Indonesia customer insights

How much do you know about Indonesia let alone the factors that go into play in making its economy into what it is now? The customs in Indonesia have made sure that the economy continuously thrives on its own to sustain itself. Here are some insights on the country that has made it clear enough that it won’t back out on an economic fight.

Key drivers of economic growth in Indonesia

According to various sources, the gross domestic product (GDP) had grown through the years. In 2012, there was already significant economic growth. The main contributors of this growth were investments and household contributions. These two factors were the key engines of growth in 2012.

Consumerism: catalyst of Indonesia’s growing economy

Consumerism is the reason for Indonesia’s growing economy as evidenced by the following indicators:

Population indicators

  • In 2013, 250 million people have been accounted for.
  •  60% of the population consists of people aged 30 years old and less.
  • In 2012, the middle class consists of 45 million people and this number is expected to grow even more up to 135 million by the year 2030.
  • By 2030, an estimated 32 million people is expected to migrate to urban areas from the rural areas.

Financial indicators

  • GDP is expected to grow in 2030 with an already high GDP in 2012.
  • 80% of the population have household income.
  • Inflation has increased from 2012 to 2013.

Cities of consumerism

With consumerism as the main reason for economic growth, this key factor is concentrated in several regions across Indonesia. Java and Sumatra are two regions in Indonesia who have contributed greatly in both population and GDP according to the Central Bureau of Statistics.

Other hubs of consumerism include:


Jakarta has an abundance of shopping malls. These shopping malls are a vessel for increasing consumerism. With the large number of shopping malls, the consumer industry is bound to soar high.

Indonesia’s urbanites

Based on the consumer expenditure statistics by Euromonitor, consumers are seen to be trendy, brand-conscious, and willing to spend.

  • Shopping is a growing trend.
  • Majority of households spend a lot on food and beverages.
  • More discretionary spending in secondary needs
  • The younger population comprises the biggest category of affluent consumers backed with the use of credit cards. Credit cards have strengthened the purchasing power of these consumers.

Business opportunities

In food services

In 2011, there were about 200,000 food service outlets in Indonesia comprised of:

Full-service Restaurants

  •         Quick Service Restaurancts
  •         Street Stalls/Kiosks
  •         Cafes/Bars

Other business opportunities in the food services sectors in Indonesia include:

  • Japanese cuisine is gaining popularity among consumers.
  • Street stalls/kiosks to include seats for customers; Most of the Indonesians prefer not to eat on-the-go.
  • Nasi and fried chicken are much preferred by Indonesian consumers to be included in their daily meals.

In packaged food and beverage sectors

The modern grocery retail (MGR) accounts for a big portion in the retail sector. The modern Indonesian grocery retail consists of the following outlets:

  • Convenience Stores
  • Supermarkets
  • Hypermarkets

Companies use and develop MGRs as a way to target the middle and upper class groups with a high income and a strong purchasing power.

Despite MGRs, the traditional retail business is still a huge sector in the retail industry. It targets the larger mass of consumers and this is the reason why it has a huge contribution to the retail sector. This gives companies an opportunity to use it as an avenue to reach to the large consumer mass.

Packaged foods are gaining popularity especially with Indonesia’s urbanites. Packaged foods can be very convenient for busy consumers. Fortified packaged foods are also in demand as consumers in Indonesia seek for fortified foods that promote health and wellness.

In other retail outlets

Other opportunities in the retail sector that show an increase in demand include:

  • Consumer Electronics
  • Fashion Apparel
  • Furniture and Furnishing

Business strategies when dealing with the Indonesian economy

  • Seek out the local strong partners.
  • Work with big-box retailers.
  • Manufacture locally.
  • Raise brand awareness.
  • Localize product innovation.

Market outlook

The outlook is good and is expected to continue this way especially with a foreseeable domestic consumption due to these following factors:

  • Global Monetary Tightening
    • In an attempt to counteract inflation, the government will reduce spending by raising interest rates, thus discouraging people from borrowing money.
  • ASEAN Economic Community
    • The ASEAN community will continue to support its member states in every endeavor especially when it reinforces the goal of strengthening the ASEAN economy.

These are some of the few insights on what goes on within Indonesia’s market – how everything works and how every country data goes into play into making the economy a strong and growing one. You could learn a lot from the notes on the Indonesian economy gathered here for you. If countries were to take this article seriously, they’re bound to follow the footsteps and soon, walk beside Indonesia.

This entry in Asia was updated on 21 May 2021 by specialist.