Digitalization appears to be a sound solution to counter the shock. But a recent study by the United Nations Development Plan (UNDP) and the University of Indonesia’s Institute for Economic and Social Research (LPEM-FEB UI) showed that only 5 to 6 percent of micro and small businesses had gone online during the pandemic. This compares with 44 percent of medium and large enterprises in Indonesia, which have increased their use of digital platforms.

President Joko “Jokowi” Widodo’s announcement to digitalize 30 million micro, small and medium enterprises (MSMEs) by 2024 highlights the urgency of this challenge. Addressing the risk of widening the digital divide in this nationwide digitalization drive would be key to ensuring all segments of the micro, small and medium enterprises (MSMEs) are covered.

WhatsApp and UKMIndonesia.id stepped up their support for micro businesses by launching “Pasar JuWAra” (Traditional Market Champions). This pilot was launched in 15 provinces to train and onboard traditional market vendors to the free WhatsApp Business app, so they had access to a digital sales channel as they approached the month of Ramadan. We especially understood that Ramadan was the peak consumption period for Southeast Asia’s largest economy.

Within a month, more than 1,100 vendors from 66 pasar were trained. From this small start the tangible impact is already encouraging. Nearly 21 percent of vendors surpassed pre-pandemic sales levels and almost 75 percent were getting new customers through WhatsApp. The project has now been extended beyond Ramadan, with new elements added based on lessons learned from the pilot and has also been recognized by the Cooperatives and SMEs Ministry as a model for other programs with similar goals.

As more organizations get involved, we will share lessons learned so more of us can be part of the solution and optimize our efforts for scale and sustainable results.

While technology can be a game-changing tool for traditional businesses, the drive to optimize the technology still lies in the hands of the vendors. That’s where facilitators play a central role in bridging the gaps as they are a trusted and ongoing accessible resource for all the vendors, as opposed to a one-time trainer. 

It became very obvious that the task was not limited to teaching vendors how to use the WhatsApp Business app. A bigger hurdle was in changing the way vendors approached business and the apprehension they had in using technology. Facilitators had to familiarize vendors with commerce features on the app, deal with third-parties for deliveries and payments and provide basic marketing suggestions such as taking attractive photographs of their products and running promotions.

For example, while most vendors use WhatsApp to chat daily with friends and family, many of them were not accustomed to using it to serve customers. Our facilitators were quick to identify this and found a solution by teaching them to use video calls instead. “Why should I learn about this?” “It’s too complicated.” “I’m doing just fine.” were also some of the early responses of skepticism from vendors, stemming from a general lack of belief in digital tools and the impact they can have.

Investing in program facilitators, creating channels where you can communicate freely with them and help them respond to any obstacles that might come up along the way are crucial factors in micro and small business digitalization programs.  

Once the vendors were onboarded, the next big task was to sustain usage. For this, creating a sense of community among the vendors is an important strategy to keep them motivated as they go through the journey of taking their business online. 

The Pasar JuWAra traditional market vendors formed a community where vendors helped each other alongside a team of 24 facilitators who provided support through groups on WhatsApp. Their shared questions and solutions, together with a steady showcase of achievements and lessons learned, eased the friction of operationalizing the technology and helped to conquer the learning curve as they all worked to improve their digital presence.

Conducting pre- and post-training surveys were key in surfacing vendor needs as new challenges surfaced with every step they took toward creating a digital sales channel. For instance, many traditional market vendors do not have a shop name. This may work for offline shopping – we may remember “the fruit stall near the south side exit gate” or “the only meat vendor that sells fresh fish in the market” - but having a clear identifier is critical in creating an online shopping experience.

On top of that, many traditional market vendors do not have one single product category as they basically trade what they can find. Consequently, we can find a salted fish vendor that also sells broomsticks or a batik vendor that sells chips. Facilitators again assisted vendors in basic business administration skills so they could easily promote their business through online channels, including Facebook, Instagram and WhatsApp.

The biggest encouragement that vendors received for their efforts was seeing an increase in sales and new customers. 

Throughout the Ramadan period, the Pasar JuWAra program worked with local influencers and press in multiple cities to drive attention and traffic to vendors. Some were joined by local leaders who also helped to amplify the message for people to support traditional businesses during this challenging year. 

Given the positive results from the pilot, we have now launched a chatbot to help people all over Indonesia discover traditional market vendors that they can buy from, using the WhatsApp Business API (+62877-7531-3357). Acting as an interactive business directory, people can search for their nearest pasar on WhatsApp. 

As we each bring our unique skills to the table, we are certain that more groups will find ways to get involved to address the wide range of challenges on the ground to scale and sustain digitalization efforts. 

As consumers, we can also take part by choosing to shop from micro and small businesses to help distribute economic opportunities to vendors like Ibu Sarmi. The bakulan fruit seller has been doing her business for 75 years at Klewer market, Surakarta, with a simple life goal: “I don’t mind not having a proper education, but all my children need to be educated,” said the mother of Wiwit AB, who is now a facilitator for the Pasar JuWAra program. 

Small and micro businesses account for 90 percent of jobs nationwide and 40 percent of Indonesia’s GDP. Like Ibu Sarmi, many of them will be experiencing the commercial benefits that technology can offer for the first time. This partnership has taught us so much and we hope these lessons will benefit more organisations as we keep pushing for recovery and progress for Indonesia’s economy. 

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Dewi Meisari Haryanti is cofounder and chief editor of UKMIndonesia.id and Esther Samboh is public policy manager for WhatsApp.