Indonesia is booming and has become TikTok's second largest market

" Your favorite influencer just bought a new lipstick, it's so pretty! "

On TikTok, you can buy the same product in the video with just a few taps. As the short video platform continues to increase its investment in e-commerce functions in Southeast Asia, it may have the opportunity to compete directly with local e-commerce platforms in the future.

Currently, the United States is still TikTok's largest market, with 116 million users. However, TikTok's influence in Southeast Asia is also increasing.

According to Statista data, as of April this year , TikTok's user base in Indonesia has reached 113 million and is still growing, approaching the position of the United States as the largest market.

In June, TikTok CEO Chow Sau-chih said the company planned to invest "billions of dollars" in Southeast Asia, with Indonesia playing a key role in the strategy.

"We see huge growth opportunities here, and we look forward to investing more in Indonesia." Zhou Shouzi also pointed out that TikTok currently has nearly 2,000 employees in Indonesia.

Online shopping has grown across Southeast Asia as internet penetration increases, with penetration (excluding food and beverages) now around 20%, according to McKinsey, which expects gross merchandise volume in the region to grow to $230 billion by 2026.

Although TikTok is currently developing smoothly in Southeast Asia, it is still necessary to consider the competitive pressure from other e-commerce platforms.

Simon Tollin, co-founder of Cube Asia, an e-commerce research platform focused on Southeast Asia , said TikTok’s regional offensive in Southeast Asia couldn’t come at a worse time for these competitors.

Earlier this year, JD.com confirmed that it would shut down its operations in Indonesia and Thailand in the future, despite struggling to gain a foothold in the two markets.

Tolin said competitors are very anxious about TikTok's e-commerce business, noting that social commerce is a trend that market watchers and analysts have been predicting for some time.

However, TikTok is currently mainly active in the fields of fashion and beauty. Whether it can further expand its product categories in the future may be a major challenge it faces.

TikTok

Indonesia

Southeast Asia