TikTok made a countermeasure just two months after being forced to “voluntarily” close its e-commerce service in Indonesia by acquiring a major shareholding in Indonesia’s tech conglomerate GoTo’s e-commerce unit, Tokopedia.
Earlier this week, TikTok announced a $840 million investment to buy 75.01% in Tokopedia, which is Indonesia’s largest e-commerce platform. This is the move seen by the market to revive TikTok’s own e-commerce service after the shutdown in October.
Not long ago, the Indonesian government issued a measure to ban online shopping due to an influx of cheap imported goods from China that hurt its own domestic businesses. TikTok complied with the restriction and closed TikTok Shop afterward.
Now TikTok appears to be back in business after the acquisition. The new partnership will commence with a pilot phase carried out in close consultation with and supervision by relevant regulators in Indonesia.
GoTo CEO Patrick Walujo said in a statement that the group expects to create an Indonesian e-commerce champion, with a combination of Tokopedia’s strong local presence and TikTok’s mass market reach and tech savvy.
GoTo’s businesses also include ride-hailing, delivery and financial services. This could be a good supporting cast to help TikTok progress with its e-commerce business.
TikTok is looking to expand its 125 million user base in Indonesia into a significant source of e-commerce income with an upside to as much as 270 million of active social media users this year.
According to a report by Google, Temasek Holdings and Bain & Co., Indonesia’s e-commerce industry is set to grow to $160 billion in valuation by 2030 from $62 billion this year.