Digitization in Marketing Supports MSMEs

KOMPAS/RADITYA HELABUMI

Rony, a gado-gado and ketoprak seller, shows his shop on the ShopeeFood application in the Tanjung Duren area, West Jakarta, Friday (13/8/2021). The use of ordering applications is not only to fulfill health protocols but is expected to add new customers.

JAKARTA, KOMPAS — The digitization of micro, small and medium enterprises (MSMEs) is believed to provide multiple benefits for businesses and their surrounding communities. Up to 77 percent of MSME survey respondents employ residents of their surrounding communities. One MSME can offer as many as five jobs.

Besides understanding the technical aspects of using digital platforms, MSMEs also need support in terms of facilitating digital literacy and entrepreneurship. This was the gist of a virtual discussion held on Thursday (26/8/2021) in Jakarta on the results of a study on "Digitization of MSMEs as Key to Indonesia\'s Inclusive Economic Growth 2021", which was conducted by Blibli.com, Kompas daily, and the Boston Consulting Group (BCG). The discussion was attended by State-Owned Enterprises (SOEs) Minister Erick Thohir, who also delivered the keynote speech.

PT Boston Consulting Indonesia president director Haikal Siregar said MSMEs that engaged in online marketing could earn incomes of up to 1.1 times higher than MSMEs engaged only in offline sales. The higher income derived from expanded coverage of their sales areas. Operational costs can be reduced, while processing transactions was more optimal.

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MSMEs that used online marketing had the potential to enjoy 2.1 times more opportunities than selling products in markets nationwide and 4.6 times greater chance of exporting their products.

"[Their] opportunity to involve the local community is 1.1 times higher and 1.4 times greater in recruiting new workers," he said.

The issues among micro, small and medium enterprises are similar, but the solutions for handling them must be different.

MSMEs that used online marketing were believed to make greater contributions to gross domestic product (GDP). This can be seen from their 1.7 times greater impact on the production supply chain and their 1.3 times greater impact on non-income factors, for example by opening branches or creating new MSMEs.

Haikal said the government had policies that supported the digitization needs of MSMEs, such as the construction of transmitters with 4G technology in remote villages.

The research showed that 56 percent of MSMEs were satisfied with the government’s policies, ranging from training and certification, to promotional support. “The issues among micro, small and medium enterprises are similar, but the solutions for handling them must be different. Public-private sector cooperation to help find solutions is very important,” Haikal said.

KOMPAS/Blibli.com

Sales trends in e-commerce during the Covid-19 pandemic

Literacy

Blibli.com CEO Kusumo Martanto said that based on the e-commerce platform’s experience in providing training workshops on online marketing, there were MSMEs that still thought of digitization as complicated. Understanding the technical aspects of digital platforms and the characteristics of online buyers in the e-commerce realm required the patience of MSME actors.

"The research findings show that 74 percent of MSMEs are aware of the existence of various types and models of e-commerce platforms. However, only 20 percent have good literacy about the world of e-commerce and make maximum use of it," he said.

According to Kusumo, the digitization of MSMEs would have a positive impact not only on local communities, but also on the image of domestic brands. A number of MSMEs had proven successful, such as Sarifood Indonesia, Oyoh Jengkol, and Uni Tutie.

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“Collaboration helps MSMEs succeed in increasing their business scale, not only through larger-scale private companies. The world of education also needs to be involved, such as universities," he said.

A researcher of the Kompas Research and Development division, B.E. Satrio, said that improving digital literacy among MSMEs required a multi-sectoral approach. The more literate the MSMEs were in e-commerce, the greater the potential for generating multiple effects for the surrounding communities.

Deputy Commissioner Imansyah of the Financial Services Authority (OJK) Institute and Digital Finance said there was a tendency for the development of digital marketing to target MSMEs in an aggregate or generic manner. Researches conducted by government and private institutions also targeted MSMEs in general without considering detailed groups of micro, small, or medium enterprises.

Each public and private institution had their own MSME development program but according to Imansyah, it would be better if the programs were integrated.

This article was translated by Hyginus Hardoyo.