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What 'Es Kepal' Milo shows us about consumers and marketing in Indonesia

Carolyn Baytion-Sunaryo
Carolyn Baytion-Sunaryo

Teaches Marketing at GS FAME Institute of Business (IBN International Programs) and has started blogging this year

Jakarta | Wed, May 9, 2018 | 01:15 pm
What 'Es Kepal' Milo shows us about consumers and marketing in Indonesia

Es Kepal Milo, which originally came from our neighboring country, Malaysia, was popularized by a couple from Kuala Kangsar at their 'Ais Kepal' (ice cubes in English) Milo Tok Abah in late 2017. (Shutterstock/File)

The rise in the popularity of the shaved ice treat Es Kepal Milo in Jakarta has driven a frenzy among many. This has presented an opportunity for Nestle, Milo’s parent company, and challenges the conventional notion that its market is households. In fact, the popularity of Es Kepal Milo has proven that Nestle’s biggest customer base at the moment are the entrepreneurs serving children and adults in the city’s kampung, suburbs, school and office cafeterias, popular culinary destinations, etc. 

Enterprising individuals are currently selling franchise rights by providing all the paraphernalia, equipment and ingredients to prepare the dessert at varying franchise prices for those who want to go into business immediately. The first to jump on the current trend will be the ones who profit the most. As many more franchisees open their stalls near each other, it is predicted that profit per stand will fall. As of the time of writing, there are already five stalls along my street, just a few meters apart from each other.

Es Kepal Milo, which originally came from our neighboring country, Malaysia, was popularized by a couple from Kuala Kangsar at their Ais Kepal (ice cubes in English) Milo Tok Abah in late 2017. Its popularity reached Indonesia through a YouTube post that sparked the entrepreneurial spirit of a young couple in Yogyakarta, Danang and Rara. Thanks to a food blogger, the couple’s business was attracting a lot of customers by the end of March this year. 

Variations have already appeared in Bandung in the form of Es Kepal Dancow, another Nestle brand. It will take just a week or two to know whether it will catch on.

Read also: Study explains salted caramel 'addiction'

These new sensations created by entrepreneurs is a demonstration of customer-generated marketing in action. First, in the way the products are used differently, and second, by the way information spreads about these new products. Milk flavoring products are designed by manufacturers to make drinking milk more fun and delicious. The popularity of Es Kepal is an example of customers showing manufacturers that they are using the products differently and are even finding ways to profit from this new invention.

But the success of this particular customer-generated marketing phenomenon was mainly down to how the information was spread, such as through food bloggers, video-sharing sites, social media and other similar digital platforms. It is also fueled by the ubiquitous use of smartphones by almost all income groups in Indonesia. 

However, this is not the first example of customer-generated marketing featuring Milo and Dancow.  Searching for Dancow recipes on Cookpad at the time of writing, there are 9,958 recipes for Dancow and 2,763 recipes for Milo. Other brands include Oreo, with 6,361 recipes and Beng Beng with 146. Other popular brands include Ovaltine with 91 recipes and Ovomaltine with 178 recipes. But topping it all (pun intended, as this ingredient is the most popular topping in Indonesia) is muisjes/meises (chocolate sprinkles) Ceres with 16,055 recipes.  

Another popular Indonesian delicacy that has helped put several brands in the limelight is martabak. This is the Indonesian version of murtabak, mutabbah or matabbak from other countries in the Middle East and Asia. There are two versions in Indonesia, the martabak telur which is the omelette pancake with green onions and minced meat (usually beef) and the martabak manis or sweet martabak which has the following basic ingredients: flour, condensed milk, sugar and margarine. It can come with various fillings, such as cheese, sesame, peanuts and sprinkles. Popular food stalls have made innovations with various fruits such as jackfruit and bananas. But what made it more popular and commanded a high price was the introduction of Nutella and Toblerone fillings. This provided the manufacturers of Toblerone (a triangular-shaped chocolate) and Nutella (a hazelnut cocoa spread) an opportunity to penetrate a new market that hadn't typically consumed their products. Also, it revived the brand Ovaltine (a brand familiar to me since childhood) and made Ovomaltine (I only recently heard of this brand), a bread spread, more familiar.  

Read also: Instagram-worthy desserts to check out this month

What is remarkable about the popularity of the shaved ice treat/dessert and martabak manis is the involvement of the customers. The innovators of the products' new uses were customers, which led to the creation of new markets.

To help maintain the popularity of the products and brand, manufacturers should make sure that there is a constant supply to avoid a sharp increase in the prices. One reason why Es Kepal Milo became an instant success is its affordability to all income classes, which starts at $70 cents in my kampung.

A word of caution for these sugar-laden products: they are to be consumed in moderation. I hope to see a healthier version of these products on the market soon. This will be a challenge to those who would like to serve a growing niche market of health-conscious Indonesians.

The fasting month is just around the corner. It is exciting to see what new ideas customers-turned-entrepreneurs will provide for us during this holy month of Ramadan. (wng)

Note: The article has been edited to correct the place of origin of Es Kepal Milo, from Kuala Kumpar to Kuala Kangsar.

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Carolyn has served as a lecturer, general manager, director and head of the international programs at GS FAME Institute of Business (IBN International Programs) for more than 20 years. She has recently started blogging on topics dear to her heart such as health and happiness at her website: https://organicwayoflife446897722.wordpress.com. Her upcoming blogs will be devoted to topics related to marketing in our daily life:  https://marketinginourdailylife.wordpress.com

Disclaimer: The opinions expressed in this article are those of the author and do not reflect the official stance of The Jakarta Post.

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