Southeast Asia’s e-commerce industry continues to expand rapidly, but the latest figures suggest the region’s online retail landscape is becoming increasingly concentrated. Reports show that Southeast Asia’s platform e-commerce market reached US$157.6 billion in gross merchandise value (GMV) in 2025, representing 22.8% year-on-year growth. While these numbers reflect healthy consumer demand and continued digital adoption, they also point to a market where a handful of platforms are capturing an ever-larger share of online commerce rather than creating a more competitive ecosystem.

Shopee, TikTok Shop (including Tokopedia) and Lazada collectively accounted for 98.8% of Southeast Asia’s platform e-commerce gross merchandise value (GMV) in 2025. This leaves little room for smaller marketplaces to achieve meaningful scale. Rather than producing a fragmented landscape populated by several successful players, Southeast Asia’s e-commerce growth is increasingly consolidating around three platforms that influence how consumers shop and how merchants operate online.

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Bigger market, fewer winners

Fast growth in the realm of e-commerce would usually imply more competition. Larger markets often create opportunities for new entrants, niche platforms and specialised marketplaces. But that is definitely not the case in Southeast Asia.

Shopee retains its top position among the most popular platforms in Southeast Asia following years of development of logistics, fulfilment, payments and services for merchants. The extensive regional presence of the platform allows sellers to access millions of customers and have access to integrated operational assistance. As the platform continues to mature, competing with Shopee becomes more difficult as merchants are not merely choosing a marketplace but an entire business infrastructure.

However, TikTok Shop has become the biggest contender, showing the world how entertainment and business are increasingly blending together. Instead of being dependent on search results or product listings alone, TikTok Shop lets people find products through videos, live streaming and recommendations from creators themselves before buying those products using the same app. This convergence of content and commerce is shifting how consumers move from discovery to purchasing. 

Lazada remains a major regional platform, particularly across markets where it has built strong logistics capabilities and long-standing merchant relationships. While competition between the three platforms remains intense, the reality is that the market has become significantly more concentrated than it was in previous years.

Competition now extends beyond shopping

Today’s platforms invest heavily in advertising technology, logistics networks, fulfilment operations, payment infrastructure, merchant financing, customer data, recommendation algorithms and inventory management tools. Each new service improves the whole ecosystem and makes merchants depend on one platform even more.

One of the most crucial elements today is advertising. As platforms develop further, product visibility will depend increasingly on sponsored products and platform advertising and not just on purely organic rankings. Merchants therefore need to allocate larger marketing budgets simply to remain competitive within increasingly crowded marketplaces.

Similarly, platform-owned logistics improve delivery reliability while allowing e-commerce companies greater control over customer experience. Integrated payment systems, seller financing and merchant analytics further deepen platform relationships beyond simple product transactions.

Greater convenience for consumers, greater dependence for merchants

These developments have had many advantages for consumers. For instance, larger e-commerce platforms tend to offer fast deliveries, more diverse product lines, integrated payment options, stronger consumer protection and better customer service. Large-scale logistics investments can improve delivery efficiency across geographically complex markets such as Indonesia and the Philippines. Recommendation engines help customers find products that interest them, while the use of customer service systems makes dispute resolution simpler.

However, things look different for merchants who use e-commerce marketplaces. In view of the increased concentration of consumers on three dominant platforms, businesses have fewer other means of reaching their customers. The visibility of products is becoming dependent on the algorithms of the platforms and the ability to afford marketing campaigns. Changes to commission rates, advertising policies or search algorithms can therefore have an immediate commercial impact on thousands of businesses simultaneously. Many merchants now depend on a small number of e-commerce platforms not only for sales, but also for customer acquisition and long-term growth.

Pressure on e-commerce startups

Market consolidation also presents new challenges for startups serving the wider e-commerce ecosystem. Independent companies providing fulfilment services, seller analytics, marketplace management software, advertising optimisation and payment infrastructure increasingly find themselves competing against capabilities being developed directly by the platforms themselves.

Many services once considered promising startup opportunities are gradually being incorporated into the major platforms themselves. Seller dashboards are still evolving, the logistics network of the platforms is still growing and the built-in advertising solutions of the platforms keep getting better.

This affects the areas where startups can create value. Startups will have to move away from providing services which are already being provided by the major marketplaces and instead start looking at areas like cross-platform analytics, inventory management solutions for enterprises, AI-powered merchant optimisation, supply chain intelligence or software designed specifically for larger merchants operating across multiple e-commerce ecosystems.

Social commerce is reshaping online retail

TikTok Shop’s growth also reflects a broader structural shift in Southeast Asia’s digital economy. Consumers increasingly discover products through creators, influencers, livestreams and short-form video content instead of beginning with traditional e-commerce searches. Shopping has become part of entertainment rather than a separate activity. This trend is transforming how brands approach digital retail.

Success is becoming more reliant upon collaborations between creators, affiliate marketing, livestream selling and content creation in addition to conventional merchandising techniques. Not only are companies competing against one another on the basis of cost, but they are now competing for consumer attention before purchase intent even exists. The distinction between social media, digital advertising and e-commerce continues to blur as content becomes an increasingly important driver of purchasing behaviour.

Is concentration strengthening or weakening the ecosystem?

The continued expansion of Southeast Asia’s e-commerce market demonstrates that consumer demand remains strong. The region’s US$157.6 billion platform e-commerce market in 2025 confirms that digital retail still has considerable room for long-term growth.

The next phase of competition is likely to be defined less by market expansion than by ecosystem dominance. The leading players are consistently increasing their control over logistics, fulfilment, advertising, payment processing, merchant services and content discovery and thus becoming essential parts of the digital commerce industry.

In the case of users, all of the above means higher convenience, increased delivery speed and improved user experience. In the case of merchants, that would mean growing dependence on the few dominant ecosystems for visibility and revenue generation. Independent e-commerce startups may also face mounting pressure as more services become integrated directly within platform offerings.

Ultimately, Southeast Asia’s e-commerce market is becoming stronger in terms of infrastructure, operational efficiency and consumer adoption. At the same time, it is also becoming more concentrated. Whether this concentration ultimately strengthens the region’s digital retail ecosystem or limits competition will depend on whether merchants, startups and supporting technology providers can continue creating value alongside Shopee, TikTok Shop and Lazada, rather than becoming increasingly dependent on them alone.