- TikTok Shop rapidly grows in Southeast Asia.
- It faces challenges from reduced subsidies and regulatory changes.
- Experts believe its local merchant base provides an advantage.
Scrolling to the top
TikTok Shop, the ecommerce arm of the popular video app, is making waves in Southeast Asia. In just two years, it has nearly quadrupled its gross merchandise value to $16.3 billion in 2023.
This rapid growth positions TikTok Shop as a formidable challenger to Shopee, the region’s leading ecommerce platform.
Growing pains
Despite its impressive growth, TikTok Shop faces hurdles. The platform has begun reducing subsidies for discounts and promotions across Southeast Asian markets.
Additionally, it’s grappling internal restructuring following its merger Tokopedia in Indonesia. These changes have led to job cuts and a potential slowdown in momentum.
Regulatory roadblocks ahead
Southeast Asian countries are tightening regulations on cross-border ecommerce and livestreaming, which could impact TikTok Shop’s operations.
From VAT impositions to stricter import controls, the platform must navigate an increasingly complex regulatory landscape.
However, industry experts believe TikTok Shop’s diverse local merchant base may help it weather these challenges better than pure cross-border platforms.
To read the original article: https://www.techinasia.com/tiktok-shop-narrows-gap-shopee-honeymoon
