Truth, Inspiration, Hope.

TikTok Surges in Vietnam Despite Increased Regulatory Pressures

Alina Wang
A native of New York, Alina has a Bachelors degree in Corporate Communications from Baruch College and writes about human rights, politics, tech, and society.
Published: April 15, 2024
TikTok app logo is seen in this illustration taken August 22, 2022. (Image: REUTERS/Dado Ruvic/Illustration/File Photo)

TikTok, the global social media behemoth under Chinese company ByteDance, has seen a sizable spike in its market performance in Vietnam, particularly within the e-commerce sector. 

Despite the app’s complex interactions with regulatory agencies across the globe — including strictures and outright bans in several countries — TikTok has not only flourished in the Southeast Asian country, but also tripled its merchant base and average sales within a year. 

Vietnam, with its tightly controlled political landscape and rapidly digitizing economy, presents a unique environment interwoven with political underpinnings. As a country governed by communist party, similar to China, Vietnam shares a nuanced relationship with its neighbor to the north. This includes elements of cooperation, such as censorship and monitoring of user data. 

MORE ON CALLS TO BAN TIKTOK: New House Bill Targets TikTok

Economic growth in a digital era

Vietnam’s digital market landscape has been evolving rapidly, a trend capitalized on by TikTok through its pivot from merely a viral video platform to a robust e-commerce hub. 

The shift in consumer attitude from skepticism around online shopping — plagued by concerns over counterfeit goods — to embracing it almost as a “hobby” illustrates a significant cultural shift in the country. This acceptance is furthered by innovative marketing strategies like “shoppertainment,” which blends shopping with entertainment and leverages local influencers and livestreams to engage users more deeply.

“People [did] not believe in social commerce,” TikTok’s Vietnam representative Nguyen Lam Thanh told Nikkei Asia in an interview. But amid a rapidly evolving digital era, more consumers are now turning to online shopping, said Nguyen, attributing the spike to being able to “follow the story [told] by the seller.”

RELATED:

This approach has proven effective, with TikTok overtaking Lazada to become the second-largest online marketplace in Vietnam, trailing only behind e-commerce giant Shopee. The platform’s success is underscored by impressive figures, with vendors in the country earning approximately $1.3 billion over six months, according to data by analytics firm Metric.

Meanwhile, TikTok’s operational strategy in Vietnam is known for its compliance and adaptability to local regulations. The platform has engaged in various initiatives alongside the Vietnamese government — ranging from promoting social causes to adapting to censorship requirements. But this collaborative stance comes with its challenges, including balancing corporate policies with government demands for content moderation and data storage. 

In 2022, TikTok’s compliance rate with Vietnamese takedown requests was remarkably high, the Nikkei Asia report finds. This pragmatic approach reflected the communist party’s goal of maintaining an operational foothold within a tightly-regulated environment. This has, however, also led to scrutiny, with inspections and investigations into practices ranging from data handling to content policies.

In response, the platform has aimed to minimize political content and emphasize its role in promoting positive social impacts. 

Toeing the line

Despite Vietnam’s growing economic ties with Western democracies and its position in regional geopolitics — particularly in the context of South China Sea disputes — it maintains a cooperative stance with China in several areas. 

This includes political rhetoric, with events celebrating Chinese leader Xi Jinping’s vision for his vision of a “community of common destiny for mankind.” Such political maneuvers illustrate the delicate balance Vietnam aims to maintain between advancing its economic interests and navigating its geopolitical alliances.

The phrase is a slogan used by the Chinese Communist Party (CCP) to describe a key foreign-policy goal of China. Also known as “community with a shared future for mankind” or “human community with a shared future,” the slogan represents China’s aim to build closer and cooperative relationships with other countries around the world.

RELATED: In Rare Admission, Xi Jinping Says China’s Economy Is Struggling

The distinction between TikTok and Douyin, its counterpart within mainland China, is also worth making note of. While both are owned by parent company ByteDance, TikTok operates independently outside China — including in Hong Kong. This suggests a strategic way for the two governments to adapt and comply with other regulatory agencies, namely from the West. 

Social and cultural impact

Beyond economic metrics, TikTok’s influence on Vietnamese digital culture cannot be overstated. With users averaging 41 hours a month on the platform, it has surpassed other social media giants in user engagement.

This high engagement level is indicative of a broader cultural shift towards digital content consumption and social commerce in Vietnam, Nikkei Asia report notes. 

The platform’s role in promoting eco-friendly products and local brands also illustrates its integration into Vietnam’s socio-economic fabric. Initiatives like these not only enhance TikTok’s corporate image but also align it with broader social trends focusing on sustainability and local entrepreneurship.

“Every issue, especially media and social media, always has two sides,” Nguyen Minh Tien, director of Vietnam’s agriculture ministry’s agricultural trade promotion center, told Nikkei Asia. “We know there’s a lot of positive value, just as there are negative aspects on social networks.”