TikTok Looks to GoTo to Jumpstart Indonesian eCommerce Business
TikTok is reportedly turning to GoTo to revive its crucial Indonesian eCommerce business. The two firms are working on a plan — which could be finalized in the next few weeks — that would see TikTok invest in Indonesia-based GoTo’s online shopping arm Tokopedia, Bloomberg News reported Wednesday (Nov. 22), citing sources familiar with the matter. Rather than a direct […]
The post TikTok Looks to GoTo to Jumpstart Indonesian eCommerce Business first appeared on PYMNTS.com.
TikTok is reportedly turning to GoTo to revive its crucial Indonesian eCommerce business.
The two firms are working on a plan — which could be finalized in the next few weeks — that would see TikTok invest in Indonesia-based GoTo’s online shopping arm Tokopedia, Bloomberg News reported Wednesday (Nov. 22), citing sources familiar with the matter.
Rather than a direct investment, the two companies could form a joint venture, building a new eCommerce platform that would allow TikTok to revitalize its online shopping business in what is the largest market in Southeast Asia.
PYMNTS has contacted both companies for comment but has not yet gotten a reply.
The move follows new measures announced by Indonesia in September to regulate the use of eCommerce via social media.
The rules bar social media platforms from handling direct payments for online purchases, a distinction that really only applies to TikTok. That means the company could advertise products to its more than 100 million Indonesian users, but those customers would need to jump to a different site or app to make purchases.
“This development has a chilling effect on the long-term growth outlook for the e-commerce market,” Simon Torring, co-founder of eCommerce research firm Cube Asia, told Bloomberg at the time. “TikTok Shop brought real innovations to Indonesia’s e-commerce market.”
TikTok’s CEO had said earlier this year that it planned to invest “billions of dollars” in Indonesia and Southeast Asia in the next few years as it tries to expand its eCommerce sales from $4.4 billion in gross merchandise value to $20 billion.
The company’s partnership with GoTo, assuming it takes off, is happening at a time when social media has become an important tool for consumers to discover new products.
“Platforms like TikTok, Instagram, and YouTube have transformed the way people shop, with each channel catering to different consumer interests,” PYMNTS wrote earlier this month. “The influence of these platforms is evident in the billions of views and viral purchases associated with hashtags like #TikTokMadeMeBuyIt, for example.”
Research from in “Tracking the Digital Payments Takeover: Monetizing Social Media,” a collaboration between PYMNTS Intelligence and AWS, shows that 43% of consumers browse social media to find goods and services.
For instance, the visual nature and curated feeds of Instagram make it a natural choice for shoppers seeking fashion inspiration and clothing advertisements, with the survey showing that 47% of consumers had purchased clothes on Instagram in the past 30 days.
The post TikTok Looks to GoTo to Jumpstart Indonesian eCommerce Business first appeared on PYMNTS.com.