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Will there be an Amazon-Alibaba duel in Vietnam?

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Amazon and Alibaba’s presence in Vietnam could create a heated battle for customers.

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Nhip Cau Dau Tu quoted Simon Baptist from Economist Intelligence Unit as saying that Amazon is joining the Vietnamese market because it is one of fastest growing economies in the region, expected to have an additional 18 million middle-class households in 2017-2030, 30 percent of which would be from Hanoi and HCMC.

Nguyen Thanh Hung, chair of the Vietnam E-commerce Association (VECOM), believes that the No 1 online seller’s presence in Vietnam will heat up the domestic e-commerce market.

“The market is divided with Lazada, Tiki, Shopee and Adayroi the biggest players. However, this doesn’t mean that there is no opportunity for other players to make things happen,” he said.

The representative of Vecom warned that Amazon will meet difficulties when jostling in Vietnam. Alibaba and rivals came to the country earlier. 

Alibaba, for example, spent $1 billion to acquire Lazada, a leading online shopping channel, now operating in Singapore, Malaysia, Thailand, the Philippines, Indonesia and Vietnam.

Lazada has 155,000 sellers and 3,000 brands to serve 560 million consumers in the region. Lazada has more than 300 million products, ranging from electronics to home appliances, from toys to fashion products.

Analysts believe that the ‘hot spot’ of the e-commerce market in the time to come will be the battlefield between Amazon and Alibaba which have the same levels of financial capability, logistics capability and technology.

Asked about its strategy, Zhang YiXing, CEO of Lazada Vietnam, said with its large logistics network, Lazada allows enterprises to easily carry goods across countries to clients anywhere.

Meanwhile, a representative of Amazon said the company would provide training programs for sellers. They will be taught how to design stalls, post information and catch consumers’ eyes with images.

Amazon can also help Vietnam’s enterprises overcome language barriers by launching an instruction page and a Facebook fanpage in Vietnamese.

An analyst commented that big challenges are awaiting Amazon in Vietnam. To date, Amazon has only signed a cooperation agreement to help Vietnam’s products approach its clients internationally.

Meanwhile, Baptist said Amazon would encounter challenges in logistics services. Despite considerable improvement, Vietnam’s infrastructure remains problematic, and it is costly to move among provinces and cities.

However, middle-class people who spend more money on high-value products will use Amazon. Vietnamese businesspeople, for example, buy goods on Amazon for resale in Vietnam.

 

 

Source: VietNamNet

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