Vietnam has emerged as a dynamic and rapidly growing market in Southeast Asia, attracting international businesses with its robust economic growth and burgeoning digital landscape. For European e-commerce retailers considering international expansion, it’s important to understand the details of Vietnam’s unique market characteristics. This article provides a detailed overview of Vietnam’s e-commerce environment, giving you valuable insights for successful entry into the market.

Facts about Vietnam

Vietnam’s official country name is the Socialist Republic of Vietnam. It is, along with Laos, one of two Marxist-Lenin communist states in the Southeast Asian region. Vietnam is located on the eastern edge of the Indochinese Peninsula in Southeast Asia. It shares land borders with China to the north, Laos to the northwest, and Cambodia to the southwest. To the southeast and east, it faces the South China Sea and to the west it faces the Gulf of Thailand. The country is approximately 331,344 square kilometers in size and has varied geographical features including mountains, hills, and fertile deltas along the Mekong and Red Rivers.

Vietnam’s capital of Hanoi is the second-largest city in the country, with approximately 8 million residents. Ho Chi Minh City is the largest city, with over 9 million people living there. That means that, in terms of population, both cities are larger than the Berlin metropolitan area, but somewhat smaller than Paris or London. The total population is around 101 million people, with 41.4 % of them living in urban areas. Vietnam’s population density is 328 per km².

Vietnam’s Human Development Index (HDI) is 0.726, ranking 107th globally. For comparison, Ukraine ranks 100th, while Croatia ranks 39th and Austria ranks 22nd. In 2024, Vietnam’s GDP reached US$476.3 billion, with a growth rate of 7.09%. The GDP per capita with parity purchasing power (PPP) is US$14,973.

The currency in Vietnam is the Vietnamese dong (VND). Over the past five years, 1 euro has been valued at between 22,700 – 27,700 VND. Vietnam is 6 hours ahead of central Europe, so it is 4 PM there when it is 10 AM in Berlin or Paris.

Language and Localization

The official language of Vietnam is Vietnamese, which is spoken by the majority of the population. In addition to Vietnamese, several ethnic minority languages are used regionally, including Tay, Muong, and Khmer, among others.

The Vietnamese language is written using a Latin-based alphabet known as Quốc Ngữ. During Vietnam’s colonial occupation of France , French became a commonly spoken second language and Vietnamese incorporated several French loan words into its vernacular. This can be seen in words such as cà phê (café / coffee).

In modern Vietnam, English is a compulsory language in most schools and is taught beginning in the 3rd grade. About 86% of the population speaks some level of English, with Japanese following as the second most common foreign language.

However, although most children learn it in school, Vietnam’s English proficiency is rated as “moderate” by the EF English Proficiency Index (EPI) by Education First. Vietnam ranked 58th out of 113 non-native English-speaking countries, which puts it slightly above the global average and is an improvement over previous results. This means that any company hoping to sell to Vietnamese consumers should translate their website into Vietnamese and localize it to suit the preferences of local consumers.

Economy and Trade

Vietnam’s economy is highly diverse, with key sectors including manufacturing, agriculture, and services. In recent years, the country has experienced significant growth in high-value manufacturing, particularly in the production of technology products. This expansion has been driven by foreign investment, a skilled workforce, and Vietnam’s strategic position as a manufacturing hub in Southeast Asia.

The country’s major export partners include the United States (29%), China (13%), South Korea (6%), Japan (6%), and Hong Kong (3%), with key export goods ranging from electronics and textiles to agricultural products such as coffee and seafood. On the import side, Vietnam relies heavily on China, South Korea, Japan, Thailand, and the United States for essential raw materials, machinery, and high-tech components needed to support its growing industries.

Trends in Internet Usage

Although the internet was first introduced in Vietnam in late 1997, it now ranks 13th among the countries with the highest number of internet users worldwide. With approximately 80 million people online, it ranks just below Egypt and just above Germany. A different Statista survey estimated an even larger number of internet users — 88.3 million in 2024, expected to increase to 101.7 by 2029.

Mobile internet usage is also widespread, with an estimated 85 million uses in 2024, expected to increase to 98.6 million in 2029. The country has near-universal 4G coverage as well.

E-Commerce Insights

While the pandemic-induced e-commerce boom has leveled off in most of the world, e-commerce growth in Vietnam continued to set new sales records in 2024. Vietnamese consumers are shopping online to an ever-greater extent. 2024 had a notable surge in e-commerce sales, especially during significant holidays. Livestreaming and TikTok shopping are extremely popular new trends among Vietnamese e-commerce shoppers. In 2024, Vietnam’s total e-commerce market was valued at over US$24 billion, with US$17 billion for the consumer e-commerce market.

The most popular e-commerce categories in 2023 included electronics, fashion, and toys, while the highest level of growth was seen in e-commerce spending for food. Spending on electronic media like video games is also increasing.

Unlike most of Europe, the most popular means of payment for online shopping in Vietnam is cash on delivery (COD), which accounts for 70% of online payments. However, digital wallets and cards are gaining in popularity.

The majority of online shoppers are young, tech-savvy individuals aged between 18 and 35, primarily residing in urban areas. More women than men made online purchases according to a 2024 study. In 2023, a different study showed that nearly 45% of online shoppers consider free shipping the most important incentive for their online shopping purchases. This was followed by coupons, discounts, and simple online checkouts.

Vietnam has several large e-commerce platforms that are popular among consumers. In terms of gross merchandise value, Shopee is in the lead with 67.9% market share in 2024. It is followed by TikTok Shop, which accounted for 23.2% of market share. Lazada and Tiki are also very popular. Unlike the other platforms, Tiki is a Vietnamese company — with a history that might sound familiar: it started off as an online bookstore and grew to become an e-commerce giant.

Import and Customs Considerations

Importing goods into Vietnam means navigating a structured regulatory process. Foreign businesses looking to import and wholesale products must establish a trading company, which grants them the necessary rights to import goods. Companies intending to sell directly to consumers must additionally obtain a retail license. For businesses that prefer not to set up a local entity, an Importer of Record (IOR) service can handle all necessary documentation, customs clearance, taxes, and transportation. This can be useful for sellers who are just testing the waters.

Import tax is levied on goods imported into Vietnam. The rate of import tax is based on the HS code (Harmonized System) of the goods, the origin of the goods, and any trade agreements that Vietnam has signed with the exporting country. The EU and Vietnam signed a trade agreement in 2019 that eliminates 99% of all tariffs and greatly reduces red tape and regulations for trade.

The customs process involves submitting key documents such as a business registration certificate, investment registration certificate, bill of lading, import goods declaration form, and certificates of origin. Some product categories, such as food supplements, require additional quality declarations and safety inspections before they can be imported, and require a label written in Vietnamese. Understanding and complying with these regulations is essential for ensuring a smooth import process into Vietnam.

Conclusion

Vietnam’s dynamic economy and rapidly expanding e-commerce sector present a wealth of opportunities for European retailers seeking international growth. By understanding the local market nuances, consumer behaviors, and regulatory environment, businesses can strategically position themselves for success in this vibrant market.



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autor_eurotext_100Author: Eurotext Editorial Team

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