E-Commerce in Indonesia Research and Analysis 06/08/2012
Key Finding• The growth of indonesia online users will be give a benefit to an e-commerce and online transaction.• E – Commerce currently rising in indonesia, and it’s a right time to running an online mal bussines.• Indonesia netizen currently tend to buy online for fashion, gadget, and personal care.• Trust issue is still to be consider by consumer. The originality of the product, internet payment system and from the e-commerce website itself.• Indonesia people tend to pay using Cash on Delivery and bank transfer rather than credit card or other internet payment system.
Internet in Indonesia Internet grows faster Year Users Population % 2000 2,000,000 206,264,595 1% 95 TV 94 2011 55,000,000 245,613,043 22,4%Source: Markplus 27 Radio 30 24 Increase 5% Internet 94 19 Newspap 13 er 14 13 55 Cinema 14 42 7 31 Tabloid 9 20 5 2010 2011 Magazine 2 7 Source : Consumer Media View W4 2010 – W4 2011 2000 2006 2009 2010 2011 2015data in Millionssource by BCG Report & MarkplusInternet user in indonesia increase because of technology, more educated people and the infrastructur whichgetting better year by year.
Internet Retailing in Indonesia Internet Retailing in Indonesia Forecast Internet Retailing in Indonesia (Revenue 2006 - 2011) (Revenue 2011 - 2016) 1.1 0.5 1 0.8 0.7 0.3 0.3 0.6 0.5 0.2 0.1 0.1 2006 2007 2008 2009 2010 2011 2011 2012 2013 2014 2015 2016 data in Trilion Rp. data in Trilion Rp. source by Euromonitor, Retailing in Indonesia source by Euromonitor, Retailing in Indonesia70% of Indonesian online usersintend to make an online purchasewww.acnielsen.co.id/news/NEWS14072010.shtml
Customer Study• Behaviour Online thing is not that new to most Indonesians living in big cities, they know it but don’t do it. Most Indonesian still lacking in trust to e-commerce sites. They still fear fraud, and still prefer offline transaction because they can see, touch, feel and try the product physically.• Payment Infrastructure in 2010, almost no online payment gateaway at all, but it’s definitely going to be a lot of offer from payment services to startups. iPaymu, Veritrans and Doku are the most famous online payment provider. Nowdays both of Bank Mandiri and BCA have their own online payment system to support online shopping.• Internet Mobile None of these e-commerce companies ara doing anything significantly for their mobile users. The market is in mobile, but most of the e-commerce startups are pushing their desktop websites.• Logistics Infrastructure e-commerce is just commerce using the internet, and a part of the commerce is also logistics, this has been an issue for most companies.• Regulations Indonesian government is planning to lauch a regulation that prohibits anyone to handle money transfer which could hold up e-commerce industry. (a non banking company has to get a permit from government for any transfer activity matters)
Customer BehaviourCustomers are getting confidence using e-commercewith the help of their friends’ recommendation, andthey need an e-commerce services that are trustworthyand easy to be accessed. LINKCustomer tend to buy Fashion and Gadget from onlineshopping. Female customer tend to buyclothes, shoes, and personal cares; while male buyshoes, gadget and gadget accessories. LINKThe products that customer buy like clothes, shoes, andaccessories tend to cost around IDR. 500,000. Customerstill don’t feel safe to spend more than IDR. 500,000because of the Trust Issue. LINKCustomer tend to pay via bank transfer or cash ondelivery rather than using credit card because Indonesiahas earned a reputation for credit card fraud. LINK
Payment InfrastructurBoth of Bank Mandiri and BCA have their own online payment system, For credit card usage there isa payment portal like Ipaymu ,Veritrans and Doku.Mandiri clickpay Merchants: Set up Fee : Rp15,000,000 BCA Klikpay Merchants: Monthly Fee : Rp500,0001. Garuda Indonesia (ticketing) Transaction Fee : 3,5% +2. Plasa.com (belanja online) 1. Bhinekka.com Rp5,0003. Indomog (voucher online) 2. Blibli.com4. Rakuten (belanja online) 3. CBN5. Blibli.com (belanja online) 4. Gudang voucher6. Kagum Hotel (reservasi hotel) 5. livingsocial7. Bhinneka.com (belanja online)8. Enjoyspin.com (game online) Target: 500,000 transactions in 20129. Net.Axisworld (belanja online)10. Tokopedia (belanja online)Target 2012 : IDR 100 billionFor The payment infrastructure is very expensive and for some online shopping all the fee is charge tocustomer or their markup the price.
Internet Mobile48% of regular internet users in Indonesia use a mobile phone to access the internet, thenumber will climb to an additonal of 5% within 12 months 2010 internet users 42.000.000 So there are 20.160.000 users using mobile phone to access the internet While 21.840.000 users access the internet using Desktop/PC
Logistic InfrastructurDue to Indonesia is a archipelago nation, so there is take a day and money if the customerlive outside java island. Online shopping usually charge the shipping fee to customer, so ifthe customer live far away from capital city then they must spend much money just forshipping fee. Nation wide Nation wide Jabodetabek OnlyPrice Jabodetabek Area – Rp6,000 Price Jabodetabek Area – Rp6,000 Price - Calculated The problem for many online shop in Indonesia is the shipping time, they usually take 2 till 6 work day for shipping time.
RegulationAfter now there is no specific regulation or law for e-commerce or online shopping.In generally they use UU-ITE No. 11 Tahun 2008 as aguideline for internet transaction and cyber law
E - Commerce in IndonesiaTOP 10 E – Commerce Website based on Alexa E – Commerce current trend category :No. Portal Name Segmentation Daily Daily Page Indonesia 1. Classified Ad LINK Visitor View Rank1 kaskus.co.id Classified Ad 1,173,887 20,425,631 9 2. Market Place LINK2 tokobagus.com Classified Ad 541,180 9,037,701 153 berniaga.com Classified Ad 326,679 4,508,167 22 3. Online Retailer LINK4 multiply.com Market Place 769,043 4,022,097 465 Bhineka.com Online Retailer 158,189 822,580 53 4. Group Buying LINK6 lazada.co.id Online Retailer 149,560 897,360 547 olx.co.id Classified Ad 166,141 541,621 58 indonetwork.co.i8 Classified Ad 155,954 640,972 60 d 9 tokopedia.com Market Place 107,303 2,414,327 6610 zalora.co.id Online Retailer 78,832 457,226 13111 dinomarket.com Market Place 45,191 343,454 19712 disdus.com Group Buying 47,242 212,589 21413 blibli.com Online Retailer 41,760 137,809 28114 livingsocial.co.id Group Buying 30,749 113,772 32415 rakuten.co.id Market Place 25,985 96,146 506
E - Commerce Revenue Competitor StudyMajor Player E-Commerce in Indonesia Annual estimated 7% 4% revenue 13% bhineka.com Rp60.000.000.000 40% multiply.com Rp32.000.000.000 14% DealKeren Rp20.000.000.000 rakuten.co.id Rp19.800.000.000 22% plasa.com Rp10.000.000.000 tokopedia.co Rp6.500.000.000 m Bhineka.com multiply.com DealKeren rakuten.co.id
E - Commerce Development Website Development Cost Total CostDevelopment Fee Rp200,000,000 Development Fee Rp216,000,000 & Setup Payment Infrastructure Payment Yearly Rp6,000,000Ipaymu Setup Rp15,000,000 FeeMonthly Fee Rp500,000 Domain Yearly Fee Rp30,000,000 Total Cost Rp252,000,000 Domain / HostingMasterwebDedicated IIX Rp1,000,000SetupMonthly Fee Rp2,500,000
E - Commerce Partnership Trusted Seller Yearly Fixed Fee IDR. 375,000 Sales Margin 3,9% Contract Term 1 Year Item Registration *UnlimitedEst. Sales Revenue 2011 IDR. 32 Bio Website Status Trusted Merchant Daily Visitor 1,203,537 Yearly Fixed Fee IDR. 555,000 Daily Page View 3,819,123 Sales Margin 3,9% Indonesia Rank 19 Contract Term 1 Year Member 4,6 Million Item Registration *Unlimited*For start up Mercahant Trusted Business Starter Package Advance Package Yearly Fixed Fee IDR. 925,000 IDR. 5 Mil IDR. 8 Mil Sales Margin 3,9% 100 products 250 products Contract Term 1 Year Item Registration *Unlimited
E - Commerce PartnershipPayment Simulation Multiply Merchant CustomerProduct Price = IDR. 500,000 IDR 19,500Margin 3,9%Merchant get IDR. 480.500Delivery apprx = IDR. 10,000 IDR 10,000(Depends on Product Weight)Customer paid with both of IDR 500,000Credit Card and Bank transfer
E - Commerce Partnership Platinum Plan Monthly Fixed Fee IDR. 5,5 M Sales Margin 4% Contract Term 1 Year Item Registration 5,000Est. Sales Revenue 2011 IDR. 19,8 Bio R-Cabinet 1 GB Website Status Gold Plan Daily Visitor 21,837 Monthly Fixed Fee IDR. 3 M Daily Page View 74,246 Sales Margin 5% Indonesia Rank 510 Contract Term 1 Year Member 35.000 Item Registration 2,000 R-Cabinet 500 MB Silver Plan Monthly Fixed Fee IDR. 1,5 M Sales Margin 6% Contract Term 1 Year Item Registration 1,000 R-Cabinet 250 MB
E - Commerce PartnershipPayment Simulation Rakuten Merchant CustomerProduct Price = IDR. 500,000Margin 4% IDR 20,000Merchant get IDR. 480.000Delivery apprx = IDR. 10,000 IDR 10,000(Depends on Product Weight) IDR 16,500Credit card charge 3,3% IDR 526,500Customer paid with Credit CardCustomer paid with Bank Transfer IDR 519,000IDR. 9,000
THANK YOUThanks to everyone, vendors, partner and article who contribute to my research.
E - Commerce Category1. Classified Ad Daily Page Portal Name Daily Visitor Indonesia Rank View Kaskus.co.id 1.415.366 23.480.929 7 tokobagus.com 383.831 3.819.123 19 berniaga.com 117.312 1.255.236 45Kaskus is the number one of the Classified Ad Categorybecause of their big and loyal member, and it’s containnumbers of seller which sell their product cheaper thanother.Tokobagus.coms total transaction value in December 2010reached IDR 300 billion from 90 thousand transactions, fromfashion products, information technology, handicrafts,books and games.http://en.indonesiafinancetoday.com/read/2864/E-Commerce-Continues-to-Rise- BACK
Classified Ad Procedure Deliver the product Transfer a payment Join the Classified Visit website Ad Webbsite Classified Ad (TokoBagus) MerchantCustomer Directly Call the Merchant to Purchase a productCustomer : Visiting tokobagus.com and looking for the product that have been upload by merchantMerchant : Join and upload the product that will be sell at tokobagus.comTokobagus : Provide an Classified Ad system that customer can directly interact with merchantCustomer : View an item at tokobagus.com and directly call the merchant to purchase an itemMerchant : Respond an make a good relationship with customerCustomer : Directly transfer the payment into merchant accountMerchant : Sent the item after received a payment from customer BACK
Classified Ad berniaga.comKaskus.co.id Tokobagus.com BACK
E - Commerce Category2. Market Place Daily Page Portal Name Daily Visitor Indonesia Rank View Multiply.com 769,043 4,022,097 46 Tokopedia.com 107,303 2,414,327 66 Dinomarket.com 45,191 343,454 162 2 Juta Active Member 35,000 Merchant 17 Merchant Category 500 New Mechant per Month 50,000 New Product per Month RP. 1.6 Billion Transaction value per Month BACK
Online Market Place Deliver the product Procedure Send Recieve Transfer a Confirmation payment Join the online Visit website market place Online Market Place MerchantCustomer (Multiply) Purchase some product and Purchase Order send a paymentCustomer : Visiting multiply.com and looking for the product that have been upload by merchantMerchant : Join and upload the product that will be sell at multiplyCustomer : Purchase an product on multiply.com, pay via credit card, internet banking, or bank transferMultiply : Automatically generated the purchase order on the merchant accountMerchant : Send the product after received the payment confirmation from multiply’s systemCustomer : When the product was received so customer must make a receive confirmation to multiply’ssystemMultiply : Transfer the payment into a merchant account BACK
Market PlaceMultiply.com Tokopedia.com Dinomarket.co m BACK
E - Commerce Category3. Online Retailer Daily Page Portal Name Daily Visitor Indonesia Rank View Bhineka.com 158,189 822,580 53 Lazada.co.id 149,560 897,360 54 Zalora.co.id 78,832 457,226 131 Bhinneka.com, which sells information technology products like computers, targets a 20 percent increase in revenues this year from last years of IDR 80 billion.http://en.indonesiafinancetoday.com/read/2864/E-Commerce-Continues-to-Rise- BACK
Online Retailer Procedure Deliver the product Visit website Online MarketCustomer Purchase some Place product and (Bhinneka) send a paymentCustomer : Visiting bhinneka.com and looking for the item that have been upload by BhinekaCustomer : Purchase an item on bhinneka.com pay via credit card, internet banking, or bank transferCustomer : Transfer a paymentBhinneka : Deliver the item to customer BACK
Online Retailerbhinneka.co m Lazada.co.id Zalora.co.id BACK
E - Commerce Category4. Group Buying Daily Page Portal Name Daily Visitor Indonesia Rank View disdus.com 47,242 212,589 214 Livingsocial.co.id 30,749 113,772 324 dealgoing.com 3,427 41,129 2,292DealKeren has more than 300 thousand members and morethan 300 merchants who are already working together.Currently there are 80 deals with 50 thousand transactions permonth, which revenue reached US$ 250 thousand per monthand growing. Based on statistics collected by DealKeren,approximately 55% of users are women aged 25-35 years, otherthan that 70-80% of users live in Jakarta, a natural consideringthat most of the deals was located in Jakarta.http://dailysocial.net/en/2011/07/04/dealkeren-post-livingsocial-acquisition/ BACK
Promote to Register as Member Group BuyingFriends Buy a Deal Procedure Register as Member Join Partnership Group Buying Merchant Customer (DealKeren) Buy a Deal Create a Deal Generate a deal voucher Customer : Visiting dealkeren and register as member to start buying Merchant : Join as partner and register the promotion Dealkeren : Provide a daily deal for customer Customer : View and buy a deal from dealkeren and transfer into dealkeren account Merchant : Create a deal and uploading into dealkeren site Dealkeren : Automatically generate a deal voucher and send into customer account Customer : Promote to his/her friends Dealkeren : Generate a point to Customer when the Customer’s referalls register and buy a deal BACK
Group BuyingDisdus.com Livingsocial.co.id Dealgoing.com BACK
Customer Study Good E-Commerce 118 Customers are getting confidence using e-120 commerce with the help of their friends’100 recommendation, and they need an e-commerce services that are trustworthy and easy to be 80 accessed 60 38 40 18 18 17 15 20 0dsresearch-ecommerce-may11224 Respondents175 Females49 Males BACK
120 112 Customer Study100 Purchasing Product Female customer tend to buy clothes, shoes, and80 personal cares; while male buy shoes, gadget and gadget accessories.60 3740 3020 15 10 8 7 5 0 dsresearch-ecommerce-may11 224 Respondents 175 Females 49 Males BACK
Customer Study The amount of transaction 118 120 The products that customer buy like 100 clothes, shoes, and accessories tend to cost around IDR. 500,000. Customer still don’t feel 80 safe to spend more than IDR. 500,000 because of the Trust Issue. 60 38 40 25 25 18 20 0 IDR. 100,000 - Less than IDR Less than IDR. Any amount Less than IDR. 500,000 5 Mil 100,000 1 Mildsresearch-ecommerce-may11224 Respondents175 Females49 Males BACK
Customer Study 57% Payment Method 60% Customer tend to pay via bank transfer or cash on delivery rather than using credit card because 50% the traumatic effect about credit card fraud in Indonesia. 40% 28% 30% 20% 7% 8% 10% 0% Bank Transfer COD Credit Card Other (Paypall, etc)Source: Direktorat e-Bisnis Ditjen Aplikasi Informasi Komenkominfo 2011 BACK