Khoi Tran Discusses E-Commerce In Vietnam
Vietnam is one of the fastest growing e-commerce markets in Southeast Asia. Vietcetera sat down with Khoi to learn more about e-commerce buying.
Vietnam is one of the fastest growing e-commerce markets in Southeast Asia with an average growth rate of 43 percent. It is expected to grow to 15 million USD by 2025, which means that the demand for people working in this field is also on the rise.
“Six years ago, e-commerce was a foreign concept and there were even many who thought it was a type of pyramid scheme. Suppliers were not comfortable working with e-commerce buyers. Instead, they preferred opening their own stores or working with traditional buyers like supermarkets or malls. E-commerce buyers were almost nonexistent. Instead, e-commerce sites had to recruit buyers from the offline retail model,” shares Tran Quang Khoi, the current head of Home and Lifestyle at Leflair.
Upon graduating with a degree in Business Administration, Khoi has been involved with e-commerce since his first days interning as a buyer assistant for an e-commerce channel. In his seven years working in the field, he has always paid close attention to the growth of the e-commerce market in Vietnam. More than anyone else, he understands the career opportunities that this field brings.
Please describe the nature of the work of an e-commerce buyer.
People often compare buyers to salespeople but this is incorrect. A buyer is the intermediary responsible for the interaction between the seller (the supplier) and the purchaser — in this case, the e-commerce site.
Buyers search for products that align with the e-commerce site positioning. Especially at Leflair, buyers personally look at, handle, and test the product of all the chosen brands.
After that, they check the invoice, standard documents, and then negotiate with the supplier to purchase the product with the best possible margin. This is different from customer-to-customer (C2C) businesses that sell thousands of products but never actually see what they are selling.
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How is this job different from a buyer for the retail or production model?
The initial stages are similar for both the e-commerce buyers and retail or production models. These stages include researching the market demand, finding a product to fit that demand, negotiating to purchase that product with a good price, submitting a purchase order, and developing a marketing strategy to sell the product.
The only differences are in the product distribution channels (offline versus online), databases, and basic knowledge of the distribution channels in marketing in order to maximize the number of products sold.
From the price quotation to the purchasing price, all the information about the purchase is stored in a database. In addition, all data regarding consumer behavior is stored to evaluate the effectiveness of the product. This will help us make appropriate changes to the purchasing plans as well as customer outreach. Each e-commerce site will have its own database.
Please share some skills needed to become an e-commerce buyer.
The ability to negotiate — this is the most essential skill. As a buyer, you’ll receive many offers from suppliers. Thus, you need to practice your negotiation skills in order to help you determine whether suppliers are being truthful about the products they are selling. You’ll also have to estimate a suitable inventory for your next event while avoiding excessive stocking, which can lead to overstocking or shortage of popular products.
Analytical skills and valuation — an advantage for e-commerce buyers is that they have access to large databases which allows them to easily verify the product’s potential and the vendor’s reputation. Typically, a product that is available on many different sites means that it is popular and loved. You also need to understand the consumer’s mentality in order to place a reasonable price on the product.
In addition, becoming an e-commerce buyer requires a creative mindset and the ability to stay updated with trends. Additionally, while there will be a team dedicated to creating the visuals, you will also need to work closely with them in order to advertise the product effectively. Occasionally, you may be the person to suggest a color scheme and content for the advertisement.
Can you tell us some characteristics of Vietnamese consumers?
Most Vietnamese customers are hesitant to buy products online. This is why most platforms accept payment upon delivery of the product to the customer. Nowadays, promotions for card payment and e-wallet apps are incentivizing people to move towards electronic payment methods.
Before deciding on buying a product, especially expensive ones, people will spend a lot of time asking for family inputs, reading online reviews, and recommendations from influencers. However, once the consumer has put their faith into a shopping site, they will be very loyal to that site.
How does an e-commerce company selling high-end products like Leflair build trust with its customers?
Around the end of 2015, consumers in Vietnam began to familiarize themselves with the concept of e-commerce. Most of the e-commerce sites available at that time were selling products in bulk and at different price points. This business strategy is effective in building public awareness on e-commerce but will become disadvantageous in the long run.
Firstly, high-end and expensive brands will be at a disadvantage if they are placed alongside with cheaper products. For the customer, they will become hesitant when presented with such a vast selection of products.
That is the reason why Leflair was founded. It is a trustworthy platform that provides customers carefully curated products from luxury brands. Leflair develops the technology, databases, as well as invests in human resources from the buyers to the production team, in order to create the most prestigious online shopping experience.
Can you share tips on how to stay updated on trends as a buyer?
I’ll split it into two ways: active and passive.
I am proactive when I read articles from GfK (the fourth largest market research organization in the world) that provides studies about consumer trends. Aside from this, you can also stay on top of trends through social media inside and outside of the country. China is quick in updating trends on manufacturing goods. Learning from China will put us two-three months ahead in comparison to others.
You can also stay updated on trends for bedding products. At the end of the day, all of the products are made from fabrics. The textile industry has trends regarding the materials used, seasonal patterns, and more.
Being passive refers to when supplier brands update trends themselves and release designs based on those trends. Other brands will also create similar products, which creates the demand for consumers to shop according to trends. The buyer’s job is to follow these developments so that they can purchase products that satisfy the consumer’s taste.
How does a buyer balance trends, consumer tastes, and brand positioning for both Leflair and its partners?
Leflair positions itself as an e-commerce site that specializes in selling high-end products at a fair price point. That is also what customers expect from Leflair. Thus, as a buyer, my responsibility is to ensure Leflair’s credibility by determining which suppliers meet both quality and price standards.
Where does one go to learn to be a buyer?
During my time, the only way was to learn and work at the same time because there weren’t any schools that taught e-commerce. However, starting in 2016, colleges in Vietnam have begun to integrate e-commerce, social media, and customer relationship management (CRM), into their programs.
I think the most effective way is still to self-teach, and through learning from experience and experienced mentors. You should be proactive because this field is still very new. There are many opportunities for growth and changes.
For example, Facebook was the top platform two years ago. However, Instagram is currently holding the top position for shopping and consumer interaction. Next in line is TikTok. Moreover, how do we solve issues such as attracting the older generation who don’t use smartphones or the internet?
What are some challenges that buyers usually face?
During months where business is slow, buyers have to be proactive and find new products. They may also have to reach out to their network and learn of new trends and products. This is also the reason why it is never a waste for buyers to make many connections with other buyers or suppliers.
While the e-commerce scene is developing at a very fast pace, Leflair is operating at an even quicker pace with its flash sales model. As a buyer, you always have to be active and have to be able to handle a high-pressure environment. Another challenge is you’re always glued to your phone because it’s helpful for work but it also wastes a lot of time (laughs).
What are the three things you like about being a buyer?
- Even though it’s an office job, that doesn’t mean being stuck in the office. — you will get to go out for work and meet lots of people.
- As I work with more people, I begin to learn more and improve my awareness of recent trends.
- Being an e-commerce buyer allows you to test your skills with many different jobs — it helps you develop your career for the future. You can start a business, manage a brand, and more.
Adapted by Lauren Nguyen
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