E-commerce is thriving across Asia, particularly in India and Vietnam, signaling substantial shifts within their economies. According to recent reports, Vietnam's e-commerce sector has surged by 25% as of 2023, and projections indicate it may account for 10% of total retail revenue by 2025. This dramatic growth is reshaping businesses and driving them to swiftly adapt to digital transformations.
Tran Quoc Bao, Deputy CEO of KIDO Group, highlighted the swift adaptation of his company to the e-commerce model. He noted, "Today, the majority of our revenue now derives from e-commerce, proving this is the right direction to pursue." This sentiment echoes across various sectors, as companies increasingly turn to digital platforms to generate sales.
Alongside KIDO, TikTok is playing a pivotal role in developing the e-commerce environment. Nguyen Lam Thanh, Vice President of the Vietnam Digital Media Association, revealed TikTok's plan to aid local manufacturers. The platform's OCOP (One Commune One Product) initiative has successfully facilitated the marketing of Vietnamese agricultural products, narrowing the digital gap between rural and urban markets.
Residents have actively engaged with TikTok's efforts, with livestream sessions hosted each Saturday, reaching audiences of up to 5 million viewers. TikTok's recent expansion of this program signals its commitment to the localization of products and enhancing the exposure of local markets to the consumer community.
Meanwhile, Tam Tra Thai Cooperative has also embraced digital outreach, utilizing platforms like Zalo, TikTok, and Facebook, with about 40% of its output sold online. This shift is transforming not just individual businesses, but entire cooperatives, particularly evident in Thai Binh province, which houses over 800 cooperatives.
Hoang Thi Tan, Director of Tam Tra Thai Cooperative, expressed optimism about the digital futures of such groups and emphasized the value of technology as they aim to boost competitiveness and streamline their supply chains. Meanwhile, Tran Van Toan, Chairman of the provincial Cooperative Alliance, highlighted the importance of digitizing application processes, which facilitates product promotion significantly.
Experts recognize Vietnam as one of the fastest-growing e-commerce markets, with growth rates sustained at about 25% annually, positioning it strongly within ASEAN. Lai Viet Anh, Deputy Director of the Vietnam E-Commerce and Digital Economy Agency, noted the challenge of competition, particularly from counterfeit goods and uneven access to online platforms. She stressed the need for regional trade departments to collaborate and effectively bolster the local e-commerce environment.
Looking to India, the e-commerce outlook parallels some of the dynamics seen in Vietnam but is amplified by its larger technology sector. Kevin Carter, founder of EMQQ Global, recently declared India to be at the forefront of global e-commerce growth. He pointed out, "It's the tip of the spear of growth—not just in the markets but on the planet." Investors are taking note, with the India Internet ETF experiencing substantial gains this year, largely driven by significant performers like Zomato.
Zomato, often dubbed the 'DoorDash of India,' has enjoyed remarkable stock performance, bolstered by the burgeoning demand for quick commerce networks. Carter notes the potential of India's growing online user base, remarking, "They’re getting their first-ever computer today basically.”
This digital revolution has not come without its hurdles. HDFC Securities has projected India’s GDP growth to moderate slightly to 6.4% for 2024-25, attributing this moderation to slowing urban demand and lagging private capital expenditure recovery. Yet, the report identified the rural sector as resilient, with increased government spending anticipated to prop up growth.
Dhiraj Relli, MD and CEO of HDFC Securities, emphasized the noteworthy distinction of India’s economic performance. He declared, "India will largely be an outlier in the GDP growth compared to its global counterparts," reinforcing the notion of sustainable growth driven by technology adoption and consumer market evolution.
Overall, as both India and Vietnam propel forward on the e-commerce front, local producers and modern retailers must navigate nuanced challenges. Properly leveraging digital technology can not only drive sales but also create more sustainable business models moving forward.
With e-commerce becoming increasingly ingrained within society, it is imperative for all stakeholders—from small cooperatives to large companies—to collaborate and innovate as they continue exploring digital avenues.
