Urban consumers are reshaping Indonesia’s retail market

77% of Indonesians still want to see products in person — even as online shopping keeps accelerating

Indonesia’s retailers are rapidly moving toward omnichannel business models as urban consumers increasingly combine online convenience with offline shopping experiences.

Speaking at the Retail Asia Summit 2026, Iqbal Shoffan Shofwan, Director General of Domestic Trade at Indonesia’s Ministry of Trade, said the country’s retail future will be shaped by integrated omnichannel ecosystems rather than competition between online and offline channels.

“The future of retail is no longer online versus offline, but a complementary marriage between the two,” he said.

Consumer behaviour data presented by the Ministry highlights the shift. While 67% of Indonesians prefer online shopping because it is practical and 66% appreciate easier price comparisons, physical retail remains highly influential, with 77% of consumers still wanting to see products directly before purchasing.

The transformation is being supported by strong economic momentum. Indonesia recorded 5.61% GDP growth in the first quarter of 2026, while real retail sales increased 4.74% year-on-year. At the same time, digital payment transactions rose 4.20%, reflecting the rapid adoption of connected retail ecosystems across urban markets.

According to Iqbal Shoffan Shofwan, retailers are increasingly integrating physical stores, marketplaces, logistics, fintech services, and consumer data platforms to meet rising expectations around convenience and customer experience.

Artificial intelligence is also becoming a key part of the industry’s next growth phase, particularly in demand forecasting, inventory management, personalised recommendations, and automated customer engagement.

For retailers operating in Indonesia’s cities, consumer loyalty is no longer driven by channel preference alone, but by speed, accessibility, and seamless experiences across both online and offline touchpoints.