Victory were shown up by the big-spending Chinese Super League side, losing 4-1 in Shanghai on Tuesday night.
Premier League winner Oscar scored two second-half goals for Shanghai SIPG, after Hulk's penalty and Wu Lei's diving header before the break.
Besart Berisha grabbed a goal for Kevin Muscat's side but they were unable to contain the home side's star-studded forward line.
"We can't deny they were the better team but we kept persevering," Muscat told AAP.
"We started really brightly. But they're a very good team. Some individuals made the difference."
The good news for Victory is they were never expected to win in Shanghai.
It's the club's 17th match without success outside Australia, a run which was unlikely to end against a team which has invested hundreds of millions of dollars in its playing talent.
But the bad news is that Victory are now up against it to qualify, sitting third in the standings behind Shanghai and Ulsan Hyundai.
Victory resume their ACL campaign in a fortnight with a home-and-away date with twice-beaten Kawasaki Frontale.
"It's going to be another big ask but its still early in the group. Three points or four points in those games will change things," Muscat said.
Captain Carl Valeri shared Muscat's optimism on qualifying, saying despite the scoreline, there were "a lot of positives" to take out of the match.
"There's still many more games to go," he said.
"With the quality of our team and the experience we have I think we can do well ... there are lessons to be learnt and a lot of good things to come out of this."
Victory will arrive back in Melbourne on Thursday ahead of a crunch A-League date with Adelaide United on Saturday night at AAMI Park.
Muscat's men need a win after three straight defeats in the domestic league but the coach sees the match as an opportunity rather than a hurdle.
"If we beat them we'll go above them," he said. "Physically tonight we were excellent and we had some nice moments so we'll be ready.
"We want to take the opportunity to catch Adelaide on Saturday."