Recently, there was news that TikTok will resume its e-commerce business in Indonesia and work with local partners. This news has attracted widespread attention, especially as TikTok’s development in Southeast Asia has attracted much attention, and it has sparked heated discussions.
The Indonesian Ministry of Cooperatives, SMEs and Microenterprises (KemenKop UKM) spoke on the news that TikTok Shop will reopen in Indonesia. Temmy Satya Permana, Assistant to the Deputy Minister of the Ministry of Cooperatives, SMEs and Microenterprises and Deputy Minister of SMEs, confirmed the news that TikTok Shop will reopen in Indonesia and said that TikTok Shop will comply with all applicable regulations in Indonesia.
He said that TikTok may not set up a new company or subsidiary for TikTok Shop. In the plan, TikTok Shop will work with a local e-commerce partner.
According to Teten Masduki, Minister of the Ministry of Cooperatives, SMEs and Microenterprises of Indonesia, TikTok has negotiated with five e-commerce companies in Indonesia to explore partnerships in operating e-commerce. The three e-commerce companies that have been contacted are Tokopedia, Bukalapak and Blibli.
According to Kalodata data, Indonesia was previously the largest market for TikTok Shop overseas. In Indonesia, TikTok was once the top platform in terms of sales, which shows the huge potential of the country’s market. However, due to some legal and regulatory issues, TikTok closed its e-commerce business in Indonesia on October 5 this year.
According to Kalodata data, the Originote, the store with the highest transaction amount in Indonesia’s TikTok store in September 2023, had a monthly transaction amount of 5.31 million US dollars; @louissescarlettfamily, the number one in Indonesia’s TikTok Shop sales list in September, had a transaction amount of 2.8 million US dollars in September; the number one live broadcast in Indonesia’s live broadcast sales list in September had a single transaction amount of 460,000 US dollars, which came from a live broadcast conducted by @drrichardlee on September 27, which lasted 15 hours and 49 minutes.
In fact, Southeast Asia is a very important market for TikTok. In addition to Indonesia, Thailand and the Philippines are also important markets for TikTok. On November 17, Thai Prime Minister Seta invited TikTok to open a training center in Thailand, hoping that TikTok could help promote local products. On November 18, Philippine President Marcos met with the CEO of TikTok and hoped that TikTok could help train local businesses to promote their products.
These cooperation plans reflect the views of Southeast Asian countries on cooperation with social media platforms such as TikTok. They see great potential in cooperation to regulate the market, increase the visibility and sales of businesses, and provide consumers with more choices and convenience.
After the closure of TikTok in Indonesia, Thailand and the United States became the two largest markets for TikTok’s e-commerce platform. According to Kalodata data, the transaction volume in the Thai market and the US market reached US$268 million and US$250 million respectively in the past 30 days (10/21-11/19).
Governments of various countries help local businesses promote products and services and promote economic development by cooperating with platforms such as TikTok. The Thai government provides tax incentives for TikTok and plans to diversify its business in the field of education.
In short, TikTok’s development in Southeast Asia has attracted much attention. With the restart of the Indonesian market, I believe TikTok will have a broader development prospect in the future.