SIRCLO: 5 E-commerce Lessons from 2020 and the Pandemic

December 30, 2020

This year, whether we were ready or not, COVID-19 has put our swiftness and adaptability to the test. Following several news announcements, nations were fighting an invisible enemy that forced a safe distance between us all, but also required our solidarity more than ever. Any form of hustle and bustle was no longer sensible and almost everything had to migrate to the digital world. E-Commerce has become the main intersection for businesses and people to meet and transact. With the rapidly increasing number of e-commerce transactions during this year, looking into the e-commerce industry could mean looking into the people’s behavior amid pandemic.

The COVID-19 pandemic has reinforced Indonesia’s e-commerce to be teeming with so much life. Generally, the exponential growth of Indonesia’s e-commerce industry is highly driven by 4 factors; the development of digital infrastructure, high rate of digital penetration, the emerging middle-affluent class beyond metro areas, and now COVID-19.1 Governmental projects that support the establishment of nationwide digital access has progressively allowed rural areas to be digitally connected with the fast-paced urban. Coupled by the smartphone adoption rate as well as affordable internet data, e-commerce and its array of promotions have been capturing the people’s attention stronger than ever.

Before 2020 turns over a new leaf, let’s take a few minutes to look back at the year in order to lay the groundwork before the new year. Sourced from SIRCLO’s internal findings along with insights gathered from extensive desk research, here are 5 lessons of Indonesia’s e-commerce industry. 

1. The boom of online shopping festivals 

The last quarters of 2020 were filled with back-to-back double number festivals or the Harbolnas season (9.9, 10.10, 11.11, 12.12), successfully becoming e-commerce’s busiest time of the year. With the many e-commerce players fervently offering appealing promotions to uplift the festivities, the number of orders have been significantly increasing every month. Throughout the peak Harbolnas/12.12 Festival alone, SIRCLO’s findings show that the number of orders increased threefold than that of 2019.

Be that as it may, the people’s willingness to shop was not only apparent during the Harbolnas season. In June 2020, Tokopedia initiated a fresh monthly campaign with the catchy name “Waktu Indonesia Belanja” or WIB for short.2 Seizing the golden moment of the working professionals’ payroll week (25th onwards), Tokopedia blasts various promotions and organizes a monthly streaming bash with performances from international as well as national celebrities. Reported through SIRCLO’s findings, WIB has been boosting an impressive order roster for Tokopedia since it was initiated. The number of orders on November 25th, 2020, experienced a threefold increase compared to its performance dated six months prior (June 25th). 

Evident through SIRCLO’s findings, the product category that has been massively checked out during the Harbolnas season was Personal Care, Household Goods and Fashion, respectively. The majorly participating marketplaces, such as Shopee and Blibli, further illustrated this finding through their official statements post-festivals.3 From the consumers’ perspective, iDea’s post-Harbolnas survey reflects a similar notion.4 Besides that, SIRCLO also discovered that Personal Care has been entering the virtual shelves of e-commerce as well as the people’s priority shopping list throughout 2020.

According to SIRCLO’s survey of 2,987 respondents that was conducted in mid-year of 2020, women and men have a certain preference when shopping through e-commerce. Women, making up 58% of the highly-frequent shoppers, most often shop for Beauty and Body Care products. On the other hand, Electronics and its accessories have been the top category for men when it comes to online shopping.5 On top of Personal Care maintaining its number one rank among others for almost the entire year, the rising popularity of electronics products during the Harbolnas season has also been reported by multiple marketplaces, such as Tokopedia,6 Shopee, and Lazada.7  

2. The emergence of e-shoppers beyond Java islands 

A phenomenon from this year that’s worth noting is the immense growth of orders beyond Java islands, illustrating that e-commerce has made its gradual way across the nation amid the pandemic. On all four Harbolnas festivals, SIRCLO’s findings show that the number of orders occurring outside of Java islands experienced up to a fivefold increment compared to that of last year. In a matter of a couple years, e-commerce spending in Indonesia is predicted to be equally distributed between Java and other Indonesian cities.8

According to Nielsen, the primary factors that inflict consumers’ attraction towards shopping online are discount vouchers (49%), affordable price points (47%), and free shipping deliveries or the return policy (33%).9 In accordance, Shopee’s evaluation of their 2020 campaigns revealed that discounts, flash sales, and free shipping vouchers were met with the most enthusiasm by its users.10 

More orders also means the need for more logistics capacity to ensure the realized delivery across cities and islands. Statistics Indonesia (BPS) reported that the transportation and warehouse sector still experienced a YOY growth by 1.27% in the first quarter of 2020. Although slightly slowing down compared to last year’s 5.45% annual growth in the same quarter, companies in the sector stayed persistent in making ends meet. For instance, PT Kamadjaja Logistics, SIRCLO Commerce’s partner in providing end-to-end multichannel management services, prioritized sea freight instead of air cargo shipping due to the government restrictions on air travel.11

Furthermore, accommodating orders beyond Java have also become the far-seeing plan for logistics and harbour companies in Indonesia. Working in a joint effort with one another, they aim to enhance their nationwide fulfillment center availability, management, and shipping of e-commerce transactions by means of the Internet of Things (IoT).12 When the availability of fulfilment centers enters more regions in Indonesia, especially beyond the Java islands, the availability of products can be more widely distributed as well. Brands would be able to offer their products nationwide without the worry of costly shipping fees being a hindrance. In consequence, consumers will then be more willing to shop, further propelling the prosperity of Indonesia’s e-commerce ecosystem. 

3. National TV and KOLs being e-commerce’s valuable allies 

Despite being born to digitalize the retail landscape, branching out its strategies to stay on top of the market’s dynamic has always been e-commerce’s second nature. This year, e-commerce rode the Hallyu (Korean) wave with full speed, giving Korean entertainment enthusiasts in Indonesia a run for their money.13 

Targeting both Indonesian K-Pop and K-Drama fans, marketplaces have been working with diverse celebrities to be their short-term or long-term brand ambassadors. For instance, Tokopedia has been inviting a variety of ever-changing K-Pop idols on their monthly WIB show throughout July to December, such as NCT14 and Blackpink.15 Meanwhile, Lazada appointed the highest-paying Korean actor Lee Min Ho as their brand ambassador,16 while Blibli held a fan party and talkshow with Asia’s Rising Star17 Park Seo Jun.18  

Another thing these marketplaces have in common is live streaming their shows through their mobile apps, making it easy for their users to join in and simultaneously shop from anywhere. In addition to that, Tokopedia and Shopee has been giving the whole nation access to the special appearances by broadcasting the show all the way from Korea through national TV channels, making it the top strategy to elevate the festival’s awareness.19 

Combining influencers/Key Opinion Leaders (KOLs) and goods selling have been an appealing strategy in China since 2018, regarded as both an infomercial as well as variety show.20 This year, as the physical retail experience becomes restricted, live streaming shopping compensates its absence by creating the feeling of “going on a shopping trip together”.21 This strategy has become fairly popular among the Indonesia, Vietnam,22 and Thailand23 e-commerce ecosystem, indicating a parallel market in the South East Asia region. Not only does this method help marketplaces lure a multitude of spectators and boost the sales of certain products,24 sellers who conduct their own live streams seem to be experiencing similar benefits.25 

4. Digital payments becoming more favorable 

Prior to the pandemic, the new wave of first-time e-commerce users preferred cash payments, making cash-on-delivery (COD) a popular payment method. However, cash exchange has become a less safer option due to its possibility of carrying the COVID-19 virus on its surface, announced by the World Health Organization (WHO).

As a result, the preference for COD payment method has decreased slightly during the pandemic, while the preference for digital wallet payment method increased 11% with credit and debit cards decreasing 10% and 2% respectively, reported from SIRCLO’s survey. Particularly evident throughout the Harbolnas season, the usage of e-wallets was dominating as 59%, followed by virtual account (30%) and COD (25%).27  


SIRCLO neither provides regulated advice nor guarantee results. The materials we convey reflect general insight and best practice based on information currently available, and do not contain all of the information needed to determine a future course of action. Such information has not been generated or independently verified by SIRCLO and is inherently uncertain and subject to change. SIRCLO has no obligation to update these materials and makes no representation or warranty and expressly disclaims any liability with respect thereto.

The Indonesian Central Bank also acknowledged the increasing usage of digital wallets in e-commerce as it was reported to have experienced 42% increase per the third quarter.28 Analyzing the various digital wallet options in Indonesia, Snapcart’s survey showed that ShopeePay has become the most used digital wallet (50%) during the Harbolnas season, followed by OVO (23%), Gopay (12%), Dana (12%), and LinkAja (3%).29 

Shopee then further declared that transactions using ShopeePay had increased 18-fold.30 According to Snapcart, ShopeePay is coming up the ranks due to its promo and discounts that have particularly been appealing to mothers. Moreover, its multifunctional aspect enables users to use it and benefit from the promos for payments on offline retails.31 All in all, digital payments can help keep the virus away and let price cuts make way.  

5. Providing exemplary customer service through chat commerce & omnichannel 

The presence of a human factor in messages have evidently been effective in obtaining Indonesian people’s trust,32 hence the interaction between businesses and its customers becomes all the more essential. The emergence of chat commerce was highly urged by this phenomenon. Standing at the core of social commerce, chat commerce connects businesses and consumers through chats (two-way conversations) before any transaction happens with purposes such as dissecting product and pricing information.33 Responding to this demand, chat commerce technologies such as SIRCLO Chat aim to be the medium for merchants across various industries. 

In light of the recent vaccine developments, Citi Research predicts that the pandemic is likely to reach the herd immunity stage by the end of 2021.34 For the time being, certain groups of people who remain cautious are likely to continue limiting outdoor activities, while other groups of people would start engaging in mobility.35 Consequently, both the offline and online shopping world will move forward hand-in-hand, making it all the more necessary to provide a synergy in between and eventually create a truly seamless customer journey. The omnichannel strategy that SWIFT by SIRCLO is based on provides exactly that.

Integrating various business channels (both online and offline) into one business ecosystem, the omnichannel strategy enables the customers to shop through either platform with ease. The additional value that’s offered can bring businesses opportunities like higher customer retention and driving customers’ purchase decisions.36  

As Indonesia’s leading e-commerce enabler company, SIRCLO’s responsibility to restore the distance between brands and consumers has been greatly heightened in 2020. While parts of the world slowed down due to the pandemic, e-commerce called for a faster pace as it became the people’s solution for needs fulfillment. In stepping into 2021, we hope to conquer whatever challenges the future may bring and to also help business owners everywhere do the same. May the new year start with fresh opportunities and the hunger to achieve more. Happy new year!