Cross Category Trends

New priorities, traditional values

The value of value

Consumers in Indonesia have always been hungry for a bargain, and even when rapid economic growth was putting more money in their pockets, they were looking to make smart purchases, finding the ideal balance between price and quality. The slower pace of economic growth in the past year, however, means the value equation has become more complex, with consumers weighing up not just rival shampoos, cooking oils or TV sets but also looking across categories to assess their purchasing priorities. Savings in one category permit spending in another, so the pleasure of a trip to the cinema, for instance, is weighed up against the pleasure provided by new shoes or money towards a mobile phone. Even for the wealthy, there is little ostentatious spending that could be seen by others as wasteful indulgence.

Making local connections

This is not a fast-growing market where there is a clamor for all things foreign. Indonesians take pride in their heritage and their country, and while this can give local brands a helping hand in this market, it does not preclude smart international brands from making similarly strong connections. What matters is aligning a brand with people’s lives and beliefs, presenting a locally relevant and resonant expression of international or regional values. Sunsilk shampoo is a brand that for many Indonesians feels local; it has long presented local models and solutions to problems unique to this market. Likewise, KFC has generated a sense of familiarity and closeness with consumers’ tastes by including a range of rice-based meals on its menu.


Time is increasingly precious to people living complex and busy lives, and products and services that help people free up time to do the things they really value are highly prized. It’s often the case, especially for people living in cities, that every adult in a household goes out to work full-time, so there’s strong demand for time-saving products such as ready meals, along with online banking and online bill-payment, that eliminates the need to queue – or can be done while stuck in a traffic jam. As leisure time becomes a luxury for many people, they welcome opportunities to share time with friends and family and brands that help them strike a healthy balance between work time and down time.

A word in your ear

This is one of the biggest social media markets in the world and one that’s almost entirely on mobile phones. Three-quarters of all mobile users are on Facebook alone, and other networks have large penetration as well. The potential influence of bloggers, YouTubers and Facebookers is therefore immense, and will only grow as more users of feature phones upgrade to smartphones. President Joko Widodo has more than five million Twitter followers and thousands of YouTube fans. Smart brands are not only using television, which still delivers massive reach, but also social channels to influence consumers. Body Shop Indonesia, for example, has 100,000 fans on Instagram, and OLX, the online marketplace, has nearly 8 million Facebook fans.

The rise of e-commerce

It’s rare that traffic in Jakarta is reason to cheer, but with the Asian Development Bank linking urban road congestion to the potential for growth in e-commerce, for Indonesia that could mean a surge in sales is on the way. Consumers in Indonesia are rapidly overcoming their concerns about security and online payment, and the e-commerce market is expected to grow from IDR18 trillion (US$1.3 billion) in 2015 to IDR 25 trillion (US$1.8 billion) in 2016. The number of people shopping online, meanwhile, is tipped to rise from 37 million to 49 million. This is fast growth, but clear potential still remains: while e-commerce in China now accounts for close to 10 percent of GDP, in Indonesia that figure is so far barely 1 percent.

Thinking beyond borders

International brands moving into Indonesia with marketing campaigns borrowed from other markets have found to their peril that they can easily miss their mark. Regional brands looking to expand from other ASEAN markets should recognize the need to draw on their international credentials, particularly if they reflect good quality, but also to have a local flavor. This must not feel tacked on, achieved by switching models to present a local face, but by identifying with local sentiment and customs. Likewise, Indonesian brands seeking to grow beyond their home country should recognize that their products and communications have probably been a domestic success because they clearly reflect the values and views of Indonesians, and this may not translate directly into other markets.

BrandZ Indonesia Top 50 2016

BrandZ Indonesian 2016 Report Top 50 Report

Top 50 Chart

Top 50 Infographic

Methodology and valuation by Millward Brown

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