TikTok plans to pump billions into Indonesia and Southeast Asia over the next few years, doubling down on the region amid increased global scrutiny over its data security.
TikTok revealed on Thursday that it would invest billions of dollars in Southeast Asia over the next few years, securing its foothold in the area amid intensifying scrutiny over its data security in the West and elsewhere.
The region is one of TikTok’s biggest markets in terms of sheer user numbers, with a collective population of 630 million — half of whom are under 30 — generating more than 325 million monthly visitors to the app. But TikTok has yet to translate that large user base into a significant e-commerce revenue source in the region, as it faces fierce competition with bigger rivals like Sea’s Shopee, Alibaba’s Lazada, and GoTo’s Tokopedia.
“We’re going to invest billions of dollars in Indonesia and Southeast Asia over the next few years,” said TikTok CEO Shou Zi Chew at a forum organized by the company in Jakarta to highlight the social and economic impact of the app in the region.
While the company did not provide a detailed outline of its spending plan, it said it would invest in training, advertising, and supporting small vendors looking to join its e-commerce platform, TikTok Shop. Chew added that content on that platform is becoming more diversified as it adds more users and expands beyond advertising into e-commerce, enabling consumers to purchase goods through links on the app during live streams.
TikTok currently has 8,000 employees in Southeast Asia and 2 million small vendors selling their wares on its platform in Indonesia, the region’s biggest economy. According to data from Momentum Works, e-commerce transactions across Southeast Asia reached nearly $100 billion last year, with Indonesia accounting for $52 billion.
While TikTok facilitated $4.4 billion in transactions across Southeast Asia last year — up from $600 million in 2021 — it still lagged far behind Shopee’s $48 billion in regional merchandise sales in 2022.