Tiktok Reportedly Plans to Enter Southeast Asia's Online Travel Agency Market

TikTok, a social commerce platform from China, said it has no plans to acquire an Indonesian online travel technology (OTA) company for the time being. TikTok also did not respond to rumors of opening up businesses such as airfare, restaurant and hotel reservations.TikTok is reportedly developing a new business with plans to enter the airfare booking and hotel accommodation markets in Jakarta, Bangkok and Singapore.An anonymous source at the South China Morning Post said the way to achieve this is to partner with a third party.A TikTok spokesperson said they have no plans to acquire a local online travel agency (OTA) for now. Previously, the South China Morning Post reported that TikTok has set up 30 vacancies for related positions in three countries - Thailand, Indonesia and Singapore - to develop new business. If this plan goes ahead, TikTok users will be able to purchase accommodation services without switching apps. There are also rumors that TikTok will partner with Indonesian OTA vendors to smooth its plans, and TikTok plans to enter the leisure category by allowing users to purchase airfare coupons offered by third parties.

Statista reports that the Indonesian travel apps market reached USD 33 million in 2022 and the market is expected to grow to USD 533 million by 2027. Currently there are two large online travel companies in Indonesia, Traveloka and Tiket.com.Traveloka's revenue reached Rp 3.46 trillion in 2022, up 75% YoY.The company's loss stood at Rp 1.5 trillion, down 29% from Rp 2.1 trillion in 2021.Meanwhile Tiket. com reported an increase of 22% in airfare orders, 36% in accommodation orders, and 22% in travel orders between February and July 2023.This growth is in line with the improvement in the tourism industry after the Covid-19 pandemic.TikTok's parent company, ByteDance, has been quite active in Indonesia, and in January 2024, ByteDance acquired GoTo's stake in Tokopedia 75% for $1.5 billion, a step that allowed TikTok to sell in Indonesia after being banned by the Ministry of Trade. After the acquisition TikTok focused on empowering local MSMEs by encouraging several programs and also tried to run its business efficiently by reorganizing 450 TikTok-Tokopedia employees in June 2024.