Vietnam’s e-commerce sector is experiencing unprecedented growth, making it an attractive market for foreign businesses. With a youthful, digitally savvy population and increasing internet connectivity, Vietnam presents unique opportunities for international companies to expand their reach. Understanding and adapting to the Vietnamese e-commerce landscape is crucial for foreign businesses seeking to leverage this booming sector. By navigating various drivers of e-commerce expansion, partnering with key players, and tapping into emerging trends like social commerce, international companies can strategically position themselves for success in the Vietnamese market.
Understanding Vietnam’s E-Commerce Landscape
Vietnam’s e-commerce market is one of the fastest-growing in Southeast Asia. Reports from Google, Temasek, and Bain & Company highlight the country’s digital economy, which had a Gross Merchandise Value (GMV) of US$36 billion in 2024, up from US$31 billion in 2023. The GMV of e-commerce alone reached US$22 billion in 2024 and is anticipated to soar to US$63 billion by 2030. This staggering growth is driven by a combination of factors, including a youthful population, increased internet connectivity, and evolving consumer habits leaning towards online shopping for convenience and variety.
The burgeoning middle class with higher disposable incomes is also a significant driver of e-commerce growth. As more Vietnamese consumers embrace online shopping for its ease and variety, international companies have the opportunity to thrive in this expanding market. For foreign businesses, understanding these dynamics is crucial to tapping into Vietnam’s e-commerce potential. Recognizing the local consumer behavior, preferences, and technological adoption trends will enable businesses to tailor their strategies effectively.
Key Drivers of E-Commerce Expansion
Widespread Mobile Access
Mobile phones have become the primary tools for accessing e-commerce in Vietnam. Nearly 57 percent of online purchases are made via mobile devices, highlighting the importance of mobile optimization for e-commerce platforms. With an increasing number of consumers relying on smartphones for their shopping needs, foreign businesses looking to enter the Vietnamese market should prioritize mobile-friendly websites and apps to cater to this trend. The mobile-first approach is essential for engaging the tech-savvy Vietnamese population and ensuring a seamless user experience.
Social Media Integration
Social media platforms like TikTok and Facebook have transcended their traditional roles to become integral parts of the e-commerce ecosystem. This phenomenon, known as social commerce, allows businesses to reach consumers directly through social media channels. By leveraging social media integration, foreign companies can engage with Vietnamese consumers more effectively and drive sales. Social media platforms provide a unique blend of entertainment and commerce, enabling businesses to create engaging content that resonates with their target audience while facilitating easy purchasing options.
Rising Middle Class and Urbanization
Economic growth and an expanding middle class are raising disposable incomes in Vietnam. Urbanization is also leading more city dwellers to embrace online shopping. For foreign businesses, targeting this demographic with tailored marketing strategies can yield significant returns. Understanding the preferences, behaviors, and purchasing power of the middle class is key to capturing this market segment. By offering products and services that align with the lifestyle aspirations of urban consumers, businesses can build a loyal customer base and drive long-term growth in the Vietnamese e-commerce sector.
Key Players in Vietnam’s E-Commerce Market
Shopee
Shopee dominates the Vietnamese e-commerce market with vibrant marketing and interactive user experiences. Despite some delivery and customer service issues, Shopee captures 67.9 percent of GMV. Foreign businesses can partner with Shopee to leverage its extensive reach and user base. Collaborating with Shopee allows companies to tap into a well-established platform that offers a wide range of products, from electronics to fashion, ensuring broad visibility and access to a diverse consumer audience.
Lazada
Backed by Alibaba, Lazada leverages its longstanding presence and robust logistics network to offer a wide range of products with reliable delivery options. Foreign companies can benefit from Lazada’s infrastructure and expertise in the Vietnamese market. By partnering with Lazada, businesses can ensure efficient supply chain management, timely deliveries, and enhanced customer satisfaction. Lazada’s integration of advanced technologies, such as AI-driven recommendations and secure payment systems, further enhances the shopping experience for Vietnamese consumers.
Tiki
A local favorite, Tiki is known for its personalized shopping experience, emphasizing product quality and customer service. Initially started as an online bookstore, Tiki has expanded its offerings and remains a trusted platform for Vietnamese consumers. Foreign businesses can collaborate with Tiki to tap into its loyal customer base. Tiki’s focus on building strong customer relationships and delivering a high-quality shopping experience makes it an ideal partner for companies aiming to establish a strong market presence and foster brand loyalty among Vietnamese consumers.
Sendo
Sendo focuses on the specific preferences of Vietnamese consumers through local promotions and support for small and medium-sized businesses. Partnering with Sendo can help foreign companies connect with local consumers and gain insights into the Vietnamese market. Sendo’s commitment to promoting local businesses aligns with the Vietnamese market’s preference for supporting homegrown brands and products, creating a favorable environment for collaboration between foreign and domestic companies.
TikTok Shop
TikTok Shop is quickly gaining popularity among younger consumers by merging short-form video content with e-commerce functions. Foreign businesses can utilize TikTok Shop to reach a younger audience and create engaging content that drives sales. TikTok Shop capitalizes on the trend of influencer marketing and user-generated content, providing a dynamic platform for businesses to showcase their products creatively and authentically. By leveraging TikTok Shop’s unique features, companies can capture the attention of Gen Z consumers and foster brand engagement.
The Gioi Di Dong (Mobile World)
An established electronics retailer, The Gioi Di Dong has successfully moved into e-commerce, specializing in mobile devices and consumer electronics. Foreign businesses in the electronics sector can collaborate with The Gioi Di Dong to leverage its trusted reputation and extensive network. The Gioi Di Dong’s strong market presence and focus on delivering high-quality electronics make it an ideal partner for companies aiming to enter the Vietnamese electronics market with confidence and credibility.
B2B E-Commerce Potential
While B2C e-commerce thrives, B2B e-commerce in Vietnam is still in its nascent stages but holds immense potential for growth. Vietnam’s robust manufacturing base in electronics, footwear, and consumer goods, paired with the “China plus one” strategy, positions it as an attractive alternative for diversified supply chains. The B2B sector offers opportunities for foreign businesses to partner with local manufacturers, suppliers, and distributors, facilitating seamless cross-border operations and enhancing supply chain resilience.
Trade agreements like the EVFTA and RCEP create favorable conditions for B2B trade by reducing tariffs and streamlining cross-border operations. Foreign businesses can explore B2B opportunities by partnering with local manufacturers and suppliers to tap into Vietnam’s growing industrial base. These agreements provide a framework for expanding trade relationships, reducing costs, and increasing market access, making Vietnam an attractive destination for international companies seeking to establish a strong foothold in the region.
Digital Payments Surge
Digital payments are rapidly becoming the standard in Vietnam, with over 63 percent of transactions going cashless in 2024. QR code payments have seen remarkable growth, increasing by nearly 900 percent. Government support for digital payment systems helps both businesses and consumers engage in e-commerce more seamlessly. By integrating digital payment solutions, foreign businesses can enhance the customer experience, ensure secure transactions, and streamline the payment process, catering to the preferences of the tech-savvy Vietnamese population.
This trend opens substantial collaboration opportunities for fintech companies and e-commerce platforms. Foreign businesses can integrate digital payment solutions to enhance the customer experience and streamline transactions. By partnering with local fintech firms, international companies can leverage innovative payment technologies, build trust with customers, and drive higher conversion rates, ultimately boosting their presence in the Vietnamese e-commerce market.
The Rise of Social Commerce
Vietnam’s e-commerce sector is experiencing unprecedented growth, turning it into an enticing market for foreign businesses. With a young, digitally adept population and expanding internet connectivity, Vietnam offers unique opportunities for international companies aiming to broaden their reach. To successfully tap into this booming sector, foreign businesses need to understand and adapt to the Vietnamese e-commerce environment.
Several drivers contribute to the expansion of e-commerce in Vietnam, including increased internet penetration, rising income levels, and a growing middle class that is comfortable with online shopping. Social commerce, where transactions occur via social media platforms, is also gaining traction, presenting an additional avenue for businesses to engage consumers.
Moreover, partnering with key local players can be instrumental. These partnerships can help foreign companies navigate regulatory hurdles, consumer preferences, and logistical challenges specific to the Vietnamese market. Learning to market effectively to Vietnamese consumers often involves leveraging local social media influencers and understanding cultural nuances.
By strategically positioning themselves and keeping an eye on emerging trends and technologies, international companies can establish a strong foothold in Vietnam’s dynamic e-commerce sector. The potential for growth in this market is substantial, making it an attractive destination for foreign investments and business expansions.
