VietNamNet Bridge - December 31, 2016 was the ‘first death anniversary’ of Deca, an e-commerce site. In 2016, Vietnam’s e-commerce witnessed the departure of another name – Lingo. Many stars in the market faded after a short time of burning bright.
Google and Temasek estimate that the revenue of the Vietnamese e-commerce market would reach $8 billion by 2025. However, it is really a hard-to-do market.
One more left
In August 2016, Maj Invest, the investor, refused to continue to pour money into Lingo.
In 2015, VMG sold 6.6 million Lingo shares to Maj Invest through a subsidiary – Yellow Star Investment 3. It was initially expected that Maj Invest would inject money into Lingo in the second phase in June 2016 to take over the remaining stakes (25.09 percent) VMG was still holding in Lingo.
|December 31, 2016 was the ‘first death anniversary’ of Deca, an e-commerce site. In 2016, Vietnam’s e-commerce witnessed the departure of another name – Lingo. Many stars in the market faded after a short time of burning bright|
However, the promise was not fulfilled.
As Deca and Lingo have left, only two Vietnamese companies – Tiki and Adayroi - still exist in the market and are struggling with foreign rivals
Foreign competitors flock to Vietnam
“I don’t want to see the Vietnamese e-commerce market swallowed by giants from Thailand, South Korea and China,” an official said.
In April 2016, Chinese Alibaba took over Lazada global in a deal worth $1 billion.
After buying 49 percent of stakes of Nguyen Kim retial chain in 2015, Thai Central Group moves ahead with a series of other M&A deals in retail and e-commerce in both Thailand and Vietnam
In May 2016, Zalora Vietnam was transferred to Central Group, which had just taken over Big C Vietnam, a large retail chain. Meanwhile, Zalora fell into the hands of Nguyen Kim, whose 49 percent stake was being held by Central Group.
With a series of M&A deals in 2016, Central Group has been making a strong presence in Vietnam, from offline to online, from fashion and consumer goods to home appliance retailing.
As for South Korea, in October 2016, Lotte launched Lotte.vn, an online shopping website run by Lotte E-commerce, a subsidiary.
Though Lotte came to Vietnam later than its rivals, the giant stated it plans to hold 20 percent of the market share.
What are Vietnamese firms doing?
Tiki in early 2016 received a huge investment of VND384 billion from VNG. It has reported a loss of VND78.1 billion in the third quarter of 2016 and loss of VND157 billion since receiving the investment.
Meanwhile, adayroi reported a loss of VND2 trillion, despite huge revenue of VND10.77 trillion.
Many new e-commerce websites have been launched, including Vuivui.com belonging to The Gioi Di Dong, known as the largest technology product distribution chain.