Indonesian Consumers are More Confident to Shop Online

2 mins read
July 31, 2014

Online shopping is no longer uncommon among Indonesians. Not only for residents of Jakarta or the rest of Java or even Sumatera,  but also in places like Balikpapan, Sulawesi, Lombok, even West Papua. Obstacles remain in various forms and issues such as fraud still cloud the practice but the number of online shops launched in Indonesia shows that the trust between consumers and sellers on the potential of e-commerce in Indonesia keep rising.

Development of e-commerce behavior in Indonesia
The Indonesian E-commerce Association (idEA) conducted a research discovered that the value of Indonesian e-commerce market may potentially reach US$25 billion by 2016. This projection is within reason, especially if we see that we’re surrounded by friends and relatives who commonly make online purchases, or even looking at ourselves.

Indonesian consumers now feel more comfortable and not too intimidated with online shopping. Be it shopping through  online merchants such as Bhinneka or Zalora, online shopping portals like OLX or Qoo10 Indonesia, internet forums like Kaskus, DetikForum, or even social media like Facebook, Twitter, BBM, WhatsApp, and Line.

There are tons of online shops available today and there are even fewer people who misuse their Facebook walls to sell items (going so far as mass tagging their friends). This shows that Indonesian people have become more and more mature in their online trading behaviors.

Additionally, it’s a fact that for most online retail transactions that occur in Indonesia,  are still handled through conventional methods and payments are done by way of bank transfers. While it’s entirely legitimate, there are several points that need to be addressed such as the fact that it’s more

However, the fact that Indonesian consumers still prefer to use the conventional bank transfer payment method when doing online transactions should also be taken into account. In this regard, there are actually several points that should be considered before doing this payment method, such as the fact that this method is more susceptible to fraud and it requires a really high level of trust between both merchants and customers.

Online Shops, Payment Method, Distribution
In response to the non-ideal online shopping conditions in Indonesia, the private sector has made attempts to improve the shopping quality. Among them include the creation of safer online payment gateways, more streamlined credit card system, and the adoption of cellular airtime-based payment.  The government is not without its responsibilities on the growth of online businesses in Indonesia; tax policies and a clear regulation will strongly affect the progress of e-commerce in the country.

That being said, online shopping and transactions will keep on going regardless. Buyers and sellers will still conduct trade through bank transfers so comfortably that they will not think twice about sharing their bank account numbers even without full guarantee that their orders will be fulfilled properly Any disputes will be left to the merchants to act properly. Of course, any dishonest practice means they will lose their customers to competitors.

Even with proper online shopping websites like OLX Indonesia, Berniaga, and others, online payment methods, like BCA or Mandiri Internet Banking and Veritrans and PayPal, the development of Indonesian e-commerce remains reliant on the merchants and customers. No matter how often merchants do advertising activities, be it via online media or offline promotion, if the customers are not attracted then it would only be a waste.

Being Optimistic towards Online Shopping Future
Despite all the weaknesses, the online shopping activity does have many advantages. Some of them are easy and cheap communication, “digital word-of-mouth” social promotion (via Facebook walls or Twitter messages), and many others. Although It cannot indeed completely substitute the role of conventional transactions via traditional markets, malls, or conventional stores, the Indonesian online shopping trend would undeniably keep growing in the future.

[Header illustration: Shutterstock]

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