Which e-commerce businesses in Vietnam miss opportunities amid Covid-19 pandemic?

The Vietnamese e-commerce industry has experienced a lot of sudden changes due to the influence of Covid-19, according to a latest report by iPrice Group.

Product categories, which are traditionally the “golden eggs” of the Vietnamese e-commerce industry such as fashion and electronics, were affected negatively during the pandemic, according to the latest Vietnamese Map of E-commerce report for the first quarter.

e-commerce, iPrice Group, fashion, electronics, healthcare, grocery, online payment  Photo: Cafebiz

E-commerce aggregator iPrice Group and analytics company SimilarWeb have jointly released on April 28 the report analyzing traffic statistics of the 50 leading e-commerce websites in Vietnam.

The report shows that in the first three months of this year, fashion retail websites experienced an average decrease of 38% in traffic compared to the previous quarter. Juno, Canifa and SHEIN saw a sharp decline of 49%, 32% and 47% in web traffic, respectively in the January-March quarter compared to Q4/2019. 

e-commerce, iPrice Group, fashion, electronics, healthcare, grocery, online payment  Source: iPrice Group. Chart: Nhat Minh

Similarly, traffic to household electronics retail websites in February decreased by 17% compared to January. By March, when people start looking for laptops, webcams, microphones, and monitors, among other items, to work from home, this category rebounded. 

Dien May Cho Lon electronics chain based in Ho Chi Minh City, saw a sharp decrease of 52% in web traffic in February compared to January but its decrease moderated to 12.2% in March compared to February. 

Another electronic chain, Thai conglomerate Central Group-backed Nguyen Kim, recorded a notable decline of 45.8% in web traffic in February compared to January but increased again by 6.6% in March compared to February. 

e-commerce, iPrice Group, fashion, electronics, healthcare, grocery, online payment  Source: iPrice Group. Chart: Nhat Minh

Opposite sides

iPrice Group’s data shows that in the quarter ended March, some online product categories suddenly became highly in-demand.

The major one is the healthcare category with the drug retailer - Pharmacity. In February, online demands for face masks and hand sanitizers increased by 610% and 680% respectively compared to January, as recorded on iPrice.vn.

By March, when more consumers stay at home to avoid outbreaks, it was then the turn for online grocery to take the throne. Visits to online grocery retailer Bach Hoa Xanh’s website this quarter increased by 49% quarter-over-quarter.

According to iPrice, these categories were not previously the focus of Vietnam’s e-commerce market. Among the top 50 e-commerce websites in Vietnam, only two are specialized in online grocery, while 10 are mobile device retailers, nine are electronics retailers, and seven are fashion retailers.

“After only the first three months of the year, the Vietnamese e-commerce industry has experienced a lot of sudden changes due to the influence of Covid-19. This brings about both new opportunities and challenges for e-commerce businesses, requiring them to be quick to react and ready to change,” the report wrote. For example, some cosmetics online businesses now start selling face masks and hand sanitizers. 

Results showed that traffic to these websites in the first quarter grew by an average of 32% quarter-over-quarter. Comparatively, for websites that sell solely cosmetics, the average increase was only 10%.

Meanwhile, the four major e-commerce marketplaces began to focus on promoting grocery and healthcare products quite late, way into March. Before that, they were still seen pushing for fashion, electronics, and cosmetics on their homepage and in their promotional campaigns. These slow responses somewhat prevented e-commerce from taking full advantage of the opportunities brought by Covid-19.

“However, after these marketplaces started to change their focuses according to the new demands of the market, by the end of the first quarter, their website traffic also started to grow again, showing signs of hope for the Vietnamese e-commerce market in the months to come,” the report concluded.

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