“Small but mighty”: How has the homegrown Vietnamese travel platform iVIVU increased revenue by 50% compared to pre-pandemic numbers?

“Small but mighty”: How has the homegrown Vietnamese travel platform iVIVU increased revenue by 50% compared to pre-pandemic numbers?

TMG – In a market worth USD 9 billion that’s largely dominated by international brands like Traveloka, Booking and Agoda, what has this Vietnamese platform done to steadily double revenue year after year and quickly recover from the pandemic?

Which direction for domestic travel platforms?

According to forecasts by the Vietnam Chamber of Commerce and Industry (VCCI), the number of online Vietnamese tourists is expected to reach 24 million by 2025, up 25% compared to 2020. Additional data from Google and Temasek has predicted that Vietnam’s online travel market is expected to reach USD 9 billion by 2025.

In an ever-growing market, foreign online travel agencies (OTAs) have so far overwhelmed domestic brands. According to a report published by The Outbox Company, the 5 most popular OTAs for Vietnamese consumers in Q1/2023 were foreign companies, respectively Traveloka, Booking.com, Agoda, Expedia and Trip.com.

Top 5 Most Loved OTAs in Vietnam in Q1/2023. Source: The Outbox Company.

At the end of 2017, the Vietnam E-Commerce Association (VECOM) said that foreign OTAs accounted for 80% of the market share. Many reasons were given, including the fact that foreign OTAs usually have more experience in online transactions, operate on a global scale, and have solid financial potential.

However, domestic OTAs can still make headway in the ever-developing tourism industry, transforming and diversifying over time. Speaking about competition with foreign OTAs, Mr. Nguyen Trung Cong, Director of iVIVU.com Joint Stock Company said that its model is different in many ways.

“iVIVU.com does not offer all types of tourism products and services in many segments. We choose to focus only on the middle- and high-end customer segment, offering 4-5 star hotel products. This approach helps us operate more efficiently and in a more focused way, giving customers a better experience because they do not have to wade through hundreds of thousands of different products, making it easy to find the right product for them.

It can be said that in business there is always competition but iVIVU.com is not a direct competitor. We choose which segment to serve and we do it well instead of trying to meet the needs of the entire market”, Mr. Cong said in analyzing the situation.

Mr. Nguyen Trung Cong, CEO of iVIVU.com.

Revenue increased by 50% compared to pre-pandemic numbers, with the aim to serve one million foreign and domestic guests

The online travel platform iVIVU.com is a part of Thien Minh Group (TMG) – an enterprise that’s been in the market for 30 years and owner of 16 brands in the tourism, hotel, online and aviation industries. Launched in 2014, iVIVU has now built an ecosystem offering every service needed by travelers such as travel packages, hotels, tours, air tickets, vehicles, tickets to entertainment venues, etc. iVIVU’s network includes more than 30,000 hotels and nearly
10,000 entertainment venues both in Vietnam and internationally.

Before the pandemic, iVIVU’s revenue doubled year-on-year. In 2019, the company was profitable, with VND 470 billion in revenue.

After Covid-19, iVIVU also recovered quickly with revenue in 2023 increasing by 50% compared to pre-pandemic numbers, estimated to account for 20% of the high-end resort tourism market share in Vietnam. The product claiming the largest proportion of revenue is travel packages. Up to now, the company has served approximately 600,000 Vietnamese consumers traveling at home and abroad.

Since the pandemic, the travel habits of Vietnamese consumers have changed significantly: prioritizing experiences, with more focus on culture, the environment and health. This makes personalizing each customer’s experience essential to meeting diverse needs.

Quickly recognizing this trend, iVIVU plans to launch “Bespoke Journey” to create personalized journeys for customers. The target is groups of 6-12 people. iVIVU’s team of travel experts will collaborate with local KOCs (Key Opinion Consumers) and guides to create an initial program framework. After that, each trip will be fine-tuned according to the specific preferences and requirements of guests.

“Bespoke Journey will be a new step forward in tourism products for Vietnamese travelers, as well as an opportunity for iVIVU to expand its business overseas, joining forces with Thien Minh Group’s offices in Europe and Asia to serve not only Vietnamese tourists, but also customers from around the world. In 2024, the company aims to serve 1 million foreign and domestic customers”, Mr. Nguyen Trung Cong shared.

Forecasting Vietnam’s online tourism market, experts say that in light of the enormous potential, new businesses may need to embrace many new products, adding diversity and increasing competitiveness in the industry. Companies will be forced to develop the right products that show insight into consumers, find ways to reduce costs and carry out effective marketing strategies.

Source: Cafebiz