BrandZ Top 50 Most Valuable Indonesian Brands 2015

TOP
50 1 2 3 4 5 7 8 9 10 11 12 13 14 15 16
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39 2840 2941 30
42
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43
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50 6
TOP10BRANDS
Banks comprise 24 percent of the
total number of brands in the Top 50
US $6,373 Mil. US $6,153 Mil. US $5,882 Mil. US$2,145 Mil. US$2,042 Mil. US$1,939 Mil. US$1,767 Mil. US$1,669 Mil.US$9,918 Mil. US $8,285 Mil.
24%
11CATEGORIES
BIGGEST
CATEGORY
12 Brands
Banks
8 Brands
Real Estate
7 Brands
Personal Care
4 Brands
1 Brand
2 Brands
Retail
Airlines
Soft Drinks
7 Brands
Tobacco
4 Brands
Food & Dairy
3 Brands
1 Brand
1 Brand
Telecom Providers
Entertainment
Home Care
1%
1% <1%
2%
13%
5%
2%
5%
23%
5%
43%
% of Total Value of BrandZ™ Top 50
Most Valuable Indonesian Brands
FMCGBRANDSLEADBRANDCONTRIBUTION
The top names in the ranking for Brand Contribution are
led by household names in food, drink and personal care.
www.brandz.com
5
4
5
4
55
4
5
5
5
Brand Contribution (BC) measures the influence of brand alone on earnings, on a 1-to-5 scale, 5 highest
Compiled by GroupM. Historic sources: eMarketer,
Portio Research, comScore, Akamai
US$402Mil.
US$1,039Mil.
US$110Mil.
US$659Mil.
US$949Mil.
US$354Mil.
US$1,767Mil.
US$5,882Mil.
US$267Mil.
US$484Mil.
The average innovation score for brands
in the Indonesian Top 50 is 103.
‘Sets trends’ score
139
120
119
119
116
116
INNOVATION
DRIVESSUCCESS
The top six brands indexed according
to consumer perceptions that they ‘set
trends’ are from five different sectors.
BRICKS-AND-MORTARRETAILERS
MAKESTRONGSHOWING
HUGEDIGITALPOTENTIALAS
INTERNETPENETRATIONGROWS
Brand Value
US$2,145Mil.
6
26
Brand Value
US$461Mil.
23
Brand Value
US$398Mil.
26
Brand Value
US$323Mil.
30
Internet Penetration
2012 2013 2014 2015 (est.)
24%
29%
33%
36%
2012 2013 2014 2015
Smartphone
Penetration
10.6%
17%
24%
29%

A L M O S T H A L F T H E P O P U L A T I O N I S U N D E R T H E A G E O F 2 5
I N D O N E S I A H A S A N A B U N D A N C E O F Y O U T H F U L E N E R G Y

6 BrandZ™ Top 50 Most Valuable Indonesian Brands 2015
CONTENTS
7
Overview
Key Results
Cross-Category Trends
Key Take Aways
Economy and Demographics
History
Media Spending
Brand Value
Brand Age
Brand Ownership
Brand Contribution
Brand Indonesia
Indonesian Narratives
By Lara-Lee Burn,
Head of Firefly Millward Brown
Empowered Youth
By Daniel B. Siswandi,
Chief Strategy Officer, J. Walter Thompson
Demanding Consumers
By Suresh Subramanian,
Managing Director, TNS
The Truth About Premium
By Nadya Ardianti,
Account Director, Kantar Worldpanel
From Fragile to Agile
By Thomas Sutton,
Technical Advisor, Landor
E-Commerce
By Maneesheel Gautam,
Leader, Invention, MindShare
Lessons from China
By Peter Walshe,
BrandZ™ Global Strategy Director, Millward Brown
Big Ideals
By Katryna Mojica,
Chief Executive Officer, Ogilvy & Mather
Localization
By Richard McLeod,
Account Director, Millward Brown
Happily Ever After
By Avinash Pareek,
Strategy and Communications Planning Director, Maxus
Creating Complex Brand Personalities
By Kris Constantoulas,
Head of Strategy, Y&R
Diving into Digital
By Manoj Damodaran,
Head of Digital, MEC
Indonesian Top 50 Ranking
Our Insights
Brand Profiles 1-12
Our Insights
Brand Profiles 13-24
Our Insights
Our Insights
Our Insights
BrandZ™ Valuation Methodology
BrandZ™ Reports, Apps and iPad Magazine
WPP Company Contributors
WPP Company Brand Building Experts
BrandZ™ Global Top 100 Team
14
18
22
24
34
36
40
42
46
47
48
50
56
58
60
64
66
68
122
124
126
130
132
134
74
78
80
86
90
96
100
106
110
117
140
144
150
158
160
CONTENTS
INTRODUCTION
THOUGHT
LEADERSHIP
BRANDBUILDING
BESTPRACTICE
THEINDONESIAN
TOP50
RESOURCES

Growth, stability and consumer confidence
create perfect conditions for brand-building
8 BrandZ™ Top 50 Most Valuable Indonesian Brands 2015 9
Indonesia is a country
whose time has come.
Overshadowed somewhat
by the headline-grabbing
growth of its neighbors
China and India, Indonesia
has its own story of
transformation to tell that
is no less extraordinary.
The country that is now
the economic powerhouse
of Southeast Asia is in
the midst of change on a
massive scale.
As the country begins a momentous
phase in its development, blending
tradition with modernization, we
inaugurate the WPP BrandZ™
Top 50 Most Valuable Indonesian
Brands 2015. This ground-breaking
study ranks the country’s most
accomplished brands, analyz es
their success, and identifies the key
forces that are driving brand growth
in this market. It is the first edition
of an annual study that will track
and anticipate the rapidly evolving
environment for brands in Indonesia,
and will chart the changing value of
the country’s most valuable brands.
Indonesia’s quarter-of-a-billion people
make it the world’s fourth-most-
populous country in the world, and
the third-largest democracy. But while
these numbers paint a compelling
picture of growth and potential in this
market, what sets it apart in the region
and makes it such an attractive long-
term market for brands is its people’s
vitality and sense of optimism.
Market liberalization and
decentralization are not only
stimulating economic growth but also
bringing unseen levels of consumer
spending power. There is a rapidly
expanding middle class, and even for
those millions of Indonesians who
can only yet dream of joining its ranks,
there is a strong sense that things are
getting better.
As Indonesia marks its 70th anniversary
of independence, there is positivity,
energy, and determination. As
President Joko Widodo said when
he was elected last year, the time has
come to “move together to work,
work and work” towards a better
future. The Asian Development Bank
forecasts GDP growth in Indonesia of
5.5 percent in 2015, and 6 percent for
2016 - strong, but sufficiently modest
to be sustainable.
The pace of market change being
seen in Indonesia is breath-taking,
thanks to the speed with which
economic restructuring and opening
up is being implemented.
Such swift change does not come
without difficulty and environmental
impact. The rush-hour traffic jams on
the streets of Jakarta are testament
to the challenge of managing the
effects of a sudden surge in consumer
affluence. But Indonesia is, without
doubt, a land of opportunity, both
for its people and for the brands that
seek their loyalty.
Whether you’re an Indonesian or an
international company, in this report
you’ll find knowledge and insight to
help you create and grow brands in
Indonesia more effectively.
On page 24, Take Aways provide
succinct, action-oriented
recommendations for brands based
on our expert analysis of the market.
We’ve also included summaries of
Indonesia’s Top 50 most valuable
brands. Brand experts from WPP
companies across Indonesia share
their market wisdom and sharp
insights through extensive Thought
Leadership and Best Practices essays,
and we present all this with stunning
photography and a vibrant design that
reflects the dynamism and variety of
the country itself.
At WPP, the global communications
services leader, our companies have
been engaged in Indonesia for 16
years. Today, 1,500 people work
across WPP companies providing
advertising, marketing, insight, media,
digital, shopper marketing and PR
expertise. It’s part of our global
presence in 112 countries. By linking
all this talent, creativity, wisdom, and
horizontality, we amplify global trends
and insights that help our clients in
useful and unique ways.
We invite you to access our unrivalled
BrandZ™ resource library. Along
with the new BrandZ™ Top 50 Most
Valuable Indonesian Brands report,
the library includes these annual
studies: BrandZ™ Top 100 Most
Valuable Global Brands, BrandZ™ Top
100 Most Valuable Chinese Brands,
and BrandZ™ Top 50 Most Valuable
Latin American Brands. To download
these and other reports, please visit
www.BrandZ.com. For the interactive
BrandZ™ mobile apps go to
www.BrandZ.com/mobile.
The backbone of all this intelligence
remains the WPP proprietary
BrandZ™ study. The planet's largest
and only consumer-focused source
of brand equity knowledge and
insight, and the unique and world
authoritative BrandZ™ brand
valuation methodology by Millward
Brown. First we analyze relevant
corporate financial data and strip
away everything that doesn’t
pertain to the branded business.
Then we take a critical step that
makes BrandZ™ unique and
definitive among brand valuation
methodologies. We conduct
ongoing, in-depth quantitative
consumer research with more
than 170,000 consumers annually,
across more than 50 countries, to
assess consumer attitudes about,
and relationships with, over 100,000
brands.
Our database includes information
from over three million consumers.
It reveals the power of the brand
in the mind of the consumer
that creates predisposition to buy
and, most importantly, validates a
positive correlation with better sales
performance.
At WPP, we’re passionate about
using our creativity to create and
build strong, differentiated brands
that deliver lasting shareholder
value. To learn more about how to
apply our experience and expertise
to benefit your brand, please
contact any of the WPP companies
that contributed expertise to
this report. Turn to page 150 for
summaries of each company and
the contact details of key executives.
Or feel free to contact me directly.
OPTIMISM AND
ENERGY DRIVE
THIS VIBRANT
EMERGINGMARKET
WELCOME
WELCOME
David Roth
CEO The Store WPP, EMEA
David.Roth@wpp.com
Twitter: davidrothlondon
Blog: www.davidroth.com
Our proprietary BrandZ™ brand
valuation methodology makes the
Top 50 Most Valuable Indonesian
Brands the definitive study of brands
in Indonesia. The uniquely consumer-
facing BrandZ™ methodology
combines extensive and on-going
consumer research with rigorous
financial analysis. (See page 140 for
the full methodology and criteria.)
We gathered brand perceptions from
consumers across the Indonesian
market, in both urban and rural areas,
and asked about brands with all kinds
of ownership structures: individual
private brands, family-owned
conglomerates, MNCs (Multinational
Corporations), and SOEs (State Owned
Enterprises). We selected brands
that met either of the two qualifying
criteria: The brand was originally
created by an Indonesian enterprise
and is owned by an enterprise listed
on a credible stock exchange; or the
brand is owned by an enterprise listed
on Jakarta Stock Exchange.
This approach produced a carefully
conceived ranking of brands in 11
consumer-facing categories, such as
home care, personal care, food and
dairy, and soft drinks. The ranking
does not include any business-to-
business brands, regardless of value,
because they are outside the scope of
this report.
To learn more about the BrandZ™
valuation methodology, please
contact:
Elspeth Cheung
Global BrandZ™ Valuation Director,
Elspeth.Cheung@millwardbrown.com
Brand
Selection
Criteria

W H E R E E U R O P E A N C L I P P E R S O N C E D O C K E D I N S E A R C H O F S P I C E S
IN T E R NAT IONA L BR A N DS SE E K A SH A R E OF GROW ING CONSU ME R W E A LT H

Modern Indonesia is being shaped by sizeable forces – some
old, some new – and to understand their effects is to begin to
appreciate the changing expectations and opportunities of the
Indonesian consumer market.
SECTION 01
INTRODUCTION
This is a land of contrasts and
contradictions. There is tension
between young and old, modernity
and tradition, aspiration and
risk-aversion.
Overwhelmingly,
though, this is
a market being
driven forward
by the youth of
its population
– among the
youngest in the
region – and by
the energy of its
people.
There is growing
wealth in
Indonesia; many
millions of people
are enjoying their
first taste of discretionary spending,
as they move from subsistence living
to stability and the ability to plan.
The ranks of the middle classes,
meanwhile, are expanding apace, and
are forecast to represent between
130 and 140 million people by 2030.
At the top end
of the income
spectrum, a small
but significant
group of super-
rich are living truly
luxurious lives.
This contrast,
not just between
rich and poor
but also between
the country’s
rich heritage and
the onslaught of
modern life, is
evident all over
the country.
Cybercafés, designer boutiques and
traffic jams are juxtaposed with the
simplicity of life for those who remain
reliant on the land and the sea for
their livelihoods. Tiny street-side
warungs – family-run shops often
crafted from wood – still have a
place in a retail landscape that runs
from wet markets to gleaming malls.
Urbanization is intensifying, as
Indonesia’s cities act as beacons
of opportunity; the number of
Indonesians living in urban areas
is expected to reach 71 percent of
the total population, or 209 million
people, by 2030. And while city-
dwellers have much in common,
there are still significant distinctions
between the country’s urban centers.
Jakarta is the country’s financial
powerhouse, a cosmopolitan center
with a worldly population, while the
city of Yogyakarta, just an hour’s
flight away, has a distinctly different
flavor, retaining greater closeness
to Javanese heritage and traditional
values.
NEW ERA OF
GROWTH AND
TRANSFORMATION
Introduction OVERVIEW
OVERVIEW

SECTION 01
INTRODUCTION
But differences such as these have
always been synonymous with
Indonesia. Diversity runs deep
through this nation, which unites
17,000 islands, 700 languages and
dialects, and 300 ethnicities.
What’s exciting now is the sense
that Indonesia is entering a new,
pivotal stage in its development,
and that the consumer and brand
landscape is, therefore, on the cusp
of tremendous change.
Just five years ago, building a brand
in Indonesia tended to involve
two steps: first, ensuring national
distribution of the product, and
second, achieving widespread
visibility on television. Those days are
gone, and a very different dynamic
is at work.
Consumers are now far more
sophisticated and selective; they
expect a more complex relationship
with the brands they make part
of their lives, and they are being
influenced by an ever greater range
of media – often using several at the
same time.
For the businesses seeking to build
brands here, these winds of change
signal a great opportunity. Not only
do people have more money to
spend, they are buying a greater
range of
products and
are increasingly
interested
in brands.
They’re also
increasingly
likely to
become brand
advocates;
research shows
that consumers
are 29 percent
more likely to
recommend
a brand to family and friends than
they were just three years ago.
Kantar Worldpanel data shows
that consumers are shopping less
frequently than before, but for a
more varied range of goods. In
2013, the average Indonesian family
bought from 45 different product
categories over the course of the
year – up from 43 just a year earlier.
To many international brand
managers, and to the most
successful and nimble brands in
Indonesia, these are questions they
are already addressing, but they are
especially important to
appreciate now.
Indonesian people
are seeking out the
brands that help
them embrace
modernity, progress
and technology - but
without having to
sacrifice their heritage
and spiritualism.
Just four years ago,
a BrandZ™ study into what was
setting the strongest brands apart
from the competition found that
saliency played the dominant role
in consumer choice – essentially,
the ease with which a brand name
sprang to mind was the key to its
success. Now, however, the role of
saliency has declined significantly,
and it is a brand’s ability to make
a meaningful connection with a
consumer that matters most. It is no
longer enough to be visible; brands
must have something relevant to say
after they get noticed.
Advertising has tremendous power to
help consumers identify the brands
and products that can enrich their
lives. But to advertise successfully in
Indonesia means achieving a delicate
balance between reflecting cultural
values that resonate across a diverse
nation, and at the same time being
sufficiently creative to stand out in a
cluttered advertising environment.
Successful brands – both local and
international – are telling stories that
reach across the diversity of modern
Indonesia, and are helping people
navigate the tensions they manage as
their lives change.
Few Indonesian brands
have established a global
presence, but those
pioneering names expanding
across the region are doing
so from a strong position in
this complex and demanding
home market. More local
brands will, in the coming
years, start to realize
their regional and global
aspirations.
There remains a sizeable, long-term
opportunity for brands to grow in
Indonesia. While personal wealth is
greater and more widely distributed
than it’s ever been before, affluence
is still a relative concept, and much
potential remains unmined.
Introduction OVERVIEW
WHAT’SEXCITINGNOW
ISTHESENSETHAT
INDONESIAISENTERING
ANEW,PIVOTALSTAGE
INITSDEVELOPMENT
With an increasingly alluring
consumer market, however, also
comes more intense competition
from newcomers. In 2013 alone,
there were 173 new food brands
launched
in the
country, 61
new drinks
brands, and
26 new
names in
personal
care.
This all
makes
the task
of a brand
owner more
challenging,
as they seek to be heard above the
growing chorus, but it is also more
complicated. Brands need to ask
a new set of questions: How well
does the brand meet the functional
needs of consumers? Are they
communicating the brand’s story in a
meaningful way? And how does this
combination of story and function
make people feel?

SECTION 01
INTRODUCTION
INDONESIA TOP 50 TOGETHER
WORTH US$65 BILLION
The combined value of the BrandZ™
Top 50 Most Valuable Indonesian Brands
hit US$64.6 billion, not far behind the
total value of the Top 50 brands in
India in 2014 (US$69.6 billion), but just
one-seventh of the value of the Most
Valuable 50 Chinese brands this year.
BRAND EQUITY IS STRONG
Indonesian brands are proving effective at creating a
consumer predisposition to purchase – on a par with the
most valuable Chinese brands and performing better in
this area than many leading global brands. In the BrandZ™
Power Index, a brand equity measurement, the Indonesian
Top 50 scored 210, compared with 212 in China, 222 in
India and 161 in Brazil; the average of all brands worldwide
is 100, so a score of 150 indicates that a brand is performing
50 percent better than the average brand.
BANKS AND TOBACCO ARE
BIGGEST PERFORMERS
Financial services brands occupy
24 percent of the Top 50 brands in
Indonesia by number of brands, and
banks take four of the top 10 places
in the rankings, including first and
second. Tobacco brands are unique in
Indonesia across the BrandZ™ rankings
in having such a strong presence
among leading brands, with six
tobacco brands featuring in the top 12,
and seven making the Top 50.
SPOTLIGHT ON
OPPORTUNITIES
FOR BRANDS
Introduction KEY RESULTS
KEY RESULTS
BCA IS INDONESIA’S
MOST VALUABLE BRAND
BCA, or Bank Central Asia, tops the
inaugural BrandZ™ Indonesia rankings,
having built its reputation over more
than 50 years in this market, during
which time it has established a network
of more than 1,000 branches around
the country. Its innovations in the
provision of card services have helped
make it one of the most widely used
consumer banks in the country. The
bank’s private-label BCA card is now
widely accepted in Singapore. BCA’s
brand value places it just outside the
Global Top 100 Most Valuable Brands;
the bank is on track to become the first
Indonesian brand to make the global
ranking.
MEGA BRANDS DOMINATE
The Top 5 brands account for 57 percent
of the total value of the BrandZ™
Indonesia Top 50, or US$37 billion. This
concentration of value at the top of the
ranking is similar to India, China and
Brazil. In contrast, the Top 5 brands in the
Global Top 50 account for only about a
quarter of the ranking’s total value.

SECTION 01
INTRODUCTION
RETAILERS PROVE
SOLID PERFORMERS
Four retail brands feature in the
Indonesian Top 50; this is not unusual
in itself, but what is interesting about
the retailers that make the rankings
here is that they are all bricks-and-
mortar stores, whether department
stores as in the case of Matahari
Department Store, or grocery outlets
such as Alfa, Ace and Hypermart. The
top performing retail brands globally,
and in China however, tend to be those
focused on e-commerce. The rate of
e-commerce is growing in Indonesia,
as smartphone penetration and the use
of credit and debit cards grows, but is
still nascent by world standards.
FAST-MOVING
CONSUMER GOODS
WELL REPRESENTED
Fast-moving consumer goods brands
make up 28 percent of brands in the
BrandZ™ Indonesia Top 50 – a very
high proportion when compared
to other countries’ rankings. Well-
loved and highly successful home-
grown noodle, water and tea brands
extra value that is worth paying for. In
categories where there is one dominant
player, this premium factor is often
seen; in Indonesia, it applies to brands
such as Matahari Department Store,
Rinso, and Garuda Indonesia.
STRONG AND DIFFERENT –
BUT LACKING LOVE
AND INNOVATION
Indonesia’s most valuable brands are
doing as good a job as the strongest
global brands when it comes to being
meaningfully different, and salient;
where they lag is in being lovable and
innovative. The Top 50 Global Brands
average an innovation score among
consumers of 120, while Indonesia’s
Top 50 manage just 103; likewise,
global brands achieve 131 on the love
scale, while Indonesia’s Top 50 only
get to 108. The importance of these
measures to a brand’s overall value is
clear when the Top 50 is split in half and
ranked according to their innovation
score. The top half then are collectively
worth US$51.9 billion, while the bottom
half, those seen as less innovative, are
valued at just US$12.7 billion.
feature strongly in the Top 50. Brand
strength for names such as Indomie,
Pepsodent, SariWangi, and Bimoli has
helped these brands punch above
their financial weight in the rankings.
The personal care category’s success
reflects investment by multinational
corporations, which have introduced
and developed their brands in
Indonesia.
CATEGORY LEADERS
PROVE PREMIUM VALUE
Leading Indonesian brands have
strength enabling them to command
a premium price that is well above
that seen among leading brands in
other markets. The BrandZ™ Premium
Index, one of several measures that
count towards brand value, is 120
among the Top 50 brands in Indonesia,
which compares to 111 in the Global
Top 50, 104 in India’s Top 50, and 109
for the leading 50 brands in China. The
average among all brands worldwide
is 100. This does not necessarily mean
that the top brands are more expensive
than the competition, but does mean
consumers see them as providing
Introduction KEY RESULTS
Make branding a priority and reap the rewards
Now is the time to focus on branding; Indonesian consumers are
more aware of and engaged with brands than ever. They talk about brands
and recommend the ones they love. The BrandZ™ ranking shows that
businesses in Indonesia that nurture the power of their brands are four times
more valuable than those that don’t. CEOs should see a clearly articulated
and communicated brand mission as essential to growth.
Safety in numbers – the value of trust
The value of being a trusted brand is underlined by analysis of the
Indonesia Top 50. Among banking brands, for instance, almost 90 percent
of the brand value in the ranking is concentrated at the top, among just
three brands. These three banks far outperform other banks on measures of
fairness, responsibility, and trust in the eyes of consumers. Economic crises
have shaken this market, and wary consumers seek out brands they feel are
safe. Emphasize scale, a long history, and popularity to foster consumer trust.
Emotional connections take brands to new heights
Brands that focus on making meaningful connections with consumers
can punch above their financial weight in the BrandZ™ rankings. These
connections must be about more than simply being well-known or
delivering quality and value. They must be built on emotion, and the most
successful brands deliver meaning not just through their products but
through their communications, creating emotional, memorable links that
connect with consumers’ lives.
Local relevance helps consumers straddle two worlds
Local brands dominate the Top 50, and Indonesians take tremendous
pride in home-grown success stories. But the BrandZ™ rankings also
show that multinational brands can succeed in this market by tailoring their
attributes to the Indonesian market - not just with a local look, but by making
a locally relevant connection with consumers. Multinational brands can
help consumers resolve the tension they feel between wanting to maintain
traditional values and their desire to be worldly and modern.
Innovate and prosper
Innovation in digital services and digital media investment drives
up a brand’s value. The Top 5 most valuable brands in the Indonesia
ranking invest significantly more in digital compared to the lowest-ranked
brands. Technology can make service brands more accessible, and digital
communication in this mobile-driven market is essential. Brands should
exploit multi-screen behavior by consumers to build layers of meaning –
but should still remember the value of TV, which is immensely popular
and remains an effective driver of reach.
TOP 5 LEARNINGS
FOR MARKETERS

SECTION 01
INTRODUCTION
THE SEARCH
FOR VALUE
Robust economic growth is putting
more money in people’s pockets,
but demand is no less intense for
great value for money. Consumers
are not necessarily buying the
cheapest products available, but
they are looking for more efficient
ways to buy, and want to strike the
right balance between quality and
price. Kantar Worldpanel Indonesia
has tracked increasing demand for
large pack sizes on FMCG products
ranging from biscuits to shampoo,
which deliver better overall value
for money. Even relatively affluent
consumers are on the lookout for
great value, and are increasingly
buying budget brands. In fact, urban
households are more likely than
those in rural areas to buy brands that
position themselves as economical,
and top-tier households (A or B on
the SES socio-economic scale) are
almost twice as likely to buy these
brands as are those shoppers at the
lower end of the scale.
CONVENIENCE
People are leading increasingly
complex and busy lives, so are keen
to buy products that help them free
up time, either for time with family
and friends at home, or for the
pursuit of hobbies, entertainment
and socializing. Many city-dwelling
couples now both go out to work,
and commute times can be long,
so ready-to-heat and ready-to-eat
meals, canned and frozen food and
disposable nappies are all enjoying
growth. At retail, shoppers are drawn
to services that help them save time
in store or make the experience
simpler. While urbanization is behind
some of the drive for convenience,
consumers outside major centers
are also seeking out time-saving
products and services, as they seek
an improved balance between work
life and their personal lives.
NEW SPHERES
OF INFLUENCE
Television remains the cornerstone of
national campaigns for mainstream
products and brands, providing
unparalleled reach across Indonesia.
But increasingly, particularly among
young consumers, digital media is
providing new sources of information
and inspiration. Given the near-
ubiquity of mobile phones and the
popularity of social media, online
forums are alive with opinion, and
the sources of influence are many
and varied. More than 62 million
Indonesian consumers are on
Facebook, and local social networking
site Kaskus has nearly 6 million. While
only about one in four mobile phone
users currently has a smartphone,
that figure is rising rapidly, and with it,
so will the effect of online word-of-
mouth and digital advertising.
E-COMMERCE
This is still a nascent area of retailing
in Indonesia, and is far from a
mainstream activity, but it is one that
is rapidly growing as smartphone
penetration and trust in buying online
increase. KADIN Indonesia, the
country’s Chamber of Commerce,
expects that by the end of 2015, 10
percent of internet users in Indonesia
will be buying online, as consumers
do banking online and buy groceries
and big-ticket items via e-commerce.
One of the biggest hurdles to growth
is the fear of being duped, along with
a lack of clarity over e-commerce
regulations, the complexity of
delivering items across a sprawling
network of islands, and the fact
that many consumers don’t have a
payment card they can use online
to complete a transaction. However,
there is a sense that a tipping point
for e-commerce is near, as individual
brands launch e-commerce ventures
and as B2C e-commerce companies
such as Lazada Indonesia, Rakuten,
and eBay gain users.
PREMIUMIZATION
Demand for aspirational brands and
products are fuelling the growth of
premium goods across categories,
from cars and fashion, to soap
and chocolate. Consumers are
willing to pay for the brands they
see as providing something that
goes beyond simply meeting their
needs. Those who can afford it are
buying top-end BMWs and premium
Samsung mobile phones, while
others are treating themselves to little
luxuries. Kantar Worldpanel found
sales of premium liquid soap, for
instance, were up 39 percent in a
year (2013), while premium chocolate
sales rose 35 percent and top-end
mouthwash saw a 15 percent surge
in sales in the same period. Premium
instant coffee, toothpaste and baby
products are also on the rise. This is
not simply about consumers splashing
out; premium products must prove
they deliver something extra that
justifies their premium pricing.
A DESIRE FOR
LOCAL MEANING
Across every aspect of their lives,
Indonesian consumers tend to be
drawn to products and brands that
they perceive to be aligned with
their own lives and beliefs. While this
puts local brands in a strong position
to make meaningful connections
with consumers, it also provides
opportunities for international brands
that can provide a locally relevant
expression of their brand – and, in
some cases, a localized version of
their product – that feels at home in
this market. McDonald’s has localized
its offering with rice-based meals,
British American Tobacco makes
hand-made kretek clove cigarettes
for this market, and to many people,
Kit-Kat and Oreo are fondly regarded
because they have generated a sense
of familiarity that has a local ‘feel’ to it.
PROGRESS AND
TRADITION IN
MODERN BLEND
Introduction CROSS-CATEGORY TRENDS
CROSS-CATEGORY TRENDS

SECTION 01
INTRODUCTION
BUILDING
VALUABLE
BRANDS IN
TODAY'S
INDONESIA
Introduction KEY TAKE AWAYS
KEY TAKE AWAYS
MATCH ASPIRATION
WITH AFFORDABILITY
Consider how different levels
of affluence affect consumer
preferences; there’s being rich,
and then there’s being really rich.
For huge numbers of Indonesians,
owning a motorcycle is no more a
badge of wealth than owning a pair
of shoes – it’s simply essential. Having
a car, however, means someone has
reached a new level of economic
success, but it’s having a car with your
own driver that shows you’ve really
arrived. Consumers right across the
income spectrum may have similar
desires, but need different ways
of realizing them. Mobile phones,
personal care products, innovative
food items, and even cars are just a
few of the categories that span a broad
range of budgets, from economy to
premium, so tailor your range, pricing,
and emotional benefits accordingly.
HELP CONSUMERS
MAKE SMART DECISIONS
Indonesian consumers are extremely value-conscious, and while
traditional price discounts and sale periods may help attract buyers, what
consumers appreciate more are brands that they feel are providing an
honest product or service at the right price. Consumers in some of the
poorer, more remote areas buy low-cost products out of necessity, but are
looking beyond headline prices for the bundle or deal that provides the
best value. More affluent consumers are just as keen on buying economy
brands when they feel they are not sacrificing quality for a good deal.
Marketers need to understand what is perceived as good value in a given
category, align with that definition and deliver it.
MAKE PROMISES,
NURTURE TRUST
Trust, reliability, and authenticity are
essential credentials for a successful
brand to possess in Indonesia.
Brands need to ensure that the
promise of their brand is aligned
with what is actually delivered, as
only then will trust be established.
Brands such as Garuda Indonesia,
Sunsilk and Indomie have done
this over many years; Oreo and
Milo have achieved high levels
of trust more recently by finding
a locally relevant expression of
their international DNA, making
a promise that speaks directly
to Indonesian consumers, and
delivering on that promise.
STUDY THE
YOUNG, VIEW
THE FUTURE
Indonesia has one of the youngest
populations in the region, with a
median age of 29 – far younger
than China (36) and the U.S. (median
age 38). Young people have grown
up with democracy, freedom, and
access to information in a way that
the older generations, who lived
under a dictatorship, could only
have dreamed of. They have a taste
for the newest products, from food
to technology, and are prepared to
pay for them. They have, however,
inherited something of their parents’
and grandparents’ sense of frugality
– of being prepared for a rainy day.
So, while they are less risk-averse
than older people, there is little
ostentatious spending when it could
be construed as wasteful indulgence.
Help young Indonesians balance their
desire for the new with their fondness
for tradition.

T H E A P P E T I T E F O R S O C I A L M E D I A I S I N T E N S E
R E F L E C T I N G T H E S O C I A L N A T U R E O F I N D O N E S I A N S O C I E T Y

SECTION 01
INTRODUCTION
KEY TAKE AWAYS
BE MINDFUL OF REGIONAL
VARIATION IN ATTITUDES
While Jakarta is the center of commerce and is where
trends are set for many other cities, it’s important
to remember that only 4 percent of the country’s
population calls the capital ‘home’. Businesses seeking
to build national brands need to look to other major
cities and beyond, and consider the differences
between each. While Jakarta is a very modern city
and is quite westernized, the central Javanese city of
Yogyakarta – another major center on the same island
– has a more traditional feel to it, and is a place where
politeness, hierarchical structures, and respect for one’s
elders is more apparent. Cynicism regarding advertising
is growing in the capital, while in places such as Medan,
Padang, Pontianak and Bodetabek, consumers are
enthusiastic about ads generally and are inclined to find
them entertaining.
EMPHASIZE RELATIONSHIPS,
NOT INDIVIDUALITY, IN
COMMUNICATIONS
For many Indonesians, there is an emphasis on
collective achievement and smooth interpersonal
relationships, ahead of individual success. People
feel more confident when they’re part of a group.
There is also a great deal of respect for authority,
which means people appreciate being given clear
guidance on how to do something, and will avoid
uncertainty and ambiguity when they can. Accepted
wisdom has it, therefore, that the best way to make a
great Indonesian ad is to feature a harmonious family
around the dinner table.
DON’T RELY SOLELY ON
FUNCTION TO SELL
Function is an important and powerful part of the
story for Indonesian consumers, but brands risk falling
behind if they rely solely on a compelling expression of
their functional benefits in their advertising. Ultimately,
the most powerful communication in Indonesia has a
balance of associations, both practical and emotional
– rooting an emotionally compelling brand story in
a core product truth. In Indonesia, half of the most
persuasive advertising strikes this balance between
function and emotion, compared to 43 percent
globally. A great example of this in action is chocolate
milk brand Milo, which shows mothers supporting
their children’s sporting achievements by giving them
the nutritious energy of Milo.
MIND THE CLUTTER,
WATCH FOR GAPS
Indonesia is a market that is now crammed with
advertising, to the extent that Maxus Indonesia report
that TV audiences are now subjected to an average
of 13 to 14 ads in a typical prime-time ad break. While
the color and dynamism of advertising is welcomed as
novel entertainment in some of the more remote parts
of the country, in the cities, especially in the capital,
there’s weariness among consumers who feel they
are bombarded by advertising that has become so
ubiquitous it is no more effective than wallpaper. The
importance of creating advertising that can cut through
this clutter is, therefore, vital to appreciate, particularly
as the overall investment being made in advertising
continues to rise, and is forecast by GroupM to grow a
further 13.5 percent in 2015.
ALIGN WITH LOCAL
VALUES AND ‘FEEL’ LOCAL
Give your brand a local identity – even if it’s a global
success – by offering something new and aspirational
that works with, rather than in opposition to, respected
traditions. Millward Brown Link™ data shows that
Indonesia has the lowest receptivity of any Southeast
Asian market to ads coming from other markets in
the region, with only 39 percent of high-performing
regional ads also performing well here. But adding a
local face to an international campaign is only getting
localization half-right. Making a real connection means
relating to consumers with a human truth that feels
relevant and familiar – but without using tired national
stereotypes. International brands can achieve this just
as well as local brands; global shampoo brand Sunsilk,
for instance, is fondly regarded as an Indonesian favorite
because it ‘feels’ local.
HELP CONSUMERS AVOID
AMBIGUITY – PROVIDE
PRAGMATIC SOLUTIONS
There are few places where it matters more than in
Indonesia that a product “does what it says on the tin”.
Consumers here are widely perceived to be rational
shoppers, making decisions about products and brands
based on information about what that item can do
for them – and at what price. Millward Brown’s Link™
research in Indonesia reveals that the most persuasive
ads are characterized by a demonstration of the product
benefits and composition. In fact, 82 percent of the
most persuasive ads demonstrate the benefits of a
product, compared to only 66 percent of the lowest
performers. Marketers must demonstrate that their brand
delivers clear benefits – and, of course, great value.
PREPARE FOR E-COMMERCE, BUT DON'T
LOSE FOCUS ON PHYSICAL RETAILING
E-commerce is the shopping mode of the moment, but it is only practised by
a tiny proportion of the population despite gradual progress being made in
delivery services, the ability to pay online, and in overall consumer trust that
shoppers will receive the goods they’re paying for. Physical stores remain where
the action is, and while a shift from wet markets and neighborhood warungs
towards the modern trade is well under way, independently owned general
stores, cafés, restaurants and clothing shops are where many people spend
the majority of their money. The appeal of the modern trade to marketers is
the ease of gaining scale and consistency of display in an efficient way, but
distribution and promotion through more traditional retailers remains important.

SECTION 01
INTRODUCTION
KEY TAKE AWAYS
LOOK BEYOND THE
FAMILY DINING TABLE
The propensity for Indonesian people to identify with
groups has grown beyond the family group, and marketers
should consider the new ways in which individuals think
about togetherness with other groups of people. Friends,
work colleagues and wider communities have become
a second family for many, especially young people who
have moved away from their family home to study or to
work. For them, togetherness can mean hang-out time at a
cinema or shopping mall, or time playing sport or pursuing
another shared interest. For older people and couples
without children, social gatherings with workmates are a
little-acknowledged opportunity to identify with a group. At
the same time as Indonesians are forming groups outside
the family, dynamics within family homes are changing,
with spaces and devices becoming more personal rather
than communal.
RESPECT RELIGION,
BUT DON’T PREACH
Indonesia is home to the largest Muslim population
in the world, and brands need to be mindful of this in
their communications. Local cosmetics brand Wardah,
for instance, has successfully reshaped the Indonesian
cosmetics category with strong halal claims about
its products, providing women with the chance
to express themselves and feel beautiful without
compromising on their values. But this is a delicate
path to tread, and in most categories, consumers like
brands to acknowledge their religious views in a subtle
way, but don’t like the idea of religion being used as
a sales platform. Financial services is perhaps one of
the few exceptions to this, as many banks offer Islamic
products, though, even then, the most successful
brands steer clear of overtly religious messages.
USE TELEVISION WISELY –
THEN STOP SPENDING
Television attracts the lion’s share of advertising investment
for a very good reason: it helps brands to achieve national
reach in an efficient way. And, despite the rise of digital
media, TV will continue to be the cornerstone of great
national ad campaigns in Indonesia for quite some time. But
a bigger TV investment does not guarantee a bigger impact;
while the optimal number of exposures to an ad required
to affect brand KPIs is high by global standards, once that
frequency has been reached, there is very little additional
lift for any additional exposure. So, establish what the ideal
level of TV exposure is for your brand, and then look to
other media to complement that investment. For many large
brands, anything from 10-50 percent of their TV campaign
budgets can end up as wastage; resulting in no incremental
impact on brand or sales measures.
USE MULTI-SCREENING
TO YOUR ADVANTAGE
The scale of the ‘multi-screen’ opportunity in Indonesia is
huge; of 26 countries in Millward Brown’s AdReaction study
in 2014, Indonesia was found to have the fifth-highest level
of multi-screening behavior. In fact, one in five multi-screen
minutes in Indonesia is spent 'meshing' – simultaneously
looking up content related to their activity on another
screen – which equates to over an hour a day. Ambitious
brands must invest in building a layered relationship with
consumers across multiple touch-points simultaneously
if they are to keep pace with changing consumer habits.
TV remains an unparalleled driver of reach and, therefore,
saliency, but non-TV screens such as mobile can be
the perfect vehicle for a more layered and meaningful
conversation with consumers.
GO DIGITAL, BUT ON
INDONESIAN TIME
Everyone is getting connected, but internet speeds in Indonesia
remain among the slowest in the world. Broadband outside
Jakarta is rare, and average connection speeds across the
country are just 1.9Mbps, slower than India, China, the
Philippines, and Vietnam, and just 10 percent of the average
speed achieved in Singapore, and an even smaller fraction
of the world-leading connections achieved in South Korea
(22.2Mbps in Q4 2014). In designing web sites and e-commerce
solutions, focus on functional elements and provide easy
navigation to save users loading unnecessary pages by mistake.
Use images sparingly and in lower-resolution formats than
you might otherwise, and be even more judicious about using
video. It is possible to run attractive and effective sites that work
over low-bandwidth connections.
BUILD OPPORTUNITIES
FOR CO-CREATION
Indonesians see their digital devices as tools for
creation, not just consumption. Brands seeking
true engagement with consumers – especially
those with a young and tech-savvy target market
– should encourage that creativity to find a
voice that is linked to their offering. Coca-Cola
Indonesia is a leader in this field, and has shown
that by providing brand advocates with the tools to
create their own content, a proliferation of brand-
centric communication online results. The volume
of user-created, brand-related content often far
outweighs that generated by a brand itself, and
has a different level of stickiness and credibility
when shared because it is the work of a friend.

SECTION 01
INTRODUCTION
KEY TAKE AWAYS
THINK SOCIAL –
CONSUMERS DO
This is a country that is social by nature, and Indonesians
with access to the internet are seizing upon the opportunity
to socialize digitally. More than 62 million Indonesian
consumers are on Facebook, local social networking site
Kaskus has nearly 6 million, and Twitter and LinkedIn are
also widely used. These sites operate freely in Indonesia, in
marked contrast to China, and are becoming increasingly
popular as the number of people upgrading to smartphones
continues to climb. Social networking can be a key tool
for improving brand engagement, and these platforms,
which provide not just reach but precision targeting by
demographics, preferences, social connections and
behavior, provide an attractive proposition for advertisers.
GET MOBILE
Indonesians spend, on average, a remarkable three
hours a day using their mobile phone – more time than they
spend watching TV. Among young people, the role of mobiles in
people’s lives is even stronger, with 16 to 24-year-olds spending
an average of four hours a day on their phones, often while
doing something else at the same time, such as watching TV.
As in other fast-growing markets such as China and India, many
people’s first experience of the internet in Indonesia is via mobile,
and often using a feature phone rather than a smartphone. The
vast majority of social media users are connecting via mobile,
rather than a desktop or laptop. The power of mobile marketing,
especially when linked to television, is not to be overlooked.
THINK LONG-TERM
There are millions of Indonesians who won’t be
in the market for brands for several years. Strong economic
growth in Indonesia has helped reduce poverty from 24 percent
of the population in 1999 to 11.3 percent in 2014, as defined
by the World Bank, but there remain an estimated 68 million
Indonesians living just above the poverty line, generating just
over the Rp 11,000 (US$1) per person per day baseline income.
These people are vulnerable to small shocks, such as illness or
job loss, which can very quickly put them in poverty. Others, who
are safely within the consuming class, will upgrade from basic
to premium goods as their wealth grows. Now is the time for
brands to build familiarity and trust. They should sow the seeds
of aspiration, and meet that aspiration with the products and
services that fit consumers’ needs as their lives change, whether
it be with shampoo, biscuits, a restaurant meal, a scooter or a flat.

SECTION 01
INTRODUCTION
Introduction ECONOMY AND DEMOGRAPHICS
ECONOMY AND DEMOGRAPHICS
POPULATION
ECONOMY
Total population Urban population
(% of total population)
Productive Age 66%
Below 30 55%
Working Age 51%
Kids and Teens 37%
Millennials 34%
The national population is forecast by the United Nations to exceed 322 million by the year 2050.
253.6 Mil.
Rate of urbanization
(annual rate of change (2010-15 est.)
2.69%
53%
Population by age
Literacy rate
(% of population over 15 years
who can read and write)
6.5%65 years and over
7.9%55-64 years
42.3%25-54 years
17.1%15-24 years
26.2%0-14 years
Median age
Foreign Direct Investment (US $ Bil.)
29.2yrs
Indonesia
18.4
Indonesia
36.7yrs
China
258.2
China
27yrs
India
28.2
India
27.7yrs
Malaysia
92.8%
Indonesia
95.1%
China
93.1%
Malaysia
37.6yrs
US
40.4yrs
UK
46.1yrs
Japan
JAKARTA
Bandung
Surabaya
Makassar
Semarang
Medan
CENTERS OF
POPULATION
Palembang
Balikpapan
Samarinda
10.176 Million
2.513 Million
2.834 Million
1.429 Million
1.614 Million
2.182 Million
1.454 Million
706,000
806,000
LANDAREA
or approximately 735,000 square miles
(about the same as the UK, France, Germany, and
Spain combined – or slightly smaller than the US.)
1,904,569 Sq. km
GDP
(2014 est.) about the same as the Netherlands
Ease of doing business
Indonesia ranks 114th out of 189 countries,
with 1 being the most business-friendly
$856.1 Billion
GDP growth rate
(2014 est.)
5.2%
GDP per capita
(2014 est.)
$10,200
12.2
S.Korea
Indonesian
smartphone users
(% of mobile users in 2015)
Sources: GroupM, World Bank, CIA Factbook, OECD, Statista
TECHNOLOGY
15.8
Indonesia
125
Indonesia
45.851.6
China
89
ChinaBrazil
15.1
India
71
India
67.0
Malaysia
84.2
US
96
US
Internet users per 100 people Mobile subscriptions per 100 people
125
UK
118
Japan
111
S.Korea
29%

SECTION 01
INTRODUCTION
Introduction HISTORY
HISTORY
CENTURIES
OF TRADING
DELIVERDIVERSITY
OF MODERN
INDONESIA
Strong economy emerges after years of upheaval
The 17,000-plus islands that make up the Indonesian archipelago have been a center
of trade in the region since the 7th century, delivering not just immigration from around
the region, but also an exchange of culture and ideas. Present-day Indonesia brings
together hundreds of distinct ethnic groups, with a range of languages and religious
beliefs. Recent years have seen economic volatility, terrorism and political unrest – but
the fourth-most-populous country in the world is emerging from this period of hardship
a vibrant, youthful nation, and is now Southeast Asia’s biggest economy.
Spice trade brings
new influences
7th century to 17th century
The islands of what is now called Indonesia have been a center
of commerce for many centuries, thanks to their proximity to
India and China. Traders brought new settlers and new ideas to
the area, all gradually absorbed by the islands’ residents. Muslim
traders’ legacy makes Indonesia home to the world’s largest
Muslim population today. Hindu and Buddhist communities
from around Asia have also flourished on the islands, and
Christianity was brought by European explorers attracted by
the islands’ exotic spices, particularly nutmeg, which was once
one of the world’s most valuable commodities.
Road to
independence
1942 to 1967
At the height of World War Two in Asia, Japan
occupied the islands of Indonesia, bringing
Dutch rule to an abrupt end and giving rise to
a push for independence that had previously
been suppressed. Immediately after the
surrender of Japan in 1945, nationalist leader
Sukarno declared independence and became
president. The Dutch were reluctant to
relinquish their hold on the islands, however,
and it was only after four years of at-times
brutal fighting and international diplomatic
pressure that the Netherlands agreed to
transfer sovereignty. Indonesia became an
independent nation with Sukarno at the helm.
The Suharto years
1967 to 1998
General Suharto became Indonesia’s
president in March 1967, with his New Order
administration supported by the USA. Years
of significant economic growth followed,
encouraged by a newly outward approach
to foreign relations and efforts to build
relationships with other countries in the
region. Indonesia is a founding member of
the ASEAN economic alliance, and restored
links with China in 1990 after a lengthy freeze.
New Order was, however, widely accused of
corruption and the suppression of political
dissent, and when the country was battered
by the Asian financial crisis of the late 1990s,
popular protest erupted and forced Suharto
to resign, in May 1998. Shortly afterwards,
East Timor voted to secede from Indonesia,
ending 25 years of military occupation there.
A new path
1999 to present day
Legislative elections were held in 1999,
and the democratic process has gradually
been strengthened in the years since then,
with the first direct presidential election
held in 2004. Political instability and
corruption have waned, and the Indonesian
economy has rallied. Freedom of speech
and freedom of the media have increased
significantly, though the country has had
to contend with terrorism – most notably
the 2002 Bali bombings, and natural
disaster. The Boxing Day tsunami in 2004 is
widely thought to have killed more people
in Indonesia than any other country –
about 170,000 – and to have displaced
many more. Separatist movements in the
provinces Aceh and Papua have also led to
armed conflict. Modern Indonesia is now,
however, largely peaceful, prosperous and,
thanks to mobile and web technology –
informed and connected.
Dutch colonization
17th century to 1942
While Portuguese traders are thought to have been the first
Europeans to have regular contact with the people of Indonesia, it
was the Dutch who began to colonize the islands in the early 17th
century, gradually consolidating their rule over the next 200 years. The
United East India Company amalgamated the many Dutch businesses
competing for trade through the islands, and established the city that
is now Jakarta as the capital of its Asian trading network. When the
company collapsed, the Dutch national government took control,
uniting the archipelago as one country, named the Dutch East Indies,
in 1900. Many areas of modern Indonesia remained independent of
Dutch rule, however, and the colonial era was punctuated by unrest
due to areas of strong local resistance to foreign rule.

I N D O N E S I A’ S N A T U R A L R I C H E S F U E L E X P O R T S
A N D A C T A S A M A G N E T F O R I N T E R N A T I O N A L T O U R I S M

SECTION 01
INTRODUCTION
Television has always been the media
darling of Indonesian advertisers,
consistently accounting for about 65
percent of total budgets. But it’s digital
media that is enjoying the strongest
growth in this rising market. Digital
media spending is forecast to rise by
39.7 percent in 2015, giving digital 8
percent of the total advertising market
– still well behind the share enjoyed by
television and newspapers, but ahead
of magazines, radio, outdoor and
cinema. Investment in digital has been
rising at rates of up to 200 percent a
year over the past decade, as internet
penetration intensifies and as more
people upgrade to smartphones.
More than 62 million Indonesian
consumers are on Facebook, and
local social networking site Kaskus,
Twitter and LinkedIn are also widely
used.
While the growth of digital has come,
to some extent, at the expense of
magazines and outdoor, which
have seen declines in their share of
the advertising pie, the amount of
investment in all media has still been
rising every year, thanks to double-
digit growth in the overall ad market.
Total media investment is forecast to
grow by 13.5 percent in 2015, reaching
31.8 billion Rupiah (US$2.6 billion).
DIGITAL WINNING
LARGER SLICE OF
GROWING MEDIA PIE
Introduction MEDIA SPENDING
MEDIA SPENDING
Innovation in digital services and digital media
investment drives up a brand’s value. The
Top 5 most valuable brands in the Indonesia
ranking invest significantly more in digital
compared to the lowest-ranked brands. Banks,
especially, are using digital technology to innovate, and about a quarter
of all bank transactions are already carried out digitally. The importance
of digital innovation and communication is set to rise. Indonesian
digital ad spend is now only 8 percent, but we can look to China for
signs of what is to come. In China, digital represented 8 percent of all
ad spend in 2009, a figure that had risen to 31 percent by 2014.
Brands in Indonesia should plan for greater investment in digital media,
exploiting multi-screening behavior by consumers to build layers of
meaning – but not abandoning television, which is still widely viewed
and remains an effective driver of reach.
Media spend by
sector (2013)
Communications
Auto
Pharmaceutical
Leisure
Household Care
Household Equipment
7%
7%
6%
4%
4%
3%
Personal Care
Clothing
Consumer Services
Education
16%
1%
2%
2%
Beverages
Food
Public
14%
13%
12%
Finance
Retail
Real Estate
3%
3%
3%
THEORY IN ACTION
The top-ranking brand in the
Indonesia Top 50 is the bank
BCA, which has been a pioneer
in mobile banking in Indonesia.
BCA’s ad spend in recent years
has been increasingly focused
on digital, both for building
brand awareness and for lead
generation. BCA uses social media
platforms to help it understand
consumers’ needs, especially
young people, and combines
social learning with other data to
drive new service development.
Ad spending by media
% shares of media
Source: GroupM
2005
TV 68.9%
Radio 2.1%
Newspapers 20.6%
Magazines 4.1%
Cinema 1%
Outdoor 2.9%
Internet 0.5%
2015
TV 65.5%
Radio 2.4%
Newspapers 17.8%
Magazines 2.9%
Cinema 0.4%
Outdoor 3%
Internet 8%
Internet Penetration
Smartphone penetration
Tablet penetration
Adult population
249,000
Adult internet users
59,600
2012
1.1%
10.6%
24%
Adult population
252,000
72,700
2013
2%
17%
29%
Adult population
254,000
83,600
2014
4%
24%
33%
Adult population
256,000
93,400
2015
Estimated
5%
29%
36%
(000s)
(000s)
Average time spent on social media per day
3 HOURS AND 54 MINUTES

SECTION 01
INTRODUCTION
The value of the BrandZ™ Top 50
Most Valuable Indonesian Brands
2015 is concentrated at the top of the
ranking and among just two dominant
categories. The Top 5 brands in the
ranking together account for 57 percent
of the value of the Top 50 brands,
and three of those five brands are
banks. The Top 5 brands are BCA, BRI,
Telkomsel, Mandiri and A Mild.
Banks and other consumer finance
brands together account for US$27.5
billion of the US$64.6 billion value of the
Top 50, while tobacco brands account
for a further US$14.8 billion. Telkomsel
is the only telecom brand to appear in
the Top 10.
Outside the Top 5, the brands in
the Top 50 represent a broad range
of industry sectors, with strong
performances from real estate, food
and dairy, soft drinks, personal care,
retail, and entertainment brands. This
diversity of brands is not dissimilar to
the range that performs well in other
countries’ BrandZ™ rankings. Together,
the brands represented paint a life-like
picture of present-day Indonesia. The
banking and real estate sectors are
essential to how the country and its
economy are developing – telecoms
and entertainment indicate consumers’
appetite for technology and being
connected, while the prominence of
tobacco, food and dairy, soft drinks,
and personal care brands help illustrate
everyday life in this market.
Such a high concentration of brand value
at the top of the ranking is consistent with
other markets. In the BrandZ™ India Top
50, the Top 5 brands accounted for 45
percent of the value of all of the brands
ranked, and it is a similar picture in China
(the Top 5 account for 56 percent of the
Top 50’s value) and Brazil (52 percent). In
contrast, only 28 percent of total brand
value is concentrated in the Top 5 brands
in the BrandZ™ Global Top 50. The
dominance of banks in the Indonesia Top
50 is consistent with BrandZ™ rankings
in other fast-growing markets.
VALUE IS
CONCENTRATED AT
THE TOP OF THE LIST
Introduction BRAND VALUE
BRAND VALUE
Category
by Brand
Value $M
Brand Value
% of Total
by Number
of brands
Number of
Brands
% of Total
Airlines 354 1% 1 2%
Banks 27,521 43% 12 24%
Entertainment 249 0% 1 2%
Food and Dairy 1,461 2% 4 8%
Home Care 949 1% 1 2%
Personal Care 3,344 5% 7 14%
Real Estate 3,098 5% 8 16%
Retail 3,327 5% 4 8%
Soft Drinks 1,061 2% 2 4%
Telecom Providers 8,417 13% 3 6%
Tobacco 14,794 23% 7 14%
Indonesia Top 50 breakdown
The Top 5 brands account for 57 percent of the total value of the Indonesia BrandZ™ Top 50.
TOP 5 BRANDS
COMBINED VALUE:
US$ 36.6 BIL.
Brands 6-25
Combined Value:
US$ 22.4 Bil.
Brands 26-50
Combined Value:
US$ 5.5 Bil.
US$ 9,918 Mil.
US$ 8,285 Mil.
US$ 6,373 Mil.
US$ 6,153 Mil.
US$ 5,882 Mil.
57%
35%
9%
15%
13%
10%
10%
9%
Businesses in Indonesia that nurture the
power of their brands are four times more
valuable than those that don’t. Branding
affects the bottom line: the 25 brands with
the strongest Brand Power scores in this
ranking are together worth US$51 billion, while the remaining 25 have
a combined brand value of US$13.6 billion. Brand Power is a BrandZ™
metric of brand equity – a brand's ability to predispose a consumer to
select a brand and pay a premium for it. However many Indonesian
brands are yet to recognize the importance of building a brand
beyond establishing a reputation for price and availability.
Now is the time to focus on branding; Indonesian consumers are
more aware of and engaged with brands than ever. BrandZ™ research
shows that 75 percent of people now recommend brands to family
and friends. That figure was 45 percent just four years ago. In this new
landscape, CEOs should be asking themselves a new set of questions:
how central is brand building to my business growth strategy in
Indonesia, do we clearly articulate our brand mission, and are we
communicating that mission clearly?
THEORY IN ACTION
Telkomsel is ranked number three among Indonesia’s most valuable
brands. It dominates the Indonesian telecoms category with a strong
commitment to brand-led growth. Its “Go Discover” mantra gives the
brand a compelling and unifying purpose – one that is communicated
and amplified through consistent messaging across multiple
touchpoints.
Financial services brands make an
extremely strong showing in the
Indonesian rankings, with 12 brands
making the Top 50, and three banks
featuring in the Top 5. Financial
services brands together account
for 24 percent of the Indonesian Top
50 by number of brands – exactly
the same proportion as was seen in
India, while in Brazil the figure was
12 percent and in the China Top 100,
they comprised 15 percent of the
index.
Unlike other markets, tobacco brands
feature heavily in the Indonesian
rankings, with seven brands in the
index – six of them in the top 12. In
no other country’s BrandZ™ rankings
have tobacco brands featured, and
only one has made the Global Top
100. There are two factors at play
here: first, in common with many
other markets in Southeast Asia, the
incidence of smoking is extremely
high. Second, Indonesia is one of the
very few markets in the world where
television advertising for cigarette
brands is still allowed – albeit at limited
times of day and with restrictions on
what can be shown.
Fast-moving consumer goods brands
comprise 28 percent of brands ranked
in the BrandZ™ Indonesian Top 50,
led by food and dairy, soft drinks,
home care and personal care brands.
This is broadly comparable to what
we see in other fast-growing markets
(40 percent in India, 9 percent in
China and 14 percent in Brazil).
The strong presence of property
developers in the Top 50, with eight
real estate brands in the Top 50,
reflects the strong growth of this
sector and its role in the Indonesian
economy.
As in India, the technology sector
does not figure prominently in the
Indonesian Top 50; major global
technology players such as Google,
Facebook, Twitter, and LinkedIn
operate freely in Indonesia, and
home-grown technology companies
have not so far emerged with
anything more compelling. Tech-
related brands that do make the Top
50 are providing telecom services.
Categories and brands

E - C O M M E R C E I S T I N Y B U T FA S T- G R O W I N G
W H I L E O N L I N E R E S E A R C H I S F U E L L I N G O F F L I N E S A L E S

SECTION 01
INTRODUCTION
The average age of Indonesian brands
in the Top 50 is 45 years old, though
there are some very old brands
whose heritage is not reflected in this
average. The second-highest ranked
brand, the bank BRI, for instance,
is more than a century old, and Dji
Sam Soe, the brand of clove or kretek
cigarettes that ranks ninth in the Top
50, dates back to 1913.
To be eligible for inclusion in the
Top 50, brands must be owned by
a publicly listed company. In other
markets, particularly China, the brands
that have achieved such scale in just
a few years have been fast-growing
technology companies. The scarcity
of young brands in the Indonesian
Top 50 brands reflects the fact that
technology brands in Indonesia have
yet to achieve significant scale.
Those few Top 50 brands launched
since 2004 include two cigarette
brands launched by a parent
company with decades of heritage
and several older brands in their
stable, along with a property
developer. The only relatively new
brand to reflect a real shift in the
consumer market is Hypermart
(ranked 23rd and launched in 2004).
Hypermarkets began to launch in
Indonesia in the 1990s, but it was only
in the 2000s that this way of shopping
became the phenomenon it is now.
The younger half of brands in the
Indonesia Top 50 are together worth
US$29.9 billion, and the older half are
worth slightly more, US$34.7 billion.
All brands in the Indonesia Top 50
are publicly listed, but the ownership
of their shares varies; in some cases,
a portion of shares is owned by
the Indonesian government, and in
others, there is a multinational parent
company that owns a stake in the
listed company. The Indonesian Top
50 brands are dominated, in both
number and value, by private brands
– those with neither a government
nor multinational parent.
There is also a strong showing by
multinational brands. Most of the
state-owned brands in the ranking
are older brands, and tend to be in
the banking sector.
Brands owned by multinationals
outperform the rest of the Top 50 on
measures of saliency and how loved
they are – but this is likely to be a
reflection of the categories in which
multinational brands have launched,
primarily FMCG categories, rather
than the fact they are owned by a
multinational parent.
The strong performance of private
and multinational brands in this
market shows that for international
brands with hopes of expansion into
Indonesia, there is ample opportunity
for success. While home-grown
brands dominate the Top 50, those
that have been imported and have
done well have proved popular
because they have adapted to reflect
local needs and values.
The older brands in the index reflect the early stages of Indonesia’s
economic development; they are predominantly banks, while the FMCG
brands that have made the Top 50 came later.
The relative youth of Chinese brands can be explained by the reforms
and opening up of the Chinese economy, a process that began in 1978.
BRAND AGE BRAND
OWNERSHIP
Introduction BRANDZ™ ANALYSIS
BRANDZ™ ANALYSIS
Launch Date
Number of
Brands Total Value Average Value
Before 1967 17 $30.1 Bil. $1.8 Bil.
1967-1998 29 $31.8 Bil. $1.1 Bil.
1999-2015 4 $2.6 Bil. $0.7 Bil.
The age of brands in the Top 50 is relatively young by
global standards, if not quite as young as the China index,
which includes many technology-focused brands, which
are inherently young.
Indonesia
Year brand formed
(average)
Average brand age
1970
45
Global
Year brand formed
(average)
Average brand age
1950
65
China
Year brand formed
(average)
Average brand age
1977
38
Indonesia Top 50 Brands launch dates
Ownership of Top 50 Indonesian brands
34 10 6
Privately Owned Multinational
Corporation
State
Owned

SECTION 01
INTRODUCTION
To measure brand contribution,
we focus on the three aspects of
brands that we know make people
buy more and pay more for brands:
being Meaningful (a combination
of emotional and rational affinity),
being Different (or at least feeling
that way to consumers), and being
Salient (coming to mind quickly
and easily when people are making
category purchases). We identify
the purchase volume and any extra
price premium delivered by these
brand associations.
The brand contribution measure
is what helps make BrandZ™ such
a unique and important ranking.
BrandZ™ is the only brand valuation
methodology that obtains this
customer view through in-depth
quantitative consumer research,
both online and face-to-face,
building up a global picture of
brands on a category-by-category
and market-by-market basis.
There are many factors that give a brand Power
and Premium, the two contributors to a Brand
Contribution score. One of these factors is love
– a genuine fondness that consumers feel for
a brand and that helps it command a premium
over the competition and achieve higher volume
sales. While top Indonesian brands score well
on most other measures compared to leading
global brands, one area where there remains
potential for improvement is on the love score.
The average love score for all brands worldwide is
100; the most valuable 50 global brands achieve
131 on the love scale, but the Top 50 in Indonesia
generate just 108.
In Indonesia, many of the brands that punch above
their financial weight in the Top 50 perform so well
because they are loved. The most loved brand in
the ranking was Indomie noodles, achieving a love
score of 145, followed by Pepsodent toothpaste
(138), and SariWangi tea (137).
Love is not just a ‘nice to have’ factor for brands; it
makes a real difference to the bottom line. When
the strongest global brands are tracked over 10
years, the value of love becomes clear. Those
with the best love scores registered 227 percent
growth in brand value globally in the past decade,
while those with the lowest love scores grew their
brand value just 22 percent over the same period.
Indonesia’s Top 10 brand contribution
marques are much-loved names from
FMCG categories, many of which
have been store-cupboard staples in
people’s homes for decades. SariWangi
tea has been served for more than
40 years in this market, as have
Indomie noodles, with Bimoli cooking
oil offering more than 30 years of
heritage. In personal care, Pepsodent
has a decades-long presence in
Indonesia, Rinso has clocked up nearly
half a century of service, and Dji Sam
Soe cigarettes have been around
for more than a century. All of these
brands registered a five on the brand
contribution scale, along with Garuda
Indonesia, the national airline, which
was formed in 1949. Ciputra, A Mild
and Agung Podomoro were among
the brands achieving a four on this
scale.
Top 50
Indonesian brands
Top 50 average
Brand Contribution 3
Top 5
Brand Contribution 4
Brands 6-25 4
Brands 26-50 2
FMCG LEAD
BRAND
CONTRIBUTION
Brand romance – the little
things that make a difference
Introduction BRAND CONTRIBUTION
BRAND CONTRIBUTION
Brand contribution measures the impact of brand alone, without financials
or other factors, in the mind of the consumer. It is the intangible asset of the
brand itself, which exists in the minds of consumers. A high brand contribution
score – on a scale of one to five, with five being the highest – suggests that a
brand is resilient and is able to increase sales volume and charge a premium.
Rank
Top 50
Rank Category Brand
Brand
Value
2015 $M
Brand
Contribution
Index
1 25 Soft Drinks SariWangi 402 5
2 14 Food and Dairy Indomie 1,039 5
3 50 Food and Dairy Bimoli 110 5
4 18 Personal Care Pepsodent 659 5
5 17 Home Care Rinso 949 5
6 27 Airlines Garuda Indonesia 354 5
7 9 Tobacco Dji Sam Soe 1,767 5
8 20 Real Estate Ciputra 484 4
9 5 Tobacco A Mild 5,882 4
10 35 Real Estate Agung Podomoro 267 4
Top 10 Brands by Brand Contribution
Average Brand
Contribution
4.4
Top third
Average
Value
$2.6bn
3.2
Middle third
Average
Value
$1.0bn
1.4
Bottom third
Average
Value
$0.2bn
Average
Value
$1.3bn
All TOP 50
3.0
Brands can punch above their
financial weight in the BrandZ™
rankings by focusing on making
meaningful connections with
consumers. These connections must be about more
than simply being top of mind, or delivering good
quality and value. They must be built on emotion,
and the most successful brands deliver meaning
not just through their products but through their
communications, creating emotional, memorable
links with consumers’ lives. FMCG brands find it
easier to build meaning as they have more frequent
connections with consumers, but the strongest of
them find ways to deepen their role in consumers’
lives. Service brands can build meaning by looking
beyond the traditional role their category plays and
develop new experiences for people to interact with
them and experience their values.
THEORY IN ACTION
Indonesia’s leading bottled water brand, Aqua, is using
its Ada Aqua campaign to give consumers reasons
to consume water more frequently by linking good
hydration with feeling alert and ready to focus on
important tasks. Aqua has a BrandZ™ score on the
meaningful index of 242 – a huge premium compared
to the average of all brands globally, which is 100. The
instant noodle brand Indomie (222 on the meaningful
index) continuously refreshes its range with new variants,
often in typically Indonesian flavors, and appeals to the
masses with its highly emotional advertising.

SECTION 01
INTRODUCTION
Yet within Indonesia, there is
tremendous pride in the country, its
people, and its successful brands. At
home, to be 'Made in Indonesia' is a
highly positive attribute for a brand or
product to have. It suggests artisanal
quality, a richness of culture, and a
connection with the country’s history.
Indonesian people living or travelling
abroad often take typically Indonesian
goods with them – Indomie noodles,
kretek cigarettes, or batik fabric – and
see themselves as ambassadors for
the country and its brands.
For Indonesia, developing a strong
reputation and building the desirability
of its brands is especially important at
the moment, with the ASEAN single
trading bloc for Southeast Asian
nations due to come into being in late
2015, simplifying regional commerce.
MIND THE GAP
The divergence of opinion inside
the country and abroad about
what Brand Indonesia stands for is
illustrated in the Personality Atlas,
a J. Walter Thompson study of the
stereotypes and perceptions of 27
markets across the globe.
The Personality Atlas study, based
on interviews with more than 6,000
adults, highlights a ‘positivity gap’
in Indonesia and other developing
countries; essentially, people feel more
positive about their own country than
people in other markets do.
The research found that in Indonesia,
36 percent of people feel very
positively about the country. In
countries in the region excluding
Indonesia, only 9 percent feel that
way about Indonesia, and globally,
11 percent feel very positively. This
global score puts Indonesia level with
India (11 percent globally view it very
positively) and not far behind Singapore
(13 percent), South Korea (13 percent),
Thailand (16 percent), and China (22
percent). The U.S., for comparison, is
regarded very positively by 31 percent
of people worldwide, and the highest
ranked country in the world is Canada,
which has 46 percent of people
around the world feeling very positively
about it.
Globally, people feel most positive
about the people and culture of
Indonesia, slightly less so about its
brands, and even less positive about
its government. The country is most
likely to be described as religious
and content – similar words used to
describe India – and is least likely to
be called cultured or charismatic. The
country is seen as welcoming, family-
focused, polite, and religious.
Locals, however, describe their country
as fun, humorous, welcoming and
polite. Regionally, there are concerns
about corruption in Indonesia.
PEOPLE POWER
Perceptions globally about Indonesian-
made products are similar to those
from other Southeast Asian nations;
products are seen as cheap, but of
questionable quality and subject to
poor safety standards. Indonesian
people have a much more positive
view about made-in-Indonesia goods
– about 35 percent feel very positively
about home-made products, while
globally just over 10 percent of people
feel the same about Indonesian
products.
As is the case with most countries,
people who have actually been to
Indonesia have a higher opinion of the
country than those who have never
visited. And people aged under 35 feel
significantly more positively towards
Indonesia than those aged 35-plus – a
difference of 10 percentage points.
When asked about the culture of a
country, people rank Indonesia above
South Korea and not far below Hong
Kong and Singapore. When asked
about the people, the world ranks
Indonesians at about the same level
as people from Egypt, Russia, Saudi
Arabia, and South Africa.
These findings chime with the
BrandZ™ country personality profile
for Indonesia, compiled from the
descriptions local consumers form of
the country’s most valuable brands,
using a vocabulary of 20 personality
characteristics. Brand Indonesia,
the cumulative impression that
consumers have of the country’s Top
50 most valuable brands, emerges
as trustworthy, wise, and friendly.
Indonesian brands are rarely seen as
playful or rebellious.
A country brand personality helps
brand owners understand how a
particular brand fits into consumers’
general view of brands across
categories. For exporters, country
brand comparisons identify the
potential areas of advantage or
disadvantage, where a country brand
can help propel or slow international
expansion.
Brand Indonesia has much
in common with Brand India
and Brand China; all are seen
as trustworthy and wise.
Indonesia is seen as more
generous and more fun.
EMERGINGFROM
THE SHADOWS
Introduction BRAND INDONESIA
BRAND INDONESIA
Indonesia’s image around the
world yet to live up to the strength
of positive feeling at home
Indonesia has a relatively low profile on the international
stage compared to its larger neighbors to the north.
Indonesian brands are little-known outside Southeast
Asia, and the term ‘Made in Indonesia’ is not something
that instantly conjures up a particularly strong mental
image for consumers living outside the region.
Trustworthy
Brave
Wise
CaringIn Control
Playful
Friendly
DesirableAssertive
Rebellious
Kind
CreativeIdealistic
Innocent
Fun
DifferentStraightforward
Adventurous
GenerousSexy
Indonesia
India
Brazil
China
Global
LatAm
Be locally relevant. Local brands dominate the
Top 50, and Indonesians take tremendous pride in
home-grown success stories. But the rankings also
show that multinational brands can succeed in this
market by tailoring their attributes to the Indonesian
market. Being locally relevant is not just about looking local – perhaps by
remaking a global communications campaign with local talent. It is about
making a locally relevant connection with consumers. The 10 multinationals
in the Top 50 have an average score on the meaningful index of 156
(compared to 100 for all brands), while that for the 10 most meaningful local
brands in the ranking is 163 – an almost insignificant difference. Multinational
brands can help consumers resolve the tension they feel between traditional
values and being worldly and modern. They can offer something new,
different and aspirational, while at the same time respecting tradition.
THEORY IN ACTION
Pond’s skincare range focuses
on whitening, an important
beauty benefit for Indonesian
women. This is amplified
through advertising featuring
everyday Indonesian women and
through endorsement by local
celebrities. Sunsilk, meanwhile,
communicates the shine it can
give naturally black hair, with local
celebrity backing. It is so locally
relevant that many consumers
regard it as an Indonesian brand.

D I S T R I B U T I O N R E M A I N S U N I Q U E LY C H A L L E N G I N G
C O N S U M E R S L I V E A C R O S S 6 , 0 0 0 I S L A N D S I N T H E I N D I A N O C E A N

OUT OF THE
SHADOWS
A new perspective
on Indonesian
narratives
It would be easy to imagine that the transformation taking place in the
Indonesian consumer landscape is a simple story of progression – from
old to new, from developing to developed and, to some extent, from
local to global.
SECTION 02
THOUGHT
LEADERSHIP
Thought Leadership INDONESIAN NARRATIVES
Yet to see progress in this way would
be to underestimate the complexity
of what is going on. For brands in
Indonesia, it is essential that when
they are building a narrative, they
reflect the reality of how people
feel about the change that’s taking
place around them – and within
themselves.
We have found that for many people,
the economic opportunities that
modern Indonesia offers are exciting,
but also have led to a pervading
sense that Indonesia is at a precipice.
There is nostalgia for old Indonesia, a
longing for the familiar, and a fear that
tradition is at risk of being lost as new
values gain ground.
“Everybody acts with less shame …
branded clothes and goods, high
tech, everything is like glass and
identity seems lost; increasingly
you feel like you are no longer
Indonesian”, one woman, Diah,
said during a recent Firefly research
project, reflecting the anxiety that
many Indonesians now feel.
MELDING OF WORLDS
Indonesians are experiencing a
change in how they see themselves
and they perceive others to view
them, and this is more complex than
simply to conclude that individualism
is supplanting traditional collectivism.
“Previously, wearing hijab was
perceived as only for a very straight
and solehah (pious) girl, but
nowadays everyone can wear it.
Expectations have changed – we can
still be sociable and hang out, even
though we wear hijab”, said Christina,
a student in her late teens.
Consumers want to move with
the times, but they do not want to
abandon their past.
The tensions driving consumer
decision-making were explored in a
recent Firefly Millward Brown research
project carried out in conversation
with Indonesians formally, and
informally, across Indonesia,
using discussion groups, digital
conversations and ethnographic
diaries. We called this study Project
Wayang, after the traditional
Javanese shadow puppet shows that
tell ancient stories from 2,000 years
ago, and that remain popular today.
The findings tell us much about
what resonates with consumers as
they manage the various cultural
pressures in their lives, and underline
the importance of brands reflecting
those consumer truths if they are to
be truly relevant.
HOME TRUTHS
There are three consumer truths we
have identified as being especially
important.
Indonesians want to feel
uplifted and uplifting. This
can look like individualism,
but is actually about managing the
desire for personal success with
the desire to support the success
of others. The traditional value of
gotong royong – providing mutual
care within a community – is just
as relevant today as ever – as is
the sense of togetherness and the
desire for cohesion. Consumers
want to feel good about focusing on
themselves without feeling selfish; a
truly Indonesian success story unites
personal success with the success
of others.
For brands, this means steering
clear of the clichéd messages of
a conforming collective without
moving too far towards the self-
serving benefits of a product or
service. Bango cooking sauce has
managed this well, showing mothers
making smart choices that benefit
their families. Mothers feel pride in
their decisions, and in their ability to
pass on their expertise.
Social recommendation is
something that links old and
new Indonesia. People aspire
to have the wisdom traditionally
associated with their elders. We see
consumers express a real desire
to be ‘in the know’ and champion
the brands they love. Brand
recommendations are highly valued
by Indonesian consumers, and have
a strong influence on decisions to
try and buy new brands.
There is a real call to action for
brand owners to explore how
successfully brand messages are
being understood, internalized,
and translated into social
recommendation. Brand owners can
build relationships through social
recommendation and validation
beyond above-the-line messaging.
There is great pride in
Indonesia, its people, and
its brands, and many people
feel unapologetically Indonesian.
As more Indonesians move abroad,
they want to feel they are taking
the spirit of Indonesia with them,
spreading what it means to be
Indonesian, rather than leaving it
behind. They want to see Indonesian
brands and products do well
internationally. Makers of traditional
clove cigarettes, kretek, are among
the brands that celebrate their own
success – and are celebrated by
consumers as a result. Dji Sam Soe
is a great example of where we see
this working through the message of
Mahakarya (Masterpiece), a message
that consumers feel easily speaks
for them, and feels as contemporary
today as it ever has.
Just as the performances of Wayang
puppeteers evolve as stories are told
and retold, so too do the narratives
that engage Indonesian consumers.
Lara-Lee Burn
Head of Firefly
Firefly Millward Brown
Lara.Burn@fireflymb.com
Firefly Millward Brown uses in-depth understanding of
marketing and consumer behavior to identify true brand
opportunities that inspire strategic recommendations to
drive brand success.
www.fireflymb.com

THE YOUTH
OF TODAY
The power
behind your
brand tomorrow
What is youth? Is
youth about freedom?
Self-expression? A
search for identity?
There are many
definitions of youth,
but in Indonesia,
youth is power.
SECTION 02
THOUGHT
LEADERSHIP
Thought Leadership EMPOWERED YOUTH
With an average age of 29, Indonesia
is a nation of millennials. Throughout
Indonesia’s history, young people
have played an important role in all
the nation’s milestones, including
Indonesia’s independence back in the
1950s, and the uprising that led to the
restoration of democracy in 1998.
As our first president, Sukarno,
said, “Seribu orang tua hanya dapat
bermimpi, satu orang pemuda dapat
mengubah dunia.” A thousand old
people can only dream; one young
person can change the world.
Young Indonesians are at the heart
of the digital media explosion taking
place. The TNS Connected Life study,
which looks at the habits of internet
users, found that 99.4 percent of 16-
to 34-year-olds in the study use social
networks.
In this connected era, young people
have the power to play an even
greater role in the development of
their country than in the past.
In 1928, young Indonesian nationalists
made what has become known as
the Youth Pledge. They proclaimed
three ideals: one motherland, one
nation, and one language. Their
declaration is marked each year on
October 28th, the anniversary of
the day it was first made. Now, the
technologically empowered youth of
Indonesia can make a digital Youth
Pledge, announcing their allegiance
to the nation through Twitter and
Facebook.
In 2010, the passion young people
have both for digital communication
and for their country came together
in a project called Indonesia Optimis.
This was an effort to modernize the
traditional August 17th Independence
Day flag raising that most Indonesians
attend during their school years,
but never bother going to again.
The campaign worked across
Twitter, Foursquare, and YouTube to
spread enthusiasm for a flag-raising
ceremony that was streamed online –
taking the event to the screens young
people held in their hands. In one
week, the site was visited by 54,000
people.
In another example of young
people wielding their tremendous
digital power, a campaign to help a
housewife fight a legal battle raised
four times the amount of money she
needed. The woman at the center
of the case was being sued for the
equivalent of US$20 million by a
hospital over claims she made about
her treatment there. The case was
dropped, and the US$80 million that
was raised has funded a foundation to
help people in similarly difficult legal
situations.
There is a danger, however, that
once marketers realize the power of
Indonesia’s youth, authenticity is lost.
Some brands have exploited young
people and their social media habits
to pursue their own agendas, and
as a result, young Indonesians have
grown cynical about involvement in
branded social media projects. This
has happened to such an extent that
some brands have given payment
or gifts in return for social media
endorsement. People with a large
enough social media following have
been able to turn their buzz into a
revenue stream as lucrative as having
a 9-5 job. But while campaigns built
on this basis build ‘likes’ for brands,
they deliver little else.
In our experience helping brands
create movements online, there are
several rules of engagement:
The cause. We needed to stay
away from carrot and stick,
and instead rely on a strong,
motivating cause that rewards
’purpose’. Daniel Pink, the
author of Drive, defined this
as people’s natural desire to
contribute to a cause greater
and more enduring than
themselves.
Be organic. The movement
needs to behave less like
marketing activity and more
like organic growth. This
requires careful consideration
of how the movement will
start, the way influencers get
involved, and the way the
brand makes its entrance.
Encourage participation.
The examples above all
demonstrate how an
important aspect of sustaining
a campaign is making it easy
for people to get involved and
participate on their own terms.
Perhaps the most important
of all, be a brand that seeks to
build a genuine relationship
with the target audience.
No number of pseudo
movements will ever replace a
genuine relationship based on
mutual respect and love.
Daniel B. Siswandi
Chief Strategy Officer
J. Walter Thompson
Daniel.Siswandi@jwt.com
J. Walter Thompson Worldwide, the world’s best-known
marketing communications brand, has been creating
pioneering solutions that build enduring brands and
business for more than 150 years.
www.jwt.com

The economic winds
of change, through
their impact on both
the demand side, and
the supply side, have
led to a fundamental
transformation of
consumer behavior in
Indonesia.
SECTION 02
THOUGHT
LEADERSHIP
There are more consumers in a
position to be more demanding
than ever before of the products and
brands they choose. Rising affluence
fuelled by rising incomes means
consumers can afford to consider a
greater range of brands, and be more
demanding when they do. They want
products that offer more, and brands
that make them feel special.
The growth of new markets within
Indonesia is also expanding the ranks
of the consumer class. Residents of
urban centers in Sumatra, Kalimantan,
Sulawesi, and in burgeoning small
towns in Java, are now in a better
position than ever to buy. The
increasing number of women in the
workforce, in part due to the new
business opportunities the internet
offers, is giving women greater
individual spending and decision-
making power, and boosting overall
household incomes. There is a rise
in both drive and personal ambition,
particularly among millennials and
Generation Y – people born from the
1980s onwards. They want to achieve
more, be it at work or through rising
entrepreneurial ambitions.
While consumers’ list of wants has
been growing and changing, the
supply side of the consumer equation
has been, too.
The rise of mini-markets across the
country means many more people
have access to a greater range of
goods, and for manufacturers, it is
becoming easier to achieve national
distribution. As more people live
within reach of self-service mini-
markets, there is a new pressure
to contend with: the agony of
choice. People now have to stand
in front of an aisle or wall of goods
and decide what they want to buy.
This is becoming a bigger issue for
consumers by the day, as the appeal
of Indonesia’s lucrative market attracts
new companies with new brands
and there are more new product
launches. In the food and beverage
category in particular, the explosion
of choice in recent years has been
tremendous. Further, increasing
internet access provides greater
access to a whole new world of
opportunities.
So, consumers want more, and
there are more ways for them to get
it. But they don’t just want more of
the same. With plentiful choice and
heightened demands, here are three
ways brands can help consumers find
what they really, really want.
1. CELEBRATE DIFFERENCE
People want to feel special,
and are drawn to products and
brands they feel are specifically
targeting them. Specialization
can cater for people in different
demographics, people pursuing
different lifestyles, for men and
women, or for consumers with
differing budgets. The power of
specialization is already evident
in rising sales of milk powder
developed specifically for children,
at the expense of standard milk
sales. Likewise, there has been
growth in personal care products
marketed specifically at men,
and there is a rise in price tiering
across categories.
2. EXCEL IN SPECIALIZED NEEDS
Good for everything will become
good for nothing. More need-
specialized brands will be the
order of the day as consumers
become more informed and
bored of the old. By focusing
on sensitive teeth, Sensodyne
is making inroads into a mature
category. The SIM card brand 3,
from Hutch, has focused almost
exclusively on its data advantage,
and this single-mindedness has
enabled the brand to outgrow
others in a highly competitive
category.
3. TARGET OCCASIONS
Consumers are already
shopping across a range of
brands and price bands within a
category, using different brands
for different consumption
occasions, particularly in the
food and beverage category.
Occasion-focused marketing is
a way to inspire more frequent
consumption and drive growth.
The macro-economic winds
of change have already caused
significant differences in the behavior
of Indonesian consumers. These
winds of change are only going to get
stronger. Specialization is imperative
in this environment if brands are not
to get left behind.
GIVE ME
MORE
The rise of the
demanding
Indonesian
consumer
Suresh Subramanian
Managing Director
TNS
Suresh.Subramanian@tnsglobal.com
Thought Leadership DEMANDING CONSUMERS
TNS is one of the largest research agencies worldwide.
We provide actionable insights that help companies
make impactful marketing decisions that drive growth.
www.tnsglobal.com

U R B A N P O P U L A T I O N S A R E S W E L L I N G
A S P E O P L E S E E K A B R I G H T E R F U T U R E

THE TRUTH
ABOUT
PREMIUM
PRODUCTS
They’re not as
exclusive as you think
Why appealing to the masses is
essential to growing the market
for top-end goods
SECTION 02
THOUGHT
LEADERSHIP
The international consumer goods manufacturers who
strode into Indonesia on the promise of fast-paced
economic growth and a surge in consumer spending are
probably a little worried about the current slowdown. GDP
growth is now at its slowest rate for five years, and it would
be logical to think that for those brands with premium price
tags, the newly affluent consumers whose business they
were counting on may be thinning out.
But consider this; although the pace of economic growth
has slowed, Indonesia’s GDP is still outpacing growth
in developed countries, and remains a leader among
developing markets. The World Bank expects 5.2 percent
growth in Indonesia this year; this compares to a 2.2
percent average for developed markets, and 4.8 percent
for developing countries. In addition, Indonesia’s young,
working-age population is expanding, providing huge scope
for wage growth and consumption.
The outlook, then, is positive for brands providing luxury or
premium products in Indonesia, and we are seeing premium
brands’ sales increase despite the slowdown. But the buyers
of high-end products are not necessarily the people you
might expect.
ADD TO BASKET
In other markets, it’s usually the case that growing a
premium market means convincing people to switch from
mid-range brands to more prestigious or luxurious labels.
What we’re seeing in Indonesia, however, is that growth
in premium sales comes not from consumers switching a
cheaper item for a more expensive one, but rather from the
adding brands to their shopping repertoire, and buying both
cheaper and more expensive items.
Kantar Worldpanel data shows that, in categories such as
detergent, soap, and personal care, where there are budget,
mid-range, and premium options, consumers don’t buy just
one product or the other - they buy several products across
the price range. In fact, only 5 percent of value growth in
premium products is coming from consumers who have
switched from a basic item to a top-end one. In 92 percent
of cases, the growth comes from people who keep buying
their mid-range goods, and buy premium items in addition.
The remainder are newcomers to the category.
MYTH-BUSTING
As brands look to build value and grow sales in this market,
it is important to better understand the buyers of premium
products – and dispel a few myths.
First, most people expect that the buyers of premium
products are more affluent than those who are not. This is
not the case. The practice of ‘repertoire purchasing’ across
price brackets means that people in the middle and at the
lower end of the Socio-Economic Classification are well
represented among buyers of premium products. In fact,
65 percent of buyers of liquid soap – a premium product
compared to bar soap – come from CDE households, and
54 percent of premium detergent buyers are also classified
as CDE. Even premium baby milk powder, which carries
a high price tag of 60 percent above the standard range,
attracts 33 percent of sales from CDE households. Premium
selling, therefore, is about not just one income bracket but
desire, and creating premium occasions.
Secondly, it is assumed that premium products command
high consumer loyalty. This is false in Indonesia today. Our
data shows mass-market goods actually generate stronger
loyalty. Consumers who exclusively buy premium goods are
almost non-existent; usually, premium and mid-range goods
are bought by the same people. Brands should, therefore,
ensure their portfolio architecture reflects the repertoire that
shoppers select from.
Thirdly, it is assumed that promotions are not an appropriate
or effective mechanism for premium goods. Again, this is
a misunderstanding. Kantar Worldpanel research in China
has shown that small packs encourage trial of premium
products for a small outlay, but in their small size also
emphasize their luxury offering – a little indulgence, perhaps
– so improve both sales and brand image.
LOOK BEYOND WALLET SIZE
Sustainable growth in the trend towards premiumization
will come not only from targeting specific consumer
groups, but by encouraging a range of people to purchase
more frequently. As such, some practical advice for
manufacturers:
Be accessible yet aspirational, to appeal to all social
classes
Market smaller pack sizes in an aspirational way, as an
affordable luxury
In communications, emphasize the benefits and quality
of goods to justify the premium pricing
Consider emphasizing other features, such as the health
benefits of a premium brand
Think about the consumer experience – make it feel
premium
Point beyond the product itself and inspire a broader
consumer lifestyle
Nadya Ardianti
Account Director
Kantar Worldpanel
Nadya.Ardianti@kantarworldpanel.com
Thought Leadership TRUTH ABOUT PREMIUM
Kantar Worldpanel is the world leader in consumer knowledge
and insights based on continuous consumer panels. Combining
market monitoring, advanced analytics and tailored market research
solutions we deliver High Definition Inspiration™ in fields as diverse
as FMCG, impulse products, fashion, baby, telecommunications and
entertainment, among many others.
www.kantarworldpanel.com/id

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