Selling Partners at Tokopedia and Tiktok Shop Reach 21 Million Sellers

Monthly active users on Tokopedia are around 100 million people, while Tiktok in Indonesia is around 125 million people.

KOMPAS/MEDIANA

E-Commerce Communication Director of Shop | Tokopedia, Nuraini Razak (third from the left), sat together with successful partner sellers, namely Lira Krisnalisa (owner of the Jenna and Kaia brand), Akram Amrullah Rajab (owner of the Hijrafood Meatshop brand), and Jessica Anggrainy (owner of the Tulus Skin brand). They were present during a halalbihalal session with the media on Thursday (25/4/2024) in Jakarta.

JAKARTA, KOMPAS — The integration of Tiktok Shop Indonesia to Tokopedia was completed in early April 2024. As of Thursday (25/4/2024), the total number of registered seller partners on both Tiktok Shop Indonesia and Tokopedia reached more than 21 million sellers.

The completion of Tiktok Shop Indonesia's system integration into Tokopedia is marked by the issuance of an Electronic System Provider certificate (TDPSE) by the Ministry of Communication and Information Technology (Kemkominfo). The integration process is realized through the Shop | Tokopedia service, which is fully managed by PT Tokopedia.

"When I first joined Tokopedia in 2019, the number of seller partners was around 6 million. It takes 1-2 years to increase 1 million seller partners," said Nuraini Razak, E-Commerce Communication Director at Shop | Tokopedia, during a halalbihalal gathering with the media on Thursday (25/4/2024) evening in Jakarta.

It is hoped that the integration of the Tiktok Shop Indonesia service system into Tokopedia will attract more sellers to join.

Also read: Tiktok Will Take Over Majority Shares in Tokopedia

Nuraini added that most of these vendor partners come from micro, small, and medium-sized enterprises (MSMEs) and small-medium industries (SMIs). As for the total post-integration transactions of Tiktok Shop Indonesia into Tokopedia, she admitted that she does not have detailed data. The available data only covers the period during Ramadhan and when Tiktok announced the Buy Local campaign with Tokopedia in December 2023.

"During Ramadan 2024, the average sales of Tiktok Shop Indonesia's partner sellers tripled. During Ramadan as well, transactions for local brands increased ninefold compared to regular days," he said.

Increase in service fees

Tokopedia announced that starting on May 1, 2024, there will be an increase in service fees of 2-6.5 percent that apply to seller partners who are registered as members of Power Merchant and Power Merchant Pro. The service fees are calculated based on the product category group that is sold.

The increase in service fees for Tokopedia sales partners, added Nuraini, has been carefully considered.

The revenue earned by Tokopedia from service charges will be returned for the needs of partner sellers, such as organizing discounted shopping promotions. According to them, they have no plans to increase service fees for partner sellers again in 2025. Increasing service fees again in the coming months will also not be done.

"Promotions and discounts will surely continue to exist in order to keep both sellers and buyers interested in shopping at Tiktok Shop Indonesia or Tokopedia," stated Nuraini.

Also read: Shop for Clothes via the Most Popular "Live Shopping" Feature

Furthermore, Nuraini also stated that Tokopedia's monthly active users currently reach 100 million people, while Tiktok users in Indonesia amount to around 125 million people. They represent a potential market after the integration of the Tiktok Shop Indonesia system into Tokopedia.

Tiktok Shop is known for its live shopping service or shopping directly through live broadcasts (live streaming) guided by presenters from the party sellers or through influencer services. In Indonesia, Tiktok Shop was present for the first time on April 17 2021.

KOMPAS/TOTOK WIJAYANTO (TOK)

Traders sell via live broadcast or live social media at Tanah Abang Market, Jakarta, Thursday (21/12/2023). Tiktok has reopened the shopping feature in its application after synergizing with Tokopedia since mid-December. Traders admit that this method helps boost sales of goods amidst the reduction in visitors coming to their stalls.

High competition

In a virtual incidental public presentation session on Wednesday (28/2/2024), GoTo CEO Patrick Walujo admitted that competition among e-commerce platforms has intensified in the past two years. Tokopedia's market share has started to decline, especially among users who prioritize price.

"Our competitors are large foreign companies with significant funding sources. To grow and survive, Tokopedia needs a very large investment," said Patrick.

Director of the Digital Economy of the Center of Economic and Law Studies Nailul Huda, when contacted on Friday (26/4/2024), in Jakarta, was of the opinion that there are two factors that influence live shopping in Indonesia. One factor is promotions (shopping discounts).

The existence of promotions is still the benchmark for most Indonesian consumers when buying goods. Apart from Tokopedia and Tiktok Shop, according to him, their competitors, such as Shopee, also continue to provide special discounts for purchasing goods during live shopping.

"If the promotion is effective, the sales level of the partner sellers will increase so that the income will also increase. However, if the platform ultimately imposes an increase in administrative costs and passes it on to the price structure of consumer purchases, consumers may choose another channel," he said.

Nailul added that the advantage of live shopping on social media is that social media has now become a platform that is widely used by all groups for various needs. So, sales partners feel it is more effective if they manage live shopping on social media. "Tiktok Shop excels in that regard," he said.

Cube Asia researcher (market intelligence firm) Peem Benjasiriwa, in the research report "Shopee: Testing the Limit of E-Commerce Take Rates In Southeast Asia" which was uploaded on the Cube Asia blog, said that the integration of live shopping to The aim of the e-commerce platform is to be able to compete like Tiktok Shop does. Marketplace platforms, such as Shopee and Lazada, have provided incentives to seller partners by offering coupons in the third quarter of 2023 which are only available if ordered via live streaming. This strategy aims to drive more traffic and conversions to the feature.

Although coupon incentives contributed to the return of growth in total purchases or gross merchandise value, they simultaneously reduced the acceptance rate of marketplaces, such as Shopee, due to streaming incentives. directly replaces the seller's need for service fees.

Beyond that there is the phenomenon of consumers switching to low-value products in the e-commerce market. This can be seen from the significant entry of direct to consumer brands into the e-commerce market, especially in the beauty and fashion categories.

Also read: E-Commerce Market Still Has Opportunity to Grow