Vietnam is in a constant state of dynamic transformation, marked by shifts in consumer behaviour, technological progress, and societal values.

Notable transformations for 2023 include the rise of shoppertainment, the growing prominence of influencer and affiliate marketing, the adoption of remote and hybrid working models, advancements in AI, electric vehicles, sustainable buying decisions, and a diminishing sense of brand loyalty among young people. 

Dig deeper into our top market trends that are defining Vietnam's business environment in 2023. 

1. The rise of TikTok shop

Given its massive user base of 49.6 million in Vietnam (January 2023), TikTok presents a huge opportunity for brands to connect with a younger and tech-savvy demographic.

TikTok Shop has significantly surged in popularity since its official launch in February 2022. 

It rose to third position in the e-commerce market by November 2022 – surpassing competitors such as Sendo and Tiki – achieving a total revenue of VND1,698 billion (approx US$70m) and selling 13 million products via 32,000 sellers. 

TikTok Shop has emerged to become a major e-commerce player in Vietnam. It may eventually threaten the likes of Shopee and Lazada.

What makes TikTok Shop so good for Vietnamese consumers?

Personalised content recommendations and a seamless purchasing experience makes TikTok Shop a user-friendly place to buy things – particularly for young Vietnamese consumers, who can add items to their carts with no interruptions as they enjoy recommended ‘shoppertainment’ content.

“If you’re doing retail in Vietnam, you can’t resist shoppertainment,” said Quang Thai, the CEO of D2C retail company DTX Asia in an episode of We Create Content’s podcast You Don’t Know Vietnam.

And he’s right. It can no longer be ignored.

How to do TikTok Shop in Vietnam?

• Stay on top of trends/challenges/trending sounds
• Incorporate trends and popular sounds into your content and product promotions
• Partner with Vietnamese TikTok influencers that align with your brand and values
• Make it easy for users to navigate to your shop by optimising your TikTok Shop profile with a clear profile image, a compelling bio, and links to your products
• Use in-feed ads, branded hashtag challenges, and other ad formats to showcase your products 
• Nurture a sense of community by responding to comments, engaging with user-generated content, and participating in conversations
• Define a unique brand voice and stick to it - even in the comments  
• Be consistent with your publishing schedule
• Don’t violate TikTok’s community guidelines - the algorithm gods will squash you!

2. Influencer marketing breaks records in Vietnam

Spending on influencer advertising in Vietnam soared by 26.4% in 2022. This was a VND319.38 billion YoY increase, pushing the total influencer ad spend in 2022 to VND1,578 billion, or US$64m.

With the rise of 'shoppertainment', influencer marketing will continue to be a game changer in Vietnam in 2023. As consumers increasingly turn to social media for product recommendations, businesses are collaborating with local influencers to promote their products. 

A huge 77% of Vietnamese online buyers have purchased a product endorsed by an influencer according to Insg.co and Statista.

One prominent KOL in Vietnam’s influencer marketing world is Pham Thoai, who won 3 million views, 22 million likes, and nearly 50,000 orders during a 12-hour live streaming marathon in January 2023.

In an exclusive interview with We Create Content, the popular TikToker said that consumers are really seeking ‘authentic and impartial product reviews rather than overly positive advertising content’.

3. Affiliate marketing in Vietnam

Affiliate marketing reached new heights in 2022, with the estimated value of its domestic market surpassing VND800 billion, or US$32.8m. It experienced remarkable YoY growth of more than 70%.

According to ACCESSTRADE’s Affiliate Report 2022, affiliate marketing contributed 10-15% of the total revenue and the amount of goods sold online for businesses, generating about 30 million orders per month.

“Affiliate marketing has expanded to many different industries, including non-physical products and services such as finance, bank accounts and so on,” said Ha Cao, Business Development Director of ACCESSTRADE.

ACCESSTRADE predicts that the field of affiliate marketing will continue to see substantial growth in revenue generation across various sectors in 2023, including Fast-Moving Consumer Goods (FMCG), Small and Medium Enterprises (SME), Business to Business (B2B), Food and Beverage (F&B), and Gaming – among others.

The research indicates that the Vietnam market is poised for sustained expansion, with revenue projected to exceed VND1,200 billion (US$49.3m) in 2023.

To stay competitive with affiliate marketing, it's important to:

• Provide affiliates with exclusive deals or promotions to offer their audience
• Ensure landing pages are user-friendly and informative with a clear CTA
• Leverage social proof by showcasing customer testimonials, ratings, and reviews
• Encourage affiliates to personalise their promotional content 
• Implement loyalty programs that reward both affiliates and customers

4. Remote and hybrid working models are here to stay

While hybrid and remote work models initially emerged during the pandemic, they have since evolved into a defining feature of the "new normal".

Glints revealed in their Southeast Asia Startup Talent Report 2023 that 45% of startups offered flexible working arrangements (hybrid), and 12% extended remote work options to their employees across all labour markets.

While it may be premature to fully gauge the societal repercussions of this trend, early reports suggest that this newfound flexibility has resulted in heightened employee satisfaction and increased productivity.

“Many graphic designers like myself often find their work to be highly adaptable in terms of time and location. It's common for designers to prefer working from home or cozying up in a coffee shop, rather than heading to a traditional office setting,” said Trung Le, Creative Design Executive at Glints Vietnam.

Trung added that he enjoys switching up his workspace to stimulate fresh creative ideas for his work.

“At times, I still make my way to the office to maintain connections and collaborate with fellow team members, to ensure a smooth and efficient workflow.”

5. AI in Vietnam

AI tools have quickly gained widespread adoption globally and Vietnam is no exception. 

While businesses in Vietnam have the chance to harness the capabilities of AI, it's important to note that AI cannot entirely substitute for human involvement - especially in content creation. 

The human touch is crucial for tasks such as fact checking and editing to guarantee accuracy and reliability, as well as keeping up with real time trends on the ground in Vietnam that AI is not yet registering.

Chatbots are now capable of promptly and efficiently addressing customers' frequently asked questions and resolving their issues using natural language that gets the job done. 

Starting from January 2023, ShopeeFood implemented an AI switchboard to replace the traditional customer care hotline. 

ShopeeFood’s automated system quickly addresses FAQs and in case of complaints, customers are encouraged to contact ShopeeFood via email. 

This strategic shift aims to reduce hotline congestion and enable ShopeeFood to assist a larger number of customers.

6. A promising future for Vietnam’s EV market

In 2022, Vietnam's electric car market experienced a surge in end of year sales, showcasing substantial growth YoY. 

The outlook for the industry appears to be promising in 2023.

In the first half of 2023, VinFast officially ventured into the electric taxi sector, starting operations with an initial fleet of 600 cyan cars. 

Then Xanh SM introduced an all-electric taxi service in Vietnam, utilising VinFast models, which have since earned praise for their quality. 

To support the proliferation of electric vehicles (EVs), VinFast established a charging station network featuring more than 150,000 charging ports nationwide for both electric motorbikes and cars.

The Hanoi Taxi Association is now actively exploring methods to transition its vehicle fleet to electric. 

As outlined in the Prime Minister's Decision 876/QD-TTg, which details the roadmap for transitioning from gasoline to electric vehicles, taxi businesses must adopt electric vehicles when procuring new cars as of 2030.

The future is bright for electric two wheelers in Vietnam too.

Son Nguyen, the CEO of electric motorbike start up Dat Bike, said: “We are sitting on two trends right now. One is that things will go from gasoline to electric, and the other one is that manufacturing is moving away from China. 

"With these two trends crossing, Vietnam has a very big opportunity to become the major electric two wheeler manufacturer of the world.”

Son also noted that Vietnam is sitting on the world’s second largest reserve of the rare earth metal that’s needed to make the magnets in electric motors. 

Not only is Vietnam an immensely large and potentially lucrative market for both electric cars and bikes, but it has all the ingredients to become a major manufacturing hub.

7. Vietnamese are embracing green consumption

According to NielsenIQ's 2023 consumer outlook survey, 38% of consumers in Vietnam appreciate business initiatives and actions that protect or improve the environment.

"The key factors influencing consumption behaviors include reasonable prices, safety and hygiene, healthiness, trustworthy brands, environmental sustainability and friendliness, so that retailers could employ several strategies to encourage green consumption," said Dang Thuy Ha, the Northern Region Manager of NielsenIQ Vietnam.

Ha’s recommendation for retailers in Vietnam include: 

• Utilising electric vehicles for transport
• Offering organic products 
• Reducing food waste 
• Providing loyalty rewards for purchasing sustainable products

8. Consumers aren’t loyal to brands

Consumers in Vietnam consistently display low loyalty to brands, readily adapting their consumption habits to shop for better products more easily. 

According to McKinsey and Company's Vietnam Consumer Pulse Survey 2022 Vietnamese consumers are reported to be the least loyal in Southeast Asia, with 90 percent having switched stores or brands in the past three months. 

'Improving perceived value' stands out as a primary driver for consumers switching brands, with factors such as quality, novelty, and personal preferences ranking among the top reasons. 

Key takeaway? 

Competition is fierce in Vietnam and consumers aren't loyal - there's no room to be getting it wrong.