In the case of Indonesia, only a small portion of the population can enjoy such benefits despite the rapid growth of smartphone sales. Over the past few years, the boom of e-commerce has opened up many possibilities for Indonesians. From the rise of young entrepreneurs to a chance to purchase rare goods from overseas, we have seen how the internet drives the interactions between marketers and buyers onto the next level.
Among the litany of advantages, it is evident that consumers would benefit the most from the thriving e-commerce through price competition. The availability of e-commerce platforms allows buyers to browse varieties of products and pick those that are offered at the most reasonable price.
Putting aside the argument that blames e-commerce for promoting consumerism, the new shopping platform has undoubtedly helped customers make informed decisions and ensure prudent spending of their money.
In the case of Indonesia, only a small portion of the population can enjoy such benefits despite the rapid growth of smartphone sales. That is because, in part, only 20 per cent of the country’s population of 250 million own bank accounts, a prerequisite for making payments on many e-commerce platforms. Meanwhile, only about 5 million of Indonesia’s 125 million-strong workforce have credit cards and hence more convenient access to e-commerce.
Apart from the technical barriers, lack of trust has halted potential customers from shopping online. Futhermore, while many Indonesian e-commerce players have been focusing on attracting tech-savvy end users, these unbanked, technology illiterate segments have remained untouched in the business. With such a huge gap, there are a number of reasons why assisted e-commerce — in which online purchases are made with assistance from a third party — serves as an alternative model to help more people access e-commerce and relish its benefits.
Filling the Gap
The first and foremost factor is, of course, the huge room for expansion in the local e-commerce market. Although they have been enjoying continuous growth in the number of registered sellers and transactions, major players such as online marketplaces Bukalapak and Tokopedia have been mainly relying on purchases made by end users who browse and buy products for their own use. The abundant parts of the society who have neither means nor knowledge to make online purchases, meanwhile, will remain at a distance in the absence of efforts or innovations that can help them understand and, therefore, access online shopping platforms.
And this is where the assisted e-commerce providers start to fill the gap. Jakarta-based Kudo, for instance, claims that it has managed, as of last week, to recruit more than 100,000 marketers, or agents, across the archipelago within just a few months after the launching of its application early this year. Running on the Android operating system only, the Kudo application serves as a mobile online store for its agents, who receive a certain commission for every product they manage to sell to people around them.