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Can social networks evolve e-commerce?

(VLR) 2019 is a key year for Vietnam’s e-commercial industry when the competition among companies is gradually focusing on linking activities and increasiang user experiences. Following this trend, the power of social media interaction will play the key role deciding the strategic competition of ecommerce platforms in 2020.

Social media directly influences on web traffic

Recently, iPrice Group has collaborated with YouNet Media to conduct a research on the impact of social network on the e-Com visits. Particularly, by using the SocialHeart tool bar of YouNet, research team realized that the promotion on social networks of E-commerce companies becomes most efficient if reaching 4 indexes: quality of discussion on Social pages relating to the brand names, number of customers writing comments, the widespread of brands on social networks and the users’ favorite for brands.

Companies selected for this research includes Shopee Vietnam, Lazada Vietnam, Tiki and Sendo, that are four eCom pages having the highest monthly web visits in Vietnam, according to an E-commerce map in Vietnam of IPrice. The result has illustrated that there is a strong correlation between the promotion efficiency of these platforms on social networks and the number of customers visiting their websites.

In the first three quarter of 2019, most of the E-commerce platforms having the highest indexes in promotion on social networks were ranked higher than that of competitors in monthly website visits. Especially in quarter II, the rank of promotion efficiency on social networks was exactly overlaped with the rank of website visits.

For example, the case study of Shopee and Tiki has showed that these two E-commerce platforms consistently achieved the great efficiency in marketing activities on social networks with the high number of followers and normally received positive comments in the discussions. This is a reason for the top ranking position in page views of these two E-commerce pages in the first 6 months in Vietnam. In contrast, Lazada Vietnam has less effective marketing on social networks hence its website traffic tended to be down in the first three quarter of 2019.

To explain for this situation, the representative of YouNet Media, a leading company for insight measurement and analysis of social networks, proved that the social media can influences on all stages of customers’ online shopping process, from searching information to choosing products and finally giving feedbacks post-buying.

Particularly in Vietnam, the effect of social media is specifically big at the time customers seek the information and make the decision. According to the latest report of Facebook, up to 48% of customers in Vietnam seeks new products via this page. Facebook also released that about 53% of Vietnamese is willing to buy products from newest E-commerce platforms.

Mr Tran Hai Linh, CEO of Sendo, supposed that: “Social networks is going to be popular in Vietnam. With a huge number of users, social networks would be the first place for customers to experience the ecommerce. When customers log-on Facebook or Instagram, they will see ads and they might interact with sellers, that is the time they will think about buying this product. This progress is very important factor to us”.

Hence, if E-commerce platforms have the efficient promotion activities on social networks, they will increase the chance approaching a larger number of customers through these pages.

The importance of social media is strongly emphasized

One research result from iPrice Group and YouNet Media also indicated that the level of customers’ interaction on social networks and E-commerce platforms is increasing dramatically. Based on the report, if the E-commerce platforms only received averagely 135,000 discussions/month on social networks in 2016 then the comments now can reach a number of 2.9 million times/month, increasing over 2,100% higher in 3 years.

Social networks currently become very popular in Vietnam. With a large number of users, social networks would be the first place where customers can experience the E-commerce. When customers log-on Facebook or Instagram, they see ads, they response to sellers and that is when they tend to think of buying products. This finding is a critical factor to us.

Mr. Tran Hai Linh, CEO of Sendo

With a boost in the number of customers’ interaction on social networks, many E-commerce platforms have proper and right-time response to take advantage of this market channel. One of the highlighted changes could be livestream activitys on Facebook or Youtube when four biggest E-commerce platforms all introduce livestream shows with the participation of the top celebrities.

As a result, only in Oct and Nov 2019 when the big discounts were promoted on E-commerce platforms, there were 7 million discussion appeared on social networks in Vietnam just talking about E-commerce pages, 30% higher than normal. This data is a considerable evidence for the wise investment of E-commerce companies in social networks for supporting marketing strategies.

With those reasons, it’s not hart to see that having a clever PR plan on social networks would be very important for the competition capacity of E-commerceplatforms in 2020.

Hai Nam

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