Consumers shopping at CO.OPmart Rach Gia supermarket, Rach Gia city, Kien Giang province. (Photo: Le Huy Hai/VNA)
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Vietnam Report JSC has recently conducted a survey and published its results for the retail business community.
25.4% of businesses reported a decrease in revenue, and a third of them experienced significantly lower profits compared to the same period in 2023.
Firms have been facing challenges since the beginning of the year due to economic hardships, reduced consumer income, and subsequent weakened demand. Added to these are the impacts of natural disasters and unfavorable weather conditions, resulting in a less dynamic retail market.
This is a concern and a pressure for the entire retail sector, with less than a quarter left in the year 2024.
Assessing the potential of modern retail, Vietnam Report’s General Director Vu Dang Vinh analyzed that, in the medium and long term, the rapid urbanization, growing income levels, a workforce of 67 million, and an expanding and diversifying middle class will be crucial drivers for consumer market growth, paving the way for retail development.
According to KPMG Vietnam, one of the largest professional services companies in the country, from 2020 to 2030, Vietnam will have an additional 23.2 million middle-class people, with a compound annual growth rate of 5.5%, placing it among the fastest-growing countries in Southeast Asia.
Furthermore, Vietnam’s consumption rate as a proportion of gross domestic product (GDP) is relatively high compared to other countries in the region, exceeding 70%.
This indicates that the potential and room for growth in the retail sector are immense, and the current challenges are only temporary. This is also a time for the industry to undergo a process of purification, as many retail businesses have lost their competitive edge and must exit, leaving room for more robust enterprises to rise and capture market share while embracing new opportunities.
Regarding adaptation to the market, Ms. Nguyen Thi Ngoc Thanh, General Director of AAA Market Research Limited Company, shared that the trend in shopping destination choices increasingly demands diversity in products, transparency in origin, reasonable prices, and added values from loyalty programs.
Thus, businesses need to effectively integrate loyalty programs with pricing strategies, ensure quality, build trust, and create long-term value to meet consumers’ rising expectations.
Quickly adapting and innovating strategies to meet these expectations will enable retail businesses to enhance their competitiveness. The trend of shopping through social media platforms continues to boom and solidify its dominant position.
Vietnam Report’s survey results show that 86% of consumers have made at least one transaction through social media platforms in the past 12 months, led by Gen Z and Millennials.
Social commerce differs from traditional e-commerce by integrating buying and selling interactions into daily life and creating a sense of community and genuine connection.
Platforms like Instagram, Facebook, and TikTok are not just tools for brands to reach customers quickly and accurately but have become effective selling instruments. Retail businesses aiming for success must grasp this concept.
Notably, social media advertising campaigns not only enhance brand awareness but also foster high engagement, forging a strong link between businesses and consumers.
According to Vietnam Report’s survey, two-thirds of consumers tend to trust and purchase products recommended by influencers or KOLs they admire.
Social media platforms employ various features and tools to stimulate shopping urges and leverage people’s natural tendency to trust the experiences and recommendations of those they admire.
Based on trust and positive impressions, consumers feel connected not only to the product but also to a community sharing similar values.
Ngoc Quynh
“Be Wary of Personal Data Exposure When Shopping on Social Media”
The challenges of social media shopping are well-known to the E-Commerce and Digital Economy Department of the Ministry of Industry and Trade, with a particular focus on security and privacy concerns.
