The State of Indonesia E-Commerce within COVID-19 & Rise of Social Commerce: An Overview
August 6, 2020
Based on a research by RedSeer, the pandemic is expected to onboard about 12 million new e-commerce users.13 Under normal circumstances, this massive growth could have taken 1.5 to 2 years. Not only is the pandemic expected to widen e-commerce’s pool of consumers, it has intrigued about 40% of new users to want to keep using the platform even when the pandemic is over.14
Both consumers and businesses have turned to e-commerce platforms as their alternative channels for continuity in these uncertain times. One of Indonesia's online marketplaces, Blibli, experienced an increased number of registered merchants by 90% in April 2020 compared to the previous month.15 This signals that numerous non-essential brick-and-mortar stores that were forced to close temporarily due to partial lockdown measures have resorted to e-commerce to keep their business running.
While businesses are generating revenues through online platforms, consumers have been making the most of it to fulfil their needs alongside minimizing the physical contact in the shopping process. According to SIRCLO’s survey, which compared consumer purchasing habits before and during the pandemic, purchases on basic needs (e.g. F&B and Health and Beauty) have seen a considerable increase, while purchases on tertiary products have declined.
On top of that, 94% of Indonesian consumers claimed that they are most likely to buy products from sellers who are responsive to chats before making a purchase, according to Facebook and BCG’s survey.25 When the conversation and transaction between people and businesses are specifically conducted through chat, this phenomenon is called chat commerce.
Gazing forward, the rise in chat commerce would potentially push companies to provide cutting-edge customer service capabilities further beyond. The rise of chatbot adoption in big corporates from different industries such as automotive, banking, telecommunications, and FMCG have indicated the future of customer-merchant interactions via messaging platforms.26 For businesses to get started, utilizing SIRCLO’s latest product that’s integrated to WhatsApp Business API, SIRCLO Chat, is a first step that businesses can take to enter chat commerce.
Therefore, once Indonesian consumers start utilizing both online and offline platforms according to their needs, it is becoming more crucial for a business’ competitiveness to become omnipresent in multiple platforms; web stores, marketplaces, and social commerce. Furthermore, creating an interconnected environment for a seamless consumer experience would bring more value to the business itself.
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.