JAKARTA -- Indonesia's e-commerce industry has not had much
success corralling the country's ever-growing number of smartphone
users, according to research company Nielsen.
"It is definitely a growing market, but the user experience is not there yet," Anil Antony, executive director for consumer insights at Nielsen Indonesia, said Wednesday.
Nielsen polled consumers in six major cities from April to June and found that 13% of the 2000 respondents made an online purchase during that period.
In a separate Nielsen survey, 60% of 503 respondents said a lack of trust prevents them from giving their credit card information to online merchants.
"Most e-commerce companies in Indonesia are local and have yet to establish a safe, reliable service," Antony said. Online marketplaces such as Kaskhus, one of the country's largest, require the merchant and buyer to carry out transactions on their own. Antony added that it will take several years for global players like Amazon to enter the market due to infrastructure, regulatory and other issues.
A World Bank study on logistics efficiency ranks Indonesia among of the worst in Asia. Without dependable delivery services, e-commerce companies cannot get orders to customers. Startups have also complained that the government has not issued clear e-commerce guidelines.
There even seems to be doubt as to whether certain licenses are needed. U.S.-based Uber Technologies -- a taxi service that connects drivers and riders via a smartphone app -- is in a legal battle with Jakarta authorities who say the company has not obtained the necessary permits to operate. The company started doing business in the city in August.
Antony pointed out that Indonesian smartphone users' heavy use of social networks and texting services will help spread the word once a service does manage to gain some traction.
Eventually, he said, some company will hit Indonesia's e-commerce sweet spot, and then a raft of copycats will follow.
"It is definitely a growing market, but the user experience is not there yet," Anil Antony, executive director for consumer insights at Nielsen Indonesia, said Wednesday.
Nielsen polled consumers in six major cities from April to June and found that 13% of the 2000 respondents made an online purchase during that period.
In a separate Nielsen survey, 60% of 503 respondents said a lack of trust prevents them from giving their credit card information to online merchants.
"Most e-commerce companies in Indonesia are local and have yet to establish a safe, reliable service," Antony said. Online marketplaces such as Kaskhus, one of the country's largest, require the merchant and buyer to carry out transactions on their own. Antony added that it will take several years for global players like Amazon to enter the market due to infrastructure, regulatory and other issues.
A World Bank study on logistics efficiency ranks Indonesia among of the worst in Asia. Without dependable delivery services, e-commerce companies cannot get orders to customers. Startups have also complained that the government has not issued clear e-commerce guidelines.
There even seems to be doubt as to whether certain licenses are needed. U.S.-based Uber Technologies -- a taxi service that connects drivers and riders via a smartphone app -- is in a legal battle with Jakarta authorities who say the company has not obtained the necessary permits to operate. The company started doing business in the city in August.
Antony pointed out that Indonesian smartphone users' heavy use of social networks and texting services will help spread the word once a service does manage to gain some traction.
Eventually, he said, some company will hit Indonesia's e-commerce sweet spot, and then a raft of copycats will follow.
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