Market analysis

1: Market size

 Global Markets

According to the report "Digital in Vietnam 2022" of We are social, Hootsuite, the
number of spending on department stores on e-commerce by customers is growing faster
than the number of users. It can be said that the development of e-commerce has led to
the growth of the department store industry. In particular, during the Covid-19 pandemic,
especially in the first 3 months of 2021, online department stores are the only industry to
achieve positive growth of 13%.

The global e-commerce market grew from $2,634.47 billion in 2021 to $3,047.83 billion

Overall, the global revenue of the online consumer goods industry – including groceries,
fashion, electronics and other household items – grew by more than half a trillion USD in
2021 (an increase of 18%), reaching a total of 3.85 trillion USD for the whole year.

 Vietnam e-commerce market

According to a report by Google, Temasek and Bain & Company, in 2022, consumers
buying online in Vietnam accounted for 49%, second only to Singapore (53%), higher
than Malaysia and Indonesia. Specifically, if in 2015, Vietnam's retail e-commerce only
reached 5 billion USD, reaching 11.8 billion USD in 2020, continuing to increase to 13.7
billion USD in 2021.

According to the Vietnam e-commerce white paper 2022, our country has up to 74.8% of
internet users participating in online shopping. In particular, the items most purchased
online are clothing, shoes and cosmetics (69%), home appliances (64%), technology and
electronics (51%).

 Shopee
According to the chart, Shopee is currently the most popular e-commerce platform in
Vietnam. It is a company of Singapore's Sea Group. Currently, Shopee accounts for
nearly 73% of total sales of 4 exchanges, equivalent to about 33.5 trillion.
Soon Lazada is accounting for 20% of the market share, corresponding to revenue of 9.7
trillion, equal to about 1/3 of Shopee sales. Lazada is the e-commerce platform of
Alibaba Group, China.
Shopee and Lazada have outpaced two domestic competitors, Tiki and Sendo, occupying
the No. 3 and 4 positions with a revenue market share of 5.8% and 1.4%, respectively.

This Shopee currently has more than 160 million active listings with about 6 million
sellers, including more than 7,000 leading brands and distributors. As of 2017, the
platform has recorded 80 million app downloads, more than 5 million in Vietnam. It
currently works with more than four million suppliers with more than 180 million
products. Accordingly, the leading e-commerce site continues to be Shopee with nearly
89 million visits in the quarter

A total of 42 million users made their first purchase on Shopee Mall in 2021 and 5
partners with a total transaction value of 100 million US dollars (nearly 2,300 billion
VND).

In 2021, Shopee Vietnam's net revenue is nearly 5,700 billion VND

2:Market growth

 Global e-commerce growth

Global e-commerce sales are expected to total $5.7 trillion worldwide by 2022. This
number is expected to continue to grow over the next few years, proving that e-commerce
is becoming an increasingly lucrative option for businesses. 

Additionally, of all global retail sales in 2022, 19.7% are expected to come from online
purchases. That is, nearly $0.20 of the $1 spent on retail goods this year will be done over
the internet. 

Online sales are expected to continue to grow and make up a larger share of the retail
pie. By 2026, it is estimated that the world's e-commerce retail sales will exceed $8.1
trillion, and total e-commerce retail sales will reach 24%

Global e-commerce growth table

  Vietnam's e-commerce growth

Compared to the situation of e-commerce in the world, Vietnam has a strong growth rate.
According to Statista, the global e-commerce growth rate has a growth rate of 16.24% in
2021 and is forecast to break through to 24.5% in 2025.

In Vietnam, this figure in 2021 is more than 20%, with a scale of 16 billion USD. By
2025, the growth rate of e-commerce in our country could reach 29%, reaching 39 billion
USD.

Metric.vn data shows that Shopee, Lazada, Tiki and Sendo are the 4 e-commerce
platforms with the largest market share in Vietnam.
The report "Digital in Vietnam 2021" recorded e-commerce spending in Vietnam in 2020
for each category. In particular, buyers spend the most on the tourism, transportation and
travel industry with a total expenditure of up to 3.18 billion US dollars. Next is the
electronics industry with total revenue of 1.57 billion USD, 1/2 of the leading industry.
Other industries with billion-dollar e-commerce revenues are fashion and beauty,
furniture and household goods, food.

 Vietnam's economic growth

Data of the General Statistics Office, the wholesale and retail sector decreased by 0.21%
compared to the previous year, reducing by 0.02% in the growth rate of the total added
value of the whole economy; the transportation and warehousing industry decreased by
5.02%, reducing by 0.3%; the accommodation and catering services sector plummeted by
20.81%, down 0.51%.

Summarizing the whole year of 2021, Vietnam's economic growth is only 2.58%, the
lowest in the past 30 years.

In that context, Vietnam's e-commerce still maintains a stable growth rate of 16%, retail
revenue reaches 13.7 billion USD in 2021; the proportion of e-commerce retail revenue
in the total retail sales of consumer goods and services nationwide reached 7%, up 27%
over the same period in 2020.

Vietnam B2C e-commerce revenue in 2017 – 2022 (billion USD)

Foreign direct investment continues to pour into Vietnam's e-commerce sector in 2022.
Companies from China, Japan, South Korea, and the U.S. have expanded their digital
presence on local e-commerce platforms

 Shoppe Company Growth

The discussion growth of 4 e-commerce floors in 2021 increased sharply, the brands
Shopee, Lazada, Tiki increased 6 times; Sendo alone has a 7-fold increase in discussions
compared to 2020
At the same time, Shopee's search trends on Google Trends always have the highest
popularity, monthly average >65/100. Popular keywords searched include "Shopee
Discount Code Search", "Shopeefood", and "Shopee Pay

Accordingly, Shopee leads with nearly 89 million visits in the quarter, up about 14%
compared to the third quarter of 2021 and about 30% over the same period last year.
Shopee is also the number one e-commerce site on both mobile platforms, Android and
iOS.

Comparing Tiki and Lazada is almost flat compared to Q3/2021, the traffic is 17.9
million units and 20.6 million units, respectively. Compared to Q4/2020, both e-
commerce platforms grew negatively, with Tiki at -20% and with Lazada at -1%.

traffic increased by 6.61% month-on-month (desktop). according to similar web statistics

Access to shopee.vn
shopee.vn generates the majority of social media traffic through Facebook, followed by
Youtube and Instagram (desktop). Engaging an audience through Tiktok offers the
possibility of new opportunities according to web statistics.

Access from social networks to shopee.vn

 The number of Shopee sellers in the vicinity of major cities grew by 70%
compared to the same period last year.
 In 2021, 1 in 6 orders were from new Shopee users, while the number of
Shopee users in the vicinity of major cities has increased by 40%.
 The number of ShopeePay e-wallet users in the vicinity of big cities increased
2.5 times, as more and more people enjoy the convenience of digital payment
methods. Besides, ShopeePay is also an effective tool to connect many online
sellers and retailers with new customers.
 More than 1,000 local sellers exceeded the revenue of 100,000 USD (nearly 2.3
billion VND) in 3 days of Shopee's year-end shopping festival of 9.9, 11.11 and
12.12.
 First-time sellers entering online business also recorded significant growth during
the year-end shopping season. On November 11 alone, sales of new sellers on
Shopee increased 18 times compared to the average of weekdays.
  The "ShopeePay Near You" feature is a new feature that helps users discover
many offers when paying at stores near them. After implementation, this new
feature has recorded 5 million transactions made at partner stores.


Shopee Mall continues to create growth momentum for partner brands, pioneering the
provision of innovative solutions and tools to support brands in sustainable development.
Many partner brands have recorded strong growth and achieved new milestones. A total
of 42 million users made their first purchase on Shopee Mall in 2021, and 5 partners had
a total transaction value of 100 million US dollars (nearly 2. 300 billion VND) .

In 2021, Shopee Vietnam's net revenue is nearly 5,700 billion, VND nearly 2.5 times the
figure of 2020 and 7 times higher than 2019. However, along with increased revenue, the
platform's annual recorded losses tend to decrease.

Market Trend :

 World e-commerce

Trust is the main currency of the future of e-commerce. Brands must be transparent,

authentic, and available to their customers, especially when online consumers spend the
majority of their time: on social media. Social e-commerce trends are the online shopping
hub for consumers tomorrow, with brands investing in video and in-person shopping.

Direct-to-consumer (DTC) companies are also investing in online communities to

personify their brands, increase customer retention, and overcome skyrocketing
advertising costs.

Trend 1
Rising acquisition costs force brands to foster long-term relationships with their
customers

Businesses strengthen customer connections by putting their brand identity front and
center
  Direct-to-consumer competition is rising

Although retail business doors have reopened, ecommerce sales aren’t

slowing, resulting in an influx of DTC brands competing for customer
attention.

 Advertising costs are skyrocketing across platforms

Digital advertising costs are eating up marketing budgets, putting

performance marketing–heavy customer acquisition models in jeopardy.

 Brand building is helping attract and retain customers

Businesses are overcoming the competition by investing in brand building,

which increases customer lifetime value, boosts conversion rates in the
short term, and attracts out-of-market buyers in the long term.

Trend 2
Death of third-party cookies forces brands to rethink personalization

Online retailers rehumanize their brands through communities, transparency, and shared
values
 Consumers are demanding personalization

Consumers continue to demand personalized shopping experiences, even as

regulations make data tracking harder, and the biggest players phase out
support for third-party cookies.

 Personalization isn’t a magic bullet for customer engagement

Brands innovate with first-party data, but personalization isn’t enough to

create long-term relationships with customers.
  Brand communities are building customer loyalty

Brand communities become key to building trust and brand equity, and
improving customer retention.

Trend 3
New commercial opportunities emerge on the biggest social platforms

Brands embrace experimentation to take advantage of social commerce

 Ecommerce is migrating to social media platforms

Ecommerce activity is congregating on social media platforms, from brand

marketing to customer service to shoppable advertising.

 Social platforms are presenting new ways to engage customers

Diverse platforms and rapidly evolving features lend themselves to unique

customer experiences, encouraging brands to reimagine consumer
engagement.

 Video is making social commerce more sociable

Video is key to unlocking the power of social commerce. Leading brands

are focusing on social-first approaches like behind-the-scenes livestreams,
video consultations, and personalized product recommendations.

 Vietnam e-commerce

The digital economy in Vietnam is growing rapidly and four key sectors—e-commerce,
online travel, food and transportation, and online media—are increasing the application
of technology to keep up with consumer demand. In 2021, the e-commerce industry in
Vietnam recorded a growth of 16% over the previous year, reaching a total value of
goods worth 13 billion USD.

The shift to e-commerce in Vietnam has opened the door for low-income people to try
running their own micro-businesses. Women have also helped increase their combined
household income through online sales. Vietnam's e-commerce growth in 2022 is forecast
to reach $16.4 billion in revenue, the first time the industry has reached this value.

According to a recent report, 53% of Vietnamese consumers have considered online

shopping as a habit, which bodes well for the development of Vietnam's e-commerce
industry in the coming years.

There is a high demand for Vietnamese agricultural products and exporters can exploit
the growth of Vietnam's e-commerce sector to promote and market these products. By
partnering with manufacturers, distributors, and other industry players, online merchants
can support the growth of the agricultural industry through their own capabilities.

Digital banking also plays a key role in Vietnam's e-commerce sector. In 2022, 85% of
Vietnamese consumers prefer digital financial services over traditional payments. The
digital transformation of Vietnam's banking system allows for leaner systems that make it
easier for consumers to access services. With more innovations, it can assist in
accelerating the e-commerce sector as more consumers maximize online shopping
channels.

Revenue from livestream sales is expected to continue to increase, leading to an increased

need for product reviews to support purchasing decisions.
 
Omnichannel will become a new form of retail. Brands will take advantage of both
traditional and online channels by joining e-commerce platforms, using available online
marketing tools.
 
The customer's shopping journey will gradually be personalized. This will be the key to
attracting attention and retaining consumers. E-commerce platforms have invested in AI
and Big Data to aggregate and process information, thereby designing their own
experiences.
 Shoppe

The demand for goods at shoppe has grown strongly in different categories, especially the
beauty and women's fashion industry, increasing sharply on holidays or discount days

In the first 3 major sales seasons of 2022, the statistics of the top 5 best-selling products
of the Beauty and Women's Fashion industry clearly show the buying trend of Buyers:
 1. The Facial Care product group leads the Beauty market on Shopee.
2. Products in the Body Care category have outstanding sales in the first half of
2022.
3. Shirts and Dresses are still the two categories that bring the highest revenue when
accounting for 40% of the total sales of women's fashion on Shopee

Along with the strong demand for open shops to serve the equivalent of the demand
needed in the market that shoppe has not yet occupied all

 The number of Shopee sellers in the vicinity of major cities grew by 70%
compared to the same period last year.
 In 2021, 1 in 6 orders were from new Shopee users, while the number of
Shopee users in the vicinity of major cities has increased by 40%.
Market share and demand :

 Global and Vietnam

Vietnam's e-commerce growth is forecasted by firms to continue to boom in the coming

years and will reach 39 billion USD by 2025, ranking 2nd after Indonesia (104 billion
USD), equal to Singapore. Vietnam's total Internet economic revenue by 2025 is forecast
to reach 57 billion USD, second only to Indonesia. Vietnam also has the 2nd highest
percentage of consumers shopping online in the region, behind only Singapore.

According to the "Digital 2022 global overview report" of We are social & Hootsuite, the
percentage of internet users shopping weekly in Vietnam ranks 11th among countries
(58.2%), on par with the global average, higher than the US, Australia, France, Japan,
Germany but lower than Thailand, Malaysia, South Korea, China, Singapore,
Philippines, India, Indonesia and the UK.
Across Southeast Asia, Google, Temasek and Bain & Company's "Southeast Asia
Economy 2021" report forecasts e-commerce revenue to grow from $120 billion in 2021
to $234 billion in 2025. It is forecasted that the average online shopping value of online
consumers will continue to increase strongly, from $ 381 / person in 2021 to $ 671 /
person in 2026. With a rate of 49%, consumers shopping online in Vietnam are second
only to Singapore (53%), higher than Indonesia and Malaysia.

 Shopee

Assess

The ranking of websites helps to assess the value of a company. Over the past three
months, shopee.vn's global ranking has dropped from 282 to 295.

But still holds the number one position in Vietnam's e-commerce market

And ranked 6th in the most visited websites in Vietnam

In the first half of 2022 report of Metric.vn Data Research Company, Vietnam is
becoming the second largest market in Southeast Asia, only after Indonesia in the context
of outstanding development after the COVID-19 pandemic.

Metric.vn's data shows that Shopee, Lazada, Tiki and Sendo are the 4 most prominent e-
commerce platforms in Vietnam. Specifically, Shopee is the e-commerce platform
accounting for the largest market share in Vietnam today with sales up to VND 43,118
billion, accounting for 72% of the market share from November 2021 to May 2022.

Ranked 2nd is Lazada with a market share of 20.9%, equivalent to VND 12,539 billion.
Tiki and Sendo are far behind the two competitors above.
According to iPrice Group's statistics in Q4/2021, Shopee is currently the leader in
popularity with nearly 89 million visits. On social networks such as Instagram, Facebook,
Youtube, the presence of this e-commerce giant is very outstanding.

Notably, Shopee's traffic is more than double the number that direct competitors like
Tiki, Lazada, and Sendo combined. Lazada is currently only ranked 4th with 20.6 million
visits, followed by Tiki's 5th place with 17.8 million visits. Sendo dropped to 11th place
with nearly 5 million visits
 Traffic of shopping sites

Referece

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