Examining Alfamart’s and Indomaret’s digital moves

With Indonesia’s e-grocery startups facing challenges in recent months, could two of the country’s major minimarket chains fill the void?

Indomaret and Alfamart branches have mushroomed across the archipelago for decades, but they have also launched apps – Klik Indomaret and Alfagift, respectively – to facilitate delivery services. According to third-party estimates, their numbers of monthly active users (MAUs) have surpassed Indonesia’s main e-grocery players.

Photo credit: The Samator

Of course, there are key differences. Indomaret and Alfamart’s offerings are primarily limited to dry goods such as packaged snacks and beverages as well as other FMCG products. Fresh fruits and vegetables, which players like Sayurbox focus on, are more difficult to handle – they are only available in a select few of the minimarkets’ locations.

Still, in terms of a tech strategy, it’s possible that deliveries are just the start for the minimarket majors. Alfamart has dipped its toes into tech investments across the ecommerce and fintech sectors while Indomaret has links through its conglomerate parent Salim Group. Both retailers are also publicly listed.

Tech in Asia reached out to Indomaret and Alfamart, but the companies have not provided comments by the time of publishing.

Retail advantages

Founded in 1988, Indomaret has nearly 20,000 offline stores. Meanwhile, Alfamart – a decade younger – has nearly 19,000 branches. Both companies sell thousands of stock-keeping units (SKUs).

This big retail presence benefits both companies in their digital efforts as it guarantees a stronger grip of their millions of daily customers. This is also what sets them apart from e-grocery players, which have little to no brick-and-mortar support of their own.

The cases of Indomaret and Alfamart are similar to that of Walmart, Whole Foods, and Target in the US, says Eisha Rachbini, head of the center of digital economy and SMEs at the Institute for Development of Economics and Finance (Indef).

She explains that the US-based companies – which are either department stores or supermarket chains rather than minimarkets – have also launched their own online platforms. Walmart, for example, has Walmart.com, a marketplace that has accommodated third-party sellers since 2009.

“The wider the market reach, the more sales will be accommodated,” Rachbini tells Tech in Asia. She also notes that fast delivery service, among other factors, will have an impact on customer satisfaction and, subsequently, the continuous development of a digital business.

Klik Indomaret and Alfagift were both launched in 2015. As of September, Klik Indomaret has around 2 million MAUs while Alfagift has over 4 million users, according to third-party estimates.

In comparison, Indonesian e-grocery players like TaniHub and Sayurbox have either never or only barely touched the one million mark in MAUs.

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