The Rise of E-commerce Business in Indonesia 2021 thumbnail

The Rise of E-commerce Business in Indonesia 2021

Powered by more than 260 million people, Indonesia is the world’s fourth most populous country sitting just behind the United States, as well as the biggest economy in Southeast Asia (SEA). With their GDP of approximately reaching US$1 trillion, the country is recognized as the world’s 16th largest economy and the 7th largest in purchasing-power-parity terms. Indonesia has played an increasingly prominent role in the global policy debate, including as a member of the Association of Southeast Asian Nations (ASEAN) and the Group of 20 (G20), an international forum that brings together twenty of the world’s most advanced and emerging market economies.

Furthermore, the country has succeeded in creating astonishing political, economic, as well as social progress in the past two decades. It has also been learnt that Indonesia’s consumer class could potentially grow by 90 million in 2030, as the country’s population continues to expand rapidly (McKinsey and Company, 2012). In fact, it grew at 1.3% a year average from 2000 to 2016, reaching approximately 261 million in 2016. Such an increase would, indeed, represent the third-largest expansion of consumers in the world; right after China and India, providing the country’s unique economic opportunities.

Nowadays, e-commerce businesses have been skyrocketing in Indonesia, especially at COVID-19’s time, where people are required to stay at home to follow the quarantine protocol. The archipelago itself stretches from the western end of Sumatera to the eastern-most point in Papua with more than 17 thousand islands. As a consequence, it is such a difficult task for ordinary businesses to reach customers in remote areas. In addition to the ongoing traffic issues in major islands such as Java and DKI Jakarta, online shopping solutions are the most effective, and newest way to succeed nowadays.

In 2021, Indonesia has become one of the world’s most active social media users, implying that access to the internet market has expanded significantly. It is the same reason why Indonesian e-commerce business continue to thrive. Further, Indonesian digital economy has grown at an exponential rate and is predicted to be worth of US$ 124 billion by 2025, making the country an ideal place to invest.