After Double Twelve, who is leading the cross-border e-commerce in Southeast Asia?

On the tumultuous global landscape, there exists such a phenomenon. Some flight routes were opened very early, but their popularity remains undiminished until now, and they are still "speeding ahead". The Southeast Asian market is undoubtedly one of the representatives.

In 2024, whether cross-border e-commerce should enter the Southeast Asian market seems like a choice, but it does not constitute a practical problem.

In fact, the upper and lower limits of the Southeast Asian market are significantly higher than those of most emerging markets. In addition to being the first choice for many Chinese enterprises and brands to expand overseas, the Southeast Asian market has three indispensable advantages:

Firstly, Southeast Asia has ample space for the intergenerational growth of e-commerce, that is, the ability to transform from traditional shelf e-commerce to a diverse form that integrates shelf, content marketing, and live-streaming with product promotion. A mature content and influencer ecosystem is a good proof. TikTok now has 325 million monthly active users in the Southeast Asian market, with a user penetration rate of more than half, and the pace of converting content into e-commerce potential has not stopped.

Secondly, the systematic soil required for the continuous explosion of cross-border e-commerce - payment, logistics, overseas warehouses and other subdivided facilities, Southeast Asia is the most friendly market for enterprises going overseas.

Thirdly, the current goals and motivations of overseas brands and e-commerce platforms are basically the same, and the platform's promotion and logistics support are very considerable. This consistency accelerates the localization of capital and supply chain, and also enables global brands to grow faster.

The real question that should be asked is: What should be done now for cross-border e-commerce in Southeast Asia?

The Signal of the Era of Live-Streaming E-commerce

According to market analysis, the GMV of TikTok Shop in Southeast Asia quadrupled last year. The "2024 Southeast Asian E-commerce Report" released by Momentum Works in July this year shows that the GMV of TikTok Shop in Southeast Asia soared from 4.4 billion US dollars in 2022 to 16.3 billion US dollars in 2023.

While other emerging markets such as the Middle East, North Africa, and Latin America are still building digital infrastructure and sorting out solutions for going overseas from scratch, Southeast Asia has entered the main stage of live-streaming e-commerce.

According to the "2024 Southeast Asia Digital Economy Report" released by Google and Temasek, video e-commerce accounted for less than 5% in 2020, but it has already accounted for 20% in 2024, becoming an important part of consumption in Southeast Asia.

From the perspective of enterprises going overseas, the Southeast Asian market is not unfamiliar, and live-streaming e-commerce has also accumulated rich practical experience in China. However, whether the combination of the two will cause "incompatibility" is still an implicit concern.

In the past two years, the answer given by the first batch of enterprises that have profited from live-streaming e-commerce is: The concept of "If you don't go overseas, you will be out" has been deeply rooted in people's hearts. Now, for e-commerce in Southeast Asia, if live-streaming with product promotion is not carried out, it is likely to be passively left behind due to the inability to adapt to market development trends and consumer shopping habits.

The risks and uncertainties of going overseas are much higher than the fierce market competition itself. Going to Southeast Asia only reduces this risk to a relatively controllable range in a way that is familiar to Chinese enterprises and brands, but going overseas is always a struggle, not a refuge.

The controllable points of risks lie in: Firstly, the e-commerce infrastructure has matured, and there are already quick and flexible solutions to problems such as after-sales service and data compliance. Secondly, the "reservoir" of traffic on major platforms has already formed a certain scale, and the consumption conversion potential of the influencer effect is still considerable. Enterprises do not need to invest a lot of money and energy in the early stage to independently explore and convert traffic.

According to media reports, in the two months of September and October this year, 20 influencers of TikTok Shop Southeast Asia each achieved a GMV of over one million US dollars. The fan stickiness of local influencers is often higher than that of platforms and brands. The platform gives influencers support rights and maintains the activity of influencers in product promotion, which is also helping brands build a traffic field and avoid localization risks.

And the sense of struggle represents the agile response of continuously adjusting product strategies and expanding e-commerce paths according to market strategies, taking growth as the internal driving force, rather than just wanting to follow the trend and "win easily".

For example, Vanwalk, an overseas brand in the luggage category, has felt the "gold everywhere" behind live-streaming e-commerce through long-term cooperation with influencers and exploration of increment.

After deciding to deeply layout live-streaming e-commerce, Vanwalk focused its main business efforts on the TikTok Shop Southeast Asia cross-border store. Since March this year, an old product of Vanwalk that has almost been eliminated on the domestic e-commerce platform has unexpectedly become popular and has been selling well for two consecutive months.

The person in charge of Vanwalk said that at first, the operation on TikTok Shop was mainly based on short videos, and now it has shifted to live-streaming e-commerce following the traffic environment. Currently, live-streaming e-commerce accounts for 40% of the total GMV.

This "accident" made Vanwalk feel that the consumption environment in Southeast Asia has entered a transition period. It is not only "repeating" the pyramid path of domestic live-streaming e-commerce. With the product power being more clearly displayed, the trust connection between users and brands and the life cycle of individual products are being prolonged.

The second growth curve of mature categories is the sweet fruit after the brand vitality leaps. The outward growth and opening up of blue ocean of innovative new categories is another way to define "struggle".

As the pioneer of the soft magnetic eyelash category, WOSADO has a deep feeling when going overseas to Southeast Asia.

The highlight of this brand is that through continuous technological innovation and iteration, it has entered a niche market like a "no man's sky", but it is very in line with the current consumption needs of women and the "efficiency revolution". At the same time, soft magnetic eyelashes are also challenging the unit price of the local eyelash service industry with affordable products.

The price advantage brought by the production capacity dividend and the key technological innovation have always been the winning points for Chinese enterprises to go overseas. For the global layout of WOSADO, the only uncertainty is how to fully display the product advantages, wearing methods, and wearing effects to consumers.

Live-streaming e-commerce is a naturally suitable foothold. Influencer cooperation and UGC output can quickly enhance the brand trust of a new category in the early stage of market education, and strongly associate WOSADO with the "efficient beauty" lifestyle attitude reflected by soft magnetic eyelashes. In addition, combined with the platform's promotion rhythm and short-video content promotion, WOSADO has achieved maximum user conversion.

Since 2023, WOSADO's products have been listed on the TikTok Shop cross-border stores in five countries in Southeast Asia, with a monthly sales volume of more than 40,000.

"To do a good job in going overseas, TikTok Shop must be an unavoidable friend."

The person in charge of WOSADO told 36Kr that at the beginning, there will also be difficulties in consumer trust, supply chain, and cultural differences. Adjusting the market strategy is one aspect, and the influencer ecosystem of TikTok Shop and the support from the cross-border team have also solved many problems. The platform continuously incubates KOLs, and cooperation opportunities continue to emerge, providing a broad space for creation and expression for "new forces" like WOSADO that focus on brand building.

Great growth is always exciting. Through observing the overseas enterprises that have grown in the past two years, a consensus is that the period of mining gold in Southeast Asia by significantly reducing costs has passed. With the development of localized infrastructure, the labor cost continues to rise. Therefore, brand and content awareness are the few correct things to do now.

Believing in TikTok Shop is basically believing that the brand can shine in live-streaming e-commerce. The flywheel from planting grass, stimulating consumption to making a purchase decision keeps turning upward.

The Trump Card to Stand Firm in the Center

The wave of going overseas does not come surging all at once, but is pushed to the climax wave after wave.

However, in the era of traditional foreign trade, enterprises relied on products and orders to find customers and explore experience by themselves, and basically there was no added value of brand connection and service. In the era of e-commerce, with the addition of digital technology, platforms and tools, and the huge dividend of excess capacity in various industries, "systematic going overseas" and the development of online traffic have become possible.

In the next three to five years, the demand for diversified going overseas will also reshuffle the localized operation and integration capabilities of enterprises. Following the ecological path of e-commerce, the era of live-streaming e-commerce will be the first to come.

According to the "2024 Southeast Asian E-commerce Report" released by Momentum Works, the total GMV of the eight mainstream e-commerce platforms in Southeast Asia reached 114.6 billion US dollars in 2023, with a year-on-year growth of 15%. And the growth rate of TikTok Shop itself is almost four times, far higher than the overall growth rate of e-commerce platforms in the industry.

If we delve into the reasons, we will find that TikTok Shop is not only a player that pioneers and defines live-streaming e-commerce. At the same time, although all e-commerce platforms are incubating their own live-streaming ecosystems, TikTok's strength in content and traffic is still difficult to replicate.

Because, whether it is short-video planting grass or live-streaming e-commerce, the most important thing is traffic matching and consumption conversion. The charm of TikTok Shop lies not only in TikTok's huge user base, but also in its precise personalized content recommendation mechanism and support and guidance for platform merchants, which are also hard barriers.

For the long-term investment in live-streaming e-commerce, TikTok Shop is not only good at it, but also dedicated and firm. While cultivating local consumption habits, TikTok Shop is also committed to promoting Chinese brands that have been successfully verified by live-streaming e-commerce in the past to become the "war gods" in their respective tracks.

For example, the old underwear brand Turandot only entered the TikTok Shop Southeast Asia cross-border in August this year, and now it has become a leading merchant in the underwear category with the support of the platform's promotion, live-streaming ecosystem and influencer matching, and has achieved a GMV of 200,000 US dollars in one day.

The person in charge of Vanwalk also revealed that although cross-border e-commerce platforms have their own characteristics, with the rapid increase in the proportion of live-streaming e-commerce in stimulating consumption, its average monthly GMV on TikTok Shop is currently 3-4 times that of other platforms.

Recently, TikTok Shop Southeast Asia E-commerce released the results of the Southeast Asia Double Twelve promotion. The cross-border GMV on the day almost doubled, exceeding this year's Double Eleven, setting the highest single-day sales record for the platform's Southeast Asia cross-border business.

Short-video preheating, creating momentum through influencers, seizing traffic in the live-streaming field, and the collaborative cooperation of various channels. In addition to TikTok Shop's consistently mature conversion link, the leading role of the platform and ecosystem is becoming more and more significant. It not only provides users with more ports and emotional connection points to interact with brands, but also shortens the distance between local consumers and global brands, changing the way users used to contact brands.

From this point of view, live-streaming e-commerce has become an irreversible development trend, and it is also the key "weapon" for TikTok Shop to rapidly rise and run all the way in the global market. And the increasingly high requirements of consumers and merchants for the quality of traffic are the external driving force for the growth of the platform.

The significance of the brand itself is to more effectively display the products and enable more positive interaction between the products and consumers. The value of short videos and live-streaming lies in this. The reason why TikTok Shop is unavoidable for the Southeast Asian e-commerce path is that enterprises that want to build a good brand and platforms that want to do a good job in high-quality traffic are essentially a symbiotic relationship that will jointly understand and meet the needs of consumers.

In the future, merchants need to give up the fantasy of going overseas in a wild way. The remaining and incremental capacity of e-commerce is no longer about competing for the first-mover advantage and low-price strategy, but the real "trump card" of the brand.

The sustainability of the growth of live-streaming e-commerce in the overseas market still needs time to be demonstrated. And based on the present, TikTok Shop, which has pioneered live-streaming e-commerce, has finally accumulated strength and burst forth, standing firmly in the center.