Why TikTok is a Game-Changer for E-commerce in Vietnam

Why TikTok is a Game-Changer for E-commerce in Vietnam

TikTok Shop's swift rise in Vietnam has fundamentally reshaped the local e-commerce landscape. Since its launch in 2022, TikTok Shop has grown into the second-largest e-commerce platform in the country, fueled by its integration of entertainment and shopping through "shoppertainment." In this article, we’ll explore TikTok’s impact on the Vietnamese market, the opportunities it presents for brands, and how both local and foreign companies are achieving success through this platform.

Vietnam’s Booming E-commerce Market: Setting the Stage for TikTok Shop

Vietnam’s e-commerce sector is on a rapid growth trajectory, with an estimated annual growth rate of 31.7%, projected to reach $32 billion by 2025.

Vietnamese consumers, particularly the younger demographic, are increasingly shopping online, with social media channels playing a significant role in this trend. By mid-2023, e-commerce in Vietnam had already generated VND 92.7 trillion (approximately $3.87 billion), and TikTok Shop emerged as a significant driver in this surge.

Read more: E-commerce in Vietnam: Trends, Growth, and Choosing the Right Platform for Your Business

What Makes TikTok Shop Different?

TikTok Shop’s unique "shoppertainment" approach, which blends short-form video content with live-streaming commerce, sets it apart from traditional e-commerce platforms. This interactive, personalized experience is particularly appealing to Vietnam’s young, tech-savvy consumers, who spend considerable time on social media. TikTok's recommendation algorithm also ensures that users see highly relevant products, helping brands connect more effectively with their target audiences.

Case Study 1: Yody – A Vietnamese Fashion Brand Thrives

Vietnamese fashion brand Yody is a prime example of how local brands can leverage TikTok Shop to increase engagement and drive sales. Within months of launching on TikTok Shop, Yody accumulated over 90,000 followers and significantly boosted their online revenue. Yody’s success was driven by its use of live-streaming, where influencers and brand representatives showcased products in real-time, creating an engaging experience for viewers. By tapping into TikTok’s interactive features, Yody effectively targeted young consumers who value a personalized shopping journey and are keen on discovering local brands with unique styles.

Case Study 2: Cô Gái Hà Lan (The Dutch Lady) – Local Dairy Brand Finds New Audience

Another successful local brand on TikTok Shop is Cô Gái Hà Lan (The Dutch Lady), a popular dairy brand. By adopting TikTok Shop’s live-streaming capabilities, Cô Gái Hà Lan was able to connect with parents and younger customers, introducing them to their extensive dairy product line. Their interactive live sessions, where viewers could ask questions about nutrition and product quality, significantly boosted consumer trust. Within six months, the brand reported a 25% increase in online sales through TikTok Shop and noted a significant uplift in brand awareness among younger demographics and families.

Case Study 3: Some By Mi – Korean Beauty Brand Captures Vietnamese Consumers

South Korean skincare brand Some By Mi has seen remarkable success on TikTok Shop by focusing on Vietnam’s beauty-conscious consumers. The brand strategically partnered with Vietnamese beauty influencers to host live-streamed product demos, which quickly garnered attention from younger audiences who value skincare routines. As a result, Some By Mi reported a 20% boost in quarterly sales in 2023, solidifying its position as one of the top international beauty brands on the platform. This demonstrates the power of TikTok Shop’s influencer ecosystem and its capacity to connect foreign brands with Vietnamese shoppers in a highly personalized way.

The Key Factors Behind TikTok Shop’s Success

1. Influencer Marketing: TikTok’s influencer-driven approach is instrumental in connecting brands with consumers. Around 40% of online shoppers in Vietnam are influenced by social media personalities, making TikTok’s influencer partnerships vital for driving sales.
2. Seamless In-App Shopping: Unlike other platforms, TikTok Shop allows users to complete purchases without leaving the app. This “scroll-to-shop” model minimizes barriers to purchase and has been effective in encouraging impulse buys.
3. Personalized Recommendations: TikTok’s powerful recommendation algorithm offers highly tailored product suggestions, helping brands reach the right audiences with increased conversion rates.
4. High Engagement with Gen Z and Millennials: Vietnam’s younger population forms the majority of TikTok’s user base, and these users are especially receptive to TikTok’s “shoppertainment” model. This demographic overlap provides brands with an opportunity to engage an influential consumer group that values entertainment in shopping experiences.

Conclusion

TikTok Shop has fundamentally changed Vietnam’s e-commerce dynamics, providing brands—both local and international—with a dynamic platform to reach new consumers. By leveraging TikTok’s unique blend of entertainment and commerce, brands like Yody, Cô Gái Hà Lan, and Some By Mi have successfully built their online presence and increased sales in this competitive market. As TikTok Shop continues to refine its model and expand its offerings, brands have an unprecedented opportunity to capture the attention of Vietnam’s growing digital shoppers and carve out a strong foothold in the country’s vibrant e-commerce landscape.

‍