COVID accelerates shift towards omni-channel retail
The COVID-19 pandemic was accelerating Vietnam’s shift towards omni-channel purchasing behaviours and retailers should capitalise on this momentum to drive expansion and increase penetration rates in the post-COVID period,
Retailers should offer omni-channel shopping in the post-pandemic period, according to Deloitte. — Photo vnexpress.net
COVID-19 was changing Vietnamese consumer habits. “The COVID-19 pandemic has resulted in a greater focus on health and wellness and dining at home as well as a broad-based shift towards e-commerce,” a recent report by Deloitte wrote.
“As a result of the pandemic, for instance, more than 50 per cent of Vietnamese consumers have reduced their frequency of visits to supermarkets, grocery stores and wet markets, while 25 per cent of them have increased online shopping.”
The pandemic was also accelerating online grocery shopping. “The COVID-19 outbreak has introduced e-commerce to a large number of Vietnamese consumers who had earlier not been interested in online grocery shopping and e-payments.”
On Shopee’s platform, for example, the time that Vietnamese consumers spent shopping increased by more than 25 per cent after the COVID-19 outbreak, as they looked to purchase groceries and other daily essentials.
“The online shopping habits that many Vietnamese consumers have picked up during the COVID-19 period may become permanent changes that e-commerce players will need to adapt to.”
Several non-traditional retail players also seized the opportunity to make their foray into the market. For instance, ride-hailing player Grab launched its grocery e-commerce platform, GrabMart, in Viet Nam on 23 March 2020.
The report said that with a dynamic e-commerce market, Viet Nam attracted the attention of both local and foreign players who had poured an estimated US$1 billion into the sector. The two largest cities, Ha Noi and HCM City, accounted for about 70 per cent of total e-commerce transactions.
Key players include Lazada, Shopee, Tiki, Thegioididong, and Sendo, with Shopee occupying the number one spot with about 16.8 per cent share of combined monthly web traffic.
Still, Viet Nam’s overall retail landscape remained predominantly offline, the report said, citing findings of a recent survey that 98 per cent of retailers cited brick-and-mortar stores and distribution channels as accounting for the majority of their sales turnover, with only 2 per cent citing e-commerce channels.
Viet Nam had more than 666,700 traditional retail outlets, 1,289 convenience stores, 58 hypermarkets and 3,450 supermarkets in 2019. — VNS
The coronavirus pandemic has changed consumer shopping behaviour, prompting retailers to embrace online commerce to keep up with new trends.
Local retailers in FMCG should rethink their channel strategy as Covid-19 impacted the way Vietnamese consumers shopping.