TikTok to invest ‘billions of dollars’ in S-E Asia to help region’s businesses: CEO
Video-sharing app TikTok will be pumping “billions of dollars” in small and medium-sized enterprises (SMEs) in South-east Asia over the next few years as it seeks to expand its functions beyond entertainment and become a relevant tool for businesses in the region.
Stressing how efforts are already under way to expand the use of TikTok, chief executive Chew Shou Zi said on Thursday that the app has provided a platform for more than 15 million small businesses in Southeast Asia, including five million in Indonesia.
“I am delighted to announce that we are going to invest billions of dollars in Indonesia and Southeast Asia over the next few years,” said Chew.
He did not reveal the exact figure or timelines for the investment, but said that part of it will include a US$12.2 million (S$16.4 million) investment that will support more than 120,000 SMEs, entrepreneurs and young people over the next three years.
The app would also invest in training, advertising and supporting small vendors who are keen to join its e-commerce platform TikTok Shop.
Speaking at TikTok’s Southeast Asia Impact Forum, held at the Ritz-Carlton Hotel in central Jakarta, Chew noted that when the app started more than five years ago, it was mainly used for entertainment purposes.
Now, the app has millions of users around the world, including 325 million in the region, who use it for other purposes like empowering local communities and businesses to reach out to wider audiences.
“As we continue to expand our platform, our content is also becoming more diversified. Dancing and singing are still important, and they hold their charm, but we are witnessing other verticals, other sectors such as education, skyrocketing on our platform globally,” he said.
Speaking to reporters during the event, Chew was asked what key strategies and initiatives his company would implement to ensure TikTok remains relevant and successful, especially in the diverse context of Southeast Asia.
“The product itself is very global, as many of you who use this might know. And I think it is really important to preserve that interoperability and ‘global-ness’ of the product, because it allows for stories and inspiring stories to be exchanged across the world,” he said.
On Thursday, TikTok also launched a new report where it found that on average, more than six in 10 of those making a living on the app in nine countries in the region were earning more than the minimum wage in their countries.
Zooming in to specific countries, the report said that Laos took the top spot, with almost nine in 10 creators earning more than the minimum wage, while the lowest was the Philippines, at four in 10. In Indonesia, more than six in 10 creators earned more than the archipelago’s minimum wage.
The study, conducted by United States-based research firm Kadence International, surveyed more than 3,400 TikTok users and 25 non-profit organisations between August and September 2022. It used both online surveys and offline interviews.
Among the businesses surveyed, 79 per cent said that they were supported by the app to transition from offline to online marketing channels, and 74 per cent said that the app increased their sales volume.
Southeast Asia is one of TikTok’s biggest markets in terms of user numbers. However, it has yet to translate this user base into a major e-commerce revenue source, given the competition it faces from bigger rivals like GoTo’s Tokopedia, Alibaba’s Lazada and Sea’s Shopee.
TikTok Shop allows users to buy goods through links on the app during live streaming.
A separate report by Singapore venture firm Momentum Works released on Thursday found that Shopee was the largest e-commerce player in South-east Asia in 2022, chalking up close to half of the total e-commerce gross merchandise value with US$47.9 billion. This was followed by Lazada at US$20.1 billion, Tokopedia at US$18.4 billion and TikTok Shop at US$4.4 billion.
Chew and TikTok made international headlines in March when he was grilled for more than five hours by US lawmakers on a variety of issues, including privacy concerns and whether the app was misusing its user data.
Besides the US, lawmakers in Europe and Canada have in recent months escalated efforts to restrict access to TikTok, amid increasing concerns that the app and its parent company ByteDance may misuse the data of its users.
India banned the platform in mid-2020, while countries like Australia, France and Britain have banned the app from official devices.
Asia News Network
