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Jakarta Post

'Middle consumer segment shifts to lower-value goods'

  • Anton Hermansyah
    Anton Hermansyah

    The Jakarta Post

Jakarta   /   Thu, November 2, 2017   /   01:59 pm
'Middle consumer segment shifts to lower-value goods' Customers queue at a Lotus Department Store outlet in Jakarta on Oct. 25 to buy discounted goods after PT Mitra Adiperkasa announced its plans to close three outlets. (tempo.co/ Rully Kesuma )

The increased cost of living during a stagnant business period has forced middle-class consumers to purchase cheaper goods to meet their daily needs, fast-moving consumer goods leader Unilever said on Wednesday.

On the other hand, high-end consumers continued to purchase premium packaged goods, PT Unilever Indonesia president director Hemant Bakshi told journalists on Wednesday, during a public expo at the company's headquarters in South Tangerang, Banten.

He said the changing consumption pattern had caused a shift in consumer segmentation, with middle-class consumers shifting to low-value goods.

"[Middle class] consumers are moving toward either smaller-sized and inexpensive products, [while high-end consumers] continue to purchase premium products,” Hemant added.

Meanwhile, Unilever Indonesia chief financial officer and finance director Tevilyan Yudhistira Rusli said that based on consumer research, the composition of high, middle and low consumers was now 10-40-50, but if the condition persisted, the middle consumer market would decline.

"The middle market will decline. To anticipate this, we need to change our portfolio," Tevilyan added.

The company was currently intensifying marketing of its second-tier brands, such as Fair & Lovely as an alternative to Pond's, which was marketed to the middle-upper consumer segment, he said. Unilever Indonesia also had plans to issue a premium variant of brands, such as softener Molto. (bbn)