Five years ago, Facebook was a catalyst for e-commerce across Southeast Asia, where cheap smartphones were changing consumer behavior in a region with twice the population of the U.S. On the Facebook and Instagram apps, local merchants and shoppers were able to find each other and arrange sales, sorting out payment and delivery elsewhere. It looked like an opportunity for the U.S. tech giant in a fast-growing part of the world.
But it was a little-known local online videogame startup that stepped in to meet that demand. Singapore-based Sea Ltd. launched a mobile-shopping app called Shopee in 2015 and used Facebook in the ultimate growth hack: Sea aggressively poached merchants from Facebook, luring them to its own app by offering free shipping and other perks. And having observed how consumers used Facebook, Sea incorporated chat and other social features to get people hooked on Shopee. Last year the pandemic turbocharged Shopee’s growth: As traditional retailers shut their doors, many local merchants and brands flocked to the app to sell their products, while homebound consumers also began spending more time on it.