The world is changing rapidly, and the business world is changing faster still. That is why it is vital that a country’s small and medium enterprises (SMEs), as the backbone of the economy, do not get left behind. This necessity is incredibly evident in the realm of the digitisation of business.
As time moves on, more and more customers are looking to interact with companies on a digital stage, and this opens up a wide range of opportunities for the businesses themselves and also the economies in which they operate.
Indonesia’s government decided to grab this opportunity with both hands as they are partnering with Alibaba-backed eCommerce company Lazada Indonesia to help point their SMEs in the direction of the future.
The partnership aims to bring two million of Indonesia’s SMEs up to speed with digitisation. They aim to do so in an ingenious way, by using Lazada’s number one resource, its sellers. They intend to recruit the most successful sellers on Lazada Indonesia’s platform into the scheme as tutors, known as kakak asuh. With 100 such tutors on board, they will work with SMEs in Indonesia to hone their online business skills, tapping into the knowledge and wisdom of those experienced at selling on one of Southeast Asia’s powerhouses of eCommerce.
The tutors will be responsible for the education of around two or three businesses each, ensuring that time can be spent with each company individually. As they are working with small numbers, they can also give additional help to those who need more attention. Lazada’s chief marketing officer Monika Rudijono, noted this variance in ability, stating that some companies need more guidance than others when going through a digital transformation, guidance that Lazada Indonesia and the Indonesian government will be there to provide.
The programme will likely aim to supply SMEs in Indonesia with the adequate tools required to improve their online presence. One of the best ways to do this is through focused advertising on social media and search advertising. These sectors expect to see around 7.1% and 7.9% annual growth rates in the coming years, respectively. These avenues of advertisement are continuing to be more and more impactful for firms of all sizes.
Looking towards increasing their social media advertising is a smart step for SMEs in Indonesia as the country has one of the largest social media user-bases with around 81 million users in 2018, a number that’s likely to rise to over 103.1 million users by 2023.
Online ads are a crucial aspect of operating in the digital sphere, but it is not the only one. When a company goes through digitisation, they should look at their internal workings to try to digitise those further and increase automation where possible. For SMEs in Indonesia, this will be useful for their continued growth and enhance their ability to be more footloose and agile in their operations. When aspects of one’s business are digitised, it is easier to evolve with the rapidly shifting business world, and these Lazada tutors will know this well, having experience in eCommerce that many would envy.
Lazada is not the only private company that the government is working with to bring SMEs their very own digital transformation. It is working with other leaders in Indonesia’s eCommerce market, such as Bukalapak, Shopee Indonesia, Tokopedia, and Blibli.
This further highlights Indonesia’s drive and commitment to improving the competitiveness of their SMEs through enhancing the digital side of their commerce sector. Indonesia has clearly taken notice of the opportunity that lies in front of them and should be commended for such a move as it not only ensures the survival of many of their SMEs but also gives them a much better chance of thriving and improving the country’s standing as a place in which to do business.
The timing of this programme is also important. The world’s economy has slowed down due to the COVID-19 pandemic, and as a result, many companies in Indonesia and around the globe have suffered drops in sales and are struggling to keep operating in these harsh times. Giving these companies the ability to increase their sales through this government scheme will likely be a lifeline for many of the best and brightest entrepreneurs that Indonesia has to offer.
This programme is an excellent and reassuring indication that the Indonesian government and Lazada Indonesia are doing their part to ensure that SMEs in Indonesia can survive and grow. They are, through the process of digital transformation, taking care of the present and the future by aiming to bring around 2 million of their most vulnerable companies into the digital age.