Technology is playing an increasing role in how consumers make purchase decisions and brands are being forced to adapt to the development while at the same time understand that this is a transition period in which consumer segments are about as different from one another as it has ever been. While the Internet has reached about 80 million people in Indonesia, that’s only a third of the population and even fewer are affected by digital or online campaigns.
According to Daniel Siswandi, Chief Strategy Officer at J. Walter Thompson, “I believe marketers will see more value in mobile and digital. But I think it’s interesting is to explore why.”
From the perspective of a brand planner, there are a number of issues or facts that will affect brands in Indonesia and perhaps Southeast Asia, according to Daniel. He expects companies to place more responsibility when it comes to using social media for communications. Indosat’s faux pas earlier this year thanks to a social media advertisement which offended the people Bekasi, West Java, “will at least highlight the need for corporations to be more responsible.”
Daniel also thinks that online videos will offer a greater opportunity thanks to the roll out and adoption of 4G LTE across Indonesia’s three major mobile networks. The increasing popularity of larger mobile screens will play a significant part in the push for online videos.
On the other hand, Lowe Indonesia’s Roy Wisnu offered caution regarding adoption of digital strategies. “70–80% of products sold here are meant for the grass roots market after all, not all to the big cities. Clients can’t easily justify spending to digital when spending 70% to digital doesn’t make sense”
Roy said that the consumption and online habits of Indonesian consumers in major cities are different from those in smaller cities and rural areas and therefore brands have to be more aware of what is going on. Mobile adoption is certainly on the rise but the way consumers use and behave on mobile platforms can differ significantly based on many different factors.
Daniel’s view is supported by Imam Wiratmadja, a member of his senior team. “An average Indonesian digital target audience consumes 2.9 hours on mobile/day,” he said. “That’s longer than time spent on mobile in Malaysia, Singapore, or Hongkong,” he said, citing statistics from TNS Connected Life 2014.
Given this behavior, mobile consumers are seen to be driving demand for what content marketers would call “middle-weight content”, examples of which are 2-minute videos, BuzzFeed-style articles, or looping short videos. The richer the video becomes, the more popular they will be among consumers on the go.
In line with what Roy Wisnu said earlier this year, Daniel believes that brand centralization will be even more evident. Companies are expected to be implementing increasing number of centralized productions which will reduce the cost of creating advertising pieces. Local advertisements will give way to regional ads and the digital media will be seen as a solution to tailor these pieces for the local market. “This applies to some companies who are heading in this direction as we move towards (ASEAN Economic Community).
Roy previously said, “(companies) make one communications campaign that can be applied to all the countries so the spending falls dramatically and it’s obvious. You see regional ads being run here.”
In the meantime, local brands will spend significantly more to get their messages across given their lack of regional network and will therefore more actively engage with advertising agencies.
“On the other hand,” Daniel said, “other marketers are starting to see that ASEAN is a political entity and not consumer entity (too diverse), which brings out the importance to have local strategy, which will result in local above the line communication. This, I suspect will balance out the landscape.”
Understanding of platform behavior is also something that brands are beginning to understand. Having gone through a handful of years of digital advertising, marketers will approach digital with cooler heads. Imam said, “Marketers have learned –sometimes the hard way– of what works and what doesn’t, and this is good, because digital is always in beta.”
[header image by AdDiction]