English for specific purposes 1 topic overview of vietnams e commerce market 2

Many experts and consumers believe that traditional shopping is now dominated by the e-commerce industry, largely due to the rise in popularity of online shopping platforms.. E-commerce

THUONGMAI UNIVERSITY

FACULTY OF MARKETING

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ENGLISH FOR SPECIFIC PURPOSES 1

TOPIC:

OVERVIEW OF VIETNAM'S E-COMMERCE MARKET

CONDUCTOR: GROUP 1 - 231ENTI101112

SUPERVISOR: MRS NGUYEN QUYNH ANH

HA NOI, 10/2023

GROUP DISCUSSION

Topic: Overview of vietnam's e-commerce market

Group: 1

Class: 231ENTI101112

Teacher: Nguyễn Quỳnh Anh

Presentation assessment: List of students (in the order of presenting)

No Name (for students) Tasks Comments (for teacher)

1 Nguyễn Lan Anh Introduction & conclusion

(Leader)

2 Đinh Thị Bích The development of e

commerce (Word)

3 Đỗ Thành Công Advantages of

e-commerce (Powerpoint)

4 Phan Thị Trâm Anh Disadvantages of

e-commerce

5 Vàng Thị Dìn Opportunities for

Vietnam’s e-commerce

6 Dương Thị Mai Anh Challenges for Vietnam’s

e-commerce

MEETING MINUTES 1 – GROUP 1

Time: from 8:00 pm to 9:00 pm September 10 2023th

Place: Google Meet

Participants: 6/6

Contents for discussing:

- Members contribute ideas on the group discussion topic “Overview of vietnam's e-commerce market”

- Leader develop an outline for the presentation and each member give ideas for the outline

- Divide the tasks for group’s members

Conclusion:

1 Nguyễn Lan Anh: Introduction and conclusion

2 Đinh Thị Bích: The development of e-commerce in Vietnam, Word

3 Đỗ Thành Công: Advantages of e-commerce, Powerpoint

4 Phan Thị Trâm Anh: Disadvantages of e-commerce

5 Vàng Thị Dìn: Opportunities for Vietnam’s e-commerce

6 Dương Thị Mai Anh: Challenges for Vietnam's e-commerce

Duties for participants: Research, complete the duties and submit before September 17th

2023

Lan Anh Bích

Nguyễn Lan Anh Đinh Thị Bích

2

MEETING MINUTES 2 – GROUP 1

Time: from 8:00 pm to 9:00 pm September 19 2023th

Place: Google Meet

Participants: 6/6

Contents for discussing:

- Review each part that the member have submitted

- Prepare template Powerpoint

Conclusion:

- Edit content according to the review received

- Choosed template Powerpoint

Duties for participants: Complete the duties and submit before September 24 2023th

Nguyễn Lan Anh Đinh Thị Bích

MEETING MINUTES 3 – GROUP 1

Time: from 6:00 pm to 7:00 pm, October 6 2023th

Place: V401

Participants: 6/6

Contents for discussing:

- Prepare the presentation content

Conclusion:

Present order:

1 Nguyễn Lan Anh: Introduction and conclusion

2 Đinh Thị Bích: The development of e-commerce in Vietnam

3 Đỗ Thành Công: Advantages of e-commerce

4 Phan Thị Trâm Anh: Disadvantages of e-commerce

5 Vàng Thị Dìn: Opportunities for Vietnam’s e-commerce

6 Dương Thị Mai Anh: Challenges for Vietnam's e-commerce

Duties for participants: Prepare and practice for the group presentation.

Nguyễn Lan Anh Đinh Thị Bích

4

INTRODUCTION 6

BODY/ DEVELOPMENT 7

1 The development of e-commerce in Vietnam 7

1.1 In the past 7

1.2 In recent years 7

1 3 Future growth prospects for Vietnam's e-commerce 7

2 Advantages of e-commerce 8

2.1 Advantages of e-commerce for consumers 8

2.2 Advantages of e-commerce for enterprises 9

3 Disadvantages of e-commerce 10

3.1 Disadvantages of e-commerce for consumers 10

3.2 Disadvantages of e-commerce for enterprises 11

4 Opportunities for Vietnam’s E-commerce 12

4.1 The proliferation of Internet users 12

4.2 Online transactions become more popular 12

4.3 The ministry assists E-commerce platforms 12

4.4 Logistics infrastructure has been improved, facilitating e-commerce transactions nationwide 13

5 Challenges for Vietnam's e-commerce 13

5.1 Challenges for for Vietnam's e-commerce 13

5.2 Some reasons why Vietnam's e-commerce faces many challenges 13

CONCLUSION 15

Many experts and consumers believe that traditional shopping is now dominated by the e-commerce industry, largely due to the rise in popularity of online shopping platforms Most consumers are familiar with electronic devices and the benefits that online platforms offer Vietnam’s e-commerce has been thriving, playing an important role in economic development as well as in the future of Vietnam’s digital economy E-commerce development is an inevitable trend in the country, and the COVID-19 pandemic serves as a catalyst for this trend to proceed faster and more strongly With the rapid change in online shopping habits in Vietnam, its e-commerce activities as well as trade promotion activities in the online environment continue to maintain rapid and sustainable development According to GlobalData's E-Commerce Analytics, Vietnam is considered one of the fastest growing e-commerce markets in Southeast Asia, with an average annual growth rate of about 18%, and its forecast market size is likely to reach $26 billion by 2024 The explosive growth of ecommerce has made Vietnam one of the most potential markets in the ASEAN region This is an inevitable development step, in line with the trend of the world However, besides those great opportunities and potential, e-commerce in our country also faces many challenges and difficulties

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BODY/ DEVELOPMENT

1 The development of e-commerce in Vietnam

1.1 In the past

E-commerce in Vietnam has not had a long development process like in many other countries By 2005, two major e-commerce platforms - Shopee and Tiki - were established, marking a new beginning for e-commerce in Vietnam TikTok Shop has become the third-largest retail e-commerce platform in Vietnam, although it has only been operating since mid-2022 E-commerce in Vietnam has a short history, and its development is not easy either

1.2 In recent years

Nowadays, many e-commerce websites offer a variety of Vietnamese goods For example: Lazada, Sendo, Shopee, Tiki, etc In the past few years, online shopping in the country has become increasingly popular and has received great attention from people, especially after the outbreak of the disease Consumers changed their buying habits from traditional shopping to more online consumption

In 2020, the COVID-19 pandemic promoted online shopping Stores are closed because of the pandemic, causing many people to rush to shop online Adapting to the general trend of the world, especially in the context of the COVID-19 epidemic, e-commerce in Vietnam in recent years has had a positive development

1 3 Future growth prospects for Vietnam's e-commerce

Vietnam's rapid economic growth has created an increasing demand for shopping, including online shopping Vietnam’s e-commerce industry is rapidly expanding, thanks

to increasing foreign investments and a favorable regulatory environment By 2025, online sales are predicted to account for nearly one-tenth of the country's total sales of goods and services

Online payment services such as e-wallets, credit cards, and online banking contribute to promoting the development of e-commerce in Vietnam The rapid increase

in the number of Internet users also creates great potential for the development of e-commerce, especially in the field of online retail

2 Advantages of e-commerce

Owing to state-of-the-art technology improvements, e-commerce has transformed and reached a flourishing era, bringing many benefits to both companies and customers 2.1 Advantages of e-commerce for consumers

a) Easy and Convenience

The rise of the e-commerce marketplace has been a boon for many individuals who cannot leave their homes or workplaces due to a variety of reasons, such as health concerns, inclement weather, long distances, or economic constraints

For instance, amidst the mn COVID-19 pandemic, the government imposed strict regulations prohibiting people from traveling long distances or visiting stores, leaving them with limited options for acquiring products Fortunately, the advent of e-commerce offered a convenient alternative, allowing customers to purchase goods with a simple mouse click

b) A diversity of products

Customers can select products from any retailer or supplier worldwide through e-commerce Compared to traditional retail establishments, customers will have a much broader selection

Additionally, instead of going to the stores and buying products quickly, customers

do not have to rush to buy online products A company can stock many goods without worrying about the cost of inventory with a virtual store As a result, a company also gives customers many options for choosing a product Customers only need to add any products they prefer to buy to the cart of e-commerce platforms, and they can buy anytime they want to or even change their minds Such availability increases the ability to earn profits and leads and helps in building a better relationship between buyers and merchants

Not to mention, this outstanding feature can be seen at any website or e-commerce platform, such as Shopee, Lazada, Tiki, with the wide range goods listed and categorized into types like clothes, furniture, Office supplies, etc

c) Lower prices

A significant advantage of ecommerce is that running a virtual store is not required

to rent commercial real estate and hire multiple employees Also, in some cases, if it’s a direct sale, no storage space is needed According to that, online merchants offer more

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economical prices of goods and services to their buyers with low shipping rates for delivery than brick and mortar ones And customers will be the ones who have benefits the most and can save up a lot of money

In truth, this can be seen by the discount prices offered by e-commerce platforms such as Shopee, Lazada, Tiki, Tiki, etc And, the real game changer is the TikTok shop They have a special discount or free delivery costs campaign for customers monthly to encourage customers to buy more products in Vietnam Users can buy items at any price depending on the discount program, which can be less than 50% of the listed price 2.2 Advantages of e-commerce for enterprises

a) Cost-Effective Operations

E-commerce often requires fewer overhead costs compared to brick-and-mortar stores This is appealing to Vietnamese businesses, particularly startups and small to medium-sized enterprises (SMEs), as it allows them to reduce operating expenses E-commerce eliminates the need for physical storefronts or multiple retail locations, which can be expensive to rent, maintain, and staff In Vietnam, where rental costs in urban areas can be high, this is a significant cost-saving factor In addition, physical stores require utilities such as electricity, water, and heating and cooling, which can add

up to significant costs While e-commerce businesses can operate from smaller, energy-efficient facilities, reducing these expenses

While e-commerce businesses still require personnel, they typically require fewer employees compared to physical stores This can result in cost savings on salaries, benefits, and training Automation tools and software can further streamline operations and reduce labor costs

b) Cross-border e-commerce

One of the other benefits related to e-commerce for businesses is that they are given

an international marketplace to function Traditionally firms were bound to operate within a geographical boundary and cater to only a limited number of customers that it could reach out to Organizations through e-commerce can approach a wide range of customers globally and meet their needs and demands

It could therefore be assessed that e-commerce allows businesses to expand their markets and customer base to various geographic areas and cater to the needs and

c) Creating customer data insights

E-commerce grants businesses access to a vast amount of customer data and insights instantly Every action a customer takes on the website is recorded, from the products he purchased to the carts he abounded, to the pages he viewed and much more Businesses now collect data through their analytics tools that help them make informed decisions in terms of optimization

By gathering data concerning their clients' purchases and their clients' personal details, businesses can make many beneficial, informed decisions These decisions include to whom they should focus their marketing efforts in the future, in which countries they should invest more to generate more sales, and what products they should add to their product/service offerings

In another aspect, by knowing in which phase of the conversion funnel the client is churning, companies could apply changes to their platform that will help them increase their retention rates By doing so, these businesses can lower their defection rates by 5%, which will lead to them increasing their profits by more than 20% (Sparrow, 2018)

3 Disadvantages of e-commerce

3.1 Disadvantages of e-commerce for consumers

a) Privacy and Security Issues

Along with benefits brought in by the Internet, Vietnam has been facing major risks

in cyberspace which may threaten national security and social order The cyber security status of Vietnam in the upcoming time is quite complicated and worrying, considering growingly serious cyber attacks in the near future With the large dominance of the e-commerce market, foreign-owned e-e-commerce platforms not only have large revenues in the Vietnamese market but also hold a large amount of Vietnamese data From basic information fields such as name, age, address, and contact phone number to information about shopping behavior, preferences, habits, and living standards of Vietnamese people This is a huge risk in terms of network safety and security, even challenging national sovereignty in cyberspace

In 2019, Vietnam was among the worst-hit countries by ransomware in the Asia-Pacific region The rate of cryptocurrency-mining malware targeting the nation came

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third in the region Drive-by attacks in Vietnam also doubled the average level of the region and the world It is alarming for Vietnamese organizations and companies Therefore, a poorly managed and insecure e-commerce website puts every consumer at great risk, which is probably the biggest disadvantage of e-commerce Strengthening cybersecurity to protect critical data, personal information, and digital assets is critical to avoiding cyberattacks and fraud

b) Fake and low quality goods

Along with that "hot" growth, fake, counterfeit, and poor quality goods are widely sold on online trading platforms and cross-border social networks, directly affecting consumers, businesses, and market health

Counterfeit goods are threatening people's livelihoods as well as affecting the reputation of genuine businesses There are hundreds of complaints from consumers about commercial fraud on e-commerce platforms They mainly involved people paying for their goods but not receiving them, poor-quality products and services, and stolen personal information Information theft, financial fraud and disturbing advertisements were the sad reality of e-commerce in Vietnam today

3.2 Disadvantages of e-commerce for enterprises

The e-commerce market in Vietnam is highly competitive, with both local and international players vying for market share This can make it difficult for new businesses

to establish themselves and for existing ones to maintain profitability Many international e-commerce giants, such as Alibaba-owned Lazada, Shopee, and Amazon, have entered the Vietnamese market These companies have substantial financial resources and expertise, making it challenging for new entrants to compete on the same scale Here are some of the key difficulties that arise due to the high level of competition:

Price Wars: Intense competition often leads to price wars, with e-commerce businesses offering steep discounts and promotions to attract customers While this benefits consumers, it can erode profit margins for businesses and make it challenging to maintain profitability