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Digital Transformation Facilitates Retail Growth in Vietnam

According to the General Statistic Office, in the first six months of 2021, total retail sales of goods and services went up 4.9% compared to the same period in 2020 to VND 2,463.8 trillion (over US$ 107 billion), of which goods retail revenue went up 6.2%.

According to a news report, the results could be attributed to the fact that the people, household businesses, and firms have been quick to adapt their business operations to the new normal situation amid the pandemic and actively apply technological solutions in trading and payment. This means digital transformation has played an important role in promoting the growth of the retail sector in particular and maintaining stability for the business community in general.

The Vice-Chairman of the Vietnam Chamber of Commerce and Industry, Hoang Quang Phong, stressed the importance of digital transformation to the development of Vietnamese businesses, especially those in the retail sector. The rapid changes in technology enable retail companies to optimise their resources and place consumers at the centre of their businesses. This helps them survive, stabilise their operations, and thrive sustainably in the context of the complicated development of the COVID-19 pandemic.

The application of new technology such as the Internet of Things (IoT), big data, artificial intelligence, and machine learning have allowed businesses to provide customer services with unique and valuable experiences, optimising management strategies as well as supply chain, hence improving revenue.

In a global survey of 800 business executives, respondents in the retail industry said that improving customer experience was the top factor driving their digital transformation in the past time (49% compared to the survey average of 36%). This showed that the COVID-19 pandemic has made digital transformation more important than ever, especially for the retail industry. The survey also showed that retailers that deploy online shopping channels and have a deep understanding of customers managed to better survive the impacts of the pandemic.

Digital technologies and smart manufacturing solutions are paving the way for the country’s overall growth. The digital economy in Vietnam accounts for about 8.2% of GDP. The potential for development for the Internet and digital economy components is large. Unleashing this resource will contribute to socio-economic growth and improve national competitiveness, as OpenGov Asia had reported. The digital economy opens up new growth spaces, helps improve the competitiveness of the economy, and is the core driving force for national economic growth. Vietnam currently has no official data about this but based on many sources, the digital economy currently accounts for about 8.2% of GDP, with about US$ 163 billion.

Although Vietnam’s internet economy is behind other countries in the region including Indonesia and Thailand in total revenue, Vietnam has the highest growth rate with 16% per year, compared to 11%/year for Indonesia or 7%/year for Thailand. Government ministries, sectors, and localities should immediately implement tasks to promote the digital economy. They can implement training programmes, universalise digital skills for people and businesses, and at the same time build a network of consultants for digital transformation and the digital economy in their industries and localities. Further, they can promote digital transformation for industries and priority areas, with the motto of digital transformation based on digital platforms, all on cloud services.

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