TikTok emerges as Southeast Asian threat to Amazon with US$20 billion shopping pilot

TikTok Shop is fast-growing feature within China’s short-video app, with a burgeoning fan base in Southeast Asia and Indonesia the successful launch pad

Firm’s success in region crucial as it faces possible US ban over national security concerns, while live-streamed marketplace may offer template to take on Amazon

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An online influencer sells products in a livestreaming video sale. Photo: Shutterstock

Published: 5:00am, 6 Jul 2023Updated: 5:47am, 6 Jul 2023

Inside a ‘shophouse’ in northeast Jakarta, dozens of salespeople take turns peddling cosmetics, contact lenses and hair accessories. A woman helps a potential customer choose the right shade of lipstick for her skin tone, while a man yells out the latest markdown on vitamin tablets.

This is no raucous flea market. It is a live-streamed marketplace within TikTok, and a gold rush for entrepreneurs seeking fortunes on the world’s most popular short-video app. For the company, best known for viral dance challenges and owned by China’s ByteDance, TikTok Shop is its fastest-growing feature with a burgeoning fan base in Southeast Asia.

Its success in the region is crucial for TikTok as it faces a possible ban in the US on national security concerns. It also provides the company a template to take on Amazon in a way that no social media company has attempted before, provided it’s allowed to keep operating in the US.

Indonesia was the first market for TikTok Shop and is still its biggest, helped by a young, mobile-savvy population that has embraced the combination of short videos and in-app shopping since its 2021 launch. TikTok Shop is expected to hit US$20 billion in gross merchandise value by the end of this year, quadrupling from a year earlier.

If it can sustain that momentum, analysts say, it could revamp a company whose mainstay video platform is already luring consumers and advertisers away from Meta and Google.

Hank Wang, who manages a cast of around 50 live streaming hosts at the bustling Jakarta shophouse, believes TikTok Shop has the power to transform the retail industry and turn entrepreneurs like him into the next e-commerce barons.

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