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With many brands from other countries also participating in global sales and exporting via e-commerce on Amazon, what are the challenges for Vietnamese businesses, Sir?
According to our observations, in recent times, Vietnamese businesses and sellers on Amazon have divided into two main groups. These two groups face different challenges.
The first is online sellers – the community of sellers who have done business online, have digital skills, and sell in the digital environment. This group often catches up trends very quickly, they almost immediately catch up with the latest trends in e-commerce sales. However, they need to have a long-term vision and need to build a serious, long-term cross-border e-commerce business plan along with branding efforts. Previously, they only sold products, calculating profits on each product sold, but did not build a roadmap or long-term business plan, increasing brand power to increase product value. The online seller community also lacks the ability to create products.
The second group are traditional manufacturers or brand owners. This group has production capacity, but does not know how to brand in the online environment. They often have more experience building brands in the domestic environment, through traditional methods. However, when entering the online environment and penetrating international markets such as the US and Europe, the way of branding must be different. In addition, although they know they need a brand story, businesses of this group do not know how to take advantage of tools and solutions from Amazon to protect their brands, build promotions, and plan on finding market needs systematically and long-term.
What is the advantage of the product portfolio from Vietnam compared to other countries?
Vietnam’s production and export strength over the past many years on the cross-border e-commerce playground is most notably wood-related products, with two main groups: houses and kitchens. According to observations, after a period of operation and optimization of logistics problems, sellers in the wood and furniture segment began to expand their product portfolio. Recently, there has been a trend of shifting from interior products to larger-sized exterior products.
Besides, there are products using Vietnamese natural, local ingredients. Widely applied in 2 product categories: consumer products (herbal tea, coffee, dried fruit…) and beauty and health care products.
It can be said that the potential for these industries is huge and Vietnam has many advantages to compete well in the international market. It should be noted that the advantage of natural materials is not the only factor that determines the success of businesses. For Vietnam to go to global through cross-border e-commerce, it needs a “three-legged tripod”. The first is production capacity, based on the advantages of local products and raw materials. The second is to combine and be alive to online skills to operate businesses in the e-commerce environment. Third is branding – if businesses only rely on the product without a brand story to create a difference, after a very short time, the product and brand will be easily imitated or counterfeited.
At this time, when selling on Amazon, is price competition an advantage?
Reasonable and attractive prices for customers are always thing which Amazon wants to bring to customers. However, for businesses and exports, there are more efforts to create a competitive element.
Normally, price competition often appears in businesses or sellers, and new products, when entering the market, they often set low prices to have customers and have good reviews for products on the store. As for experienced businesses, price is not a competitive factor, but is often branding. Because when liking a certain brand, users will be willing to pay a higher price to buy the products, or will also buy based on the reviews of other consumers. If the review is good, they will have trust and be willing to spend more money to buy the same products.
Price competition is also a factor, but not the only and most powerful factor to determine success for businesses, but there are other factors in how to grasp market demand to improve products, how to build brand value for their products, how consumers not only buy the product but also buy the brand. These are the factors that can contribute to the success of the businesses.
He mentioned a lot about branding elements in the online environment. So, please tell us what is the level of brand registration of Vietnamese businesses on Amazon?
In the past 5 years, the number of Vietnamese businesses participating in Amazon’s Brand Registry program has increased 35 times. This shows the seriousness of businesses in the story of online export through Amazon. It is not just a story of selling products, operations, or how to optimize revenue, but also a story of building a brand for sustainable development.
Registering for the Amazon Brand Registry program, businesses will have to register trademarks in target markets, use recognized trademarks in these markets, and update them on the Amazon system. Amazon will conduct verification and allow these businesses to register their brands on Amazon. Once registration is completed, the brand will be protected and can use branding tools on Amazon stores.
Building and developing a brand is an important step, and there needs to be a roadmap to develop the brand in a sustainable way. This is our effort in recent years to help Vietnamese businesses understand the story of branding and use technology tools, and advanced solutions from Amazon to develop an effective and long-term branding strategy.
Thank Sir!