Approach Indonesia not as a country but as a continent; localise your product, design and price points for your specific target market.
Rob Fergusson, Assistant Secretary Indonesia Branch of the Department of Foreign Affairs and Trade built on these points by providing key findings in the recent report: Blueprint for Trade and Investment with Indonesia, which outlines the potential of the Indonesia market: “Over 40% of population is under 25, just think of the opportunities that creates in terms of the demand for agricultural products … as the economy grows and productivity increases”.
Determining Price Point in Indonesia
The panellists emphasised the difficulty of establishing a specific pricing strategy across Indonesia, particularly when distributing products to areas such as Sumatra, given the distribution costs of exporting across the archipelago. Rather than viewing Indonesia holistically, Fabrizio Jorge recommended that teams entering Indonesia design localised strategies that target specific cities and think about how they can win in Jakarta (30 million people), Surabaya (7.3 million people) and Bandung (6.9 million people), locations that are unique in their own right, early adopters and passionate about quality food.
‘I think, for us Australians it’s good to remember that we have a huge number of students coming to Australia from Indonesia and they return with new ideas [and] a great taste for Australian foods,’ says Cristina Talacko.
The city and target market for your product plays a major role in product design and price point. When achieving a certain value chain, Fabrizio Jorge recommended reviewing the supply chain by working backwards, beginning at the consumer within each of the cities, then to distribution and back to the manufacturer. The panel also encouraged designing a product for Indonesians, citing big brands like Nestle that localise to each city.
Product design
Cristina Talacko elaborated on her experience customising products for Indonesia market. While planning to export into Indonesia, she worked with her distributors to adapt the flavours of her products and method of cooking to match the preferences of the Indonesia market. She stressed that businesses cannot compromise on taste with the Indonesian people and collected market research by participating in food shows, where she was able to get an understanding of the consumers and retailers and modify the product accordingly.
According to Fabrizio Jorge, the dairy industry is a prime example of adapting product design for the market. Substitutes are common in Indonesia due to the fragmentation and difficulty of cold supply chains, meaning many dairy products are shelf stable and taste different from the products in Australia.
The consensus among panelists was that it is worth conducting research to ensure your product taste will meet the expectations of your market and your product ingredients can be transported with the available supply chains.
Distributors
Cristina Talacko chose Sal Dolce’s distributor based on their deep understanding of the local market, knowledge of the heath food sector in Indonesia, and experience importing products from Australia.
She shared that she invested time and money into educating her distributors about their products in the beginning, and did many roadshows where they met chefs and organised store demonstration to buyers before moving onto online sales, where they began doing more work on social media, engaging with bloggers, famous personalities and local chefs. Cristina credited her distributors for providing direction of where to dedicate their efforts and money for maximum return, particularly when pivoting during COVID-19.
