e-Conomy SEA 2021| Vietnam: Roaring 20s — The SEA Digital Decade
The brief report shows that pandemic-driven shifts in consumer behavior are expected to have a lasting impact on key growth drivers in the internet economy: e-commerce, food and transport, online media, online travel, and digital financial services. To unlock the massive opportunity for business growth, brands need to know what it takes to meet consumer expectations and increase customer satisfaction.
Here, we share what the state of Vietnam’s internet economy in 2021 and this decade means for brands and marketers.
Consumers cruise into a new way of life
Digital consumption is now ingrained as a way of life in Southeast Asia (SEA). Early adopters have deepened usage – pre-pandemic users are consuming four more digital services than they did before 2020 – and the 60M consumers who joined since the pandemic started are here to stay, with 9 in 10 consumers who tried a new digital service in 2020 continuing to use the service in 2021.
Vietnam has seen 8M new digital consumers since the start of the pandemic (up to H1 2021), with 55% of them coming from non-metro areas. Stickiness of adoption remains high as digital consumption has become a way of life – 97% of the new consumers are still using the services and 99% intend to continue going forward. Pre-pandemic users – those who used the services before the pandemic – have consumed an average of 4 more services since the pandemic, and amongst all users, satisfaction with the services sit at 83% across verticals.
Digital merchants take off
The extraordinary shift in consumer behaviour has led to the rise of the digital merchant: native digital SMEs and early adopters who have embraced digital services end-to-end. 1 in 3 believe they would not have survived COVID-19 without digital platforms, and while most have a positive view of digital platforms, profitability remains a top concern.
In Vietnam, 30% of digital merchants believe that they would not have survived the pandemic if not for digital platforms. While digital merchants use an average of two digital platforms, profitability remains a top concern. Digital financial services are also becoming critical enablers, with 99% of digital merchants now accepting digital payments and 72% having adopted digital lending solutions. Many are also embracing digital tools to engage with their customers, with 72% expecting to increase usage of digital marketing tools in the next five years.
Resilience gives way to resurgence
While SEA’s internet economy was resilient in 2020, a resurgence in 2021 has propelled the region upwards to $170B GMV. e-Commerce, food delivery and digital financial services remain primary growth drivers and we expect the internet economy to reach ~$360B by 2025.
Funding on track to reach new heights
Strong growth fundamentals, successful exits and supportive regulations have sparked an outpouring of global capital into SEA at an unprecedented scale. Deal activity has been at a record high, clocking $11.5B in H1 2021 alone, putting it on par with 2020’s full year value. e-Commerce and digital financial services have remained centre stage and are likely to continue attracting more investments.
Deal activity skyrocketed in the first half of 2021, already surpassing full-year investments of recent years. Vietnam remains a very attractive innovation hub with more incubators, accelerators, and innovation labs than most other markets in the region. Despite market uncertainty, global capital continues to pour into the country given its strong growth fundamentals and growing digital ecosystem. Investment appetite remains strong in digital services that surged as a result of COVID-19, such as e-commerce, fintech, health tech, and edtech.
Download full report: e-Conomy SEA 2021: Roading 20s: The SEA Digital Decade
Source: think with Google
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