Greetings from Hoi An, Vietnam. City of 1,000 tailors. One month in to my stay in vietnam, I have a few observations Iâ€™d like to share about universal behaviors and commerce.
Vietnam is a developing country. It is not nearly as far behind as I expected (perhaps better wifi availability than the US), but it is still over 100 countries behind the US in the development index. There are some timeless business lessons to be learned here.
As an Westerner, I am often swarmed by people asking for money or trying to sell me some small trinket like I am a high roller. It is weird to think that even though as a grad student I was on the bottom end of the US income spectrum that I probably make more than most in Vietnam (still averaging $3/day income). But interestingly, the unemployment rate in Vietnam is only around 5%, and lots of people are involved in multiple businesses.
Here are some of the truisms I have seen in effect in Vietnam:
The power of affiliates. the hotel owner recommending tour operators and tailors, to the guys sitting next to you at the cafe who will arrange a bus to swing by and pick you up, it pays to be on either end of an affiliate deal. In the case of our guide in Sa Pa, the hotel was getting 50% of the price of our booking, and the guy who called the bus got 25%.
Always have a good hype man. When you go to the market and see 20 different food stalls advertising the same dish (no unique selling proposition here), often we find ourselves eating at the stall that either has the best english speaker who engages us and tells us to look at the menu or clears a place at the bench. Otherwise we may just sit down at the first stall, which brings us to the next point:
Location, Location, Location. When choosing food, we are much more likely to simply pick the first stall than try to decide if there is something better further into the row of food vendors. When parking, to avoid the hassle of driving around in this hectic traffic, I usually take the first spot offered to me. Restaurants with a view of the water typically 3X their prices compared to ones just a block or two away.
Offer something for free first. This is classic model of persuasion seen when you get the free dime/map/return address label from the charity in the mail. We parked in a village and did a trek down the canyon to an ancient rattan bridge, and 3 little girls â€œadoptedâ€ us and followed us the whole way there, waited an hour while we went swimming, wove little animals out of reeds to give us, and then asked us to buy a little woven purse or bracelet from them. We felt obligated to buy, and even though we didnâ€™t really want to, it was hard to say no because they had already given us something (even if we didnâ€™t ask).
Know your alternative when negotiating. The best results I have when negotiating in the street markets are when I either know I can get the same product somewhere else for cheaper (such as water outside of the tourist areas) or am willing to walk away. The items that I really like and am not convinced I can get somewhere else, I usually give in with too high a price. It pays to know the going rate or what your upper limit of price will be for the purchase to be a good one to you.
Engage your customer/audience. Step outside of a tourist hotel and you may be greeted with repeated querys of â€œwhere you from?â€ Being the proud citizen of the USA that I am, I often fall into the â€˜trapâ€™ of engaging in conversation with someone who is ultimately trying to sell me something. Ironically, I also ask this question of many of the other travelers that I meet, so I can start a conversation with them.
Lots of these lessons make sense in highly developed countries like the US or even for online businesses.
Question: How can you apply these lesson to your own projects? Leave your comment below.