SoftBank-backed Tokopedia scores record $1.3 bln Ramadan sale

SB Technology

19/06/2019 09:25

JAKARTA, June 19 (Reuters) - Tokopedia, an Indonesian
e-commerce site backed by SoftBank  9984.T  and Alibaba
 BABA.N , said on Wednesday it generated a record $1.3 billion
in gross merchandise volume (GMV) during Ramadan sale, amid
soaring demand for online retail. 
    The company said its biggest sales, recorded on May 17,
resulted in a total transaction value that was higher than
combined sales from the first six years.
    "Those transactions are happening across 97% of
sub-districts in Indonesia and involved 5.9 million sellers,"
said Tokopedia founder and CEO William Tanuwijaya.
    The start-up secured $1.1 billion in a funding round in
December, led by Japan's SoftBank Group Vision Fund and Chinese
e-commerce giant Alibaba Group Holding Ltd. Sources say
Tokopedia is valued at $7 billion. 
     Shopping for clothes and gifts during the holy month of
Ramadan is a significant part of the culture for Indonesia - the
world's largest Muslim-majority country.
    The Southeast Asian nation of over 260 million people is
seen among the most promising global e-commerce markets, buoyed
by a younger generation shifting their preference to online
shopping.
    The Indonesian internet economy reached $27 billion last
year and is poised to grow to $100 billion by 2025, according to
Google-Temasek 2018 study.
    However, its logistical challenges are massive. The
country's 17,000 islands are sprinkled across an area bigger
than the European Union, with logistical costs swallowing up
around a quarter of Indonesia's gross domestic product.
    Tokopedia's Ramadan sale success reflects that e-commerce
retailers are trying to overcome difficulties faster than
expected amid higher usage of smartphones.
    Tanuwijaya told reporters that Tokopedia, which does not
have its own inventory, was experimenting with artificial
intelligence to predict demand and store stock in advance in
partnership with warehouse operators.
    Rivals Bukalapak and Shoppee have not made their Ramadan
sales public.  

 (Reporting by Fanny Potkin, Editing by Sherry Jacob-Phillips)
 ((f.potkin@thomsonreuters.com;))