Quality products not enough: Indonesian SMEs face digital era challenges

In Indonesia's increasingly competitive digital landscape, Micro, Small, and Medium Enterprises (UMKM) must move beyond simply offering quality products to achieve sustainable growth. Building strong brands and enhancing product visibility are now essential components for success.

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We believe every Indonesian UMKM has the potential to continue growing if supported by the right capabilities, opportunities to be more easily found by consumers, and a strong ecosystem.

Executive Director of Tokopedia & TikTok Shop Indonesia, Stephanie Susilo, highlighted that the ability to effectively utilize various digital channels is key for UMKM to expand their markets. "We believe every Indonesian UMKM has the potential to continue growing if supported by the right capabilities, opportunities to be more easily found by consumers, and a strong ecosystem," Stephanie stated during a #BeliLokal discussion.

Brand awareness remains a significant challenge, according to Susilo. Quality products require strategic visibility efforts, including engaging content, live shopping events, and collaborations with creators and affiliates. Satrio Arief, Group Brand Manager at Facetology, shared this sentiment, noting that building trust and reaching a wider audience are hurdles for local brands. He emphasized the importance of creator collaborations in reaching diverse consumer segments, provided the partnerships align with the creator's audience.

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The role of creators is very important because to introduce something we cannot move alone. When we move together, it can speed up the path to introduce it to more people.

Lisa Amalia, Owner of Apelicious, a healthy snack business, experienced this transformation firsthand. After joining Tokopedia and TikTok Shop in 2021, her product, initially apple chips, gained significant traction. "Initially, there was a lack of confidence in introducing this product to a wider audience. After joining, we were surprised that within about a month, the product became trending," Lisa shared. She noted that approximately 40% of Apelicious' sales now come from video content, with live streaming also contributing substantially. Beyond visibility, Amalia stressed the need for UMKM to establish unique differentiators and strong values to avoid price wars with non-local competitors, advocating for a community-focused approach to build trust and encourage word-of-mouth marketing.

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Initially, there was a lack of confidence in introducing this product to a wider audience. After joining, we were surprised that within about a month, the product became trending.