TikTok parent company, ByteDance, has announced plans to invest billions of dollars in Southeast Asia, including Indonesia and Singapore, and has started to dominate the e-commerce market using apps.
Earlier, TikTok CEO, attended the event in Indonesia on the 15th and said he would invest $10 billion in Indonesia over the next five years. FT analyzed that in line with attempts to ban the use of TikTok in the U.S., ByteDance has shifted its marketing focus to 700 million people in Southeast Asia. The U.S. government has consistently raised suspicions that TikTok is providing information on its citizens to Chinese public security. The U.S. Congress is also seeking to enact a ban, saying TikTok could threaten national security.
For ByteDance, which is preparing for an initial public offering (IPO) within two years, it is necessary to reduce risks and increase the company’s value. This is the background of turning to the Southeast Asian market. ByteDance sees its corporate value at about $300 billion (about 391 trillion won).
TikTok has been trying a service that combines e-commerce features with apps since 2021. Recently, new shopping services such as TikTok Shop and Trendy Beat have been strengthened, which are well received in Southeast Asia. It is a method of promoting and selling products and obtaining fees by connecting certain brands with celebrities (influencers) in TikTok. Furthermore, TikTok is even considering selling its own products through live broadcasting.
According to FT, TikTok’s shopping-related e-commerce sales in Indonesia are expected to exceed $5 billion this year. It is twice as much as last year (2.5 billion dollars). This year, Southeast Asia’s estimated sales, including Indonesia, are estimated to be $15 billion. Most of the global sales of shopping-related apps occur in Southeast Asia.
TikTok’s ambitious plan is considered successful for now, a TikTok official said, “This year’s sales target of $15 billion is a conservative number,” adding, “The first wave of growth seen in Indonesia over the past year is leading to Thailand, Vietnam, and the Philippines.” The momentum is surprising,” he said. However, it is also pointed out that most of the products sold are biased toward fashion and beauty.
