Investment & Finance

Pandemic making consumers adapt better

Saigon Investment
(SGI) - The current fourth wave of the Covid-19 pandemic is hurting businesses severely and seriously. On the other hand, it is also making businesses more alert and aware of the need to find long-term solutions to survive and continue to flourish even as the pandemic rages on. 

Illustrative photo.

Illustrative photo.

Mr. DOAN DINH HOANG, a consultant on marketing strategy and branding, spoke with Saigon Investment about many important issues that businesses are currently facing and have to tackle in the future.

JOURNALIST: - Sir, what solutions do businesses need to immediately apply to be able to survive this fourth wave of the pandemic, without having to suffer for the next few months?

Mr. DOAN DINH HOANG: - It is an obvious fact that we all have to find ways to live with the ongoing pandemic, and not just deal with it in the short term. Across the world, countries that have been vaccinated to achieve herd immunity are still at risk because of new strains of coronavirus, so we are no exception.

Therefore, we have to accept a new normal way of life, and so do all businesses if they want to survive. This means that we all have to adapt and live in harmony together. In the short term, businesses will still have to struggle on a day to day basis, and face continual and unexpected risks. Now it is imperative that all businesses must have access to vaccines for their workers and staff. Currently, businesses in Vietnam are waiting for State regulations on vaccines, while some foreign businesses are proactively sourcing vaccines by themselves.

In the medium and long term, enterprises must think about restructuring and moving strongly towards the digital platform to prevent risks such as in the supply chain network. In fact, in the previous waves of the pandemic, there were businesses already moving towards a digital transformation, but this time the need is for a larger digital transformation of many businesses, which should be accompanied with more determination.

However, digital transformation will be a big challenge, especially for SMEs. First, they need more capital, because investing in infrastructure for digitization requires a lot of money. Companies that do large-chain digitization need a budget of upto millions of dollars. In addition, it is necessary to resolve the human resource problem as well. For example, in the education sector, teachers are qualified people, but when switching to online teaching, many of these teachers have not kept up with technology. This shows that the role of people in operating the digital platform is very important.

-  Sir, in your opinion, when switching towards an online business model, what are the most important factors that businesses should pay attention to?

- Basically, online sales have a different operating structure from the traditional model, forcing businesses to make changes that cannot be maintained in the traditional way. It is being seen that some businesses have already made the necessary preparations, such as the retail industry. Manufacturing businesses that have not yet organized their own distribution network must get used to it when switching to a digital platform, and they need to pay attention to factors such as branding, which must be characterized by an online interactive platform. This must have newer, faster communication techniques, and greater than the role of influencers to interact with customers.

When I worked as a consultant for businesses, I realized that many businesses have well prepared themselves, but they want to build a more complete and effective website. Of course, it's a bit late to prepare at this point but better late than never. Businesses need to be prepared to go along with the pandemic in the long term, and not just deal with it for a few months or in a specific situation.

In addition, when doing business online, you also need to understand that the cost for the online segment is as high as the offline segment. There are many people who think that switching to online sales will not cost much for staff or rental of premises. In fact, selling online also costs a lot to run an effective platform. One must not think that when moving to an online platform, profits will be better. We need to anticipate profits and pitfalls and have appropriate investment.

The cost of selling online is not cheap, so when the market stabilizes again, the offline segment could restart and then it is a question whether online selling will be abandoned or not. In my opinion, online and offline selling will both run side-by-side from now on. This is also the reason why the term multi-channel selling is being mentioned a lot nowadays. One of the barriers to traditional selling is the failure to measure customer response, but with the multi-channel platform, this barrier is resolved easily with instant communication. In addition, online business will be a tool to bring goods without borders, which offline businesses cannot do without lengthy procedures and documentations.

Currently, not only businesses, but individuals also are taking advantage of the online business platform very well, especially during the ongoing pandemic. Even farmers are selling goods online on e-commerce platforms. More recently, in Ho Chi Minh City where many traditional markets have been closed, there have been proposals to support small businesses by selling on e-commerce channels. It is being seen that each individual needs to be proactive when going for digital transformation and learn how to adapt to the new normal.

-  Sir, the shift towards an online business model in the context of social distancing in the current pandemic conditions originates from the needs of the consumer. Will consumer behavior change in the online segment after the pandemic is finally over?

- To be able to understand this very clearly, it is necessary to look at the e-commerce platforms such as Tiki and Lazada. So far they have not made a profit, but they still continue to pour capital and receive capital to promote the online shopping habits of consumers. Similarly, businesses that are more active on the online platform will contribute to changing the behavior and habits of buyers. Once these habits have been formed, consumers will find it very difficult to change or drop these habits.

In fact, at any time in any crisis situation there always emerges an opportunity to cease upon. Likewise, with this pandemic, if we look at it more positively, we will see that the pandemic is actually making businesses and consumers better able to adapt and change for the better. In the future, we can look forward to healthier businesses and a better economy.

- Thank you very much.

Thanh Dung (interviewer)

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