For the everyday Indonesian, it is hard to overstate the importance of retailers within general trade. In total, the daily value of transactions in the general trade channel is roughly IDR 9.5 billion. According to SIRCLO’s report on Iklan Pintar, Warung Pintar’s trade marketing initiative, nine out of ten Indonesians meet their daily necessities through retailers, both online and offline, and 190 million are actively utilising the general trade channel to fulfil their demands daily.
Despite being embedded in Indonesians’ everyday lives, 82% of these retailers have never been part of a retail marketing campaign. This is a clear sign that the level of trade marketing penetration in general trade is very low.
There are a few key reasons for this. Firstly, monitoring and tracking marketing programs, as well as product promotions, is extraordinarily difficult due to the complexity of general trade. While the modern trade ecosystem allows for overlaps between brands and distributors and distributors and the market, the general trade ecosystem often sees a long chain of relatively segregated middlemen who lie between brands and retailers. The multiplicity of these layers makes it difficult to reach and connect the general trade ecosystem.
Furthermore, a cost-effective, end-to-end offline marketing and promotion solution that is well-suited for general trade channels is tough to find. Marketing programs for general trade entail large expenditures and often involve multiple actors.5
In general, offline marketing programs for general trade lack pertinent and dependable data. Even though this data is crucial for analyzing ongoing marketing activity, limitations in feedback collection and a lack of engagement make it hard to obtain this information.
As a result, more than 80% of a company’s marketing budget is typically allocated to modern trade, whereas general trade receives only 20%, despite being the largest FMCG channel.