Why Top Brands in Indonesia Are Pouring Ad Dollars Into Retail Media and E-Commerce Advertising

    27 Nov 2023

    Unleashing High ROI Through E-Commerce's Ability to Analyze and Predict Purchase

    Why Top Brands in Indonesia Are Pouring Ad Dollars Into Retail Media and E-Commerce Advertising

    27 Nov 2023


    In a world marked by economic slowdowns, lower market consumption, and marketing budget constraints, marketers are facing an uphill battle in determining the right platform to generate the most return on ad spend. The quest for a high-growth, high-ROI marketing strategy has become more challenging than ever. The 2023 Annual Marketing Report by Nielsen reveals a stark statistic, with only 54% of marketers expressing confidence in ROI measurement across various digital channels.

    In the midst of this challenging landscape, advertising on Retail Media (e-commerce and on-demand platforms), emerges as a beacon of hope. The latest research from WARC Media projects a substantial 10.2% increase in spending on retail media this year, with a further 10.5% growth anticipated in 2024, resulting in a total investment of $141.7 billion. This trajectory positions retail media as one of the fastest-growing advertising channels. What it means for business is that, we are seeing once again the value advertisers place in leveraging first-party data to target the right message to the right person at the right time, which has been the advantage of Retail Media.

    A dominant facet of Retail Media Ads is advertising on e-commerce platforms, also known as e-commerce advertising. In 2023, e-commerce giants Alibaba and Amazon collectively secured a 68% share of global retail media investment, signaling a resounding global surge in enthusiasm and trust in e-commerce advertising.

    E-commerce Advertising: Unleashing High ROI Through E-Commerce's Ability to Analyze and Predict Purchase

    Focusing our lens on Southeast Asia, the e-Conomy SEA 2023 report from Google, BAIN and Temasek indicates that there is an increasing demand towards e-commerce advertising. This is highlighted by the significant 43% contribution of advertisements as a driving force behind e-commerce growth. Moreover, research from Carousel Media Group found that 87% of Asia-based marketers have future intention to include retail media as part of media planning over the next 12 months.

    While Indonesia, Southeast Asia’s largest digital economy country, witnessed a striking surge in the adoption of e-commerce and e-commerce advertising. Projections for 2025 paint a growth of 15% in the e-commerce sector, reaching a total of USD 82 billion. This surge has compelled numerous brands to allocate a significant portion of their advertising budgets to e-commerce.

    Tokopedia, a major player in the Indonesian e-commerce landscape, is a testament to the impact of this trend. From early 2020 to 2023, there has been a staggering 52x growth in the number of brands investing in Tokopedia’s digital marketing platform, named Tokopedia Marketing Solutions. Among these clients are international heavyweights such as Samsung, Coca-Cola, P&G, Unilever, L’oreal, Levi’s, and TCL. The results have been astonishing, with Samsung, for instance, achieving an impressive 139% boost in revenue, supported by an 18x Return on Ad Spend (ROAS). Similarly, Indonesia's largest dairy company, Frisian Flag, experienced a remarkable 297% upsurge in orders with a 10x ROAS. Meanwhile, the Lego Group attained a 163% surge in revenue through Collaborative Ads managed by Tokopedia Marketing Solutions.

    The success of these brands can be credited to their comprehensive strategy of maintaining a presence across all consumer touchpoints within the platform. They leverage a variety of Tokopedia Ads, ensuring visibility when users explore the main page, search for specific products, compare different items, and engage with social media during their daily routines.


    Edwin Chayadi, Vice President of Tokopedia Marketing Solutions, underscores the accomplishments of e-commerce advertising, attributing its triumph to its adept use of first-party data for discerning current user needs and predicting future purchases. He elaborates, “In e-commerce, most of the consumer journeys happen on the platform. It allows us to learn and analyze the behavior of our consumers. By capitalizing on these insights, Tokopedia empowers businesses, particularly sellers on its platform, to engage with customers highly likely to be interested in their offerings. In parallel, our Lookalike Technology extends the reach of brands by identifying new audiences that mirror the characteristics of the brand's existing customers."

    Precision in Performance Measurement and the Seamless Ecosystem

    In addition to its vast audience data and insights, e-commerce platforms establish their distinctiveness through precise performance measurement, seamlessly combining store data with media data. Unlike conventional digital marketing platforms that predominantly only gauge impressions and click-through rates, e-commerce advertising offers marketers the unique ability to correlate purchased ads with store sales and orders directly.

    The hallmark of e-commerce platforms lies in their closed-loop ecosystem, presenting users with an uncomplicated journey from discovering products to doorstep delivery. This simplicity, bolstered by security and convenience, resonates profoundly with contemporary consumers. For businesses, this model serves as a vehicle to reach a vast user base without the encumbrance of excessive overhead costs, constituting a compelling selling proposition.

    Tailored Solutions For Diverse Marketing Backgrounds

    Furthermore, e-commerce platforms' marketing solutions have evolved to encompass a comprehensive array of advertising products, capable of accommodating a broad spectrum of marketing objectives. Whether a business seeks to create brand awareness or pursue ongoing performance marketing, e-commerce platforms stand ready to provide customized solutions.

    "In today's digital world, advertising on e-commerce platforms is no longer optional – it's a must. This shift reflects how consumers seamlessly integrate the digital experience into every aspect of their lives. Businesses that embrace this change position themselves strategically, gaining a competitive edge. This transformation highlights the adaptability of modern marketing strategies, even in the face of enduring challenges," Edwin said.

    The recognition of the benefits of e-commerce advertising was further demonstrated at the Marketing Excellence Awards 2023 in Indonesia. Tokopedia Marketing Solutions, a digital marketing platform designed to unlock businesses' maximum growth on e-commerce, received accolades as a Gold Winner in the category of Excellent Data-Driven Marketing and a Bronze Award in Performance Marketing. A panel of 15 marketing experts, who served as judges, commended them for its proficient utilization of cutting-edge business intelligence and data analytics to enhance targeting. This innovative approach has led to sustainable growth for thousands of its clients.

    Looking to boost your marketing efforts with e-commerce advertising? Reach out to marketing.solutions@tokopedia.com, and let us assist you in crafting the optimal e-commerce strategy to maximize your business growth.