TikTok Shop is coming for Shopee’s e-commerce crown
In Singapore, Shopee still leads by a wide margin, holding a 52% of market share as of 2025 Read more at The Business Times.
In Singapore, Shopee still leads by a wide margin, holding a 52% of market share as of 2025
IN THE second quarter of 2026, TikTok Shop overtook Shopee by sales volume in Thailand. While it was only a 3 per cent margin, it is a sign that Shopee’s dominance in South-east Asia is beginning to falter.
This could signal more intense competition in the region’s e-commerce sector next year, with TikTok Shop launching a standalone app. It also raises the question of where else Shopee could lose its lead, or if Thailand is an exception.
Analysts suggest Vietnam, where TikTok Shop is trailing closely behind Shopee in gross merchandise volume (GMV), could soon be next.
Toni Ruotanen, head of South-east Asia markets at marketing firm Havas, estimates that based on TikTok Shop’s current pace of growth, it could overtake Shopee in Vietnam within the next six to nine months.
In Vietnam, “TikTok Shop has already overtaken Shopee in the fashion category, while beauty is now evenly split between the two platforms,” Ruotanen tells Tech in Asia. He previously served as chief commercial officer at e-commerce enabler Crea.
TikTok’s Thailand edge
TikTok Shop had already overtaken Shopee in the skincare and face-care categories in Thailand six to 12 months before Q2 2026, notes Simon Torring, co-founder of markets insights firm Cube Asia. Because of this, TikTok catching up to Shopee was “not so unexpected,” he says.
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According to Torring, Thailand’s e-commerce market is skewed towards certain product categories that TikTok Shop is a natural fit for.
Within South-east Asia, Thailand has the biggest beauty, personal care, and wellness market in e-commerce, with these categories accounting for around 30 per cent of the country’s online sales. These categories are well-suited to short videos and livestreams, where creators can demonstrate products, review them, and answer questions.
Paul Srivorakul, CEO of e-commerce enabler aCommerce, similarly notes that among the brands it works with, beauty and personal care were TikTok Shop’s leading categories in Thailand in the first half of 2026. ACommerce helps brands such as Estee Lauder and Unicharm manage their sales across multiple online platforms.
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The relatively higher margins of beauty and personal care give brands more room to pay affiliate commissions to creators. Sales through affiliate marketing, driven by short-video and live content, account for roughly 32 per cent of TikTok Shop’s GMV in South-east Asia, according to Srivorakul.
Izhhar Gemilang, assistant manager for e-commerce at AB Foods, agrees that categories such as fashion, beauty, and snacks tend to perform better through TikTok Shop affiliates because those products are easier to demonstrate in a livestream.
AB Foods distributes products by Twinings and Ovaltine in Southeast Asia. Gemilang declined to share which e-commerce platform generated more sales for his company or which platform AB Foods invests more into.
Rather than any unique strategy it is employing in the market, Torring believes TikTok Shop’s success in Thailand largely comes from the country’s strong demand for categories that are better suited to its platform.
“I don’t expect that the investment level or the P&L health of TikTok Shop is dramatically different in Thailand from the other markets,” Torring says.
A TikTok spokesperson declined to comment.
TikTok Shop previously announced that it had trained local creators and 10,000 small and medium-sized enterprises in Thailand on livestreaming. In March, the platform said it had over three million sellers and more than five million creators in the country.
Will Vietnam follow suit?
Consumer spending on beauty and personal care products is increasing in Vietnam.
In 2025, e-commerce customers spent nearly 74.4 trillion dong (US$3 billion) on those categories, up almost 30 per cent from a year earlier, according to data platform Metric.vn.
In Q4 last year, TikTok Shop accounted for roughly half of beauty and personal care sales across e-commerce platforms in the country, narrowly ahead of Shopee’s 48 per cent.
Vietnam’s established creator ecosystem and rising consumer spending mean it can become another TikTok Shop stronghold in Southeast Asia. The country has “a few mega livestreamers” like Hannah Ohlala and Vo Ha Linh, who have 2.1 million and 5.6 million followers on TikTok, respectively.
These livestreamers yield large influence not just in the beauty category but also across products for women. Ohlala has driven more than 10 per cent of monthly beauty sales volume in Vietnam’s e-commerce market, Torring notes.
However, Havas’ Ruotanen says Vietnamese consumers are hesitant to buy products at higher price points. This could make promotions and sales events – which Shopee frequently relies on – more effective as a marketing strategy.
Singapore is harder to crack
In Singapore, Shopee still leads by a wide margin, holding a 52 per cent of market share as of 2025. It’s followed by Lazada at 36 per cent and TikTok Shop at 6 per cent, according to a report from Momentum Works.
Shopee’s continued dominance in the country can be attributed to consumer habits. Singapore has a stronger tradition of mall-based shopping, while livestream shopping and short-form entertainment are less established than in other South-east Asian markets.
Singapore also has an “underdeveloped influencer scene,” Torring points out.
Many brands are hesitant to invest in Singapore because of its small market, notes Havas’ Ruotanen, citing his conversations with brands. Investing in TikTok Shop involves more than advertising spend, as it also requires budgets for affiliate commissions, livestreaming, and content production. Brands need sufficient sales volume to justify these investments.
As a result, “brands might start the TikTok Shop journey outside Singapore and at a later stage address the market,” Ruotanen says.
Despite this, the high purchasing power among Singapore consumers makes it an attractive market, notes Gemilang of AB Foods. That said, consumers in the country have plenty of convenient offline options for categories such as FMCG and daily essentials.
TikTok Shop faces different obstacles in other Southeast Asian markets.
In Indonesia and the Philippines, logistics and fulfilment remain major challenges. In Malaysia, TikTok needs to expand beyond categories such as beauty, fashion, and FMCG to become more competitive, including in higher-value product categories such as electronics and gadgets, Ruotanen says.
Shopee fights back
Shopee is not sitting idle as TikTok Shop gains ground.
It continues to invest in entertainment, recently introducing microdrama content to entice users to spend more time on the platform. Viewers can earn loyalty points by watching microdramas and use those points for discounts on purchases.
The strategy attempts to replicate TikTok’s appeal as an entertainment platform, where consumers organically stumble across products to buy even without an intent to purchase.
However, changing user habits will take time, and Shopee may struggle to convince users to see it as an entertainment destination.
Ruotanen is doubtful that consumers will turn to Shopee for content, as their intent when opening the app is more focused on shopping than entertainment.
Rather than relying on vouchers, Shopee is leaning more onto its paid loyalty programme, which gives members a 4 to 6 per cent discount on purchases. The approach could encourage consumers to stick with Shopee rather than compare prices across platforms, a strategy Torring likens to Amazon Prime.
Indeed, Sea CEO Forrest Li said during the company’s Q3 2026 earnings call that ShopeeVIP membership had exceeded 21 million at the end of September, up 40 per cent from the previous quarter. ShopeeVIP members accounted for close to 25 per cent of Shopee’s GMV during the quarter.
Shopee is also investing in faster delivery, which Torring sees as an effort to increase GMV by capturing a share of offline retail spending. The platform’s instant and same-day delivery accounted for nearly 15 per cent of orders in Bangkok and surrounding areas, according to Li.
Still, defending its market position will come at a cost. Torring predicts Shopee will raise its take rates – the commissions it charges sellers – by 5 to 7 per cent next year, particularly in categories where it faces stronger competition from TikTok Shop.
He expects Shopee to channel much of that additional revenue into platform vouchers to keep prices competitive.
Shopee declined to comment. However, Sea’s management had noted during the earnings call that Shopee’s future monetisation improvements are expected to come from advertising rather than fixed commissions.
“I believe that Shopee sees South-east Asia as a cannot-lose region,” says Torring. “It will become more aggressive at fighting back.” TECH IN ASIA
Originally published by businesstimes.com.sg. Syndicated material does not necessarily reflect the views of Glamour Canada.
