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lectronics manufacturers are all excited about the market response to their premium products as more wealthy individuals choose to buy high-priced refrigerators and televisions for their homes.

The premium home electronics segment is estimated to grow 40 percent annually, according to Andi Irawan, LG Electronics Indonesia branch manager for hyper channel.

'€œWe see big potential in this premium segment given that consumers in Indonesia have increasingly embraced digital lifestyles,'€ he said.

Samsung Electronics Indonesia consumer electronics head Bernard Ang, meanwhile, said that in the television segment alone, the pricier smart TV market had grown 52.1 percent, outpacing the 27.8 percent increase registered by regular flat panel televisions.

'€œSamsung has been driving the growth for smart TVs and that is why more than half of the market for this segment is ours,'€ he told The Jakarta Post.

Smart televisions, unlike regular flat panel units, are embedded with richer technology such as motion and voice sensors.

Ang said the entry of smart TVs into the market had formed a new segment '€” the '€œsuper premium'€ '€” in which each unit cost Rp 100 million (US$9,900) and above.

'€œWe are just seeing the beginning of the super premium segment as sales steadily increase,'€ he told the Post.

The trend has not been lost on major electronics brands, which have started churning out products for this elite consumer group '€” high net worth individuals (HNWI) '€” that asset management firm Julius Baer predicts will number 104,000 Indonesians by 2015.

Samsung, for example, has released its 85-inch ultra-high definition (UHD) smart TV for roughly Rp 400 million while Sony markets its 84-inch Bravia 4K for about Rp 300 million.

Meanwhile, LG'€™s 84-inch UHD television carries a price tag of approximately Rp 200 million.

Ang said a particular buyer had even bought six 65-inch and 75-inch televisions, the prices of which start from Rp 50 million each.

According to Ang, purchases of premium televisions were on the rise because high-income customers see home electronics as statements of their lifestyle.

'€œSuper high-end buyers want not only good quality products but also those that offer good aesthetics,'€ he said, adding that this elite group consisted of entrepreneurs and senior professionals who had '€œmade it'€.

He added that such customers also bought Samsung multi-door refrigerators worth around Rp 40 million to install in the family kitchen as show-and-tell pieces during house parties.

LG is also offering side-by-side refrigerators for approximately Rp 45 million.

'€œThey like to have the latest things in their houses to talk about,'€ Ang pointed out.

He added that although Jakarta was still the sales locus of premium products, the Korean electronics manufacturer also saw sales in Surabaya, East Java, and Medan, North Sumatra, as wealth distribution spread outward from the
capital.

'€œWe have also seen growth in Palembang [South Sumatra], Banjarmasin [South Kalimantan], Samarinda [East Kalimantan] and Makassar [South Sulawesi] for our 46-inch televisions,'€ he said.

Andi of LG Electronics Indonesia added that the mushrooming of modern electronics retail centers had helped the distribution of premium products.

'€œWe are supported by a nationwide distribution system,'€ he said, adding that the manufacturer drove sales through appealing store displays and offering special promotions to would-be buyers.

Sony Indonesia spokesperson Peggy Anastasia said that as Indonesia'€™s economy marched forward, so would the premium consumer electronics market.

'€œWe feel confident of this segment as the economy grows,'€ she said.

The World Bank expects the Indonesian economy to grow 5.9 percent this year.

'€”JP/Mariel Grazella