Vietnam’s internet economy growth ranks second in Asia: report
Vietnam’s internet economy has advanced by 39% annually since 2015 and is currently the second fastest-growing in Asia, with 68 million internet users in the country in 2020 and the figure is expected to reach 75.7 million by 2023,
according to Google’s first “Vietnam’s Search for Tomorrow” report.
|A student is seen learning online. Vietnam’s internet economy has advanced by 39% annually since 2015 and is currently the second fastest-growing in Asia – Photo: VNA|
The upward trend is expected to continue, with the Government’s drive toward 100% smartphone penetration through the support of low-cost smartphone production and one of the cheapest data packages in the region.
Rise of digital rural consumers
Although urban areas continue to dominate the online landscape in terms of spending, rural Vietnam is a prime market for growth, poised to grow twice as quickly as the metro cities. This is where over half of the country’s population resides — an untapped market with rising internet penetration.
Specifically, 77% of residents in rural areas now have internet access, with 91% of them browsing the internet daily. The internet has become a bridge to resources, products and services that these users are accessing for the first time.
Rural users are rapidly turning to the internet for communication, education, self-development, and entertainment. Marketers can align their messaging to these categories, leveraging the aspirations of these users with useful and relevant content that creates an emotional connection.
Besides this, YouTube’s relevant and easily accessible content appeals to rural users, with 97% using the platform every week and 62% viewing content on it daily. But when making purchase decisions, search is the clear leader, with 45% of rural consumers using it to find information on products compared with traditional media at 24% and social media at 27%.
Rise of on-demand economy
With most of the world under lockdown, the Covid-19 pandemic has brought down the number of customers visiting stores. Although Vietnam is no longer under lockdown, local consumers are still reluctant to venture out of their homes, leading to a much slower recovery of store traffic.
Even before the pandemic, the internet economies were on the rise with Vietnamese consumers, especially the young generation, moving to online services in hopes of a hassle-free and convenient lifestyle.
Similarly, education and money management also saw a steady increase in search interest: 1 in 3 Gen Zs turned to the internet in the last month alone to learn and develop their knowledge base.
In addition, local consumers are increasingly shifting from physical branches to the online medium for their financial needs, which has resulted in a 33% surge in the download of finance apps and increase in search interest for “online lending apps” by 300% in the past year.
The shopping journey has evolved significantly due to increased access to the internet and the health crisis, with 83% of Vietnamese now spending more time researching products online before making a purchase. Online decision-making and offline purchasing is the dominant behavior across key categories.
In addition, local consumers are asking more personalized queries, with 75% of purchases being done offline, yet 62% of the research for these purchases being done online.
Vietnamese care about their health
A healthy lifestyle has never been more important to the Vietnamese and many have looked for products and services to improve their lifestyles and consumption habits.
Air quality is a common concern in the country, as more consumers searched for “air pollution”, up 80%, and “air purifiers”, up 340%, and there was a dramatic increase in the search for products to help improve the home environment.
Consumers are also increasingly becoming more health-conscious, indicated by the surge in search interest for “health wearables" by 55%, and “home workouts” by 60%, as well as a 38% increase in “fitness apps” downloads. In fact, the time spent per visitor on apps or websites relating to fitness or diets also saw an increase by 62%.
Vietnamese internet users also showed an increased interest in using healthier and organic products despite the higher price tags, with an increase in search interest for food and beverages, such as “alkaline water” by 80%, “zero alcohol beer” by 250%, and “low sugar” by 100%. SGT
The digital sector is expected to contribute 30% to Vietnam's economy by 2030.
The Southeast Asian internet economy has expanded by 39 per cent this year to hit US$100 billion for the first time, according to a report released by Google, Temasek and new partner Bain & Company on Thursday.