Vietnam e-commerce rivalry intensifies as TikTok Shop surges, Shopee growth slows

Competition among leading e-commerce platforms in Vietnam remained intense in 2025, with China-backed TikTok Shop rapidly closing the gap on market leader Shopee, according to the Vietnam Tech & Venture Capital Outlook 2025 by VinVentures, an investment arm of conglomerate Vingroup (HoSE: VIC).

In Q3/2025, Shopee retained the top position with a 56% market share, but its revenue growth slowed to 4% year-on-year, reflecting market saturation amid rising competition and costs, the report said.

TikTok Shop posted 69% revenue growth, expanding its market share to 41% from 30%, driven by its “shoppertainment” model that blends shopping with short videos and livestreaming.

Lazada’s market share held steady at about 3%, while Tiki continued to lose ground, with revenue plunging 80% after cumulative spending of roughly $670 million, according to VinVentures.

Seller dynamics highlighted the shift in momentum. In the first half of 2025, the number of sellers on TikTok Shop surged 96% to 267,000, while Shopee’s active sellers fell 32% to about 210,000, implying a loss of roughly one-third of its seller base. Other platforms also recorded sharp declines.

Average transaction value (ATV) per product on TikTok Shop rose 10% year-on-year to about VND130,000 ($4.95), signalling a move away from ultra-low-priced and trend-driven items towards higher-quality brands.

By contrast, Shopee’s ATV fell 7.2% to around VND107,000 ($4.07), reinforcing its positioning as a value-for-money platform.

In Q3/2025, the highest-grossing categories on e-commerce platforms were beauty with VND17.7 trillion ($673.58 million), home and living with VND13.8 trillion ($525.16 million), and women’s fashion with VND12.1 trillion ($460.47 million).

VinVentures said “shoppertainment” has become the industry’s new standard. Following TikTok’s rise, rival platforms and brands have expanded livestreaming and short-video sales. Service providers such as Nina Live Hub have grown into integrated ecosystems, offering creator training, network management, store operations, and revenue management across e-commerce platforms.

Regulatory changes are also reshaping the market. Since July 1, 2025, e-commerce platforms have been required to withhold value-added tax and personal income tax on sales conducted through their sites, collecting 1% VAT and 0.5% personal income tax on revenues generated by individuals and household businesses.

The mechanism effectively turns platforms into tax collectors, formalizing income for thousands of micro-businesses and reducing informal activity, but also raising operational complexity and compliance costs as platforms upgrade payment systems, classify sellers, and enhance reporting and reconciliation, the report said.

Looking ahead, VinVentures expects new e-commerce regulations to improve transparency and formalization, while increasing compliance burdens, particularly for sellers operating through social commerce channels.

Future success, the report said, will increasingly depend on public and private investment in e-commerce enablers and cross-border logistics, helping small and medium-sized enterprises meet international quality and sustainability standards and expand Vietnam’s digital export potential.

Larger platforms and well-capitalized direct-to-consumer brands are likely to use artificial intelligence to boost productivity and cut costs by 10% to 30%, while smaller players that are slower to adopt AI may struggle to remain competitive on cost and operational efficiency.