jakartaIndonesia now has a $2 billion e-commerce market and the country is the world’s sixth largest emerging market. The potential of Indonesia is massive. McKinsey & Co predict that Indonesia’s ecommerce market could soon be the largest in the world. It currently contributes more than $150 billion a year to the economy.


Remarkably, this fast developing e-commerce market has grown from a country with internet penetration of just 38 percent; meaning that there are around 150 million Indonesians that are currently offline. The Palapa ring network expansion will play a crucial role in bringing internet to the masses as it will develop an undersea fibre-optic cable network stretching 13,000 kilometers. When completed it will bring fast broadband internet to both urban and rural dwelling citizens This means that by 2020 the online retail industry could account for five percent of Indonesia’s economy.

Analysts predict that 90 million Indonesians will be added to the consuming class by 2030. Additionally, 71 percent of Indonesians are expected to live in urban areas by 2030, that’s about 209 million people. Thus the opportunities for online businesses are abundant.

“We have seen a sharp increase in online visitors since we established ourselves in Indonesia,” said Mart Polman, managing director of Lamudi Indonesia—the online property platform. “As more Indonesians have internet access the real estate market will shift to an entirely online marketplace,” Polman added.

The market is developing quickly. Take for instance Go-Jek who started as a simple ride-hailing app but evolved to offer vendor to door delivery with everything from cinema tickets to beauty therapy on offer. Players need to adapt to fast changing trends and evolve along with their customers.

When Lamudi Indonesia first entered the market. They didn’t even have an app; now they have one for house hunters and another exclusively for agents. To be a success in ecommerce you need both an easy navigable website and an app. Indonesia has the third- largest smartphone market in the Asia-Pacific region exceeding one billion users so if your company doesn’t have a good app you really can’t compete.

However, if ecommerce in the country is to progress further the government need to invest in key infrastructure projects. Their priority should be improving the electricity supply, modernizing the road and rail networks and expanding credit card and technology usage. ***