TikTok Shop Expands Further... "Next Year's Transaction Target Set at $50 Billion"

Chinese video-sharing platform TikTok (Douyin) announced that its total e-commerce gross merchandise volume (GMV) target through TikTok Shop next year is $50 billion (approximately 65.13 trillion KRW). In some countries with high entry barriers, it is accelerating the expansion of its business network by seeking indirect entry through the acquisition of local companies.

According to local media including China Observer Network on the 20th, TikTok set its e-commerce GMV target through its platform next year at $50 billion. This is 2.5 times the target amount for this year ($20 billion). Last year, TikTok's global revenue was around $4.4 billion.

The scale of TikTok's e-commerce is rapidly increasing, centered on Southeast Asia and the United States. Already this year, it has recorded over $13 billion in Southeast Asia, mainly in Indonesia ($4 billion) and Thailand ($3.5 billion). In the U.S., daily sales through TikTok Shop exceeded $300,000 in May, rapidly growing to $5 million in August and $10 million in October.

According to data from Fastmoss, during the Black Friday promotion period on the 24th of last month, the daily GMV surged to $33 million. A TikTok service official predicted that the daily GMV in the U.S. next year could reach $100 million to $200 million, potentially amounting to $30 billion annually.

Previously, TikTok's e-commerce business suffered setbacks due to regulations in the Indonesian and Malaysian markets. Local governments restricted TikTok's operations, citing reviews of product sales regulations and global minimum tax. Indonesia, in particular, took a strong stance by completely expelling TikTok to protect its domestic market. The Observer Network reported that TikTok incurred losses of at least $1 billion in the Indonesian market alone after closing TikTok Shop.

However, TikTok is attempting to enter the local market by acquiring the local e-commerce company Tokopedia. TikTok's parent company, ByteDance, plans to invest about $1.5 billion to merge Tokopedia with its own e-commerce business division and establish a joint venture. TikTok will hold a 75.01% stake in this joint venture. It is expected that TikTok will employ a similar strategy in Malaysia, where local authorities have announced they are studying measures regarding TikTok's operations.

Meanwhile, TikTok is reportedly choosing South Korea as its ninth country of entry following the United States, the United Kingdom, and six Southeast Asian countries. TikTok Korea recently filed a trademark application for 'TikTok Shop' in South Korea and is reportedly weighing the timing of its launch.