Shopify sees SEA ecommerce as “the future”

Photo credit: Shopify

For Shopify‘s Bharati Balakrishnan, Southeast Asia is one of the ecommerce giant’s prioritized markets.

“If you could look at the next 10 years and you’re not doing ecommerce in Southeast Asia and India, you’re just not going to be part of the future,” she said in a recent interview with Tech in Asia. Balakrishnan is Shopify’s country head and director for the two markets.

According to data from the Shopify Entrepreneurship Index, the firm’s merchants contributed US$1.5 billion to Singapore’s gross domestic product (GDP) and US$500 million each to Indonesia and Vietnam in 2022.

These numbers are still quite modest, given that Shopify entered this region 10 years ago. For instance, a study found that GoTo Group may contribute over US$28 billion to Indonesia’s GDP in 2023.

However, Shopify is still betting on the region’s growing number of direct-to-consumer brands as they need to seek alternatives outside of marketplaces.

The company has been sealing a number of partnerships with local firms such as Thailand-based aCommerce, Vietnam-based ZaloPay, and Malaysia-based Meekco.

In 2022, Shopify made its first investment in a Southeast Asian startup in WATI, which operates in Malaysia.

Balakrishnan added that social commerce is a “key channel” in the region, highlighting the live shopping feature of TikTok as an example.

However, she said Shopify does not see TikTok Shop as a competitor but rather as a partner. In 2021, Shopify assisted TikTok in launching its in-app shopping features in the US.

According to a recent report by Momentum Works, Southeast Asia’s total gross merchandise value is projected to reach as high as US$232 billion in 2028.

See also: Can TikTok Shop catch up with Shopee, Tokopedia in Indonesia?