New Delhi, Nov. 18, 2024 (GLOBE NEWSWIRE) -- Vietnam AI in retail market is projected to hit the market valuation of US$ 637.32 million by 2032 from US$ 86.62 million in 2023 at a CAGR of 25.55% during the forecast period 2024–2032.
Vietnam's retail industry is on the cusp of a technological revolution, propelled by the rapid adoption of Artificial Intelligence (AI). As the country positions itself as a burgeoning digital economy, AI integration is not only transforming retail operations but also reshaping consumer experiences. This article delves into the current state of AI adoption in Vietnam's retail sector, recent advancements, investments, government initiatives, case studies, potential impacts, and the challenges ahead, supported by the latest statistics. AI adoption in Vietnam's retail industry has accelerated significantly in recent years, giving a boost to the AI in retail market.
Download Free Sample Copy @ https://www.astuteanalytica.com/request-sample/vietnam-ai-in-retail-market
According to the Vietnam E-commerce Association (VECOM), as of 2022, over 45% of large-scale Vietnamese retailers have implemented AI solutions in some capacity, a notable increase from 30% in 2019. Major players like VinCommerce, Saigon Co.op, and Mobile World Investment Corporation are leveraging AI for inventory management, customer service, and personalized marketing. This growth is fueled by increasing consumer demand for seamless shopping experiences and the competitive advantage AI offers in operations efficiency.
Key Findings in Vietnam AI in Retail Market
| Market Forecast (2032) | US$ 637.32 million |
| CAGR | 25.55% |
| By Component | Solution/Software (49.29%) |
| By Deployment | Cloud (75.48%) |
| By Application | Front-End (64.23%) |
| By End Users | Specialized Retail (51.29%) |
| By Technology | Machine Learning (33.15%) |
| Top Drivers |
|
| Top Trends |
|
| Top Challenges |
|
Unlocking Vietnam's Retail Future: The Synergy of Cloud, Machine Learning, and Specialized Front-End AI Applications
Vietnam's AI in retail market is experiencing a dynamic transformation driven by the integration of artificial intelligence across various domains. Central to this evolution is the predominance of cloud-based AI deployments, which have captured over 75% of the market share. This inclination towards cloud solutions is propelled by their scalability, flexibility, and cost-effectiveness, enabling retailers to implement advanced AI technologies without substantial upfront investments. For example, Saigon Co.op, one of Vietnam's leading supermarket chains, reported a 35% reduction in IT infrastructure costs after migrating to cloud-based AI platforms. Additionally, the government's commitment to digital transformation, aiming to have 50% of businesses operating on digital platforms by 2025, reinforces the momentum towards cloud adoption.
At the heart of technological adoption in retail is Machine Learning (ML), which leads with a significant 33.15% market share in the AI in retail market. ML's capacity to process vast datasets and generate predictive insights has made it indispensable for retailers aiming to enhance operational efficiency and customer experience. E-commerce giant Shopee Vietnam utilizes ML algorithms to personalize shopping experiences, resulting in a 20% increase in customer retention rates. Furthermore, the rise of local ML startups has surged by 25% in the past year, indicating a robust ecosystem that supports innovation and addresses the specific needs of the Vietnamese market.
Front-end applications have become the pivotal point where AI technologies create tangible value for retailers and customers alike, with over 64% of AI applications deployed in this area. AI-driven chatbots, personalized marketing, and virtual shopping assistants are enhancing customer engagement and satisfaction. Vincom Retail, for instance, one of the key end users in the AI in retail market, implemented AI-powered interactive kiosks in their malls, leading to a 30% increase in foot traffic to featured stores. Specialized retail stores are at the forefront, commanding 51.29% of the AI retail market revenue. These retailers, focusing on niches like electronics, fashion, and home goods, leverage AI to curate personalized experiences, managing to boost average transaction values by 28%.
Recent Developments and Advancements in AI for Vietnam's Retail Sector
Technological advancements have enabled Vietnamese retailers to adopt sophisticated AI applications. AI-powered chatbots have become prevalent, with FPT Corporation's chatbot handling over 2 million customer inquiries monthly, improving response times by 60%. Additionally, computer vision technology is now used by 35% of large retailers for in-store analytics, enhancing product placement and reducing stockouts by 25%. Natural language processing (NLP) tailored for the Vietnamese language has also seen significant progress. Zalo AI, developed by VNG Corporation, supports voice assistants used by 20% of e-commerce platforms, facilitating more natural customer interactions.
Investments in AI in Retail Market in Vietnam
- Investment in AI has seen substantial growth. In 2022 alone, AI startups in Vietnam attracted over $200 million in funding, doubling the amount from $100 million in 2020. Notable funding rounds include:
- VinAI Research, part of VinGroup, secured $50 million to develop AI technologies applicable across retail and other sectors.
- Aifactory, an AI platform provider, received $10 million from Japanese investors to expand its retail solutions.
- True Platform raised $6 million to enhance its AI-driven customer service tools for retailers.
- Foreign direct investment (FDI) in Vietnam's AI sector reached $150 million in 2022, with significant contributions from investors in Japan, South Korea, and Singapore.
Government Initiatives and Policies Supporting AI Adoption
The Vietnamese government has strategically positioned artificial intelligence (AI) as a cornerstone of its ambitions for the Fourth Industrial Revolution. In 2021, Vietnam launched the National Strategy on Research, Development, and Application of Artificial Intelligence, with the goal of establishing the country as a leading AI hub in the ASEAN region by 2030. This ambitious plan in the AI in retail market includes a substantial investment of $500 million over five years dedicated to AI research and development. Additionally, the government is setting up three national innovation centers that focus on AI and digital transformation, which are expected to drive significant advancements in these fields.
To further encourage AI adoption, Vietnam has introduced tax incentives, including a 10% reduction in corporate income tax for AI enterprises. The government has set a target for 50% of businesses to integrate AI technologies by 2025, reflecting its commitment to fostering a tech-driven economy. These policies have catalyzed private sector engagement, with a notable 70% of retailers planning to invest in AI technologies within the next two years, as reported by the Ministry of Industry and Trade. This proactive approach underscores Vietnam's dedication to leveraging AI as a transformative force in its economic and technological landscape.
Potential Impact of AI on Vietnam's Retail Industry
The integration of artificial intelligence (AI) is set to revolutionize Vietnam's AI in retail market, promising substantial productivity and economic gains. According to a report by Deloitte Vietnam, AI could enhance retail productivity by 40% over the next decade, highlighting its transformative potential. This technological advancement is projected to drive significant revenue growth, with AI-driven sales expected to contribute an additional $1.2 billion to the retail sector by 2025. Furthermore, AI-enabled automation and process optimization are anticipated to reduce operational costs by up to 20%, offering retailers a competitive edge in efficiency and cost management.
Consumers are also poised to benefit from AI integration, as 65% of shoppers express a preference for retailers that offer AI-based recommendations, indicating a shift towards personalized shopping experiences. While there are concerns about job displacement due to automation, AI is also expected to create new employment opportunities. By 2030, an estimated 50,000 new jobs in AI-related fields could emerge, balancing the scales between automation and job creation. This dual impact underscores AI's role not only as a catalyst for economic growth but also as a driver of innovation and employment in Vietnam's evolving retail landscape.
Request Free Customization of this report: https://www.astuteanalytica.com/ask-for-customization/vietnam-ai-in-retail-market
Challenges and Limitations Facing AI Adoption
Vietnam's journey towards AI integration faces several challenges, particularly in infrastructure and talent. Limited digital infrastructure in rural areas affects 35% of retailers, creating inconsistencies in AI deployment, negatively affecting the AI in retail market growth to some extent. This gap highlights the need for improved connectivity to support widespread AI adoption. Additionally, there is a significant talent shortage, with only 10% of Vietnam's ICT graduates possessing AI-related expertise. To meet industry demands, the country requires an additional 20,000 AI specialists, underscoring the urgency for educational reforms and training programs to build a robust AI workforce.
Cultural and financial barriers further complicate AI adoption. A 2022 consumer survey revealed that 40% of Vietnamese consumers are hesitant about AI-driven services due to privacy concerns, indicating a need for greater public awareness and trust-building initiatives. For small and medium-sized enterprises (SMEs), which constitute 98% of Vietnam's businesses, financial constraints are a major hurdle, with 60% citing high costs as a deterrent to AI adoption. While government policies are generally supportive, the evolving regulatory framework on data protection and AI ethics creates uncertainty for 25% of businesses considering AI investments. Addressing these issues is crucial for Vietnam to fully harness AI's potential and drive economic growth.
Vietnam AI in Retail Market Key Players
- Amazon Web Services Inc.
- Alibaba Group Holding Limited
- Microsoft Corporation
- IBM Corporation
- Google LLC (Alphabet Inc.)
- SAP SE
- Nvidia Corporation
- FPT Smart Cloud Company Limited
- Intel Corporation
- Other Prominent Players
Key Segmentation:
By Component
- Hardware
- Camera and Imaging Devices
- Sensors
- AI Chips
- Data Loggers
- Service Robots
- Smart Shelves & Labels
- Displays
- Scanners
- POS Systems
- Others
- Solution/ Software
- AI Platform/Tools
- Chatbots & Virtual Assistants
- Others
- Services
- Professional Services
- Managed Services
By Technology
- Natural Processing Language (NLP)
- Machine Learning (ML)
- Computer Vision (CV)
- Data Mining
- Deep Learning
- Robotic Process Automation (RPA)
- Others
By Deployment
- Cloud-Based
- On-Premises
By Application
- Front-End
- Customer Service
- AI-based Chatbots
- Virtual Assistants
- Sales & Marketing
- Personalized Recommendations
- Predictive Analytics
- Visual Search and Image Recognition
- In-Store Operations
- Autonomous Checkout Systems
- Smart Shelves
- Heatmap
- People Counting
- Consumer Behavior Analysis
- Others
- Customer Service
- Back-End
- Supply Chain & Inventory Management
- Fraud Detection & Prevention
- Demand Forecasting
- Price Optimization
- Warehouse Automation
- Workforce Management
- Others
By End Users
- Specialized Retail
- Supermarkets/Hypermarkets
- Omnichannel Retailers
View report summary and Table of Contents (TOC): https://www.astuteanalytica.com/industry-report/vietnam-ai-in-retail-market
About Astute Analytica
Astute Analytica is a global analytics and advisory company which has built a solid reputation in a short period, thanks to the tangible outcomes we have delivered to our clients. We pride ourselves in generating unparalleled, in depth and uncannily accurate estimates and projections for our very demanding clients spread across different verticals. We have a long list of satisfied and repeat clients from a wide spectrum including technology, healthcare, chemicals, semiconductors, FMCG, and many more. These happy customers come to us from all across the Globe. They are able to make well calibrated decisions and leverage highly lucrative opportunities while surmounting the fierce challenges all because we analyze for them the complex business environment, segment wise existing and emerging possibilities, technology formations, growth estimates, and even the strategic choices available. In short, a complete package. All this is possible because we have a highly qualified, competent, and experienced team of professionals comprising of business analysts, economists, consultants, and technology experts. In our list of priorities, you-our patron-come at the top. You can be sure of best cost-effective, value-added package from us, should you decide to engage with us.
Contact Us:
Astute Analytica
Phone: +1-888 429 6757 (US Toll Free); +91-0120- 4483891 (Rest of the World)
For Sales Enquiries: sales@astuteanalytica.com
Website: https://www.astuteanalytica.com/
LinkedIn | Twitter | YouTube
