Vietnamese people like Facebook/Zalo shopping?

Since the boom of Internet in Vietnam as well as increase in income, Vietnamese people are enjoying various online shopping service. Besides B2C e-commerce websites like Lazada, Tiki, Sendo, shopping on SNS (particularly Facebook and Zalo) is a trend in Vietnam at present.

According to a survey result of Vinaresearch, most of respondents who living in Ho Chi Minh City answered that they have bought goods via Facebook (96.9% male and 98.3% female) and Zalo (30.9% male and 29.5% female).

In addition, the type of goods that they purchased most was Fashion (including Clothes and Accessories (Facebook 70.5%, Zalo 64.2%), followed by Cosmetics (30%), junk food (nearly 30%) then Gifts/Books, Electrical goods, etc. The question is that why do Vietnamese people like shopping on Facebook or Zalo?

Since more than half of population uses Facebook frequently, Facebook shopping is truly huge market.  From consumers’ perspective, there are many benefits of shopping on Facebook and Zalo. People can surf Facebook, and chat with friends  as their daily routine while they are looking at images of outstanding shops appearing on their network or recommended by friends quickly, instead of searching other websites. Moreover, it is much easier for consumers to see comment and rate directly (especially their common friends’ comment) on the Facebook page or Zalo account of those shops. It may help consumers check for certain whether they should trust this shop. If they are interested in any products, they can comment or send questions to the shop admin via Facebook messenger and then receive reply quickly. It is obviously much faster and more convenient than Q&A part on Lazada or Tiki. In addition, each shop has their own promotion program. That is also an advantage of shopping on Facebook or Zalo because users can receive the notification when they follow the shop and compare with other suppliers.
Undeniably, there are a lot of shops on Facebook and Zalo now.  However, it is also a difficulty for consumers when they must see the fact that all shops are not good as they expected. Due to the expectation of customers is different, it will be hard to confirm certainly that the shop is good by checking rate or comments, until the consumers receive products. As the matter of fact, there are some risks of shopping on Facebook/Zalo.

According Vinaresearch, the ratio of online shopping scams was nearly 48.1%. Scammers use some tricks to set up fake retailer shops on Facebook with sophisticated design and layout and fake number of like and comments. Many shops offer good items with beautiful images at very low price or even high price. However, consumers sometimes receive the fake products or not-good-as- advertised products. In some cases, consumers lost their money when they paid first and received nothing. Sometimes, consumers can return products, but they are charged fee for delivery, or in the worst case, purchased item cannot be refunded or returned. The main reason is that online shopping via SNS is based on the trust between sellers and buyers. There is no strict pledge or unclear consumer protection law in this case in Vietnam. The solution that many people did when they were scammed was that they unfollow page, then shared bad comment with their social network, without making attempt at suing scammers for loss.

In general, it is clearly to see the plus points and drawback of shopping on Facebook/Zalo. Nevertheless, the trend of online purchase on these SNS is expected to keep going in Vietnam but with a stable growth speed. Consumers may switch to use other e-commerce website or method easily if those service are good.

From sellers/ retailer’s perspective, doing business on Facebook/Zalo is opportunity and challenge at present. There are many good points of opening shops on Facebook/ Zalo. One of the most benefit that sellers can gain is “start-up quickly. They can open a shop in few seconds with zero dollar.  What they need to do is merely a Facebook/Zalo account. Then they can reach a big number of users in Vietnam as potential customers. Sellers also can use ads to spread their image at the beginning with lower cost than other traditional advertisements. Therefore, Facebook and Zalo are becoming “marketing channel” of retailers.  In addition, retailers can contact customers directly via Facebook/Zalo messenger in order to answer customers’ questions, to introduce or give guideline to customers and to receive order.  It is regarded as “a useful tool of customer service” to gain customers’ trust and loyalty. If the shop admins provide good service, they will definitely win customers’ heart. The next benefit is that sellers do not have to pay commission to other e-commerce channels.

Nevertheless, there are some disadvantages of doing business on Facebook/Zalo. In addition to risks of account hack/report and competition among various shops, shop owners will have to deal with the risk of loss and risk of Facebook/Zalo policy.  Firstly, the risk of loss happens when ordered-item is sent to customers but customers do not pay and return products or delivery man cannot contact customers. In this case, sellers will have to be in charge of delivery fee. The reason for this risk is based on many Vietnamese people’ shopping behavior which is “online shopping- payment in cash”. The second risk is Facebook and Zalo or any SNS’ change in policy. Recently, many Vietnamese retailers have been worried about the change in policy of Facebook, such as the new feed of friends is preferably appeared on users’ Facebook instead of content related to e-commerce or brands; an increase in cost of advertising on Facebook. These affected engagement rate of retailers’ page and caused their decrease in revenue. However, despite those disadvantages, Facebook, then Zalo, are still playing important role in Vietnamese retailers’ business, particularly those who do not have much money for their startup, or for those who regard Facebook, Zalo as a useful tool of their social media plan at present.