This Country Was Rated the Fastest-growing Internet Economy in Southeast Asia By Google
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Digitization has changed the consumer behaviour drastically over the last few years. How we look at everyday needs such as food, grocery and clothing has changed with the advent of mobile phones and internet availability. With just one click, one can now get food delivered at their doorsteps, book a cab or avail a number of other services.
In a recently published report, Google said that while the internet economy is thriving across Southeast Asian countries, Indonesia is growing faster and is charging ahead.
According to the Year in Search Indonesia report by Google, Indonesia's internet economy is currently valued at $40 billion in 2019 and this is expected to triple and reach $130 billion by 2025.
Major Sectors Fueling This Growth
All the business sectors in the country are being fuelled by intense competition between Indonesian and other regional players, the report said. Some sectors are, however, setting the pace and growing faster, bolstering the internet economy in the country.
E-commerce: According to the report, the e-commerce market in Indonesia is pegged at $20.09 billion. This market is expected to reach $82 billion by 2025, thereby registering 4X growth. The report also revealed that there 2.1x rise in queries related to e-commerce. People from non-metropolitan cities are turning to online shopping and thus the market is expected to see double the gross merchandise value growth compared to metros by 2025. Google recorded 80 per cent increase in search related to beauty, 82 per cent in auto and 90 per cent in travel.
Online media: The online media market is expected to cross $9 billion in 2025 from $ 3.5 billion currently, registering 2.6X growth. “News and gaming are the two pillars driving growth in media and entertainment across Indonesia,” the report noted. According to Google, there was a 1.2X growth in YouTube searches for “sinetron” (soap opera) and a 2X growth for news in 2019.
Ride-hailing: The Indonesian ride-hailing market is expected to grow 3 times to become an $18 billion market by 2025. The report revealed a 1.5x increase in searches for digital products such as “ride hailing vouchers”, “gaming vouchers”, and “e-money vouchers”.
Online travel: Currently pegged at $10.2 billion, the online travel market in Indonesia is expected to register 2.5X growth to reach $25 billion by 2025. Indonesia has been rated as the largest and fastest growing online travel market in Southeast Asia. The country recorded 39% growth in travel-related searches in the past 18 months.
Digital Transactions: The report revealed that “unbanked and cosmopolitan Indonesians” are finding digital transactions and electronic money to be more convenient and practical options. “Searches for “digital wallet” have seen 2.7X growth in 2019 year on year, with the keywords best digital wallet growing in popularity,” the report noted. Digital transaction in the country is also registering growth due to brands offering incentives to consumers through deals and promotions.