Sangat Pedas

Why Tokobagus Is Changing - Big Time


Little did we know when Arno (co-founder) and me started the Tokobagus adventure 6 years ago. At the time I was (and probably still am) an opportunist and somewhat of a cowboy. Great qualities when starting a company but when the company grows it also requires the same or even more growth from the founders.

The first years we were focussing mostly on volume, getting as much content as possible and getting as much visitors and page views as possible. And I’ll be honost, we enjoyed and still enjoy growth in terms of quantity. Growing >100% every year is a great feeling and one of the “programs” I watch most is “Google Analytics Real-time”.

Our strategy and aggressive approach has brought us where we are right now, undisputed e-commerce market leader in Indonesia and top 5 local site overall. This has made us Rockstars and one of the most sexy tech-company in Indonesia. But there’s a danger to that, it’s so easy to enter a “sit-back-and-relax” mode thinking we’re done. But luckily there are a lot of internal and external factors that tell us we’re not there yet and we need to do some growing up ourselves to get to the next level.

One of the most confronting and annoying signs for me was that I hardly shopped on Tokobagus myself anymore for some of the popular products. In the beginning when I noticed that I waived it because we were  growing fast so it must just have been me. But in the end we all found that we got lost in our hunger for quantity and maybe underestimated the importance of quality. This has led to pretty drastic measures. In the end of 2011 we already put some sensitive categories in pre-moderation mode and recently we’ve put our whole site in pre-moderation mode. Basically this means that no ad will be live before our support department has checked and approved the ad.

We also setup a new set of pretty strict rules for our sellers:

  • No more imitation/counterfeit products
  • No more products which are obviously highly underpriced and indicate intention for fraud
  • No more spam
  • No more weird payment setups which indicate intend for fraud
  • No more “lazy-ads” where the seller doesn’t take the time to ad some original pictures or write a decent description
  • No more prices of 0 or 1 Rupiah for products
  • No more products that don’t even exist (yep, we already had iPhone 5′s on our site)
  • No more products that are clearly black market products

Now this is a pretty extreme step for a classified site in Indonesia where imitation products, counterfeit items and black market products are extremely popular for obvious pricing reasons. When we introduced these new rules we instantly cut somewhere between 300.000-500.000 ads overnight. That’s a significant part of our ads and undoubtedly impacts (search) traffic. So on short-term we might take a blow traffic wise but shopping on Tokobagus has become so much nicer because cutting “crap” created a gap for the professional sellers with good products, good service and good intentions. Cutting counterfeit items caused new sellers to post their real products such as games and real Gucci bags.

Bear with us, we’re still learning and perfecting the system and there will always be a cat and mouse fight. But we’ve committed to keep Tokobagus clean from counterfeit, imitation, fraud and just regular crap. Giving buyers the best possible shopping experience and supply of great products is in the end the only way to make this model sustainable and profitable.

Definitely not all people selling on Tokobagus understand or appreciate this move but that’s allright. No disrespect meant but this is a buyers market so our main goal is to attract and bind buyers to Tokobagus. Simple logics, when there are a lot of potential buyers somewhere then sellers wil quickly follow.

But there’s another angle why a bold move like this in the end would have been inevitable. Being market leader in an emerging market comes with responsibilities. If the e-commerce market leader makes a huge mess of their platform than that’s really bad and harmfull for the whole industry. Something we’ve seen in the mobile content industry and we don’t want repeated in e-commerce. If a market leader is not able to educate the market and gain trust then that will give e-commerce in general a bad name and hurt all other e-commerce player in the market. It will also force the government to take unpopular measures to protect the people and righteously so.

2012 is the year in which e-commerce enters the rapids. The government is taking things seriously and wil soon come with additional legislation. This is all great news and necessary but in the end it’s the e-commerce players themselves who have to grow the market and grow to maturity themselves. But with the founding of the official Indonesian e-commerce association (IdEA) all signs indicate that all major players realize that it takes more to bring e-commerce in Indonesia to the next level.