How Shopee’s closed ecosystem operates in Vietnam
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- Business
- 14:05 10/04/2024
DNHN - To cope with fierce competition from e-commerce platforms, Shopee has not only increased its online sales activities but also sought to enhance the experience to attract customers.
According to the newly released F&B market report, ShopeeFood is currently the most popular online food delivery channel in Vietnam, accounting for 42.94% of businesses using it. On the consumer side, nearly 50% of respondents said they would choose ShopeeFood to order food if all other platforms did not have any promotions.
The report also states that ShopeeFood provides 41% of total revenue for food businesses. ShopeeFood is currently operating in 22 localities nationwide. The platform was officially launched in 2021 after SEA - Shopee’s parent company based in Singapore acquired Vietnam’s food delivery app Now.
In addition to ShopeeFood, SEA also operates the e-wallet ShopeePay in Vietnam. Currently, all payment transactions on Shopee and ShopeeFood are made through ShopeePay, creating a closed ecosystem for SEA in Vietnam.
In addition, SEA has launched a buy-now-pay-later service called ShopeePayLater and a lending service called SEasy. For users, ShopeePayLater provides a spending limit in advance and repayment later, while SEasy helps sellers ensure a seamless cash flow and expand their business on the platform. This strategy has helped Shopee become a major growth driver for SEA, surpassing the traditional revenue-generating segment of gaming. Shopee’s revenue contribution to the SEA Group has increased from 38% in 2019 to 69% in 2023.
Currently, Shopee is facing fierce competition from TikTok Shop, especially after TikTok Shop invested US$1.5 billion to acquire Tokopedia in Indonesia. To cope with this issue, Shopee is focusing on increasing its livestream sales activities and improving the shopping experience. A typical example is allowing customers to return products after 15 days and free shipping, a new policy that has been applied since the beginning of March in Vietnam.
H.C
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