Chinese social media giant TikTok is set to invest $1.5 billion to become the controlling shareholder of an e-commerce unit within the country’s tech conglomerate GoTo, formed through the merger of Gojek and Tokopedia.
This bold initiative follows the suspension of TikTok’s e-commerce service, TikTok Shop, due to regulatory measures implemented in October, which banned online shopping on social media platforms to safeguard smaller merchants and user data.
The partnership with Tokopedia, Indonesia’s homegrown e-commerce platform, significantly shifts the nation’s digital landscape.
CGTN ‘s Silkina Ahluwalia filed this report.
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The collaboration aims to empower local small and medium-sized enterprises (SMEs) and contribute to national economic growth through digital channels.
Aditia Grasio Nelwan, Head of Communications at Tokopedia, stated, “Tokopedia’s collaboration with TikTok aims to empower local SMEs in Indonesia and helps to contribute to national economic growth, especially through digital channels. In principle, TikTok will be the platform to display a variety of products to consumers. Payment will be processed by Tokopedia.”
For TikTok users like Felicia Fiyoza, who operates an online shop sourcing unique items from China, the investment opens new avenues. Felicia, optimistic about the merger, expressed her excitement: “I can go live again to sell our products. ]
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“I tried going live on other platforms, but the reach is just not as wide as TikTok”.
The $1.5 billion investment is positioned as a game-changer, integrating TikTok’s extensive reach with Tokopedia’s robust e-commerce infrastructure. In a country where traditional markets still hold significance, this collaboration signals a crucial shift in Indonesia’s approach to online shopping and the digital economy.
Nailul Huda, Digital Economy Director at CELIOS, highlighted the evolving shopping preferences in Indonesia, stating, “Data shows that Indonesian users prefer to shop on social media apps. There has been a massive change in the way people shop in the past few years. This is what sets TikTok apart from other competitors; they are able to offer exactly what consumers are looking for in this day and age.”
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TikTok, once primarily a social media app, is rapidly transforming into a go-to shopping destination, leveraging Tokopedia’s infrastructure.
Industry experts anticipate that the combined forces of TikTok and Tokopedia will capture at least 40% of Indonesia’s e-commerce market.
In a country of over 270 million people, this partnership reflects Indonesia’s increasing embrace of online shopping and the digital economy.
As TikTok and Tokopedia redefine the digital ecosystem, the collaboration promises not just a transactional shopping experience but a valuable and integral part of everyday life for Indonesian consumers.
