A Shift in E-Commerce Consumer Behavior
The trend of online shopping in Indonesia experienced significant turbulence after the closure of TikTok Shop on October 4, 2023. Minister of Cooperatives and SMEs, Teten Masduki, projected that as many as 80% of TikTok Shop users opted to stop shopping online. A monumental shift in consumer behavior garnered attention during the Working Meeting (Raker) with the VI Commission of the Indonesian Parliament in Senayan, Jakarta, on November 23, 2023.
According to data compiled by the Ministry of Cooperatives and SMEs, 20% of former TikTok Shop customers decided to switch to leading multichannel platforms such as Shopee, Tokopedia, Lazada, and Bukalapak. Teten Masduki conveyed this information as a result of the evaluation of the impact of TikTok Shop’s closure.
“I have received input that after the closure, 20% of TikTok Shop customers chose to return to multichannel platforms,” said Teten Masduki during the Raker [as quoted by Detik].
However, what is interesting is that the majority, namely 80%, of TikTok Shop users are said to be those who initially only used the platform for social media purposes. They were not active shoppers but rather tended to use TikTok as a means of entertainment and social interaction.
The government, through Minister Teten Masduki, emphasizes that TikTok Shop still has the opportunity to reopen. However, this step must comply with the requirements and regulations of the Indonesian government. This creates an opportunity for TikTok to partner with local e-commerce to relaunch TikTok Shop services.
Although 80% of TikTok Shop users choose to stop online shopping, the positive outlook on the return of TikTok Shop remains very much open. The potential collaboration with local e-commerce will provide new opportunities for loyal TikTok Shop customers and local businesses.
Currently, rumors about the possible return of TikTok Shop are circulating among online users. The collaboration with local e-commerce is expected to create synergies that benefit all parties, including the government, consumers, and small and medium-sized businesses.
Thus, the closure of TikTok Shop is not the end of the story but rather the beginning of a new chapter in the world of e-commerce in Indonesia. Changes in consumer preferences create opportunities for innovation and adaptation for industry players to continue competing in a dynamic market.