It appears Grab will play a major role in leading the logistics capabilities of Lippo Group’s O2O company Matahari Mall
Two of Southeast Asia’s major players in the startup scene are set to work together as major Indonesian conglomerate Lippo Group and Southeast Asia’s leading ride-hailing app Grab announced today a strategic partnership targeted towards Lippo’s online businesses.
Financial details of the deal were not disclosed.
The strategy specifically indicated the partnership will target Matahari Mall by using Grab to provide logistics expertise for the e-commerce platform’s O2O business.
Lippo Group is hoping to leverage Grab’s market penetration — it claims 50 per cent of the private car-hailing market at end of 2015 and crossing 50 per cent of the motorcycle transport market this month in Indonesia.
It is fairly easy to imagine how Grab can be used in the agreement. Matahari Mall works by having users purchase something online before picking it up at a Lippo store.
An on-demand transportation service could be key to getting additional sales from customers who may have been turned off by the prospect of navigating Jakarta’s traffic for retail.
Furthermore, Tokopedia has already pioneered this type of agreement as Indonesia’s first unicorn has a similar type of partnership with Go-Jek.
“MatahariMall is emerging as the number one e-commerce platform in Indonesia, and Grab’s scale and growth of its businesses in Indonesia demonstrates a deep local market understanding. Our combined knowledge of the Indonesia market will help us build the most effective online-to-offline experience,” said John Riady, a Lippo Group Director in an official statement.
Riady (whose family runs Lippo Group) is the leading the charge for Matahari Mall and Lippo Group has dumped US$500 million into its subsidiary platform for the next two years.
The timing of the agreement is interesting as Indonesia is grappling with how it will integrate the ride-sharing economy.
Over the past few weeks the country has seen protests from traditional transportation industries like taxis and mini-buses. But, Communication and Information Technology Minister Rudiantara said he would work to bolster the ride-hailing industry’s legal status.
Furthermore, the presence of Lippo Group in the agreement adds a wrinkle to the debate. While the Tokopedia and Go-Jek partnership bring together two large and successful startup companies, neither can compete with the size and influence of Lippo Group (for example, its education foundation manages 52 schools).
Additionally, the Indonesian e-commerce scene is beginning to integrate the official roadmap laid out in January.
“Technology can be a key driver of economic growth, and we are both invested in opening the digital economy to all Indonesians. For Grab, this means using technology to help commuters navigate traffic congestion, and give drivers’ more sustainable livelihoods,” said Anthony Tan, Group CEO and Grab Co-Founder in an official statement.
Matahari Mall was launched in September 2015 and in February claimed 160 per cent growth per month.
Photo by Kevin McSpadden
The post Two giants team up: Lippo Group signs partnership with Grab for logistics expertise appeared first on e27.
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