Once the deal is completed, JD will become one of the biggest investors of Tiki. JD declined to reveal the investment capital it pledged to inject into Tiki, but Tiki said it has raised US$50 million which will be used to expand business.
The latest investment deal made by the second largest Chinese e-commerce firm and the world’s third largest shows that cutthroat competition in the Vietnamese e-commerce market.
Winston Cheng from JD said that it will provide high-quality distinctive services to Vietnamese suppliers and consumers because of its professionalism in promoting social media in the field of e-commerce, and partnership between Tiki and VNG in social networks and mobile payments.
An analyst said the decision by JD to invest in Tiki shows that Vietnam is an attractive market in the eyes of Chinese e-commerce firms.
Alibaba, the largest e-commerce firm owned by Jack Ma, began in Vietnam in April 2016 after the takeover of Lazada.
Shopee, a rising star in the Vietnamese market, is also a Chinese invested firm. Its head office is located in Singapore, but like Lazada, Shopee’s largest shareholder, which holds 40% of shares, is Tencent, a Chinese technology conglomerate.
As such, all three of the biggest Chinese technology and e-commerce groups have arrived in Vietnam Vietnam through M&A, the quickest way to cement positions in the field.
Alibaba’s Jack Ma visited Vietnam last year and spoke about how he built the Chinese e-commerce market.
Shopee also shows its powerful resources and determination to conquer the Vietnamese market through a series of ad campaigns.
As for Tiki, analysts believe JD will not only pour money into Tiki, but also use its experience learned from the Chinese market to help Tiki develop.
According to Google, Lazada, Shopee and Tiki are three out of the four most searched e-commerce websites in Vietnam.
Vietnam has many e-commerce websites, namely FPT’s Sendo, Vingroup’s Adayroi and The Gioi Di Dong’s Vuivui.
There are also firms from the Republic of Korea (Lotte) and Japan (Aeon). However, Le Thiet Bao, an e-commerce firm, said the three Chinese invested firms will be major players in the market.
The report “The Future of E-commerce in FMCG” (fast moving consumer goods) by Kantar Worldpanel Vietnam e-commerce, although small, is among the fastest growing globally.