Indonesia E-commerce Market Outlook

The e-commerce industry in indonesia has seen rapid growth in the past few years, and is projected to continue this trend throughout the next decade. the total value of transactions is expected to cross $46 billion by 2032, according to an estimation. as the country is looking to become one of the largest economies in the world by 2020, the e-commerce market will play a key role in the growth of the economy. as of 2018, the indonesian e-commerce market is currently the largest market in southeast asia. it has a digital population of over 91 million people, with an active internet penetration of 51%. this creates a conducive environment for e-commerce to thrive in. in addition, this large digital population is a highly engaged group, with most of them conducting transactions through their handheld devices such as smartphones and tablets. this has led to the rapid growth in the number of businesses taking advantage of the digital marketplace to reach wider audiences. moreover, certain policies by the government have played a crucial role in this growth. these include introducing the e-commerce road map in 2017, the e-commerce licensing program in 2020, and the improvement of the digital infrastructure. according to the research by google and temasek, the total size of indonesia’s e-commerce market was estimated to be at $12 billion in 2018. this is expected to double by 2025 to around $25 billion, and will further double by 2032 to $46 billion. the same research found that overall online digital spends in indonesia are expected to witness a healthy growth from $53 billion in 2018 to $125 billion by 2032. apart from the domestic market, the indonesian e-commerce sector will experience an additional growth in the form of increased foreign investments from abroad. this will further promote the growth of the sector as these investments help in improving the overall business environment, which in turn leads to more international businesses entering the market. in conclusion, the indonesian e-commerce market is looking extremely promising over the next decade and is expected to experience tremendous growth. the sector has been enabled by government policies, foreign investments, and wide digital penetration. it is estimated that by 2032, the total value of transactions will reach $46 billion. it is hence essential for businesses operating in the indonesian market to be well prepared to reap the benefits of the digital revolution that is set to take place in the upcoming years.