Yang Muda, Yang Bergerak: The Evolving Youth of IndonesiaBy Piers Lee
Indonesia has one of the youngest populations in Asia with over 40% under 25 years. The new generation of Gen Y and Z will be the most disruptive in modern history – social media has demolished all barriers to communicating about brands and products, few corporations can rely on their loyalty, yet in Indonesia Gen Y and Z will have more disposable income than past generations.
To assess how the new generation will shape consumerism in Indonesia, BVA BDRC Asia undertook research to get into the minds of the evolving ‘Youth’ of Indonesia. This involved focus groups with 22-25 years old single males & females, within their first employment.
Indonesia, with its rapid development has given birth to a new breed of Young Indonesians who are more confident and dynamic than their predecessors. They are more optimistic and expressive about life and are characterized by need for more freedom, infinite social connections, more individualism and above all a unique youth culture space. Language expressions partly defined this space, being more easy and casual. The Youth of Indonesia believes in the mantra of ‘work hard, play hard’, their lives have become increasingly outgoing (Gaul) and thus they exhibit greater sense of freedom than their yesteryears counterparts – they are more open to experiments, either with their career or their dress codes and they are not afraid to express their individuality.
However, the need for self-expression for the majority of Youth of Indonesian is different from that of their Western counterparts. This is not about standing out from the crowd but to gain social acceptance among the youth sub-culture. It is still about being a part of the community and is largely driven by the need of ‘I want to belong’. As one of the youth says – “It’s about building friendship and building networks”.
However, today’s youth spend much less time with family, and are becoming more collective outside their home space with best friends become the extended family. The definition of friendship (sohib) has gone through massive change, with friends now being advisors, motivators, and even financially supportive.
One of the key catalysts for change has been technology and social media. BVA BDRC’s interactions revealed a strong primal need to be a part of a social unit for limitless social expressions. The Youth of Indonesia loves to participate and share their every moment with friends through pictures and visual expressions along with verbal chat and thus with the usage of mobile devices have increased and the brands they swear most by are Samsung, iPhone and BBM as the enablers of their social as well as individual expression. Thus technology has moved beyond just functionality but now has deep social and emotional value.
While the Youth of Indonesia are still carrying religious values materialism is moving into the youth sub-culture of Indonesia. The need to follow trends (in terms of being seen in the right hangout / place, dressing for success vs. dressing for party, carrying the right bag, doing the right media consumption for talk value etc.) is very deep among the Youth of Indonesia and they take pride being a part of the same. More options for technological gadgets have increased their materialism perhaps to the detriment of practicing religion which some feel portrays a “less modern image”.
With increased buying power and online access through mobile devices, we see a high incidence of online transactions. This covers travel, entertainment, smaller electronic gadgets, and even buying food. Females are also buying clothes and accessories online. The use of e-commerce is driven by convenience, speed, and bargains and if eroding loyalty to high street brands.
The Youth of Indonesia might be sophisticated in e-commerce, but is not very investment savvy and with males in particular being less involved or knowledgeable about the insurance category. Females are more sophisticated in this category with more knowledge and involvement, e.g. haven already taken out time deposits and investments in gold – the latter seen as a good stepping stone towards investments.
Across males and females BCA, Mandiri and CIMB Niaga tend to be the preferred banks. Although the bank selection is not that different from the older generation, the Youth of Indonesia are more heavily dependent on online / digital means of banking reflecting their love affair with technology.
While brand loyalty across all categories will be lower with the new generation, ‘jobs to be done’ (i.e. service providers who can help ‘fix’ consumer needs quickly and efficiently) will be more important in consumers’ more complex and demanding live styles. The importance of branding research could diminish, but there is even greater need for product development research to ensure that product features and benefits will satisfy a new generation.
To sum up, the Youth of Indonesia seem to be basking in the glory of increased consumerism. They are optimistic, expressive and full of confidence but still deeply rooted to the sense of social belonging – they see technology as a means to connect and share bonds with friends, more than anything else. As one of the famous saying goes – “A dream you dream alone is only a dream. A dream you dream together is reality.” - John Lennon