On Thursday, TikTok, owned by China’s ByteDance, said it would invest billions of dollars in Southeast Asia to boost e-commerce. It’s a huge commitment that suggests the app has no plans to stop expanding even as it faces renewed global scrutiny over its data security.
The investment comes as the company aims to turn its vast user base into a significant ecommerce revenue source in the region, where it has been unable to capitalize on its popularity in the past because of intense competition from established rivals like Sea’s Shopee, Alibaba’s Lazada and GoTo’s Tokopedia.
To do that, it’s focusing on its in-app shopping feature. Its ecommerce platform, called TikTok Shop, lets consumers purchase products from small merchants that are linked to the videos they watch. The service currently generates more than 325 million monthly visits to the app.
“It’s a very fast-growing market, and it’s an essential part of our strategy,” CEO Chew Shou Zi told reporters at an event in Jakarta. He urged local governments and business groups to help develop the app by offering tax breaks and other incentives to encourage people to use it more often.
The company is also working on adding new features that will make it more attractive to users, including a live-streaming option and the ability to search for specific content. It’s also promoting a regionally tailored version of the app to cater to the unique needs and preferences of Southeast Asian customers.
It’s also seeking to build up its e-commerce ecosystem in the region by making it easier for SMEs to join its platform and adding more payment options. It also wants to promote its cross-border e-commerce marketplace in the region by focusing on countries with high internet connectivity, such as Indonesia, Thailand, and Vietnam.
But it remains to be seen whether the new investments will be enough to fend off growing concerns about the app’s privacy policies and potential for it to be used to influence elections. The app has already been blocked in some countries over political content and has faced scrutiny from regulators in others for allowing pornography and blasphemy to be uploaded.
The rise of TikTok is a big story in itself. But what’s more interesting is how it has changed how we consume videos on our smartphones. It’s no longer limited to consumer lifestyle brands that previously dominated the space and is open to content creators from various industries. To find out more, listen to this week’s episode of Orbital, our podcast on all things tech. You can subscribe to the show on Spotify, JioSaavn, and Google Play. Also, don’t forget to rate and review the show! We love hearing from you. You can also email us with any questions or feedback. We are always looking for more great ideas to share with our audience.
