What is an E-Commerce Website? Information You Need to Know

Are you planning to build an e-commerce website and start selling online? Do you want to understand what a business website is, what you need to know when designing an e-commerce website, and how to succeed in e-commerce? We’ll answer all of these questions in the article below.

I. Overview of the Development of E-commerce in Vietnam

The Department of E-commerce and Digital Economy recently released its 2023 Vietnam E-commerce Report. Accordingly, the e-commerce sector in Vietnam has seen significant growth in recent years and is projected to reach USD 20.5 billion in 2023 (an increase of 25% compared to the previous year).

The report not only highlights the bright outlook of the digital economy, but the statistical data also clearly shows the enormous development potential of e-commerce.

In Vietnam, it’s estimated that about 59–62 million consumers shop online (accounting for around 74% of the population), with the average purchase value per person estimated at USD 300–320 (up by USD 12–32 compared to 2022).

Most people shop online for some types of goods and services: clothing, shoes, cosmetics (about 76%), household goods (about 67%), tech and electronic devices (about 61%), books, gifts, and flowers (about 53%), etc.

II. What is an E-commerce Website?

Many people mistakenly believe that an e-commerce website is simply a sales website that supports online transactions, with features like a shopping cart, checkout page, and order placement.

According to Clause 8, Article 3 of Decree No. 52/2013/ND-CP by the Government on E-commerce:

“An e-commerce website is an electronic information page established to serve part or all of the process of buying and selling goods or providing services—from displaying and introducing products/services to entering contracts, service delivery, payment, and after-sales services.”

Simply put, any website that is created, managed, and operates one or more business functions such as transactions, product/service presentations, advertising, events, or contracts can be considered an e-commerce website.

Types of E-commerce Websites

When learning about e-commerce websites, we cannot overlook the different types currently in existence.

In reality, e-commerce websites can be categorized by industry, scale, ownership, or user purpose—but the most common method is by function.

There are two main types of e-commerce websites:

• Sales E-commerce Website: These are created by individuals or organizations for the purpose of direct selling, without intermediaries. Typically, the website sells one type or category of goods from a single seller.

• E-commerce Service Website: These are created by organizations or businesses to support others in conducting business. Unlike sales sites, these offer a wide variety of products and services.

Understanding the operational model of any e-commerce website participating in the broader digital marketplace is crucial.

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III. Common E-commerce Business Models

Here are the most widely used e-commerce models in the current market:

1. B2B (Business to Business)

This model refers to electronic commerce between businesses. It typically involves transactions between manufacturers, suppliers, distributors, agents, and other companies.

Transactions in B2B are usually based on wholesale or retail prices without a physical retail store.

Examples include:

• Websites offering branding and marketing services for other businesses

• Platforms providing IT infrastructure like internet services, platforms, applications, operating systems, servers

• Websites offering management software, operating systems, accounting systems

• Manufacturer websites selling to distributors or agents

Well-known B2B platforms include Amazon (B2B services), Taobao, and Alibaba.

2. B2C (Business to Customer)

This is one of the most popular and widely known e-commerce models today.

B2C refers to transactions between a business and the end consumer. The business offers its products or services to customers through its e-commerce website.

The customers are individual consumers, and the order values tend to be small.

Famous B2C websites in Vietnam include Thế Giới Di Động, Bách Hóa Xanh, Lazada, and Shopee.

3. C2C (Customer to Customer)

This model refers to transactions between individual consumers.

C2C platforms allow users to buy and sell directly to each other under certain terms.

Examples of C2C websites in Vietnam: chotot.com, raovat.net, nhattao.com.

4. B2G (Business to Government)

This model refers to transactions between businesses and government agencies.

B2G involves using the internet for procurement, licensing, and other government-related activities.

Although B2G is transparent, it’s less common in Vietnam due to the underdeveloped state of government procurement systems.

IV. Principles of E-commerce Operations

Article 26 of Decree 52/2013/ND-CP details the principles of e-commerce operations. This is one of the important contents that merchants, individuals, and organizations engaged in online sales on e-commerce websites must adhere to.

The principles listed in this decree include:

Principle 1:

Freedom and voluntary agreement in e-commerce transactions. Entities participating in e-commerce activities have the right to freely agree, within the legal framework, to establish the rights and obligations of each party in the transaction.

This agreement serves as the basis for resolving disputes that may arise during the transaction process.

Principle 2:

Principle of determining the scope of business activities in e-commerce. If merchants, organizations, or individuals engage in the sale of goods, provision of services, and promotion of trade on an e-commerce website without specifying the geographical limits of these activities, such activities are considered as being carried out nationwide.

Principle 3:

Principle of determining the obligation to protect consumer rights in e-commerce activities.

Owners of e-commerce websites and sellers on e-commerce platforms must comply with the Consumer Protection Law when providing goods and services to customers.

Customers on e-commerce platforms are consumers of e-commerce services and consumers of goods and services provided by sellers on these websites.

In cases where merchants or organizations providing e-commerce services offer information about goods and services from sellers to consumers on the e-commerce website, these entities are considered third parties in providing information under consumer protection laws (as amended by Clause a, Article 8 of Decree 85/2021/ND-CP).

Principle 4:

Principle of trading restricted or conditional goods and services through e-commerce.

E-commerce activities involving restricted or conditional goods and services must comply with the relevant legal regulations.

Entities engaging in e-commerce to trade restricted or conditional goods and services must adhere to laws regulating such goods and services (as amended by Clause a, Article 8 of Decree 85/2021/ND-CP).

Entities participating in e-commerce activities must comply with regulations on information security, cybersecurity, and other related laws (as added by Clause b, Article 8 of Decree 85/2021/ND-CP).

V. Steps to Build an E-commerce Website

Step 1 – Define Objectives and Choose a Market

Building a successful e-commerce website begins with clearly defining business goals. This not only helps the company effectively plan the development of the website but also provides a precise cost estimate, including design, domain, and hosting.

A successful e-commerce website needs to meet the performance and user experience requirements.

Fast page loading speed, intuitive interface, and features such as diverse payment options and efficient order management will help increase conversion rates and retain customers.

Step 2 – Choose a Platform to Use

After defining business goals, choosing a suitable platform for building the e-commerce website is crucial. The market currently offers various platforms such as:

• Shopify

• Magento

• OpenCart

• WordPress

Step 3 – Find a Design Unit

To choose a reputable unit, you can refer to this article: “Consulting Professional Website Design.”

Step 4 – Purchase Domain & Hosting

When selecting a domain name, businesses should prioritize short and memorable names. To choose the right hosting provider, consider factors such as server configuration (disk space, bandwidth, CPU…), customer service (24/7 live chat, data backup…), and other included features.

Step 5 – Develop the E-commerce Website

At this stage, it’s essential to collaborate smoothly with the website development unit, frequently updating the project’s progress according to the agreed plan or making necessary adjustments during execution.

When developing the e-commerce website, companies must also work with payment and shipping units providing services for the website being built.

Step 6 – Complete Legal Procedures

This step is essential to ensure the e-commerce website complies with the law, preventing issues and ensuring benefits for both the business and customers.

VI. E-commerce Business Requires Registration/Notification with the Ministry of Industry and Trade

The reality is that most online business owners, especially those engaged in e-commerce, are particularly afraid of doing the necessary registration procedures.

There are many reasons for this hesitation, such as the “fear” of expensive registration fees, “fear” of inconvenience, “embarrassment” due to unfamiliarity with registration procedures, or deliberately avoiding registration for “difficult to explain” reasons.

However, we advise you that if you truly consider e-commerce as a long-term business and want to grow sustainably, you should register the e-commerce website with the Ministry of Industry and Trade. The more, the better.

Here are some reasons why you should register/notify your e-commerce website with the Ministry of Industry and Trade:

• Compliance with the law and legal protection of rights: According to Decree 52/2013/ND-CP, any individual or organization owning an e-commerce website for online sales must notify/register with the Ministry of Industry and Trade. Websites that delay or fail to notify/register with the relevant authorities within the prescribed period will be subject to administrative penalties.

• Building customer trust: Websites confirmed as having registered/communicated with the Ministry of Industry and Trade are considered transparent about business information (business registration license, contact information, products/services offered…). Customers will avoid fraudulent or illegal websites.

• Building credibility and brand reputation in the market.

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Building a Professional E-commerce Website

The goal of creating an e-commerce website is not just to create an attractive website that grabs users’ attention.

It must also ensure that the website’s structure is designed according to SEO standards and has proper navigation to improve communication and attract potential customers to your sales page.

Here are some factors you should consider to create a professional and effective e-commerce website:

• Choose an attractive e-commerce website template that suits your industry.

• Prioritize websites with SEO-friendly structures.

• Organize category pages, product pages, blog pages, etc., with clear navigation.

• Place call-to-action buttons wisely and naturally.

• Don’t forget to use high-quality illustrations for product/blog posts on your website.

• Install plugins/apps to support your website: automatic registration, performance tracking integration, online payment, user reviews and comments, etc.

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