Thailand's e-commerce sector has reached a significant milestone, achieving a market value of 1.1 trillion baht in 2024, up from 980 billion baht in 2023.

This represents a growth rate of 14%, according to a recent report from Priceza.com, which projects further expansion, with anticipated growth to 1.6 trillion baht by 2027.

Thailand ranks as the second-largest e-commerce market in the Association of Southeast Asian Nations (ASEAN), following Indonesia, despite being the fourth-largest in population within the region.

Key factors in this growth include increased engagement from Thai consumers with online shopping platforms and the strategic shift of brands towards digital marketplaces.

Among the various platforms, Shopee leads with a 75% usage rate among Thai consumers, followed by Lazada at 67% and TikTok at 51%.

TikTok’s rise exemplifies the increasing significance of social commerce in the region, with industry observers indicating that the platform may become the dominant force in Thailand within the next one to two years.

TikTok Shop (Thailand) Co., Ltd. reported revenues exceeding 12 billion baht in its initial operational period.

Founded on November 8, 2023, with an initial capital of 200 million baht, the company is headed by Chawanrath Poochaiwatnanon, who also oversees its fashion e-commerce sector.

Analysts forecast a shift toward affiliate marketing as brands increasingly seek cost-effective measures to boost sales, especially in light of escalating seller fees on leading platforms.

TikTok's integration of short-form videos with e-commerce functions allows consumers to make purchases while watching content, streamlining the shopping experience.

This innovative model is contributing to significant growth in purchase volumes and impacting consumer behavior in online shopping.

However, concerns have arisen regarding fair competition due to TikTok's market strategies.

Concerns include the platform's practices that may disadvantage competitors by limiting visibility for links to rival services and compelling vendors to utilize its in-house sales systems to maintain audience reach.

Small-scale retailers have expressed escalating frustrations, citing higher sales volumes alongside increased platform fees and constraints imposed by delivery service choices mandated by TikTok.

Despite its influence in social commerce, TikTok's logistics framework faces criticism.

Thailand Post's President, Danan Suphatthaphan, noted challenges in tracking revenue impacts from their collaboration with TikTok, initiated in mid-2024, due to a lack of data transparency.

Of the parcels delivered via TikTok, Thailand Post estimates its share is merely 1-2%, a fraction compared to larger private logistics firms that have secured greater partnerships with TikTok, such as J&T Express.

As TikTok continues to shape Thailand's S-Commerce landscape, small sellers are increasingly concerned about being relegated in an environment dominated by platform control.

Reports have highlighted that sales surges come with higher commission fees, and visibility for products relies heavily on advertising spend or participation in TikTok campaigns.

Academics from Thammasat University have pointed to the global implications of TikTok's regulatory scrutiny as it transitions into a major S-Commerce player.

There are rising alarms regarding fair competition, especially due to TikTok's extensive user engagement, which averages 95 minutes per day.

TikTok’s integration of social media and e-commerce could lead to potential 'self-preferencing' issues, where the platform favors its products over competitors.

In Indonesia, for instance, the government temporarily banned TikTok Shop following concerns about anti-competitive behaviors, such as monopolizing user data and engaging in predatory pricing strategies.

As Thailand’s S-Commerce sector grows rapidly, regulatory frameworks are yet to keep pace, raising questions about the separation of TikTok’s roles as a media platform and a marketplace, as well as the need for oversight of its recommendation algorithms.

Logistics providers like Thailand Post have echoed concerns about potential distortions in competition, notably with TikTok’s partnership preferences for delivery services.

With the European Union moving to classify TikTok as a 'gatekeeper' under its Digital Markets Act to mitigate anti-competitive practices, Thailand faces a pivotal moment in determining its regulatory stance towards S-Commerce, aiming to ensure fair competition and protect the interests of consumers and small businesses.