H2 2020: The State of E-Commerce in Indonesia

Mar 24, 2021

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In a study on Indonesia’s State of E-Commerce in 2019, we found that e-commerce in Indonesia had a lot of potential and room for growth. According to Statista, the e-commerce market in Indonesia is predicted to reach US$ 38.2 million in 2021. 

A recent survey by Rakuten Insight found that 42% of consumers in Indonesia made online purchases weekly in 2020 while 17% of consumers made online purchases almost every day. While it is no secret that the pandemic led to an e-commerce boom in all parts of the world, it appears that online shopping is being accelerated in Indonesia.

So just how much has the state of e-commerce in Indonesia changed since 2019? Our inhouse data team analyzed data from the second half of 2020 and here are some of our observations:

The average transit time to the first delivery attempt was 1.7 days

In a joint study with iPrice Group on the impact of COVID on delivery times in Southeast Asia, we found that Indonesia’s average transit time had increased by 30% from 2.3 days to 3.0 days. 

Retailers were flooded with overwhelming online orders and consequently, carriers were faced with limited capacity to ensure that deliveries were made on time. This posed a challenge for the logistics industry with more than a 50% drop in performance amid the pandemic

However, the drop in delivery performance has improved since the average delivery time went from 3.0 to 1.7 days in the second half of 2020. Interestingly, the e-commerce boom in Indonesia even drove new developments and investors to ramp up the logistics sector. The logistics industry in Indonesia might still be lagging behind in some aspects, but it sure is one to look out for as more investors are looking to tap into this relatively untapped e-commerce market opportunity.  

94% of parcels are successfully delivered at the first attempt 

In early April 2020, the Indonesian government announced a partial lockdown. This however did not keep the spread of the virus under control, which led to more areas within the country going into lockdown, including Jakarta. As it was mandatory to work from home, most online orders were successfully delivered; since someone was always home to receive the packages. 

58.7% of international shipments originated from the US and China

From 2019’s numbers, we found that 51% of international shipments originated from China. Based on our latest numbers, in 2020, 58.7% of international shipments were from both the US and China. 

From April to September 2020, we noticed that there was an increase in shipment volume coming in from China; from 29.2% to 39.3%. The top e-commerce sites used by Indonesian consumers include Shopee, Bukalapak, Lazada, and Tokopedia. Shopee came in as the top e-commerce site patronized by Indonesian consumers with the most website visitors. 

The outlook for the e-commerce industry in Indonesia looks promising, especially with the increase in interest from local and international investors. With the number of e-commerce consumers growing throughout Southeast Asia; future improvements in logistics and order fulfillment from investments, Indonesia is well-positioned to be the next e-commerce powerhouse in the years to come. 

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