Tiki accelerated burning money, pushing the loss of 2019 to VND 1,800 billion but still short of breath before Shopee?

The story of burning money in the field of e-commerce has never been old and outdated, especially with the “four pillars” in the industry. The difference, if any, is that platforms are seeking to reshape themselves, with a unique approach instead of massively promoted as before.

The annual report of VNG – one of the largest shareholders holding 24% of Tiki – has revealed the huge loss of this e-commerce site in 2019 with nearly VND 1,800 billion, while the same period last year This company only lost more than VND 750 billion. Tiki’s loss is also close to two big names in this field, Lazada and Shopee, with 2018 losses of VND 1,773 billion and VND 1,901 billion.

In terms of overall cumulative losses, Tiki is still somewhat inferior to the two competitors, which are strongly backed by foreign parent companies. However, these figures also show that the “money-burning” race seems to show no sign of cooling off, although the approach is now different.

Unlike the previous period, the issue of burning money now no longer focuses primarily on promotions. Instead, as the game is gradually narrowed to just a few names, these platforms are trying to increase their brand awareness with their own “identities”, making a difference.

IPrice’s report on Vietnam e-commerce platforms in 2019, along with SimilarWeb, App Annie and YouNet Media, commented that the market is gradually becoming more mature.

According to the team, 45% of users access e-commerce platforms by typing a website address directly into a browser, rather than searching on Google or clicking on ads. “Online shopping on e-commerce platforms has become a reflex for Vietnamese consumers. Whenever the demand arises, they will open their favorite applications on their phones or type their website addresses and visit the website. update now, “the team said.

This is considered a new turning point for the market and also became a turning point in the strategy of the leading names.

Looking back at the past, when this market was in its early stages, the main rivals of e-commerce exchanges were in fact the habit of buying directly. The massive promotion with similar programs between exchanges aims to attract consumers to new ways. And after years of “burning money” competition, the e-commerce market has had “sweet fruits” – it is a habit with online shopping more often.

This story, if viewed from another perspective, is also a way to train less rivals, who do not keep up the game “burning money”. Adayroi, Lotte.vn, Robins.vn or VuiVui are the names that stopped in 2019, with an almost common reason for all “insufficient resources”.

The game in the e-commerce market, in fact, is now encapsulated in four names: Shopee, Sendo, Tiki and Lazada. And as the market has shifted, the money-burning race has also changed from competing for promotions and identical shopping events to separate directions.

Tiki, a well-known name that is able to compete with foreign e-commerce platforms, increases dramatically in 2019 when it aims to increase user experience by launching new features such as livestream TikiLIVE and investing in warehouse system development, fast delivery. This floor also spent a significant amount of money to increase the level of recognition to young customers through music videos.

Since the beginning of April 2019, a series of music videos with the “accidental” appearance of Tiki have been posted on Youtube and occupied the top positions on Youtube Trending. “Suspended” (B-Ray and Masew), “Fearless” (K-ICM ft. Jack), “Stop loving, I’m tired” (Min), “Dude stay” (Chi Pu) and ” Can you love me? ” (Duc Phuc). The common point of these MVs is that the delivery staff plays the Tiki logo, the end of the song is brand information.

Meanwhile, Shopee Vietnam, with its leading position, continues to create strong pressure. According to iPrice, Shopee continues to lead in 2019 in terms of website traffic, an average of 33.6 million visits per month. This figure is somewhat similar to Shopee’s sudden increase in losses in recent years, with abundant financial resources from the parent company – SEA.

Shopee, thanks to the large amount of money, competes well on every front. The platform introduced the Shopee Live feature in March, promoted with Cristiano Ronaldo in September, organized the Shopee Show in November, and partnered with fast delivery with Grab in December. According to iPrice, in the context of SEA Limited reaching Sales in 2019 increased by 152% compared to last year, Shopee will surely go far. For a simple reason, they have a lot of money to “burn”.

Meanwhile, Sendo focuses primarily on strategies to attract new users. From the first quarter to the second quarter, Sendo’s website traffic increased by 24%, putting them in third place. At the same time, Sendo’s mobile app also ranked second in terms of downloads in the second and third quarters of last year. .

Finally, Lazada Vietnam spends most of the year on shopping activities that combine entertainment such as Lazada Super Party, Guess the Price game, and Lazada Music Festival. Because most of these activities are only for mobile, Lazada, although ranked second in terms of app users, only ranked fifth in terms of website traffic.

These moves have shown that e-commerce game, though changing, still revolves around the “burning money” approach. The difference is that money is burned into new projects, ways to attract new users. And although the market has been gradually shaped, this war seems to be even more intense than before.