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The
Significance of Mobile E-Commerce in Customer Retention in Vietnam
The
Significance of Mobile E-Commerce in Customer Retention in Vietnam
By (Name)
Professor
University
City/State
Date
The
Significance of Mobile E-Commerce in Customer Retention in Vietnam
1.0 Background
of the Study
Marketing
dynamics across the globe have changed significantly, necessitating firms to
find innovative ways of attracting, serving, and retaining customers. One of
these emerging ways of doing business entails the use of e-commerce. Other than
creating a network of customers, e-commerce facilitates business by reducing
the cost of operation through speeding up activities, managing customers'
information, as well as linking a retailer with the outside world of the
outbound supply chain. Research shows that “e-commerce is one of the most innovative
expansions of the technologies that enable small and medium-sized enterprise
(SMEs) access to global communication and trade” (Nguyen
& Thai-Binh 2018, p. 1). Now
more than ever, almost all multinational and local businesses have adopted the
use of mobile e-commerce as a way of gaining a competitive edge; however, for a
sector to gain these aspirations, a clear understand of the significance of
mobile e-commerce toward improving the rate of customer loyalty and retention
is paramount.
Vietnam is located
in the Indochinese peninsula and is among the Southeast Asia region. For the
last decade, regions bordering Vietnam, such as China to the North, Cambodia,
and Laos, have economically grown; this does not mean Vietnam has been left
behind. Research by Phong et al. (2018) indicates that Vietnam's growth in internet use has gone up from 20%
to 67.1% for the last 6 years. In the production sector, the country has also
experienced a remarkable increase in output, which has translated into an
overall growth in Gross Domestic Product. The interlink between the growth of
industrial operations and the increased use of the internet has created a
significant opportunity for the retail industry. One of the ways through which
ecommerce has been enhanced is via the establishment and commercialization of
business solutions and platforms such as e-commerce and m-commerce.
1.1 Justification of
the Study
The mobile commerce is one of the
most growing technology in all parts of the world. Technological advancement
has also enhanced the use of mobile devices, such as smartphones and tablets.
For this reason, this study will be focused on investigating the use of mobile
commerce (m-commerce) in Vietnam. The growth of mobile communication
technology, as noted by Nguyen and Thai-Binh (2018), is
one of the main reasons why most of the marketing strategies are customized to
meet the needs of the population that uses phones for long hours. The
millennials in Vietnam use phones to an average of 2 hours per day. During the time
millennials spend online, they order products, such as foodstuffs, cloth,
entertainment products such as gaming console, among others. Additionally, Weng-Onn and Soon (2016) indicated that online shopping
through m-commerce has grown with an index of 25% for the last 5 years, hence
making it essential to investigate how mobile commerce facilitates customer
retention. It
is due to these reasons that this study focuses on the population of Vietnamese
millennials.
1.2 Problem
Statement
The growth of the use of business support solutions
and that of competition in the global markets are exponential. These dynamics
create pressure for the overall retail industry as firms contend for available target
markets. The increased pressure in the business is a 'blessing in disguise' for
customers, mainly because they get quality products and services at low prices,
increased convenience, and accountability on the side of retailers. Nevertheless,
these benefits come at a cost. First, businesses have to establish a secure
business model to interlink customers and the products or services being
offered. This requirement raises the problem of cost and the security of
customer data.
Customer retention is one of the main objectives of a
business; efforts towards retaining a customer starts at the initial point of
contact. The marketing department in any company establishes the first
interaction with customers, and how they portray the company's products determines,
to a greater extent, the possibilities of instilling customer loyalty.
Retention also depends on how well a firm leverage information technology in
communicating, marketing, selling, and offering after sale-follow-up. In the
case of Vietnam, a vast number of businesses that use e-commerce focus on
reaching as many customers as possible without critical consideration of
avenues of retaining the existing customer base. That is why this study is
oriented toward discovering some of the significances of mobile e-commerce in
retaining the customer base.
1.3 Research
Aims
·
Examining
the role of mobile e-commerce in enhancing customers’ loyalty and retention
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