The Vietnam mobile phone retail market is heating up with an enormous expansion of the largest retailers such as TheGioiDiDong, FPT and VienthongA. Therefore, smaller retailers in the mobile phone business need to adapt in order to survive in this competitive market.
Vietnam’s largest mobile phone retailer, Thegioididong has accounted for 40% share of mobile retail market in Vietnam and its revenue in 2015 was reported to increase 60% compared to the previous year from 15,800 billion VND to 25,250 billion VND. “The market share of Thegioididong is up to 40% and not stoppable; It is really not easy for anyone who wants to penetrate into this market to compete with Thegioididong” Nguyen Duc Tai, the CEO of Thegioididong, said.
Other electronic and mobile phone retailers such as VienthongA, Viettel and FPT also have plans to open more retail stores and expand their brands and presence nationwide. Currently VienthongA has more than 200 retail outlets, Viettel Store has more than 300 and FPT has more than 250 outlets. All three companies are planning for double-digit increases as their major competitor; Thegioididong has unveiled plans to open 400 additional stores in the coming years.
As hundreds of new branded mobile retailer stores has emerged each year, smaller “mom and pop” retailers find it difficult to compete with these strong players because of their small customer bases, limited marketing budgets, small scale of business which causes their prices to be higher and many old-fashioned customer service and business strategies.
Small mobile phone retailers in Vietnam now sell a variety of related products for attracting consumers such as top-up cards for mobile phones, accessories, decoration items and second-hand phones and also render some other extra services such as phone decoration, mobile phone maintenance and repair services.
While these smaller mobile phone shops currently hold an estimated 30 ~ 35% share of the market, their market share is predicted to shrink in the future as the large mobile phone retailers continue to expand their retail networks. The future of these smaller retailers will be dependent upon their ability to create strong loyalty with their existing customers while adapting their businesses to provide value added services that the large retailers are unable to do. The next few years will be an interesting time to see how these changes in the retail mobile phone market develop.