Groupon Inc (NASDAQ:GRPN) is witnessing a massive surge in mobile transactions this year in Indonesia, with consumers moving away from desktop, says a report from the Jakarta Post. The transition has gained pace with the growing number of smartphone users in the country.
Indonesia holds great potential for Groupon
Groupon Indonesia CEO Indrasto Budisantoso stated on Monday that mobile transactions now form more than 50% of their online transactions. Budisantoso said this is a huge shift from the company’s trend last year when desktop transactions accounted for a major part of revenue. According to Indrasto, consumers will continue with mobile transactions, abandoning desktop on the back of the increasing number of smartphones.
Market research company eMarketer said the number of users in 2017 will soar to 103.6 million people, a hike from 61.2 million people this year. Indonesian mobile browsing totals 661 pages per person every month, which is two times the numbers in China and the United States. Data from the Indonesian e-commerce association states that the e-commerce market in Indonesia will be worth Rp 295 trillion ($24.3 billion) in 2016, a rise from Rp 94.5 trillion last year. Groupon currently has millions of subscribers and partners with more than 5,000 merchants.
Rivals such as LivingSocial, Lazada, OLX and Tokopedia are giving tough competition to the company in Indonesia. According to Indrasto, to beat the competition, Groupon Indonesia will primarily push itself to become a prominent lifestyle e-commerce player by enhancing its best-deal voucher business.
Buyers shy away from online transactions
However, Indrasto did acknowledge that even though the number smartphone users is on the rise, only 6% of these users make online transactions using mobile devices. For Groupon, this is a challenge as well as an opportunity in Indonesia. He said, “There are still people who do not want to buy goods online because they want to see or touch the items first.”
The CEO added that people avoid buying goods online because these stores accept credit card payments. To tap this opportunity, Groupon Indonesia offers various methods of payments such as credit cards, bank transfers, and other alternatives. The subsidiary of the U.S.-based Groupon is also planning to unveil the upgraded version of its iOS and Android apps to offer better user experiences, according to Indrasto.