Deloitte Consumer Insights

Dawn of the digital age in Indonesia

Young and digitally savvy, Indonesian consumers are also growing increasingly conscious about their health and wellness. As urbanisation continues to accelerate, consumer companies will also need to grapple with several urban-specific challenges.

Over the last five editions of the Deloitte Consumer Insights, we have observed the evolution of the Indonesian consumer as they become more discerning about product attributes, and increasingly moved towards greater adoption of Modern Trade and e-commerce channels.

In this sixth edition of the Deloitte Consumer Insights, we explore some of the latest consumer behaviour patterns emerging from the results of our survey conducted during the first quarter of 2019 across 1,500 households through face-to-face interviews in five major cities: Bandung, Jakarta, Makassar, Medan, and Surabaya.

We will begin by examining the overall consumer sentiment and plan for future expenditure, and observe how they vary between the various cities. One interesting finding was that consumer sentiment and plan for future expenditure may not always be correlated: according to our findings, some survey respondents who expressed negative sentiments may in fact plan to increase their future expenditure.

Next, we explore some of the latest trends in spending patterns. What we found was a significant uptick in the amount of expenditure allocated to Consumer Electronics categories, particularly amongst survey respondents with average monthly household income levels. We also noted a desire to purchase more premium products, as well as an interest in exploring alternative product options for the next purchase.

In terms of buying channels, we observed that survey respondents utilised a diverse mix of retail channels across the entire spectrum from Modern Trade to Traditional Trade, with Warungs maintaining their dominance as the most preferred retail channel. Although survey respondents continue to rely on traditional media as their preferred communication channel, we are also witnessing the growing importance of online reviews, especially for online marketplace platforms.

Finally, we examine the e-commerce landscape in Indonesia in the context of its rising digital economy. Home to many of Southeast Asia’s unicorns, Indonesia’s vibrant and dynamic technology start-up scene has introduced a number of new business models to the e-commerce market, which have in turn fundamentally changed the expectations and behaviours of the Indonesian consumer.

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Deloitte Consumer Insights
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