Some key facts about middle class shopping trends that retailers and manufacturers need to consider include:
- Fresh food makes up 37 percent of their monthly spending. Ice cream, noodles, and biscuits are the biggest movers thanks to product innovations.
- Value for money is key for nearly all (97%) middle class shoppers.
- 88 percent of middle class consumers said they want to experiment with brands.
- More than half (53%) shop in a modern trade outlet twice a month.
- They tend to visit the minimarket closest to their home, but promotions can disrupt their regular routine: 90 percent are looking for stores “with attractive and interesting promotions.” They also desire a diverse assortment of goods, friendly service and a comfortable environment.
- Mini-markets see the highest levels of spending, followed by supermarkets, with traditional retailers still highly important for fresh foods and the location convenience they offer.
Indonesians of all income levels love to watch TV, and nearly all (95%) middle class homes own a TV, with 96 percent watching programs every day. Other traditional media such as radio and newspapers are also popular, but are increasingly being consumed online, a trend driven primarily by Indonesian youth. Internet usage and mobile phone ownership are surging, each increasing every quarter. Mobile penetration is already high, and purchase intent for smartphones is strong. These devices are fast becoming the primary platform for a variety of activities, such as watching video, accessing the Internet and connecting to social networks, opening a space for marketers and content providers to focus their efforts to include mobile in their content distribution. Nevertheless, relevancy and convenience to the consumers remain key to mobile content distribution.
- Middle class Indonesian households watch an average of 4.5 hours of TV a day. Sports programming is the most popular, followed by drama series and other entertainment genres.
- Local content is appealing to middle class, which is why each city has its own newspaper.
- Almost a quarter (22%) of middle class consumers have Internet access, and spend 1.5 hours a day accessing the internet.
- Nearly three-quarters of middle class consumers in major cities (71%) have a mobile phone, with almost half saying they use the devices to access the Internet. More than one-third (35%) have a smartphone.
- Indonesians love social networking: 94 percent are connected to social networks, and 89 percent have a Facebook account.
Given the abundance of opportunities in the marketplace, how can retailers, manufacturers, marketers and media companies connect with the middle class consumer? In a number of consumer goods categories, innovation has proven to be a growth engine. For example, in the ice cream category, the number of new varieties has surged by nearly 32 percent, with single packs the driver of sales. Volume sales of snack noodles surged 92 percent in the past year, thanks in large part to new flavors and a repositioning of the category (what used to be seen as a basic meal now is a great, convenient snack). The instant coffee market has expanded, and middle class consumers contributed 71 percent of volume growth within that category. In contrast, categories that presented few innovations saw slower growth.
- Kids playing a role in modern shopping: 95 percent said that they “hardly ever refuse” the invitation from their kids to go to the minimarket.
- Convenience is key: today’s middle class consumers are pressed for time, with the demands of work and family life. Products that make life a bit easier are clear winners.
- Appeal to the fact that they are smart shoppers: Indonesians know how much items cost and where they are located in the store. Retailers must create a welcoming environment, promote value for money and win customers’ loyalty.
- Connect with consumers: they are increasingly online, and they discuss brands and products in that space. Retailers must strive to engage with them on social networks.
- Be relevant: tailor marketing – especially online and mobile campaigns – to consumers and their need-states.