Here are the best e-commerce platforms in Southeast Asia this year

Shopee remained the leading e-commerce platform in Southeast Asia in 2023, maintaining a 48% market share and achieving a gross merchandise value (GMV) of US$55.1 billion.

TikTok Shop is the second largest platform in Southeast Asia. According to a recent Momentum Works study, its market value (GMV) increased almost fourfold in 2023 ($16.3 billion).

TikTok Shop is currently on the same scale as longtime Lazada and Tokopedia. The merger with Tokopedia in Indonesia puts TikTok Shop on a similar scale against Shopee.

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Lazada has shifted its focus from brands to supply chain and consumer experience this year, part of Alibaba’s global war with Pinduoduo-owned Temu and other challenges.

On the other hand, Temu entered Southeast Asia in 2023 but is focusing on North America, Europe and other affluent countries. It may pay more attention to the region after ROI in other markets has declined. It is currently testing in Malaysia and the Philippines and is looking to add Indonesia to its map, the report said.

Across Southeast Asia, beauty has become the most popular category on TikTok Shop and Shopee.

Other major categories include home and living, electronics, women’s fashion, and Muslim fashion. Men’s fashion and food and drink round out the categories.

Key trends for 2024

According to the report, four major trends can be identified over the course of the year that will define the e-commerce narrative in Southeast Asia.

To start with, eCommerce players will learn from China and explore live trading. In fact, the active promotion of live trading on TikTok Shop fosters an ecosystem of sellers, service providers, KOLs and MCNs.

At the same time, Shopee has been investing heavily in ShopeeLive. Both platforms have spent hundreds of millions of dollars on vouchers, discounts, and seller support, it said.

Live trading is still ongoing in the region, but top-selling KOLs have started to emerge. These include Võ Hà Linh from Vietnam, Pimrypie from Thailand, and Richard Lee from Indonesia.

Second, platforms are beginning to explore generative AI applications to enhance user experience, optimize operations, and improve overall performance. If leveraged well, AI can drive the future competitiveness of e-commerce platforms and ecosystems.

Another trend for 2024 is consolidation. In the future, leading enablers will need to diversify their business and expand their services to include software, brand incubation, live commerce, multi-channel networks, and supply chain. Expansion into these areas can also be done through internal development.

Finally, Momentum Works predicts a new competitive dynamic among third-party logistics players. This is especially important as eCommerce platforms place greater emphasis on in-house logistics.

In fact, more than 50% of Shopee orders in Southeast Asia are delivered by ShopeeXpress. This puts pressure on third-party logistics providers, the report said.

As added in the report, TikTok Shop has no current plans to develop internal logistics, but may simply build or acquire its own logistics department once it deems the return on investment for such a solution worthwhile.

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