O2O Battle Will Determine Indonesian E-commerce Leader

Summary

Indonesia's e-commerce market shows high growth potential, particularly for virtual products or vouchers, according to the Danareksa Research Institute (DRI) survey of 1,724 respondents across Indonesia. DRI noted that e-commerce penetration is still in its early growth, citing one of the essential findings that traditional channels, including conventional stalls, are a source for the community to meet their daily consumption needs. The use of online channels and supermarkets is still limited, while groups of people with high incomes mostly use minimarkets.

Nearly 60 percent of consumers access retail stores more than ten times per month or are repeat buyers, a DRI survey reveals, citing a significant room to drive consumer spending power by cross-selling and offering a more comfortable experience typically achieved from modern retail stores.

Meanwhile, BRI Danareksa Sekuritas research reveals that the public still relies on traditional markets and stalls for their retail needs. "We think that online-to-offline (O2O) is the most reasonable strategy to encourage e-commerce penetration in Indonesia," BRI Analyst at Danareksa Sekuritas Niko Margaronis wrote in his research, Monday.

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