TikTok Shop's GMV target for this year exceeds $20 billion

In the past two years, TikTok's e-commerce business has not achieved very impressive results. However, according to people familiar with the matter, TikTok has set a grand goal for its e-commerce department this year: to quadruple site-wide sales to $20 billion.

This goal may seem a bit exaggerated to outsiders. After all, TikTok Shop's annual sales last year were only US$4.4 billion.

The person familiar with the matter said that TikTok will mainly bet on the growth potential of the Southeast Asian market this year, and the Indonesian market is TikTok's key focus.

According to data from e-commerce research firm Cube Asia, the GMV of TikTok Shop in Indonesia alone exceeded US$2.5 billion last year, and the GMV in the first three months of this year alone exceeded US$1 billion.

It can be seen that if TikTok can fully tap the e-commerce potential of the Southeast Asian market, it may really be able to achieve this seemingly "impossible" goal this year.

Judging from the current business model, TikTok's e-commerce business mainly relies on sellers to post shopping links during live broadcasts to sell goods, and most of the sales come from the live broadcast room. Although some videos can also post shopping links, the GMV contributed is relatively small.

In addition to the Southeast Asian market, TikTok has actually been trying to expand into Europe and the United States, although these two markets only account for a small part of the $20 billion target.

Currently, the TikTok Shop US site is still in internal testing, and the official has not given an exact time for the official public testing.

Perhaps due to cultural differences or local policies, TikTok's e-commerce business has not developed as smoothly in Europe and the United States as in Southeast Asia.

Last year, the Financial Times reported that TikTok would partner with Los Angeles-based TalkShopLive to launch its online shopping platform in North America through outsourced operations.

TikTok did not respond to this news .

TikTok

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E-commerce