Payments space in e-commerce ripe for innovation in Vietnam: Google’s Alex Long
E-commerce is the buzzword in Vietnam’s entrepreneurial ecosystem with several homegrown platforms competing with global players and emergence of new businesses such as Taembe, Wiindi, BoxMe Logistics and Adayroi.com.
There are still untapped opportunities in this market, according to Alex Long, Google’s country lead for public policy and government affairs in emerging markets in South and Southeast Asia.
In an interview with DEALSTREETASIA, Long, being a public policy person, explains how regulatory clarity and payments mechanism will spur the e-commerce activities in Vietnam further. Edited excerpts:-
Do you think e-commerce is a good potential for startups?
Short answer is yes. I think Vietnamese entrepreneurs are incredibly savvy. One of the areas they looked at extensively and have been successful is e-commerce. I don’t think they should be limited to e-commerce. That’s just one vertical.
I am a public policy guy, so I am looking at the big picture, and I think Vietnamese entrepreneurs are very wise to look at e-commerce. There is a big platform for e-commerce. It lets us find many things possible to sell to consumers. There are some new areas that entrepreneurs can be successful in, for example, addressing the payment issues that exist in e-commerce. I think very few people in Vietnam have credit cards, so payment has been a bigger challenge than it has been in more mature markets like the US, where at this point of time, most people have credit or debit cards. I think that’s just one of maybe 20 areas of e-commerce that are ripe for innovation in Vietnam.
What are the critical factors needed to build an e-commerce ecosystem?
Generally speaking in Asia, there’s the regulatory piece which is very important. I know the State Bank of Vietnam (the local central bank) has been looking at hi-tech payment issues. It’s been looking at things like bitcoin in order to decide whether this form of payment will be acceptable in Vietnam. To be general, I think the key piece is regulatory clarity. This is in terms of saying what can a business do and what is it not allowed to do. There is clarity around tax implications for e-commerce. Where is the tax burden placed on? These things are not always clear in Vietnam. Finally, I would say the policy of the platform. What is the refund policy? Do they honour that policy and do regulators enforce that policy? These are interesting questions.
Generally speaking, people are more and more comfortable with e-commerce in Vietnam.
What kind of growth do you anticipate in Vietnam’s e-commerce play?
I think e-commerce will grow rapidly. I see two sections, one is pure play e-commerce, which is a site that is built to engage in e-commerce. But I am more interested in helping traditional businesses leverage e-commerce to grow. In the second category, opportunities are wide open. Only a small portion of traditional businesses are really smartly using e-commerce, and I think in Vietnam, there is a ton of room for growth. Looking at the economy as a whole, there are still opportunities when it comes to making affordable e-commerce solutions work for the economy.
How does Google help small businesses grow e-commerce?
There are a number of products that would be useful. The most basic ones are Google Adwords and Google Adsense. These are ways for companies to spend a little money every month marketing their products or services to whichever countries or parts of Vietnam they’re interested in. That is the most basic way for a small business to take a step into the digital economy. There are other things that are focused on entrepreneurship, like the Google Business Group in Vietnam, where people can go and get best practices about e-commerce and e-business.