Buying Local Products

Cited from article composed by Suci Rakhmawati on sucirakhmawati.wordpress.com (2013) with title “Lack of Interest in Buying Local Products within Indonesian Society”, Indonesia failed to compete in international market due to lack of awareness from Indonesian residents regarding local products and that particular failure caused by failure of the producer to uphold and maintain Indonesians’ trust. Thus, there are some measures to be taken in order to overcome this problem.

In the article, the author written that Indonesia is a country with many natural resources and 17,500 islands scattered all around Indonesia, makes the nation is the largest archipelago country and the world’s fourth most populated inhabitant. With Indonesian population reached 265 million persons and still growing fast, Indonesia has a huge potential for doing market expansion. Indonesia’s GDP equals to 3,683.9 trillion rupiah. (BPS, 2018) Hence, the average monthly salary received is 2,65 million rupiah. Based on the research done by Kompas in 2012 , within six big cities (Jakarta, Bandung, Jogjakarta, Surabaya, Medan and Surabaya), 50.3 % of the population are middle income class, while the middle-upper class is 3.6% of society and 1% are super rich families. The rest are the low income population. In addition, with current lifestyle, urbanization and globalization trends and increment of wage, Indonesian citizens have tendency to do impulsive buying leads to consumptive behavior. In that matter, the opportunity to penetrate Indonesia’s market is opened widely.

The article is also stating, ” Indonesia produces high-quality products, certainly that Indonesian’s products should be revolved in the country itself. ” In fact, some of those foreign products are made in Indonesia, such as Onitsuka Tiger’s shoes, the Germany’s brand, Hugo Boss and Calvin Klein suits are made in Bandung, H&M and Uniqlo garment factories are in Majalengka and Tangerang. (Detik Finance, 2014). It leads to one major question left to be answered, why local products are hard to compete with global products even though the imported goods are much more expensive than the local one and moreover, the quality of local goods are not less than the foreign brands.
Quoting directly from the article, “ The core problem of the Indonesian brands is the necessity of improving its local products, hence as a host, local brands are able to be international brands and the citizens have will to embrace the products. ” Based on the data received from CNBC Indonesia in early 2018 stated that over 60% of the Indonesians would rather make a purchase on foreign brands than the local ones. The first reason Indonesian’s local brands are less desirable are the goods with better qualities are being exported while the less one sold to the local consumers which makes them reluctant to buy them. The price is indeed cheaper but not entirely comfortable and most of the time, not durable enough whereas the citizens nowadays are smart enough to buy goods that a little bit more pricey but comfortable with high and long durability. The second one is lack of realization in using local products and the advantages in using them. Those advantages are increasing national income that leads to strengthen value of rupiah to US Dollar, expanding number of workers and as a result, better public welfare, raising qualities of goods and strengthening the pride of using local products. (Inspirator Freak, 2016).

Brand image, accurate market segmentation, and product’s packaging are the next action which also important to be done based on the article. Branding is the key of recreating public image against the brand. It holds big parts of costumers’ credence and value proposition offered by buying that product. It affects the costumers’ judgment to buy the products, whether it is worth or not to be bought at such high price. For example, the plastic trash bag that can be acquired cheaply at supermarket, can be sold at twenty million rupiah on Lanvin store. Another example is plastic bag with Celine brand, sold for seven million rupiah, yet included into one of the best-seller bags and produced again for summer 2018 collection. (Indira Rezkisari, 2018) Readjusting brand image can be one of the alternative solutions. Japanese’s brand, Asics has executed it and it is worked splendidly. The company pivots from athletes’ footwear to health and wellness gear, proven by the current brand ambassador, DJ (Disc Jockey) Steve Aoki – the first non-athlete brand ambassador. Next, Asics did to change its image is broadening subsidiary brand which is Onitsuka Tiger. The purpose is to implement the latest trend of vintage look sneakers in order to recruit young generation and millennial consumers. (Adrianne Pasquarelli, 2017) Accurate market target is the other key element for obtaining customers. Calibrating STP (Segmenting, Targeting, Positioning) is one way to create niche market. Even better if the brand is able to penetrate the overseas’ market. In Korea, local cosmetic brands such as Innisfree, Tony Moly, Nature Republic, Skin Food, A’PIEU, Etude House are brands for adolescences only, since trend in Korea, after a person reaches 20 years old, they are likely to use the anti-aging skincare products and the price is only a quarter of the price with same product in Indonesia. Even the foreign brand like The Body Shop, Estee Lauder, and Yves Saint-Laurent are able to reach Korean market better. The point is, why are those brands are awfully fancied by Indonesians? It turns out, the skincare users from late teenagers to early 30 are affluent by Korean drama and its paradigm. The drama usually begins or ends or even in the drama itself with advertisements portrayed by the actors and actresses. Thus, with the correct advertising method and international-quality products, it can be another alternative solution to breach the market and obtain mass’ trusts. The author mentioned about non-monotone packaging as another action can be taken to boost up selling demand. For example, Dinoplatz Lip Balm in #1 Spilled Wine produced by Too Cool For School that has cute dinosaurs sketch on the lid and adorable Tony Molly’s Pig Collagen Sleeping Mask packaging that widely known. “ It will create and deliver sense of quality while also reflecting product’s rand image. With the right packaging design can attract consumer’s eye and make the product stand out next to competitor’s product. ” (Terry Lane, 2017).

For those who agree with buying foreigner brands rather than local ones, the fact is those people mostly use it for prestige and symbol of their social status. Take iPhone as an example. Based on the research done by Business Insider, the biggest reason why they want to buy iPhone even though the price is notably expensive is they think that products made by this Cupertino company is wonderful. (Susanto, D.A, 2012) Thus, actually most of them don’t seek for the advantage of the features provided by Apple product such as neat User Interface (UI), extra protection provided by good Operating System (OS) and long durability since the OS supports the older version of iPhone, but only hunt for the bitten apple logo itself.

In conclusion, the first cause lack of local products’ demand is no trust towards domestic products because they don’t uphold good quality and in the end, forging citizens common thought which branded goods are made with better qualities than the native one. The second factor which determine the Indonesians in order to buy the items is the prestige to increase that person’s economical level plus with the globalization trend makes the Indonesians tend to be “follower” to the world’s standard of beauty and wealth.