TikTok buys Tokopedia

 

Chinese video-sharing platform TikTok has expanded its e-Commerce reach: the social media giant purchased a controlling share in Indonesian online marketplace Tokopedia. The merger was first announced at the end of 2023 and finalised in the first months of 2024.

 

Read all about TikTok’s e-Commerce ventures here!

 

TikTok paid around 781 million euros to purchase 75.1% in Tokopedia. The rest of the company remains in the hands of Indonesian technology firm GoTo, the country’s “largest digital ecosystem” that provides transport, e-Commerce, fulfillment, logistics, financial, as well as food and grocery-delivery services to both businesses and consumers.

 

As GoTo’s CEO Patrick Walujo remarked, “We are creating an Indonesian e-commerce champion, combining Tokopedia’s strong local presence with TikTok’s mass market reach and technological prowess.”

 

 

What changes for Tokopedia

Thanks to the merger, TikTok Shop can now resume its operations in Indonesia after it was shut down due to a law that forbids online shopping on social media platforms. However, customers looking for TikTok Shop may be disappointed: the new venture will continue to use the well-known name of Tokopedia, even after it receives a cash injection of approximately 1.4 billion euros.

 

Learn more about TikTok Shop here

 

When visiting Tokopedia’s website, we didn’t see any significant changes pointing to the merger. From a consumer’s point of view, the marketplace seems to operate just like it did before.

 

Screenshot of tokopedia.com’s homepage

 

Learn all about Tokopedia and other noteworthy marketplaces in Asia!

 

However, when landing on the sign-up page for sellers, the differences were more than obvious.

 

Screenshot of https://seller-id.tokopedia.com/account/register

 

The top left corner features both TikTok Shop and Tokopedia’s brand names, while the main text invites sellers to grow their business with “TikTok x Tokopedia”, which makes the connection between the e-Commerce actors clear.

 

Scrolling down on the page, prospective sellers get a taste of what services they can expect from the newly united platforms. These include live-streaming, short videos, product showcases and more.

 

Screenshot of the Commerce Solutions section of https://seller-id.tokopedia.com/account/register

 

Further down, the page offers guidance on the sign-up process, including a list of all the documents prospective sellers need to join the marketplace.

 

 

What’s in it for TikTok and Tokopedia

Both entities had ample motivation for the merger.

 

Tokopedia is the second largest e-Commerce platform in Indonesia behind Shopee. Analysts praise the marketplace for its exceptional logistics coverage, delivering to 93% of the country, often even on the same day as the order was placed.

 

Discover Indonesia’s emerging e-Commerce industry!

 

With 117.3 million monthly users and an annual revenue of $947 million, Tokopedia has been an important player in Indonesian e-Commerce even before the merger with TikTok Shop. Now, however, the platform can focus on further developing its offering and strengthening its positions in its domestic market.

 

According to GoTo CEO Patrick Walujo, “we will optimise our capital usage in line with a newly developed capital allocation plan, which may include a share buyback initiative, subject to regulatory and shareholder approval.”

 

Moreover, the newly merged TikTok and Tokopedia have already forged a partnership with leading Indonesian university UGM to establish a digital talent development centre complete with internship and employee exchange programmes.

 

 

Related topics

Introduction to e-Commerce in Indonesia

 

Shopifying TikTok - new opportunities in social commerce

 

What is Tokopedia

 

 

As for TikTok, being able to reenter Indonesian e-Commerce is a clear win. The market is currently valued at $58.43 billion, with forecasts predicting a growth to $95.84 billion by 2029 - no wonder TikTok Shop wanted to find a way to come back after shopping on social media platforms was banned in 2023.

 

Ever since the video sharing platform launched its social commerce endeavour by partnering with Shopify in 2021, TikTok aimed to follow the path of sister company Douyin and grow its share in social shopping.

 

Learn more about TikTok and Douyin’s ventures in e-Commerce!

 

TikTok Shop has an annual GMV of $11.05 billion, with beauty and personal care products taking the lead as the most popular product category. While the number of people shopping on TikTok (33.3 million in the US) is still less than that of Facebook and Instagram shoppers (65.7 and 43 million respectively), TikTok Shop has already taken the lead in the category of impulse purchases. 55% of TikTok users have bought something on the spot, while only 46% of Instagram and 45% of Facebook users can say the same.

 

A reentry into the lucrative Indonesian e-Commerce market gives TikTok Shop a great chance at growth. With 125 million TikTok users in the country, 6 million of whom used to sell on TikTok Shop before the ban, the platform already has a great base. Add Tokopedia’s 117.3 million monthly visitors to that equation (although there’s surely an overlap between the two groups of people), and it’s clear that the venture is off to a promising start.

 

Obviously, as online brand protection experts, our main question at this point is what the merger means for the protection of intellectual property rights.

 

 

Online brand protection on TikTok Shop x Tokopedia

When it comes to counterfeiting and the fight against IP infringements, Tokopedia is no stranger to us at globaleyez, as the marketplace was repeatedly featured in earlier editions of the USTR’s (United States Trade Representative) Review of Notorious Markets for Counterfeiting.

 

However, this year’s edition doesn’t mention Tokopedia as a notorious marketplace. This is no doubt due to the effort of the platform to combat IP infringements - an effort that includes a strong cooperation with globaleyez.

 

Our marketplace monitoring service is designed to detect IP infringing product listings on Tokopedia and on over 150 other marketplaces worldwide. With keyword-based searches, our software tool traxster quickly gives us the collection of listings containing words that imply an association with your brand. Powerful filters discard those that are indeed associated with you, leaving us with dubious listings that infringe on your IP rights.

 

Our social media monitoring service does the same on social media platforms, detecting infringing product listings, ads, posts and other types of content that may hurt your brand’s IP rights. Since fraudsters often use stolen or copied images to draw in customers, a round of image monitoring could also be necessary to pick up stragglers and establish connections between seemingly independent cases of infringement.

 

Once all infringing content has been rounded up, we can enforce your rights. We’ll reach out to the hosts (social media platforms, marketplaces, domain registries and registrars, etc) and demand the removal of all infringing content from the internet.

 

 

Conclusion

The merger of Tokopedia and TikTok Shop may shake up the landscape of Indonesian e-Commerce. Whether your brand sees it as a chance is up to you.

 

However, don’t let fraudsters see it as a chance to infringe on your IP rights: contact us and let’s devise an effective, tailor-made online brand protection strategy together.