HO CHI MINH CITY UNIVERSITY OF FOREIGN LANGUAGES –

INFORMATION TECHNOLOGY

FACULTY OF INTERNATIONAL BUSINESS ADMINISTRATION

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FINAL ASSIGNMENT
HOW TO OBTAIN COMPETITIVE ADVANTAGE

USING SERVICE AT TIKTOK SHOP

Group’s member:

Trần Minh Đức – 22DH120557

Đặng Thị Như Huyền – 22DH120919

Nguyễn Ngọc Huyền – 22DH120930

Trần Mỹ Linh – 22DH121298

Nguyễn Khánh Ly – 22DH121367

Trần Phạm Trà My – 22DH121504

Lê Trần Thành Trí – 22DH123126

Nguyễn Song Đức Phát – 22DH123678

HCMC, 7/2024
 TABLE OF CONTENTS

1. Introduction..............................................................................................................
2. The rise of TikTok Shop..........................................................................................
2.1....................................................................................... Historical background
..............................................................................................................................
2.2..................................................................................... Enterprise functionality
..............................................................................................................................
2.3............................................................................................................. Triumphs
..............................................................................................................................
3. The competitive advantage of TikTok Shop..........................................................
4. The analysis of the strategies used by TikTok Shop to gain a competitive
advantage..................................................................................................................
4.1. Strategies used by TikTok Shop.......................................................................
4.2............................................................................... The evaluation of strategies
..............................................................................................................................
5. Conclusion................................................................................................................
6. References.................................................................................................................
1. Introduction
With the rapid advancement of information technology and the worldwide trend of
digitalization, e-commerce has emerged as one of the most important businesses. There is
no denying that the rise of e-commerce has marked a tremendous revolution in the global
economy, setting an unwavering rule that firms that wish to grow must quickly adapt to
this new business model transformation trend. The e-commerce sector increasingly
becomes saturated over time due to the appeal it provides to companies, thus businesses
must have a competitive edge in this tough battle to compete and make a distinction in
customer perception, so maximising corporate revenues in the best way possible. As a
result, this research study aims to explore how TikTok Shop acquired a competitive edge,
allowing it to develop dramatically in just one year and overcome the behemoth Lazada
in the fight to dominate Vietnam's e-commerce market.
2. The rise of TikTok Shop
2.1. Historical background
2.2. Enterprise functionality
TikTok Shop's business model is based on operating an online shopping platform through the
TikTok application, this is the highlight that makes TikTok Shop different from other e-
commerce platforms such as Shopee, and Lazada,... thereby attracting customer interest and
attention to this emerging e-commerce platform. Today TikTok Shop has nearly 300,000
registered sales accounts and provides more than 2 billion products to consumers with more
than 1,000 large and small brands worldwide in many different categories, such as fashion,
beauty, sports, etc.. The success of TikTok Shop is the clearest proof of whether TikTok Shop
can develop successfully or not, and this is also a part of the marketing campaign that helps
them become more and more famous and overcome. other competitors in the race to
dominate the market share of this potential and attractive e-commerce field.

Figure 1. Dominant Categories on TikTok Shop

2.3. Triumphs

With the increasingly rapid development of TikTok, TikTok Shop's presence has spread in
most major economic regions in the world. Among the regions where TikTok Shops are
present, Southeast Asian countries account for more than 60% of the total number of TikTok
Shops globally, which shows that this is an extremely potential area for developing the e-
commerce ecosystem. In addition, TikTok Shop in the USA also has a surprising number
with more than 31 thousand stores, accounting for nearly 12% of the total number of stores.
From there, we can see that TikTok Shop is completely capable of competing fairly with
giants like Amazon, and Emart,... as well as extremely strong development prospects in the
future.

Figure 2. Number of TikTok Shop by region

In Vietnam, although it was only launched in April 2022, TikTok has quickly surpassed
Lazada in the e-commerce market share here and ranked second only behind Shopee. TikTok
Shop's market share has grown from 15.5% in the first quarter of 2023 to 20% in the second
quarter of 2023, while Lazada's market share has decreased quite significantly from 19.1% to
16%. In the last quarter of 2022, TikTok Shop posted revenue equal to about 80% of Lazada's
revenue despite only being in operation for 4 months. TikTok Shop earned over 25 trillion
VND in revenue in just the first nine months of 2023, and the e-commerce platform obtained
about 10 trillion VND in the second quarter of 2023 alone. What is worth mentioning here is
that although it is just a new player entering the market, TikTok Shop was able to quickly
overthrow Lazada's seemingly solid position in the race to lead the e-commerce market in
Vietnam, from where it can be seen that TikTok Shop has an extremely perfect competitive

advantage in addition to appropriate development strategies.

Figure 3. The revenue of e-commerce platforms between Q3/2022 and Q3/2023

Bích Thu (26/4/2023). Metric: Doanh thu Tiktok Shop tăng trưởng thần tốc, tiến sát Shopee và
Lazada. Retrieved from: https://vietnambiz.vn/metric-doanh-thu-tiktok-shop-tang-truong-
than-toc-tien-sat-shopee-va-lazada-202342695234265.htm
Thảo Đan (24/10/2023). Choáng với doanh thu của TikTok Shop tại Việt Nam - vượt xa nhiều
ông lớn. Retrieved from: https://nguoiquansat.vn/choang-voi-doanh-thu-cua-tiktok-shop-
tai-viet-nam-vuot-xa-nhieu-ong-lon-96391.html

Tri Duc (20/7/2023). Tiktok Shop overtakes Lazada, becomes Vietnam’s second biggest e-
commerce platform. Retrieved from: https://theinvestor.vn/tiktok-shop-overtakes-lazada-
becomes-vietnams-second-biggest-e-commerce-platform-d5884.html

Elyssa Lopez (12/4/2024). TikTok Shop triples sales, merchant count in Vietnam. Retrieved from:
https://www.techinasia.com/tiktok-shop-unseats-shopee-vietnam-top-ecommerce-player
Hoàng Thùy (24/10/2023). Metric: Thị phần TikTok Shop tăng gấp 4 lần chỉ sau 1 năm.
Retrieved from: https://www.brandsvietnam.com/23917-Metric-Thi-phan-TikTok-Shop-tang-
gap-4-lan-chi-sau-1-nam