Donews reported on December 5 that on December 5, Beijing time, TikTok, a subsidiary of ByteDance, has reached an agreement to invest in Tokopedia, the e-commerce division of Goto, Indonesia's largest Internet company, and the two sides will also cooperate on an online shopping service. The partnership may create a template for TikTok to offer TikTok e-commerce (TikTok Shop) services globally.
According to people familiar with the matter, TikTok has agreed to cooperate extensively with Tokopedia in a number of areas, rather than competing directly with the latter, according to people familiar with the matter. The two companies aim to announce details of the strategic tie-up as early as next week.
While the two companies have reached an informal agreement, the final details of the alliance are still being finalized and could change before being announced. The agreement is subject to regulatory approval, and there is still a possibility of a breakdown.
For TikTok, the investment in Tokopedia will be the company's first such partnership for TikTok's e-commerce services. TikTok e-commerce is one of TikTok's fast-growing businesses, and it is making inroads into online shopping markets from the United States to Europe.
However, its move to challenge rivals SEA and TOKOPEDIA in the Indonesian e-commerce market came to an abrupt halt after Indonesia** announced a ban on TikTok from engaging in e-commerce transactions through social platforms after receiving complaints from local merchants.
ByteDance's ultimate goal is to resume shopping services in Indonesia, Southeast Asia's largest retail market. TikTok is the only platform that has been immediately affected by Indonesia's new regulations and has stopped online shopping services.
Last month it was reported that TikTok and Goto were discussing a potential investment, but the other option was to form a joint venture, which could require the establishment of a new e-commerce platform. Representatives for TikTok and Goto declined to comment.
Now, partnering with a knowledgeable local company could serve as a template for TikTok to grow its e-commerce services in other countries, as the company also looks to expand in other markets such as Malaysia. Malaysia** has also previously said it is willing to review the influence of overseas companies such as TikTok.
For Goto, the partnership with TikTok is a double-edged sword. First of all, the partnership can be risky, as it will help a major ** retail competitor to set up a business in Indonesia. But at the same time, it also gives GOTO access a strong global social** partner that facilitates the total amount of shopping, logistics and payments for both companies.