E-commerce: Key to Develop Trademarks

 

Experience from countries over the world show that one of effective measures to promote e-commerce websites is certificates granted by the prestigious third side. The certificates are indicated by trust mark on websites and consumers can completely confirm it just by pressing the trust mark. The trust mark not only makes consumers feel safe about the certified website but also brings effective business for e-commerce websites through increasing revenues for the web owner. According to a survey by the US’s leading group, TRUSTe - www.truste.org, for every US$15 spent for shopping, consumers are ready to spend additional 60 cent if the website has trust mark and can keep their personal information.

 

An Phuoc Garment Company now owns two brands namely An Phuoc and Pierre Cardin. The products with these brands have the same quality, material and design as well as production costs. However, the products branded Pierre Cardin is more expensive the An Phuoc-named ones. Pham Gia Tuc, Vice President cum General Secretary of the VCCI said among products of the same kind of different brands, which bear stronger trademarks is more expensive.

Currently, several international organisations cooperate with agencies in charge of granting e-commerce website certificates such as Global Trustmark Alliance (GTA) and Asia - Pacific Trustmark Alliance (ATA). This is great effort to enhance consumers’ confidence, one of the biggest barriers for the development of border-cross e-commerce.

 

ATA is the group of organisations in charge of issuing certificates for prestigious e-commerce websites in the region. ATA aims to link these organisations to increase the websites’ prestige in the region.

 

Speaking at a conference themed “Hard trademark-competitive advantages in the integration period” held by the Vietnam Chamber of Commerce and Industry (VCCI), Nguyen Manh Quyen, Deputy Director General Vietnam E-commerce and IT Agency under the Ministry of Industry and Trade said the appearance of e-commerce websites makes consumers entirely trust and feel secure in online trading activities. Each successful transaction time not only bring in revenue and profit for companies but also helps to promote their trademarks. The trademarks are formed via consumers’ habit of shopping and satisfaction for goods.

 

A survey covering 1,600 Vietnamese firms by the Ministry of Industry and Trade in 2008 indicated that most of local enterprises have applied e-commerce, but in different levels. They have invested remarkably in e-commerce development and received benefits from this.

 

Vietnamese companies pay attention to buying computer equipment. To date, nearly all local businesses have computers. The rate of firms with between 11 and 20 computers gradually increased and reached 20 percent last year. According to the survey, up to 88 percent of the interviewed companies built their internal websites in 2008, up from 84 percent in 2007. Currently, 99 percent of the asked businesses are linked Internet with 98 percent using broadband connection. Last year, 45 percent of Vietnamese companies had their own websites, up 7 percent compared to 2007. The rate of websites posted with update information regularly and with online goods booking is sharply increasing.

According to Dr. Tran Le Hong from the Department of Intellectual Property under the Ministry of Science and Technology, Vietnamese businesses which want to export their products must have brands registered in foreign countries. The registration is very complicated and often costs US$1,000 for a brand. However, it is still cheaper than the cost to make other brands. Vietnamese companies now register around just 1,500 brands in foreign countries, a modest figure.

 

Investment for software of Vietnamese companies has also considerably grown, making up 46 percent of the total investment for their IT investment in 2008, up 2 times against 2007. Meanwhile, hardware investment fell to 39 percent in 2008 from 55.5 percent in 2007. The change in the investment mechanism show a fact that local enterprise start focusing on software to deploy e-commerce after IT infrastructure stabilisation. Revenue from e-commerce has also tended to increase stably. Up to 75 percent of local firms gain the revenue ratio of at least 5 percent in 2008. Many of them set up a separate board for e-commerce management.

 

According to many foreign experts, Vietnam is the most potential country in Asia for economic development. The country also has long relations with European and Asian partners and the US as well, which is among its advantage for the economic development. Besides, the Vietnamese government pledges to concentrate on education development.

 

Grasping these advantages of the dynamic economy which boasts stable finance and banking system and a cheap, diligent and intelligent labour force, Vietnam owns favourable conditions for companies to develop their trademarks.

 

The majority of the Vietnamese community is small and medium-sized enterprises (SMEs). This is a competitive advantage but also a challenge for Vietnam. Local SMEs need to develop their own trademarks. Therefore, e-commerce is considered as a key to the Vietnamese SMEs’ development.