This insight is by Anne Ridwan, Country Director, R3 Indonesia

What does the Gojek and Tokopedia merger mean for the e-commerce industry in Indonesia?

This merger creates the largest digital consumer platform in Indonesia, which will lead to expedited e-commerce growth in the country. The two giants complement each other to provide an integrated service, online and offline, which will benefit merchants from across Indonesia and provide more opportunities for economic inclusivity across all social-economic classes.

What does the Gojek and Tokopedia merger mean for the e-commerce industry outside of Indonesia, across Asia Pacific?

This is yet to be seen. The merger creates the largest tech platform in the region, but the focus now is on the Indonesian market. That said, the merger also establishes a stronger personalised delivery to the e-commerce business, which could set a new (logistic) business trend across Asia Pacific.

What will it mean for other players like Grab, Shopee, and Lazada?

Definitely a watch out. Obviously, there will be greater competition for Grab in Indonesia. Gojek and Tokopedia combining provide a powerful counterbalance to the strength of Grab in the region. It will be interesting to observe post the GoTo IPO, where fresh funding will optimise the expansion and innovation for both Gojek and Tokopedia in Indonesia, and possibly, in the region. And how, it will then disrupt Shopee and Lazada, who already have regional presence compared to Tokopedia.

Gojek’s backer Tencent and Tokopedia’s investor Alibaba. As both are rivals, will this merger succeed?

A strong spirit of nationalism behind this merger and the desire to put Indonesia on the global map explain “why” this will work. Gojek and Tokopedia seem to strongly uphold this vision. The result of the merger itself has made GoTo the 12th largest global start-up in terms of valuation. This result, of course, benefits all stakeholders; the pride of the founders who have placed Indonesia in the top ranks and the valuation that investors benefit from. All in all, the strong common “why” at the centre of this is why every party will work to make this merger successful.

How should brand marketers and advertisers work with GoTo?

GoTo is a holding company that houses Gojek and Tokopedia. Each subsidiary will continue to work independently. In this business model, brands and advertisers will engage directly with either Gojek or Tokopedia. This type of business model is similar to that of Alphabet Inc’s, where brands and advertisers work directly with its business units, such as Google and YouTube.