3 E-commerce Mega Campaign Profit Barriers & Sustainable Growth Strategy

The Shift of Vietnam's E-Commerce Market in the Period of 2024-2025

Vietnam's e-commerce (e-commerce) market is facing a historic turning point, moving from a period of hot growth based on "burning money" to an era of prioritizing profit optimization and sustainability of the business model. Tan Phat Digital believes that businesses today can no longer rely only on surface revenue but must go deeper into the actual effectiveness of each dollar of capital spent.

Below are key indicators of Vietnam's e-commerce market in the period of 2024 - 2027:

• Market size (Billion USD): Reaching 24 - 25 billion USD in 2024, forecast increases to 28 - 32 billion USD in 2025 and can reach 44 billion USD in 2027.

• Contribution to total retail sales: Accounts for about 9% - 10% in 2024 and expected to reach 12% in 2025.

• Annual growth rate (YoY): Maintaining 20% - 27% in 2024, revenue is forecast to grow steadily at 10% - 15% in 2025.

• Per capita spending: Reaches 275 USD/year in 2024 and tends to continue to increase.

• Output of products sold output: Expected to reach 3.6 to 3.9 billion product units by 2025.

This boom is driven by a mature digital ecosystem, where 96% of consumers use smartphones to shop an average of 4 times per month. However, the pressure on profit margins is increasing when advertising costs and price competition peak during Mega Campaign periods.

3 Barriers Restraining Revenue and Profit Growth in Mega Campaign

According to Tan Phat Digital's analysis, many brands often only focus on discount codes (vouchers) and forget about the disruptions in the customer journey. A typical case is the case of "Brand A" in the condom industry at Mega 3.3, despite investing heavily in vouchers, it still failed against competitors due to the following 3 core barriers:

1. Barriers to Discovery: The Break at the Display Touch Point

The first barrier is the ability to "Discovery". In Mega Campaign, customer attention is very expensive. Brand A recorded a significantly lower search ad display rate for its genuine store (Mall) than its competitors. This is often due to inflexible budget management, not optimizing real-time bidding to keep top visibility during peak hours.

2. Barriers to Comparison: The Paradox Between Selling Price and Perceived Value

Vietnamese e-commerce customers are extremely price sensitive. At Mega 3.3, the average selling price of Brand A was not competitive enough. Furthermore, while competitors use the attractive "Gift with Purchase" strategy, Brand A lacks flexibility in gift structure. Tan Phat Digital emphasizes that gifts with high perceived value often stimulate purchases more strongly than direct discounts.

3. Conversion Barriers: When Vouchers Cannot Fill the Lack of Experience

The shopping cart abandonment rate in Vietnam in 2024 is at an alarming 79%. Even if there is a voucher, if the final price at the checkout page is not as expected or lacks loyalty programs - which influence 83% of repurchase decisions - customers will leave.

Advertising Performance and Financial Indicators Targeted in 2025

To overcome barriers, businesses need to apply an accurate KPI framework instead of just chasing after GMV.

ROAS Benchmarks: Performance Measures by Industry

In the context of CPM costs on platforms like Meta increasing by 19.2% in Q1 2025, the target ROAS (Return on advertising spend) level needs to be set based on industry characteristics:

• Fashion & Apparel: Target ROAS ~4.3:1 (Thanks high shopping frequency and aesthetics).

• Jewelry & Accessories: Target ROAS ~4.0:1 (High order value, emotional buying).

• Home & Garden: Target ROAS 3.8 - 4.0:1 (Significant seasonality).

• Mom & Baby: Target ROAS 3.7 - 3.9:1 (Buyers prioritize quality and reputation).

• Food & Beverages: Target ROAS ~3.4:1 (High repurchase rate but high shipping costs).

• Beauty & Cosmetics: Target ROAS 2.8 - 3.6:1 (Strong dependence on social proof and livestream).

• Health & Functional Foods: Target ROAS ~2.3:1 (Real profit lies in lifetime value - LTV).

LTV:CAC Ratio - Guideline for Sustainable Growth

$LTV:CAC$ index (Customer Lifetime Value over Customer Acquisition Cost) is the most important measure of business health that Tan Phat Digital always recommends. A ratio of 3:1 is often the ideal target.

Strategy for applying $LTV:CAC$ is flexible in stages:

• Early stage (0-$10M in revenue): Accept a ratio of 2:1 - 2.5:1 to capture market share.

• Growth stage ($10M-$50M): Aim for 3.5:1 - 4:1 for financial stability.

• Maturity stage (Over $50M): Achieve 4:1 - 5:1 to optimize profits.

Platform Race: TikTok Shop GMV Max And Shopee's Domination

In 2025, Shopee and TikTok Shop account for 97% of the e-commerce market share in Vietnam.

• TikTok Shop GMV Max: From July 2025, GMV Max will become the default tool for e-commerce advertising on TikTok. This tool uses AI to completely automate from multi-channel budget allocation to the most effective creative selection.

• Shopee: Maintains its leading position with more than 56% market share thanks to its stable operations and logistics system. However, the increase in floor fees up to 9% is forcing brands to shift to the DTC (Direct Sales) model to protect profit margins.

Case Study: LocknLock And Watsons - Two Directions Towards Sustainable Growth

• LocknLock: Focus on profit margin management through 9 core principles, prioritizing optimization of operating costs and adapt quickly with floor algorithms instead of negative price racing.

• Watsons: Success thanks to O+O (Offline plus Online) strategy and personalization with AI. Their "Online Skincare Advisor" tool helps increase conversion rate by 396% and average order value ($AOV$) by 29%.

Sustainable Revenue and Profit Optimization Strategy 2026-2030

Based on practical implementation experience, Tan Phat Digital proposes a roadmap of 4 strategic pillars:

1. Maximum Advantages: 360 Degree Synchronized Data: Observe competitors and the market in real time to early identify disruptions in the customer journey.

2. Shift to a Value-Driven Model: Use AI to personalize product suggestions and invest heavily in content quality instead of just reducing prices.

3. Multi-Channel Loyalty Ecosystem: Integrate advantages incentives between physical stores and online platforms to increase customer retention rate (Retention Rate) - target of over 30%.

4. Disciplined Financial Management: Set ROAS threshold and control "Contribution Margin" for each product code (SKU).

System of 10 Successful Case Studies on Vietnamese E-commerce

Tan Phat Digital summarizes 10 typical revenue and profit breakthrough models from the Vietnamese market:

1. Nivea: Key SKU and Dual-Platform Strategy Nivea achieved revenue growth of 233% in the first half of 2025 thanks to focusing all its efforts on 1 key SKU, Super 8 Night Nourish Body Lotion. Brands use Shopee to maintain a stable 59.6% revenue share and TikTok Shop to explode recognition through creative content.

2. Coolmate: D2C Model and Website Experience Optimization Coolmate grows 4 times per year thanks to applying the D2C (Direct-to-Consumer) model and investing heavily in its own website with page loading speed < 2 seconds. After appearing on Shark Tank, sales increased 5 times for 5 consecutive days. The brand focuses on LTV with a free 60-day return policy.

3. Biti's Hunter: Brand Repositioning and Emotional Connection Biti's Hunter escapes its "old" image by launching a product line specifically for Gen Z (18-24 years old). The "Go To Come Back" and "Proudly Made in Vietnam" campaigns have aroused national pride, helping to record more than 7,000 pre-orders in just 3 weeks.

4. Vinamilk: Breakthrough thanks to Shoppertainment By April 2025, Shopee became Vinamilk's No. 1 e-commerce platform, contributing 61.9% of liquid milk industry revenue. Vinamilk Nut Milk line reached the top 5 best-selling products thanks to taking full advantage of the Shoppertainment trend and Livestream sessions aimed at the young generation.

5. CM Foods: Optimize conversions from Short Videos Food brand CM Foods achieved 4.2 times ROAS and 12.6% conversion rate in the 12.12 campaign. They succeeded by combining short video ads with livestreams, reaching more than 7.2 million users in a short time.

6. FPT Shop: Personalization and Gamification FPT Shop was honored at GMC 2025 thanks to its deep personalization strategy and Gamification application to retain users. They focus on 5 core elements: AI, Data, Identity, Communication and Touchpoints to create a smooth shopping journey.

7. Estée Lauder: Strategy to Focus on Key Products In 2025, Estée Lauder's official store recorded breakthrough growth thanks to the Facial Serum line. Brands prioritize TikTok Shop to create trends and Shopee to close orders with highly loyal customer base.

8. Cocoon: Product combo and 3-digit growth Vegan cosmetics brand Cocoon achieved revenue of 203 billion VND on Shopee in just the first half of 2025, a 3-digit growth. The core strategy is to promote combo packages of skin cleansing products, helping to increase average order value (AOV) significantly.

9. Sabeco: Digital transformation based on Heritage Identity Sabeco maintains market share thanks to the "Vietnamese Identity" campaign and promoting digital marketing through KOLs. The brand conducts M&A with Sabibeco to optimize 6 strategic factories, helping to increase profit margins and enrich the canned beer product portfolio.

10. Honda Winner This strategy helps them effectively access 83% of e-commerce revenue concentrated in large cities like Hanoi and Ho Chi Minh City.

Frequently Asked Questions (FAQ)

Q1: Why is GMV no longer the only measure of Mega Campaign success? A: GMV only reflects the total transaction value without deducting costs such as vouchers, floor fees (up to 9%), advertising (15-20%) and refundable goods. Tan Phat Digital emphasizes that net profit and lifetime value (LTV) are the factors that help businesses survive in the long term.

Q2: What does the LTV:CAC ratio of 3:1 mean in practice? A: It means that the value a customer brings throughout the life cycle must be at least 3 times the cost to attract them. If this ratio < 1, the business is losing money on each new customer.  

Q3: How does price elasticity of demand (PED) -2% in Vietnam affect pricing? A: PED level -2% shows that Vietnamese consumers are extremely sensitive. When prices increase by 1%, sales can decrease by up to 2% as buyers immediately switch to competitors.  

Q4: What stages does the DCC strategic framework include? A: DCC includes Discovery, Comparison and Conversion. A break at any point will cause customers to abandon their shopping carts.  

Q5: How is TikTok Shop GMV Max different from traditional types of advertising? A: GMV Max is a fully AI automation tool that prioritizes displaying products with the highest revenue potential instead of just manual targeting by keywords.  

Q6: Why is the shopping cart abandonment rate as high as 79%? A: The top reasons are that the final price is higher than expected, shipping costs are expensive, or the checkout process is too complicated on mobile devices.  

Q7: How much impact does the Loyalty program really have? A: Data shows that this program influences 83% of customers' repurchase decisions, helping to increase revenue by 12-18% each year.  

Q8: Why is the "Shop Mall" trend dominating? A: Although it only accounts for 2.12% of the number of shops, the Shop Mall group contributes up to 32.6% of total market sales, because users increasingly prioritize prestige and authenticity.

Q9: Is COD payment still popular? A: Yes, 67% of e-commerce transactions in Vietnam still use COD, creating pressure on cash flow and return risk for businesses.  

Q10: What ROAS is considered "good" in 2025? A: The industry average is 2.87:1. However, industries like Fashion need to achieve ~4.3:1, while Health can accept ~2.3:1 if there is a good subscription model.  

Q11: How much revenue market share is video-commerce accounting for? A: Video commerce currently accounts for about 25% of the total GMV of e-commerce in the region, forcing brands to invest heavily in continuous content creation.  

Q12: What is the average monthly spending of Vietnamese e-commerce consumers? A: About 36.4% spend less than 5 million VND/month, 36% spend from 5-10 million VND and only 4.8% spend over 20 million VND/month.  

Q13: How does AI help Watsons grow? A: The Skinfie Lab tool using AI for online skin consultation has helped them increase the conversion rate for their engaged customer group by 396%.  

Q14: Why will the number of sellers decrease by 7.4% in 2025? A: This is a natural "purification" process when small shops cannot withstand the pressure of increasing floor fees and advertising costs compared to professional brands.

Q15: Does the "Buy Now Pay Later" (BNPL) model have potential? A: Yes, 49% of Vietnamese consumers expressed interest in BNPL, especially young customer groups to reduce financial pressure when shopping Mega Sale.  

To win in Mega Campaigns, brands must overcome 3 barriers: Discovery, Comparison and Conversion. By combining the power of automation and financial discipline in LTV:CAC management, Tan Phat Digital believes that businesses will turn e-commerce from a "cash burning" channel into a sustainable growth engine for the future.