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Tokopedia boosts pandemic-battered MSMEs economy through digital transformation
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uring a year in which staying home is the new going out, it comes as no surprise that 2020 has propelled online shopping and marketplace platforms to the top of everyone’s lists for all sorts of everyday needs, from a new virtual meeting-friendly wardrobe to stocking up on essential items.
Homegrown technology company with the leading marketplace platform Tokopedia, for example, has seen a surge in its transactions throughout the country. Not only that, research by the School of Economics and Business at University of Indonesia’s Institute for Economic and Social Research (LPEM FEB UI) showed that seven out of 10 business owners on Tokopedia experienced an increase in sales volume, with an average of 133 percent.
The research proved that digital adoption through marketplaces such as Tokopedia had a major impact on the Indonesian economy, especially in helping MSMEs to survive and even thrive during the pandemic.
Head of LPEM FEB UI, Riatu Mariatul Qibthiyyah, explained that 68.6 percent of business owners who joined Tokopedia during the pandemic were the sole breadwinners in the family.
The research also revealed the biggest increase in income during the pandemic was shown in a spike in three provinces, namely West Nusa Tenggara, booking an increase of 144.6 percent, followed by Central Sulawesi at 73.4 percent and South Sulawesi at 73.3 percent.
The three provinces with the biggest increase in the number of business owners on Tokopedia during the pandemic were Bali at 66.2 percent, Yogyakarta at 42.2 percent and DKI Jakarta at 28.3 percent.
One example of this growth was explained by Ni Kadek Eka Citrawati, owner of the MSME Bali Alus, who spoke of the increase in online sales during the pandemic.
“Since the pandemic, 80 percent of our sales have come from Tokopedia. Our sales nearly tripled compared to before the pandemic,” she said.
From the side of the business owners, 76.4 percent have also said that having the ease to manage their business was the main reason for joining Tokopedia. During the pandemic, micro-scale business owners made up 90 percent of the newly joined business owners on Tokopedia.
Astri Wahyuni, Tokopedia vice president of public policy and government relations said that based on Tokopedia’s internal data, the number of business owners grew from 7.2 million before the pandemic in January 2020 to more than 10 million business owners today.
She also noted that the pandemic had accelerated digital transformation in various sectors.
“Digitalization and technology are no longer just added value, but have rapidly developed into a necessity to answer the challenges of the pandemic. Tokopedia is committed to being #SelaluAdaSelaluBisa (Always Present Always Able) in making it easier for people to fulfill their daily needs to create opportunities through technology, especially amid the pandemic,” Astri said.
At the same time, the study showed that online shopping was increasingly becoming an alternative for people to meet their needs, likely due to the added benefit of reducing the risk of spreading the virus in crowded places. This was made evident by the data, which showed that the average monthly expenditure of consumers before and during the pandemic on Tokopedia had increased 71 percent.
The research also revealed that Indonesians’ transactions to fulfill health needs, hobbies and bills had increased during the pandemic.
“Tokopedia as an online shopping platform is increasingly relied on by various groups. These new consumers include housewives, students, online application partners, self-employed entrepreneurs and freelancers, which have increased during the pandemic,” Riatu explained.
Astri also noted that Tokopedia had seen a growth in the number of monthly active users, from more than 90 million before the pandemic in January 2020 to more than 100 million today.
Furthermore, the study found that verified e-wallets and mobile or internet banking were the two most registered financial products during the pandemic. In addition, transactions via virtual accounts and e-wallets are also widely chosen during the pandemic.
To that end, Tokopedia hopes that more parties will collaborate aggressively in helping business owners in Indonesia, especially local MSMEs, continue contributing to restoring the economy, as MSMEs contribute more than 60 percent of Indonesia’s GDP.
“Indonesia, which consists of more than 17 thousand islands, will continue to be the main focus of Tokopedia. Therefore, Tokopedia is committed to being more relevant for Indonesia,” Astri concluded.
