toys and electronics technology,
accounted for 60%, increased 25% comparing with 2013. The items which were popular with
online shoppers were clothing, shoes, cosmetics (60%), household appliances (34%), books and
stationery (31%)...
Figure 26: Popular online products on e-commerce websites
Professional services 5%
(training, consultant…) 10% 2014
Food 18%
20%
Technology 60%
35%
The survey results also indicated that 71% of respondents purchasing online through websites
that sold goods / services, up 10% compared to 2013. The number of people using the social
network websites for online shopping purpose increased from 45% in 2013 to 53% in 2014. The
number of people that purchased items via group buying websites, fell sharply from 51% in 2013
to 35% in 2014. 25% of respondents said that they purchased via e-marketplace and 13% via
applications on mobile.
26
Figure 27: Online purchase methods
71%
2013 2014
61%
51% 53%
45%
35%
25%
19%
13%
6% 4%
0%
Cash was a major payment method in online transaction (64% of respondents), though decreased
10% comparing with 2013. Bank transfer also fell from 41% in 2013 to 14% in 2014. Instead of
that, the number of people using electronic wallet increased from 8% in 2013 to 37% in 2014.
37% 41%
14%
8% 9% 11% 11% 7%
0 1%
27
Figure 29: Satisfaction of online purchasers
62%
2013 2014
48%
41%
29%
5% 6% 4% 5%
According to the survey's results, 40% of online shoppers bought less than 5 products in 2014,
29% purchased from 5 to 10 products and 17% purchased above 15 products.
Figure 30: Estimated number of products/services each individual shopping online in 2014
40%
29%
17%
14%
Dưới 55
Under Từ5 5- 10
- 10 Từ1010- 15
- 15 Trên
Above1515
29% of buyers chose to purchase item with price from 1 to 3 million. Following was the price
above 5 million with 26% of people chose to buy, and the least was from 3 to 5 million (11%).
29%
26%
21%
14%
11%
Dưới Under
5 trăm nghìn Từ 5500,000
trăm nghìn
- Từ 1,000,000
1 triệu đến- 3 Từ3,000,000
3 triệu đến- 5 Trên 5Above
triệu đồng
đồng
500,000vnd đến 1 triệu đồng
1,000,000vnd triệu đồng
3,000,000vnd triệu đồng
5,000,000vnd 5,000,000vnd
28
The survey also indicated that the reputation of the seller or the website was the most important
factor with online shoppers, 740 respondents selected this factor, corresponding to the ratio of
81%. 80% of shoppers concerned about price, followed by order, payment and delivery methods
(68%), and the brand of products and services (64%).
Figure 32: The consideration factors of online shopping
80% 81%
64% 68%
23%
Giá cả
Price Thương hiệuof
Brands của sản Reputation
Uy tín của người
of the Cách thức
Order, đặt
payment Thiết kế củadesign
Website website
phẩm/dịch
products/ vụ bán/website bán
seller/ website hàng and
hàng, delivery
thanh toán và
services giao nhận hàng hóa
methods
According to respondents, the greatest obstacle of online shopping was the quality of products
or services worse than being advertised (81%). Next was unprofessional logistic services (51%),
price not lower than buying in traditional shops or not clear (46%), personal privacy disclosure
(42%), and unprofessional website design (29%).
Figure 33: Obstacles of online shopping
Others 5%
Unprofessional website design 29%
Unprofessional logistic service 51%
Personal privacy disclosure 42%
Complicated order method 27%
Quality of products or services worse than advertised 81%
Price 46%
The reasons why people did not purchase online including: the difficulty in examining quality of
products (78%), not having trusty sellers (57%), not have enough information to make purchase
decisions (46%), not having credit cards or other payable cards (42%), buying in store faster and
easier (38%), complicated online order procedures (26%).
Figure 34: Reasons for people not shopping online
No online buying/ selling 20%
Not having enough information to decide 46%
Difficult to examine quality of priducts 78%
Not having trusty sellers 57%
Low internet connection 7%
Easy and fast to buy in stores 38%
Complicated order procedures 26%
Not having credit card or payable card 42%
Unable to use online shopping functions 8%
Never try 17%
29
However, 97% of respondents would continue to purchase items online in the future, this ratio
was significantly increased comparing with 88% in 2013.
Figure 35: Continue to purchase items online or not
97%
3%
Yes
Có Không
No
30
CHAPTER III
E-COMMERCE APPLICATION IN ENTERPRISES
31
I. GENERAL INFORMATION
In 2014, VECITA – Ministry of Trade and Industry sent the survey questionnaires on the e-
commerce application to 3.538 enterprises nationwide. All figures and analysis in this chapter
reflected the results of this survey.
1. Types of enterprises
Differing from 2013, the limited liability companies accounted for the highest figures (48%),
followed by the joint stock companies (34%). The private companies, companies with foreign
capital and other types of enterprises accounted for 19% of the total surveyed enterprises.
Figure 1: Types of enterprises surveyed in 2014
2% 4% 12% DN tư nhâncompanies
Private
Limied
Công liabitity
ty TNHH
34%
48% Joint
Công ty stock companies
cổ phần
Parnerships
Công ty có vốn đầu tư nước
ngoài
32
the small and medium enterprises (SMEs). According to the scale of enterprises, 9% of
respondents in the survey were large enterprises; the rest of respondents were SMEs (91%).
Figure 3: The scale of enterprises over years
SME Largenghiệp
Doanh enterprises
lớn
6% 6%
10% 9%
11%
94% 94%
90% 91%
89%
33
II. INFORMATION TECHNOLOGY AND HUMAN RESOURCES INFRASTRUCTURE
1. Hardware
a. Computer
According to the survey result in 2014, 98% of enterprises participating in the survey equipped
with private computers (PC) and laptop, 45% of them equipped with tablets.
Figure 4: The number of computers in enterprises in 2014
98%
45%
PC
PCvà lapLaptops
and top Tablets
Máy tính bảng
Tablets
In conformity with the findings, each enterprise had 21 PC/ laptop and 3 tablets on average.
Figure 5: The average of computers in enterprises in 2014
21
PCPCand
và lap top
Laptops Máy tính bảng
Tablets
34
Figure 6: Cost structure for IT and E-commerce in enterprises over years
15%
Others
Khác 17%
16%
26%
Software
Phần mềm 24%
23%
41%
Hardware
Phần cứng 42%
43%
2. Software
According to the survey results, two groups of software were most commonly used in business
included accounting, financial software (88%) and human resources management (49%). Some
complicated software required high-level structure of enterprises as Customer Relationship
Management software (CRM), Supply Chain Management software (SCM), Enterprise Resource
Planning software (ERP), were used less commonly with 24%, 22% and 17% respectively.
Figure 7: Rate of enterprises applying software in 2014
Không
No Có
Yes
ERP 83%
17%
CRM 76%
24%
SCM 78%
22%
Accounting, 12%
Kế toán, tài chính
financial 88%
Human
Quản lý nhân sự 51%
49%
resources
35
The e-signature was established in the form of words, letters, numerals, symbols, sounds or other
forms by electronic means, logically attached or associated with a data message and capable of
certifying the person who has signed it as well as the approval of such person to the content of
the signed data message9. According to the findings, the number of enterprises increased over
years from 23% in 2012 to 45% in 2014. The rate of large enterprises using e-signatures was
higher than the rate of SMEs (with 60% and 44% respectively).
31%
23%
60%
44%
9
Law on E-transactions 2005
36
Figure 10: The use of online monitoring system
78%
22%
Có Không
Yes No
4. Email
Outstanding advantages such as high speed, cheap price and no geographical distance, email was
the most commonly mean for enterprises on business strategy and daily activities. According to
the survey results in 2014, the number of enterprises having more than 50% employees and using
email on daily activities increased comparing with the last year (24% in 2013 and 35% in 2014).
Năm
20132013 Năm 2014
2014
51%
40%
35%
25% 25% 24%
Dưới 10%
Under 10% Từ 11 - 50
11-50% Trên
Over50%
50%
In general, the rate of enterprises using email for doing business with customers and suppliers
accounted for the highest figure (67% in 2012, 77% in 2013 and 75% in 2014)
37
Figure 12: Email usage for business purpose in enterprises
65% 62%
51%
20% 23%
38
Figure 14: The proportion of IT and E-commerce specialized by business sectors
Others
Khác 63%
Du lịch, ănFoods
Tourism, uống 71%
Bán buôn, bán lẻ
Wholesale, Retail 64%
Xây dựng
Construction 52%
CNTT, truyền thông
IT, Communication 80%
Giải trí
Entertainment 73%
Vận tải, giao nận
Transportation 54%
Năng lượng, khoáng
Energy, sản
mineral 65%
Tài Finance,
chính, Bất động
Real sản
estate 75%
Y tế,
Heathcare, Giáo dục,Training
Education, đào tạo 69%
Nông,
Agriculure, lâm, thủy
forestry, sản
fishiers 56%
CôngIndustry
nghiệp 70%
73%
27%
Yes
Có No
Không
39
III. THE TYPES OF TRANSACTIONS AND PAYMENT ON E-COMMENCE
1. The types of sale
a. Social networks
Regarding the findings, 24% of respondents had already participated in the social networks and
8% of respondents will participate in 2015.
Figure 16: The rate of enterprises selling on social networking
68%
24%
8%
b. Enterprises’ websites
The number of website owners in 2014 was 45%. Of which, the enterprises on IT and
communication had the highest rate (69%).
Figure 17: The rate of enterprises owning websites over years
DN sẽ xây dựnggoing
Enterprises website trong websites
to have 2014
Enterprises
DN có website having websites
21% 11% 9% 9%
11%
40
Figure 18: Enterprises owning websites by business sectors
Heathcare,YEducation,
tế, Giáo dục, đào tạo
Training 59%
Nông,
Agriculure, lâm, fishiers
forestry, thủy sản 44%
Công nghiệp
Industry 55%
c. Mobile platform
E-commerce in mobile platform kept approaching retail sector, changing role as communication
channels to interaction channels between retailers and customers. The survey on the usage of
apps on mobile platform for trading purpose, 11% of respondents had already used apps on
mobile platform for trading.
Figure 19: The usage of apps on mobile flat forms for trading purpose
8% 11%
CóYes
No
Không
SẽGoing
sử dụngtotrong
usenăm
in
81% 2014
2014
41
d. E-marketplace
The rate of enterprises participated e-marketplaces in 2014, slightly increased comparing with
the previous years.
Figure 20: The percentage of enterprises participating E-marketplaces over years
15%
14%
12% 12%
9%
Trên cácnetworks
Social mạng xã hội TrênWebsites
website của TrênMobile
các ứng dụng di
apps Trên các sàn thương
E-marketplaces
Social networks
doanh nghiệp động mại điện tử
42
2. The payment method
The main payment method in enterprises was money transfer (90% over recent years). The
second common payment method was cards (20% in 2014), e-wallets (6% in 2014) and scratch
cards (3% in 2014).
Figure 22: The payment method
97%
90% 94%
39%
19% 20%
7% 3% 6% 4% 3% 3%
Money transfer
Chuyển khoản VíE-wallets
điện tử Cardstoán
Thẻ thanh Scratch
Thẻ càocards
3. Privacy policy
Most of enterprises had the privacy policy. In 2014, 80% of enterprises adopted privacy policy
comparing with 73% of 2013.
Figure 23: The privacy policy
43
IV. THE STATUS OF E-COMMERCE WEBSITES OPERATION
1. The information update on e-commerce websites
52% of respondents updated information daily on their websites. Hanoi got the highest number
of enterprises which daily updated on their websites (52%).
Figure 24: Frequency of information updates on websites in 2014
52%
32%
16%
Daily
Hàng ngày Hàng tuần
Weekly Hàng tháng
Yearly
Weekly
Daily
Hàng ngày Hàng tuần
Weekly Monthly
Hàng tháng
Monthly
Hà Nội
Hanoi Tp.
HoHồ
ChiChí Minh
Minh Hải
HaiPhòng
Phong Đà
DaNẵng
Nang Cần
Canthơ
Tho
Daily
Hàng ngày Hàng tuần
Weekly Monthly
Hàng tháng
44
Figure 27: The rate of owning mobile version of websites
85%
15%
Có Không
Yes No
3. Website functions
In 2014, the number of websites having online orders increased comparing to the previous years
(41% in 2013 and 59% in 2014). The rate of websites having online payment in 2014 was 20%,
slightly increased 2% compared to 2013 (18%).
Figure 28: The rate of enterprises’ website functions
41%
20%
18%
45
Figure 29: The advertising methods of e-commerce websites in 2014
NoChưa quảng bá
advertising 13%
Các phương tiện khác
Other methods 21%
ỨngMobile
dụng diapps
động 10%
Tin nhắn/Email quảng cáo
SMS/Email 24%
Các công
Search cụ TK
engines 47%
Mạng XH
Social networks 50%
Truyền hình
Television 15%
Báo
Electronic điện tử
journal 35%
Báo giấy
Newspapers 24%
No advertising 21%
Phương tiện khác 27%
25% 2014 2013 2012
Other methods
15%
Truyền hình 18%
Mobile apps 16%
47%
Các SMS/Email
công cụ TK 43%
47%
Search engines 35%
Báo điện tử 40%
39%
Social networks
13%
Chưa quảng bá 15%
Television 15%
Electronic 50%
Mạng xã hội 37%
journal 34%
24%
Báo giấy
Newspapers 26%
20%
46
Figure 32: The cost of enterprises’ website advertisement in 2014
52%
40%
7%
47
V. THE EFFICIENCY OF E-COMMERCE APPLICATION IN ENTERPRISES
1. Receiving and placing orders via electronic means
In 2014, the rate of enterprises receiving orders via email was double the rate of enterprises
receiving via website, with 78% and 36% respectively. Similarly, the rate of enterprises placing
orders via email had twice the rate of enterprises placing via websites (75% and 41%
respectively).
Figure 33: Receiving and placing orders in enterprises in 2014
36% 41%
Email Website
Figure 34: Receiving orders via electronic means in enterprises over years
83% 78%
70%
35% 36%
29%
Email Website
Figure 35: Placing orders via electronics means in enterprises over years
50%
41%
33%
Email Website
48
According to the survey results, 16% of enterprises said the value of their receiving orders via
electronic means (email, website) passing 50% the total revenue. Meanwhile, 33% of enterprises
said that the value of their receiving orders via these electronic means ranged from 21% - 50% of
their total revenue in 2014.
Figure 36: The total value of orders enterprises receiving compared the total revenue in
2014
51%
33%
16%
Dưới20%
Under 20% Từ–21-50%
10 50% Trên
Over50%
50%
Regarding the findings, 13% of enterprises said that the value of orders placed via electronic means
accounted for over 50% of the total expenses.
Figure 37: The value of orders enterprises placing compared to the total expenses in 2014
55%
31%
13%
Dưới
Under 20%
20% Từ 21-50%
Under 10 - 50% Over
Trên 50%
50%
70% of enterprises receiving under 400 online orders in 2014. 43% of enterprises said that the
value of placing orders in 2014 was 5 million VND on average.
Figure 38: The number of online orders enterprises received in 2014
70%
19%
4% 7%
Dưới
Under400
400 Từ 400 - 1000
400-1000 Từ1000-2000
1000 - 2000 Trên
Over2000
2000
49
Figure 39: The average value of order enterprises receiving in 2014
43%
23%
21%
13%
Dưới
Under 1 triệu
1 million VND Từ
1-2 1 - 2VND
million triệu Từ million
2-5 2 - 5 triệu
VND OverTrên 5 triệu
5 million VND
44% of surveyed enterprises having revenue of goods, services via e-commerce channels in 2014
increased, comparing with 2013, 50% of respondents said this revenue experienced almost no
change. Only 9% of respondents had decreased revenue.
Figure 40: The revenue of goods, services via e-commerce channel
50%
42%
9%
Tăng
Increase Giảm
Decrease Hầu nhưnokhông
Almost đổi
change
50
VI. THE USE OF ONLINE PUBLIC SERVIC
1. The status of online public services usage
With more than 4.000 online public services provided by management agencies, enterprises had
opportunities to approach the information on the websites of management agencies. According to
the survey results in 2014, 43% of respondents frequently searched information on these
websites.
Figure 41: Frequency of searching information on the websites of management agencies
53%
42%
5%
Thường xuyên
Frequently Thỉnh thoảng
Occasionally ChưaNever
bao giờ
57% of enterprises had already used online public services related to registration, licensing,
notification…provided on local websites.
Figure 42: The use of online public services in 2014
57%
43%
Đã sử dụng
Already use Chưa sửyet
Not dụng
6%
Rất có
Very ích
useful Tương đối có ích
Useful Không có ích
Not useful
51
CHAPTER IV
THE OPERATION STATUS OF E-COMMERCE SERVICE WEBSITES
52
I. GENERAL INFORMATION
In 2014, VECITA conducted surveys on 247 traders and organizations owning e-commerce
service websites.
1. Model and scope of operations
The e-commerce service websites in the survey included three types: 88% of e-marketplaces;
16% of online sale promotion websites and 2% of online auction websites.
Figure 79: The models of e-commerce websites in the survey
88%
16%
2%
The surveyed websites were mostly located in two big cities named Ho Chi Minh City and Hanoi
with the proportion of 38% and 37%. The rest of 25% websites were provided by other regions.
25% Hanoi
37%
Ho Chi Minh City
Other regions
38%
According to the survey, 72% of websites had business over the country. The rest of 12%
websites operated in provinces and cities where traders and organizations had place of business
or representative office placed in.
Figure 81: Business range
72%
12% 11%
2%
53
2. Investment capital
85% of e-commerce service websites in the survey had their own budgets. Websites from foreign
investment accounted for 10%, the remained websites were invested from the state budget or
others with small proportions of 5% and 2% respectively.
85%
5% 10%
2%
Advertisement 70%
% chargedFee
feesper
perorder
order 56%
Consult 27%
Membership
Membership fee 25%
Message 13%
54
Figure 84: The supporting utilities and tools on websites
Seller evaluation 2%
Other utilities 9%
Product comparison 17%
Transport, delivery administration 23%
Product evaluation 42%
Order management 44%
Shopping cart 44%
Integrated SMS 50%
Integrated social network 53%
Online support/chat/skype… 76%
Filter/search engine 81%
6. Human resources
The percentage of enterprises that had less than 10 employees was 53% of total surveyed
enterprises. Enterprises had from 10-20 employees and from 20-100 employees took the
proportion of 27% and 16% respectively. And enterprises had more than 100 employees
accounting for 4%.
4%
< 10 employees
16%
10-20 employees
55
Top 5 websites had the greatest number of staffs in 2014: cungmua.com, enbac.com, hotdeal.vn,
vatgia.vn and lazada.vn. The number of staffs was from 240 to 563 people.
563
471
349
240
182
Regarding the personnel structure, e-commerce service websites had more staffs working on
sales than staffs working on other activities.
4 4 4
3
1
Sales staffs IT staffs Support staffs Managers Shipping staffs Legal staffs
7. Payment infrastructure
30% enterprises that owning e-marketplaces, had supported and integrated online payment
functions. 27% accepted card payment such as Visa, Master Card, 25% accepted intermediate
payment and 10% accepted SMS. 45% websites supported delivery service and cash on delivery
(COD).
The method of making payment at store was popular and accounted for 75%. Meanwhile, the
payment method by bank transfer was still used at the rate of 77%.
56
Figure 89: The payment methods on website
Online payment methods were chosen to use: Ngan Luong (34%), Bao Kim (24%), One Pay
(18%) and Payoo (18%). The intermediate payment portals accounted for 18%, including:
Paypal, Smartlink, Fibo, VNPT ePay, Banknet…
57
II. THE OPERATION STATUS OF E-COMMERCE WEBSITESIN DIFFERENT TYPES
1. E-marketplace
21%
10% 8%
5% 4% 3% 2% 1%
The survey results also showed that, the 3 leading e-marketplaces on revenue from e-commerce
service providing activities were: lazada.vn (26%), ebay.vn (19%), and vatgia.vn (18%).
Figure 45: The share of revenue from e-commerce service providing activities in e-
marketplaces
26%
19%
18%
6%
2% 2%
1% 1% 1% 1%
58
Figure 46: The top websites by revenue
1. Lazada.vn
Lazada.vn was established in the mid 2013 with the investment from Rocket Internet Corporation.
This e-marketplace was quickly trusted as a leading brand name. Compared with 2013, lazada.vn
developed in both transaction volume and transaction value and doubled the growth rate of
revenue.
Total
Transaction Total
Enterprises Website transaction
volume revenue
value
2. Sendo.vn
With 5,300 suppliers of goods and services, hundred thousands of diverse products were available
in sendo.vn, this e-marketplace had achieved a 45% growth in revenue, 100% successful
transaction volume and a 45% growth in total transaction value. Sendo.vn had advantages of new
customers after buying the famous website 123mua.vn from VNG. Recently, Sendo JSC
announced an investment strategy in cooperation with three leading Japanese conglomerates on
internet: SBI Holdings, Econtext ASIA, BEENOS10.
10
Information cited from website www.sendo.vn, dated 5/12/2014
59
Figure 94: Investment on technology innovation
2013 2014
<10 million VND 10-100 million VND 100 million VND - 1 >1 billion VND
billion VND
The highest level of investment on technology innovation was seen in chodientu.vn with the
investment accounting for 25% of the total revenue. Other websites such as tiki.vn, ebay.vn,
sendo.vn , vatgia.vn were in the top 10 websites invested the most in technology;
If comparing with total revenue, this investment only accounted for a small proportion from 1-
5%.
37% 38%
25%
16%
11% 9%
4% 5% 2%
1%
a. Revenue
Total revenue of online sale promotion websites in 2014 was estimated to be over 960 billion
VND, up 18% comparing with 2013.
960
810
2013 2014
60
The leading website was hotdeal.vn, accounting for 60% of market share. The following was
muachung.vn with 27% of market share. The other websites such as sieumua.com, ivivu.com and
lingo.vn were in the top 5 online promotion websites that got small revenue comparing to total
revenue of these websites (2 – 4%).
Figure 97: The market share of revenue from online promotion websites
b. Promotion value
The saving amount of 40 online promotion websites for consumers in 2014 was estimated at 276
billion VND, up 53% compared to 2013. In particular, hotdeal.vn was leading the saving rate
(35% of the whole market). Muachung.vn followed at the rate of 23%. The other websites such
as cungmua.com, nhommua.com and sieumua.com took the relatively small proportion (4%).
Figure 98: The amount of savings (billion VND)
276
237
2013 2014
Figure 99: Top 5 online promotion websites having greatest amount of savings
35%
23%
4% 4% 4%
61
c. The development of top revenue websites
In 2014, muachung.vn experienced a slight increase in revenue (+4%). Lingo.vn also strongly
developed in the terms of revenue, the number of suppliers for websites and the amount of
saving for consumers with the growth rate of 14 % and 38 %. The online reservation system for
hotel in Ivivu.com was growing slowly (+1%).
Though sieumua.com got the third highest of revenue but its revenue declined comparing with
2013. For example, 11% of orders and 13% of savings reduced and led to a significant decrease
in revenue (-20%).
Figure 100: The development of top 5 revenue online promotion websites in comparison
with 2013
Saving
No. Website Revenue Suppliers Orders
amount
11
Statistics from Online Shopping Day in 2014 at Appendix 1
62
- Total views: 10.684.904 page views
- Views/visit rate: 7.09 views/visit
- The number of participants in the program awards: 13.604 unique users
- Total number of clients email subscribed to regular promotions: 11,301 email
B. TRANSACTION STATISTICS
Online shopping day in 2014 was chosen by many enterprises as the beginning of the year-end
sale. During the day 05/12/2014, the aggregated data from these enterprises were recorded as:
- The total value of goods traded in the day estimated 154 billion VND, an increase
of 2.48 times the average day in the year.
< 100 millionVND 100 million - 500 > 500 million VND
million VND
63
Figure 103: Introduction to some online auction websites
1. eBay.vn
In 2009, the online auction website eBay.vn was established. After 5 years, the number of
participants and transactions is increasing. In 2014, eBay.vn held for approximately 30,000
members in the auction, successful auctions 15,000 worth successful bid to reach 30 billion.
2. Kiemthem.vn
Kiemthem.vn is the auction system of working, services with specified time. In 2014, the website
had 80,000 members in 7,000 jobs auction, worth approximately 14 billion.
3. sohot.vn
From starting at a website classifieds, sohot.vn developed features to become the online auction
website. In 2014, the website had attracted 14,000 members in the auction, successful bid of
4,000 auctions totaling up to 400 million.
64
III. SETTLEMENT OF DISPUTES AND COMPLAINTS ON THE E-COMMERCE
WEBSITES
1. Policies and settlement for disputes
In order to support consumers purchasing on e-commerce service websites, these websites have
announced their dispute settlements. 85% of websites had policies and dispute settlement to
resolve the issues as sellers and buyers reach an agreement with each other. 15% of websites had
supporting policies for cases that parties decided to bring disputes to law authorities. Supporting
policies included the supplement of information and evidences that relating to transactions on
website.
Figure 104: Settlement of disputes on e-commerce websites
Law enforcement
agencies
85%
79%
59%
31% 29%
65
Most complaints concerned about the delivery time (60%). 15% of sites were complained about
supporting services in the e-marketplace and 13% were about the quality and design of goods.
Only 6% websites were complained about the payment services.
Other complaints 8%
Payment 6%
Delivery, shipment 3%
66
CHAPTER V
THE STATUS OF E-COMMERCE SALE WEBSITES
67
I. GENERAL OVERVIEW
In 2014, VECITA surveyed 1.350 e-commerce sale websites. Of which, 765 websites or
approximately 57% provided online stores with tools like shopping carts, which allowed
customers to make online orders, to use online payment functions as payment gateway,
electronic wallet, online transfer, etc. 585 websites (43%) of those surveyed were built to provide
information about the products or services, or belonged to distributors or manufacturers that not
trading products or services directly.
43%
1. Websites by geography
According to the survey, websites were mostly located in the two big cities named Hanoi and
Ho Chi Minh city. 46% of websites were set in Hanoi, 44% of websites in Ho Chi Minh city,
while 10% were in other cities/provinces.
10%
Hanoi
46%
Ho Chi Minh city
44% Other
68
2. Business range
About 69% of websites provided products and services nation-wide, while 14% of websites
operated within the cities/provinces where they located. 13% of websites expanded their
businesses to international markets.
14% 13%
5%
3. Business sectors
The survey showed changes in size and number of categories of products/services provided on
websites. Apart from the traditional online sectors such as food, beverage, books and stationery,
etc., new sectors including auto, bike, and construction industry were also developing.
18%
17% 17%
In order to support customers promptly, several websites adopted supporting tools such as
Skype, Yahoo Messenger or online chatting software, etc. Two categories, that had the largest
number of supporting staffs, were computers, phones and office equipments, and fashion,
cosmetic and health-care products (making up about 22% of employees).
Legal staffs Shipping staffs IT staffs Managers Support staffs Sales staffs
23%23%23%23%24%24% 21%22%22%22%22%23%
20%20%22% 20%20%
17%19%19%19%
14% 14%
9%
Tourism, accommodation Computer, telephone, office Electronics, household Fashion, comestic, health-
equipments care
82% of surveyed websites had staffs to support customers via telephone, Yahoo Messenger,
Skype or email. Shipping staffs accounted for 16% of total staffs. 42% of websites recruited
staffs for shipping purpose.
5. Investment Source
In 1,350 surveyed websites, over 97% were fully funded by domestic enterprises, while only
0.5% websites received funds from foreign enterprises.
70
Figure 113: Websites by investment source
Other 2.0%
Funded by foreign… 0.5%
As for enterprises owning information delivery websites, their websites only provided
information on company’s capacity and the main product. Therefore, their technical
infrastructure and human resources were not invested as much as online store websites did.
Those websites cost a small and medium enterprise an average of 5 billion VND for website
design and domain maintenance, and a large enterprise an average of 10 - 30 billion VND. The
responsibility of website admin was often carried out by staffs, who holding multiple positions in
the enterprise, but basically were not IT staffs.
71
II. THE STATUS OF E-COMMERCE SALE WEBSITES
1. Supporting tools
b. Membership registration
Most of websites did not require customers register before ordering products/ services (76%).
Instead, those websites asked customers to fill order forms or provided phone number.
Figure 116: The proportion of websites requiring user accounts before placing online order
24%
Require
Not require
76%
72
c. Integration of social networks
Almost 50% of surveyed websites enabled customers to login social network accounts to place
an order, instead of creating a new account on the site. Accordingly, websites automatically
received customer’s information without requiring them to provide any information.
49% Integrated
51% Not integrated
COD 56%
Visa, Master cards 22%
Online payment providers 16%
SMS 3%
Bank transfer 83%
Online payment 27%
In-store 89%
Among online payment providers, Ngan Luong took the lead with 33% of websites applied,
followed by Bao Kim with 25%. Onepay was used by 15%, Banknet and Smartlink both by 4%,
and other providers by 19%.
73
Figure 119: Top 5 of online payment providers
Ngan Luong
19%
33% Bao Kim
4%
Onepay
4%
Smartlink
15% Banknet
25% Other
a. Delivery policy
Delivery service played an important role in online business due to its relation to cost and
services provided by enterprises. Most of SMEs outsourced delivery service by hiring third
parties to ship products and collect money (COD). 42% of enterprises shipped products directly
to consumers. 49% of enterprises used both methods.
Both 49%
Outsource 9%
b. Dispute Settlement
Only 33% of surveyed websites published dispute settlement policy on their pages.
33%
Having
Not having
67%
74
c. Advertising methods
According to the survey’s results, Facebook fanpage was ranked first in online advertising
methods (making up 48%), closely followed by Google’s SEO (47%). Advertising via blog and
forum which offered the advantages of low cost, were also optimized by 41% of enterprises.
Total spending on advertising in 2014 was 1.5 times as much as that in 2013. However, online
advertising was still inadequate with the potential of 33 billion Vietnamese Internet users.
Company Domain
75
Figure 124: Offline advertising methods
In offline advertising methods, mobile advertising was applied the most by enterprises (44%).
The category of service that had the highest level of applying mobile advertising was beauty,
tourism and banking account providers. Advertising via agencies and distribution channels was
the second leading method in terms of usage by enterprises (32%). Main customers of this offline
advertising method were websites that selling functional food, which aimed to optimize the
advantage of agencies and distribution channels to be more affordable with customers as most of
the functional food was imported.
76
III. EXPENSE AND REVENUE OF E-COMMERCE SALE WEBSITE
1. Expense
According to the survey result, in 2014, operating expense for e-commerce sale website
represented 1.32% of total revenue while advertising cost accounted for 0.96%. Besides, expense
for technology upgrade witnessed significant change, down to 0.36% of total revenue in 2014
from 0.44% in 2013. The decrease was explained by the cutting down on operating expense by
enterprises for after 2 years of operation, the procedure and management of websites had
gradually been stable.
2013 2014
2.75%
2. Revenue
Based on the survey results, only 875 out of 1,350 websites (64.8%) earned revenue, with the
total of 8.084 billion VND (or equivalent to 4 million US dollars). According to enterprises that
owning these websites, this amount in 2014 increased 1.7 times as much as that in 2013.
Figure 126: Total revenue of surveyed e-commerce sale websites (billion VND)
8,084
4,672
2013 2014
The largest revenue came from group of websites which sold fashion, cosmetic and health-care
products and services, accounting for 23% of the total revenue in 2013 and reaching 26% in
2014. Group of websites selling computer, mobile and office equipment witnessed a dramatic
rise in revenue in 2014 which is 1.8 times as much as in 2013. In this group, the biggest
enterprises in terms of revenue included thegioidiVND.com, nguyenkim.com and
fptshop.com.vn. As for electronic and household products, their revenue decreased by 0.1% in
2014. Websites providing tourism service came next in the ranking with a decline of 0.5% to
2.7% in 2014.
77
Figure 127: Products/Services with largest revenue in total revenue
2014 2013
In 2014, consumers were also affected by financial crisis. Products were most purchased
including electronics and household items. Products with high value were less acquired.
Consumers only visited websites in order to compare prices of same products selling by different
stores.
Figure 128: Most purchased products and services
ccording to the survey, the popular price for products purchased on e-commerce websites was
less than 200.000 VND, accounting for 36% of surveyed websites.
>5.000.000 8%
2.000.000-5.000.000 12%
500.000-200.0000 20%
200.000 - 500.000 23%
<200.000 36%
78
Out of 23% of surveyed websites whose prices ranged from 200,000 to 500,000 VND, had
fashion, domestic and health-care as the most purchased products. Nevertheless, popular price
paid for electronic and technology products were higher, ranging from 500,000 to 2,000,000
VND.
Figure 130: The main customer resources of websites
Other 25%
Via social media 40%
Via telephone 48%
Via email 26%
Via website 82%
Based on the survey, 82% of websites contacted with their customers via their pages, 48% via
phones and 40% via social media. The statistics indicated that getting access to enterprise’s
websites is the best among various ways to purchase a product.
15%
5% 1%
Revenue for e-commerce websites came mainly from the sale of products and services provided
on the websites, accounting for 84% of total revenue, while revenue occurring from advertising
and membership made up small amount which were 5% and 1%, respectively.
79
Figure 132: Successful application of e-commerce in enterprise’s business 12
1. Dacsankiengiang.vn
The business establishment Thanh Hang was established in August 2013 in Kien Giang. In
August 2014, Thanh Hang built website at www.dacsankiengiang.vn through solutions provided
at www.eKip.vn with objectives:
“To collect and introduce special products from Kien Giang”.
- Fresh and raw seafoods; Dried jelly fish, dried shrimps; Processed food; Handmade products,
etc.
After 5 months of operation, the website attracted over 56,000 pageviews and received a lot of
orders via websites and phones. Popular products purchased were fresh and raw seafood, fish
sauce, dried food, pepper, myrtle wine, etc. Apart from infrequent retailed orders, frequent orders
in wholesale and of high value ranging from 2 billion to 10 billion VND were placed by
customers from provinces like Can Tho, Vinh Long, HCM City, Binh Phuoc, etc. Thanh Hang’s
average revenue reached 100 million VND per month after the application of e-commerce.
2. Cakhotranluan.com – amthuccotruyen.com
The business establishment Ca Kho Tran Luan operated as a household business since 1998 in
Ha Nam. In 2009, Ca Kho Tran Luan started introducing their products on website at
cakhotranluan.com.
Main business lines of Ca Kho Tran Luan include the process and distribution of main product:
Stew fish originated from Vu Dai village. The product was known in both domestic and
international market as Vu Dai village’s stew fish. Since 2009, Ca Kho Tran Luan was one of the
first business establishments introducing rural special food to market. Applied Internet
successfully in the business operation, Ca Kho Tran Luan boosted production and business
activities of Vu Dai villagers, and obtained the following achievements:
- 5 consecutive years in top of provider of Vu Dai stew fish with an annual growth rate of 150%.
- In 2013, Ca Kho Tran Luan provided to the market over 10,000 clay pots, with the value of
each pot ranging from 400,000 to 1,200,000 VND (for 1 to 5 kg).
12
Data provided by enterprises
80
CHAPTER VI
E-COMMERCE IN MOBILE PLATFORM
81
I. E-COMMERCE ON MOBILE PLATFORM
With a population of 90.73 million people in 2014, Vietnam was the 14th most populous country
in the world, the 8th in Asia and 3rd in Southeast Asia. Vietnam's population increased by 1.08%
compared with 2013, including urban population of 30 million, accounting for 33%; rural
population of 61 million, accounting for 67%. In particular, the percentage of the population that
used Internet was 39%, the number of mobile subscribers were more than 130 million (1
Vietnamese on 1.45 SIM card phone in average), 36% of the population used internet via mobile
platforms.
Figure 133: The figure on the use of Internet through mobile in Vietnam
Vietnam population
33% urban
(90,73 million)
Access Internet
39% population
(36 million)
Mobile subcribers
20% smartphone
(134 million)
The percentage of population
36% population
accessing Internet via mobile
In January 2015, WeAreSocial announced survey results on the proportion of people purchasing
online via mobile devices by 27 countries. Accordingly, the dominant demographic structure of
the population with 40% aged from 10 to 24, put Vietnam in the group of countries having high
rate of people purchasing online via mobile devices. This rate could up to 15%; the same as
Australia, Brazil, Saudi Arabia, and surpass countries that technologies developed such as Japan,
France ...
Figure 134: Percentage of people purchases online via mobile devices (%)
37
27 27 23 23
20 19 19 18 18 17 17 16
15 15 15 15 14 14 13 12 11 11 11
9 8 6
Arab…
South…
Turkey
Germany
Russia
Argentina
Italy
UAE
Japan
China
UK
US
Spain
Hongkong
France
Australia
Mexico
Thailands
India
Korea
Poland
Indonesia
Singapore
Brazil
Malaysia
Vietnam
Philippines
82
1. Model B2C
In the context of the economy with many difficulties, e-commerce with revolution in mobile
technology, that leading by smart-phones and software applications, were contributing to the
retail operations, and creating a basic change in interactive relationship between consumers,
retailers and trademark.
When consumers used mobile devices with software applications on devices to search, access,
compare and buy goods, mobile solutions are becoming an important sales channel for retail
sector. Statistics from the leading retailers in Vietnam showed that retailers were trying to adapt
to the tendency of e-commerce on mobile platforms. The retail businesses not only introduced
actively their products, brands and promotions on mobile commerce platform, but also invested
on designing mobile applications for their own brands.
Tiki Joint Stock Company, a Vietnam enterprise working in the field of e-commerce,
announced the investment structure on new technology platform and investment rates on
mobile platforms in 2014 as follows:
Tiki identified that the investment in mobile platform for B2C transactions was one strategic
investment direction in future. The percentage of investment in mobile platform accounted for
68% of the investment structure for new technology platform researching activities. In the
investment in mobile platforms, investment structure remained focused primarily on
communication activities (73%), investment in technology accounts for 27%.
According to a survey of VECITA in 2014 with more than 900 consumers using Internet,
Vietnamese consumers accessed Internet not only via laptop, but also via mobile devices.
Specifically, although in 2010, the number of people accessing Internet via mobile phones was at
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only 27%, after 4 years, the rate has increased by 38% and reached 65% in 2014; besides, the use
of mobile devices to access the Internet also experienced a sharp rise, due to the appearing of
new technology mobile devices such as tablet, etc... This ratio increased by 19% in 2014,
comparing with 0% in 2010.
84% 75%
65% 2010
The statistic also showed the method of online shopping via mobile applications was doubled
from 6% in 2013 to 13% in 2014.
71%
61% 2013
51% 53%
45% 2014
35%
25%
19%
13%
6%
0% 4%
The survey results revealed that, e-commerce on mobile platform was gradually growing in the
retail sector as a transition from a communication channel to an interactive channel between
retailers and consumers. The acceptance level of consumers was very positive, so the problem
that retailers must solve was how to ensuring technology and their core business services.
2. Model C2C
Another e-commerce model was also popular in Vietnam is e-market place. They were having
movements to direct investment in mobile platforms. The applications for Model C2C could be
divided into two main groups, including:
Group 1 including enterprises developing mobile solutions based on consumer community that
already available on the web platform; representatives of this group were enterprises that had
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prestigious website, having large number of users so when they expanded to mobile applications
market, they would have the advantage of users. The application of Group 1 was also designed to
take advantage of the basic features of mobile devices such as calling, messages...
Group 2 including enterprises that had no customer yet so they had to take advantage of the rapid
spread of mobile platforms to promote their applications and build the community of buyer and
seller; representatives of this group were enterprises that were trying to solve the problem of
technology to create a good application platform, then focus on building the community of seller
and buyer. This group had advantage of orienting on the mobile platform from the beginning.
Therefore, it was appropriate with mobile users for rich features, and good technology platform.
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II. BANKING SERVICES - MOBILE PAYMENT
1. Electronic payment services on mobile
According to the report "Mobile Commerce in emerging Asia" in 2014 by Sony Ericsson
Telecom Group that studying on market-based mobile commerce in developing countries in
Asia, the research results showed that the demand of transferring - receiving money of
consumers in Vietnam accounted for 45% of the population, which was also the basis for the
development of application for money transfer via mobile devices in future.
Ericsson's research also showed that although the proportion of consumers using mobile
payments were limited to 1% in 2014, but this number would change due to the growing interest
of consumers for this type of payment. Ericsson announced that 19% of respondents
acknowledged the payment services on mobile and 10% expressed their interest, and desire to
learn and use the payment services on this platform.
Used to use 1%
Vietnam consumer using payment services via mobile for two main purposes: to pay bills and
transfer money. Results of the research showed that when paying bills, 48% of consumers in
Vietnam preferred the payment application on mobile devices of bank to the application of
telecommunications unit. For the transfer, the majority of consumers trusted mobile applications
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of banks (71%) than other applications provided by the telecommunications unit (10%) or the
card issuers (10%).
Figure 142: Type of payment applications via mobile that consumers preferred
12% 9%
Mobile application of
10% providers of
telecommunication
20% services
48% 10% Mobile application of
card issuers
71%
20% Other applications
Figure 143: The number of banks implementing e-banking services on mobile devices in
Vietnam 2013
Along with the conveniences mentioned above, e-banking services on mobile devices ensured
the security and safety for information because a successful transaction via mobile banking needs
three factors:
3) Authenticity containing random information will be provided by bank (via SMS, email
or Token) when transfers incurred and costumers have to enter the correct required
information.
With the advantages of convenient and safe, the e-banking service on mobile platform was an
important trend of payment, that contributing for the payment infrastructure for e-commerce in
Vietnam. In 2014, Nielsen announced the report "Driving smarter business Decisions in
Vietnam". The report said that e-banking service on mobile platforms would be the trend growth
of Vietnam and will pass on traditional e-banking equipment such as computers (laptop, desktop)
in the next few years. Particularly in 2014, 6% of 26% computer owners that having high
incomes, used e-banking via computer; however, survey data showed that 9% of 22% smart-
phone owners that had high income, used e-banking services on mobile devices.
Figure 144: Percentage of e-banking via computer comparing to via mobile in Vietnam
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III. INTERACTIVE SERVICES IN MOBILE
Although this service was still very new in Vietnam, but it already had a regular customer base to
compete with traditional taxi services. However, there was a disparity in market share among the
brands. According to an independent survey carried out by YounetCo about the distribution of
taxi booking applications in Vietnam 13 , Grabtaxi accounted for 62% while the number of
EasyTaxi and Uber is 17% and 21%, respectively. The cause of the difference mentioned above
was that their marketing strategies, promotions are quite different.
Uber
21%
GrabTaxi
EasyTaxi 62%
17%
Google Trends showed the search trends of Vietnam online community, which also leaning
towards GrabTaxi and Uber.
As taxi booking service via mobile was developing, in 2015, it was predicted to be an exciting
year for taxi services market and the customer would be able to use the services which becoming
better. The market would also experience the participation of Vietnam enterprises.
13
The data were published in http://www.younetmedia.com/blogs/dich-vu-dat-cho-taxi-suc-manh-se-vao-tay-ga-
khong-lo.html
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Figure 146: Search Trends on taxi booking services
Not only local enterprises, but also big manufacturers of mobile devices were also implementing
the investment in this segment with the aim of adding value to the customer when buying their
products.
Figure 147: The interface of mobile application Muachung
Galaxy Gift and Lumia Vip were the first attempt by Samsung and Microsoft in order to hit the
market of providing voucher, and coupon via mobile devices in Vietnam. When users installed
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these applications, they would receive the discount code to save money when using the catering
services, spa services or other services in promotional system. Especially, these applications
integrated with the utility navigation to help users identify the promotion in areas surrounding
their positions.
Figure 148: Lumia VIP app allows users to search promotions in areas surrounding them
In order to use one promotion, users only needed to do a few simple steps to create a discount
code. When they gave that code to the store employee, the price would be reduced respectively.
If the shop had signed with My Points of Microsoft (Lumia Vip Application), the user would
receive accumulated points, for example , for each 100,000 vnd paying, they would receive 100
points; then they could use that point to reduce the payment for other services.
The solution of the smart card member providing through mobile devices was also developed by
some enterprises. The application helped users get incentives in the form of accumulated points,
or promotions when they use the provided service. Users could use the application in the list of
preferential locations and to receive special form of service. As accessed the location, users
simply need to open the application, click on the location and display E-Card on the screen.
Then, they show that phone screen to the staff.
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IV. DIGITAL CONTENT SERVICES
1. Digital content business on mobile devices
Digital content services on mobile devices are deployed in Vietnam was very diverse way with
many groups, but if divining by the payment method, there should be two main groups:
The form of providing the first service had been developed for a long time, from the early days
of digital content services based on mobile platform. Users could download ringtones, ringback
tones, wallpapers ... to their phones via SMS, or download it directly via the Internet. Payment
fee could be paid via SMS that charging directly to users' accounts, or charging to postpaid
account, or by scratching cards, online payments via bank cards ...
VECITA had done a quick interview about consumer attitudes on the issue of payment for digital
content on mobile for 30 random people who own smart phones in Hanoi. The results showed a
fact that consumers were not psychologically ready to pay for digital content. Instead of that,
most of consumers were still looking for free content (10%) , or copyrighted content but had
been unlocked (80%) and only a few people were willing to pay for copyrighted content (7%).
80%
10% 7% 3%
Only use free content Looking for unlocked Paying for copyright Never
copyright digital digital content
content
The second form allowed users to choose the periodic payment with a subscription fee to use the
service. The mobile application allowed users to watch TV programs, or some applications
would allow users to watch high-resolution movies after paying a certain fee.
In fact, consumers in Vietnam had started to change habits for paying costs to be able to use the
online services such as watching movies on mobile. Results of a quick interview with 30
consumers showed that nearly 30% of them were willing to pay for online movie on mobile.
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Figure 151: The willingness to pay for online movie on mobile of consumers
No 73%
Yes 27%
Source: WeAreSocial
The application of searching content and location information on a map was very diverse with
platforms of foreign enterprises such as Google Maps, Nokia (Here Map), Apple Map ... or of
local enterprises as Diadiem.com, Thodia.vn ... The common thing of these solutions was the
base on geographical maps to provide information about landmarks, entertainment, business
address, ... to help users access easier to information of places around their positions. However,
in this segment of foreign enterprises were many advantages with technological resources and a
large number of users.
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V.APPLICATIONS AND GAMES ON MOBILE
1. Mobile application
Mobile application market (App Store) was a distribution platform for mobile applications.
Normally, the applications operated on certain platform and equipment, such as the application
of the operating system iOS was only available on Apple App Store. Calculated separately on
Google Android Market, the number of mobile applications had reached approximately 1.5
million, however, the number of applications has "low quality"14 accounted for 15% - according
to statistics collected on the website www.AppBrain.com.
Source: www.appbrain.com
There was still a large gap between the number of free applications and applications with fee in
the market: The number of free application in Google's Android market was approximately
1,251,484, accounted 85.33% of the total number of applications offered on the market.
Figure 154: The number of mobile applications for free and with fee of Android
The most popular applications of Android were in the field of Education - 113.342 downloads;
Lifestyle - 103.818 downloads; and Entertainment - 102.345 downloads.
14
The application of low quality as evaluated by Google would be removed from the market quarterly
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Figure 155: The application forms available on Android
Although the number was still limited, however, the applications developed by local developers
were also received by the community with high-rate and great downloads on the Apple iOS app
market, Google Android and Microsoft Windows Phone.
Application
with ads Mobile game
27%
Application with
Mobile game IAP
Application 60%
with IAP
13%
2014, Newzoo associated with Facebook, Microsoft, EA and Baidu to conduct market research
on mobile games in all Southern Asia countries. The results showed that, with the growth at
87.7% per year, the revenue of mobile game application market in Vietnam could reach 36.5
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million USD, an increase of 22.5 million USD compared with 2013 and was estimated to reach
161.6 million USD in 2017.
Figure 157: The growth of the mobile game application market in Vietnam
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Responsible publisher
NGUYEN HOANG CAM
Chief author
TRAN HUU LINH
Director General of Vietnam E-commerce and Information Technology Agency
Content editor
LE DUC ANH – LE THI HA – LE THI THU HANG
NGUYEN DIEU HUONG – NGUYEN HUU TUAN
Copyrighted by
VIETNAM E-COMMERCE AND INFORMATION TECHNOLOGY AGENCY
MINISTRY OF INDUSTRY AND TRADE
www.vecita.gov.vn
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