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Offline retail still necessary amid e-commerce boom: Business
Business players and an industry association have said that the future of Indonesia’s retail industry will be a mix of offline and online platforms, despite the fact that e-commerce is experiencing exponential growth in the country.
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Transact safely: Shop owner Yandizar Erisma Sembiring (right) serves a customer under health protocol to prevent the spread of COVID-19 in Bogor, West Java. (JP/Wendra Ajistyatama)
Business players and an industry association have said that the future of Indonesia’s retail industry will be a mix of offline and online platforms, despite the fact that e-commerce is experiencing exponential growth in the country.
Fast-moving consumer goods (FMCG) company PT Kino CEO and president director Harry Sanusi said the company would keep developing its products for both online and offline retail to keep up with the competition.
“The pandemic has driven businesses, including ours, to go digital. We will be combining and maximizing our online and offline presence, so that we will not be behind companies with only online or only offline [sales],” he said during the Microsoft Cloud Summit 2020 held virtually on Tuesday.
Indonesia has seen a new cohort of e-commerce users as the coronavirus outbreak has discouraged consumers from going outside. Data from management consulting company Redseer shows that the number of online shoppers in Indonesia grew to 85 million people during the pandemic, from 75 million pre-COVID-19.
Meanwhile, the e-Conomy SEA 2020 report published by Google, Temasek and Bain & Co. reveals that Indonesia’s e-commerce industry is still the driving force of the country’s internet economy. E-commerce is predicted to grow at 54 percent this year, reaching a gross merchandise value of US$32 billion, and more than double to $83 billion by 2025.
Harry said he understood that shoppers were shifting online in response to movement restrictions imposed due to the COVID-19 pandemic, but he argued that FMCG companies needed their products to be available in physical stores to cater to impromptu shoppers.
