Asian brands gain ground in Indonesia’s retail market

Shifting consumer preferences, brand perception, and loyalty tech fuel the rise of Eastern labels.

Indonesia’s US$175 billion retail market is undergoing a shift as more consumers—particularly in the middle-income segment—turn to Asian brands over traditional Western labels.

According to Juan Pisente Widjaja, Managing Partner at Gideon Consulting Group, the country’s mature smartphone market is one factor accelerating this change. “Some studies already suggest that 85% of Indonesians already own a smartphone, and 18% already own two smartphones,” Widjaja said. “So the market has died down a little in the last few years.”

This slowdown has pushed major players like Erajaya—long known for its smartphone retail dominance—to diversify into lifestyle and food & beverage retail. Rather than banking on popular Western brands, Erajaya has increasingly turned to Eastern brands to differentiate its portfolio.

“We are seeing that some retailers are employing such a unique strategy of using Eastern brands... which could hint at the impacts of the geopolitical tension between the US and China,” Widjaja added.

Supporting this shift is the rise of integrated loyalty ecosystems. Erajaya’s membership program now links multiple brands under one app—encouraging cross-category shopping and repeat engagement. “Some membership programs already boost a significant growth of up to tens of millions of members every single year,” said Widjaja. “It allows a person to purchase a smartphone, for example, and also dine in F&B retail restaurants.”

Widjaja’s firm also uncovered a cultural factor boosting demand for Asian labels: brand exoticism. “In Indonesia, the usage of foreign brands boosts credibility, trust, and therefore competitiveness,” he said. “Every time they launch a new brand in Indonesia, there's a flurry of new media channels that provide information on the strategies and the successes of their brands in their respective home countries. That boosts the credibility and also the brand trust.”

While Erajaya’s embrace of Asian brands may not have been entirely intentional, Widjaja said its impact is clear: “It is clearly a sign of the competitiveness scale of the Asian market.”