Last week, our Business Development Manager Dennis was in Jakarta attending the E2Ecommerce Indonesia Conference in Jakarta as organized by PT Omni eComm Expo. We learned a lot about the current e-commerce landscape in Indonesia and the current challenges retailers are facing to drive customer experience and sales for their respective markets.
Here are our 3 key takeaways for the event:
#1: The e-Commerce landscape in Indonesia is dominated by marketplaces
e-Commerce and technology in Indonesia are still in its early stages but is also rapidly growing. Most e-commerce sales take place on either B2C online marketplaces, direct sales sites, and consumer-to-consumer (C2C) marketplaces.
We found that the majority of retailers in Indonesia do not sell online on their own as they require a license to sell goods. As an alternative, they harness online marketplaces to help them sell online. Market leaders like Tokiopedia, Lazada Indonesia, Bukalapak and Blibli lead the way in helping brands and individuals sell their goods online.
By using a marketplace, retailers save on the sometimes considerable costs of creating a branded webstore of their own, they can also tap on the site authority, branding and traffic of the marketplaces they choose. By analyzing the average monthly web traffic of the marketplace, retailers can make informed decisions.
Key takeaway: For retailers getting started in the e-commerce world, starting in a marketplace would be a good place to start. However, once your online store is more established, you need to consider building your own branded webstore and owning your customer experience as you are vulnerable to any policy changes or branding conditions of the marketplace.
#2. Indonesia’s e-Commerce boom has led to rising demands for a superior online customer experience.
We learned the explosion of e-commerce in Indonesia is mainly driven by two factors – the growth of the number of online shoppers and a growing number younger, tech-savvy population who have Internet access. They also tend to spend more time and money online; especially on their smartphones.
While Indonesian consumers found shopping online is practical and saves time, they also highlighted gaps in the online shopping experience like the risk of fraud and how the quality of products don’t match their expectations. This has a negative impact on how well online shops are perceived and whether customers would want to continue online shopping.
Key takeaway: Delivery experience and customer experience are universal factors that are critical to customer retention regardless of where in the world they come from. Retailers selling online must, therefore, prepare their store to instill trust and security in customers.
Do you have transparency on your delivery process? Do your product photos accurately depict your merchandise? Building trust with your customers and meeting those expectations is key to driving customer retention.
#3. Marketplaces are hungry for insights on their customer’s delivery experience to improve
In its comparison of marketplaces in Indonesia, Tech in Asia found that one of the biggest gripes from customers is long delivery times as no matter how sophisticated a marketplace was, deliveries are still largely out of their control. Indonesia’s logistics infrastructure and last mile delivery networks are fragmented and have many inefficiencies; given their unique geographical challenges.
We found marketplaces like Tokiopedia are on the lookout for unified delivery solutions to give visibility on the delivery process, determine the performance of logistics carriers and make more informed decisions. After all, with delivery experience being a key factor of customer retention, retailers need transparency on the delivery process to manage customer expectations.
Key takeaway: Indonesia’s e-commerce landscape is unique and retailers face a complex set of challenges in measuring the performance of their logistics carriers. Do you face the same challenge? Parcel Perform’s logistics dashboards help you analyze the performance of your logistics carriers to optimize your carrier setup.
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Joshua is the Marketing Manager at Parcel Perform. He loves technology and a good book. Outside of e-commerce and Parcel Perform, you can find him in the kitchen, gym or yoga studio.