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DOI: https://doi.org/10.55057/ajrbm.2023.5.3.4
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Abstract: PT Digital Mobil Indonesia (DMI) is a digital company, specializing in the sales,
purchase, and trade-in of used cars through an online platform called DIMO. DMI is a
subsidiary of PT Mobil Indonesia, an Indonesian conglomerate company specializing in the
automotive industry. DIMO aims to strengthen its position as a key player in the used car
industry by leveraging PT Mobil Indonesia's ecosystem of new cars. This research aims to
understand potential consumers' perceptions of DIMO's Unique Selling Proposition (USP) and
propose business strategies to increase the volume of transactions for used car purchases. Both
quantitative and qualitative research methods are employed for this study. A questionnaire is
used as the basis for the quantitative research to understand potential consumers' perceptions,
and interviews with DIMO's management provide insights for internal company analysis. The
findings of this research provide an overview of DIMO's brand positioning in the market and
effective business strategies to enhance the volume of used car purchases through the DIMO
platform. Based on the perception of potential customers, the DIMO brand is positioned in
third place among all measured variables. The proposed business strategy to increase
purchase transactions includes collaborating on a trade-in program, conducting a
collaborative digital marketing campaign, conducting price analysis, and establishing a
specialized trade-in program for electric vehicles. By understanding potential consumers'
perceptions and analyzing the internal aspects of the company, this research offers valuable
insights to support DIMO's growth and success in the competitive used car business landscape.
1. Introduction
PT Mobil Indonesia, one of the largest automotive companies in Indonesia, recognized the
challenges and opportunities presented by the online-based used car business. To address these,
they established a subsidiary called PT Digital Mobil Indonesia and launched a platform called
DIMO. In 2023, the addressable used car market is projected to reach 487,600 units and PT
Digital Mobil Indonesia aims to capitalize on these favourable market conditions by becoming
the market share by 2.5% or purchase 12,000 units in 2023. Until March 2023, DIMO has
successfully acquired only 2,758 purchase units, which falls significantly short of the annual
target of 12,000 units. When comparing the achievement to the quarterly target of 3,000 units,
it becomes evident that there is a considerable performance gap.
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Asian Journal of Research in Business and Management
e-ISSN: 2682-8510 | Vol. 5, No. 3, 37-48, 2023
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The rise of digital approaches in retail business has been accelerated by the COVID-19
pandemic. Recognizing this trend, PT Digital Mobil Indonesia leverages the widespread use of
mobile and internet technologies to establish DIMO as a prominent online platform for used
car transactions. Furthermore, being associated with PT Mobil Indonesia provides DIMO with
a distinct advantage. By incorporating the parent brand within its logo, DIMO can benefit from
the positive perception and trust that customers already have towards PT Mobil Indonesia.
In the used car business, gaining trust and recognition from customers who wish to sell their
cars is crucial. The supply of used cars is essential for the company's fundamental operations.
Establishing a solid reputation and credibility among customers is necessary to ensure a
consistent flow of used cars into the business. In order to support the DIMO to attract the
market, DIMO has Unique Selling Propositions:
a. Used car is inspected by experts from PT Mobil Indonesia
b. Price competitive based on fair inspection
c. Safe, transparent and convenient process of selling
d. Providing a fast price offering after the inspection
Based on the opportunities and challenges above, this research has objective to:
i. Understand the perception of market towards DIMO’s Unique Selling Propositions
compared to competitors.
ii. Propose business strategy for DIMO to increase the purchase transaction volume.
2. Literature Review
The previous research conducted by the Elena Delgado-Ballester and Miguel Hernández-
Espallardo (2008), found the new or unfamiliar online merchant brands may profit from
initiatives that show a link between the new e-brand and a familiar one. Since impressions
influence consumers' actual behavior, perceptions matter more in marketing than reality (Kotler
& Keller, 2012). According to Clow, K. E. & Baack, D. (2018), an established company
provides customers with assurance regarding what to anticipate. It will be advantageous for
positioning a brand in society. Positioning is the process of designing a company's offering and
image to occupy a unique position in the minds of its target market (Kotler & Keller, 2012).
To address the research question, author used conceptual framework as the table below:
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Asian Journal of Research in Business and Management
e-ISSN: 2682-8510 | Vol. 5, No. 3, 37-48, 2023
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3. Methodology
The author aims to understand the perception of potential customers towards used car platform
in Indonesia. Based on the insights gained, the author will propose a business strategy that is
combined with internal and external analysis of the company. In summary, the author will
employ a combination of quantitative and qualitative approaches.
The primary data will be obtained through two methods. The questionnaires will be distributed
to potential customers of DIMO and conduct in-dept interview with Management of DIMO.
The author used the Slovin's Formula to determine the sample size. The target sample
questionnaire is 100 respondents, who preferably live in Jakarta, Bogor, Depok, Tangerang,
and Bekasi (Jabodetabek), considering the largest automotive market is located in this region
contributing 32% in 2021.
The design of the questionnaire consists of categories for identification, top of mind,
awareness, and perception. The identification category requires to collect each respondent's
profile information, the top-of-mind section is to identify used car platform brands that come
to mind for potential customers, the awareness section is to identify whether the respondents
are familiar with a brand named DIMO and the perception section seeks to analyse respondents'
perception and opinions of used car platforms in Indonesia using DIMO’s unique selling
proposition. In addition, to gather other primary data, the author will conduct in-depth
interviews with the Management at DIMO to understand the company's resources related to
the competitive advantages and value chain analysis.
The questionnaire scoring will be using the IPA Model. IPA (Importance Performance
Analysis) used to rank different service characteristics and determine what steps the
organisation needs to take. It uses a Cartesian diagram consisting of performance on the X-
axis, which represents the level of performance of a product or service, and importance on the
Y-axis, which represents the perceived importance by consumers.
The authors validate the questionnaire before it is made accessible to the public to make sure
that the questions are simple, straightforward, and understandable to potential respondents. A
questionnaire needs to go through a validation process to ensure that it assesses its objectives
accurately independently of the respondent (Kazi, A., Khalid, W., 2012). The sample was sent
to the author's family members and colleagues as part of validation questions.
The author utilized secondary data from journals, articles, books, internal company data, and
other relevant sources that can contribute to and support this research. Additionally,
information related to the automotive industry that is available to the public is also utilized to
complete this writing.
4. Analysis
The author uses PESTEL Analysis, Porter's five forces model, and competitor analysis to
identify the external conditions of the used car industry.
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Asian Journal of Research in Business and Management
e-ISSN: 2682-8510 | Vol. 5, No. 3, 37-48, 2023
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leaders can address potential threats and capitalize on opportunities, thereby mitigating risks
and maximizing the company's strategic position (Rothaermel, 2019).
In general, the government of the Republic of Indonesia fully supports the growth of the
automotive industry in the country, taking into consideration the significant potential of this
industry in improving the national economic conditions. Additionally, according to the
Minister of Industry, the car ownership ratio compared to the total population in Indonesia is
still 99 out of 1000 people, indicating that the automotive market in Indonesia is still huge.
Indonesia's economic condition is relatively satisfactory, with a growth rate of 5.31% in 2022,
higher than the previous year. According to PwC analysis, Indonesia's economy is expected to
experience only a mild slowdown in 2023, which is favourable considering the global trends
where major world economies are expected to experience a recession in 2023.
The demographic landscape in Indonesia is undergoing a significant shift with the dominance
of the millennial and Generation Z generations. These generations are characterized by their
familiarity and comfort with technology, making them a crucial driving force behind the
growth of the digital economy. As tech-savvy individuals, they actively engage with digital
platforms and contribute to the increasing demand for internet usage.
Although the used car industry in Indonesia has historically remained fragmented, the
landscape has started to shift, particularly since the introduction of online used car markets to
dealerships during the COVID-19 pandemic. Currently, Indonesia ranks as the fourth-largest
country in terms of smartphone users, with 370 million cellular mobile connections (133%
compared to the population). Moreover, 94% of internet users in Indonesia access the internet
through smartphones. It is projected that by 2029, the number of internet users in Indonesia
will reach 210 million.
The government has implemented policies and incentives to support the adoption of electric
vehicles, such as tax exemptions and subsidies, further encouraging the shift towards this
cleaner and more sustainable mode of transportation. The Indonesian government has
implemented various regulations to govern the automotive industry, covering aspects such as
vehicle production, importation, distribution, and usage. These regulations are designed to
ensure safety, quality standards, environmental compliance, and consumer protection within
the industry.
The used car digital business faces high barriers to entry. The used car industry is highly
sensitive to factors such as aging stock or the time a car remains in inventory, mainly due to
the depreciation of used cars and the lack of standardized pricing in the market. Therefore,
combining online platforms and offline dealership approaches is necessary to reach a larger
market.
The used car digital business has a high bargaining power of suppliers, despite there are
numerous suppliers, ranging from individuals to companies looking to sell their used cars. The
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Asian Journal of Research in Business and Management
e-ISSN: 2682-8510 | Vol. 5, No. 3, 37-48, 2023
http://myjms.mohe.gov.my/index.php/ajrbm
bargaining power of buyers in the used car industry is relatively medium, their ability to choose
from various sellers and their price sensitivity provide them with certain advantages.
The threat of substitutes can be categorized as a medium-level threat. Substitutes can come in
the form of online transportation platforms that are widely used by the public. Additionally,
the use of public transportation can also be considered a threat of substitute.
The rivalry among existing competitors in the used car digital platform can be considered high.
Each company is vying for market share and striving to differentiate itself from the
competition. They may offer competitive pricing, a wide selection of cars, convenient online
platforms, number of inspection points or superior customer service. This intense competition.
In the digital era, the competition within the used car business platform is intense, making
competitor analysis a crucial task. To gain a competitive edge, it is essential to evaluate and
understand the key aspects of the competitors. Discovering each competitor’s strategy,
advantages, and distinctive offerings is another goal of the competition analysis.
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Asian Journal of Research in Business and Management
e-ISSN: 2682-8510 | Vol. 5, No. 3, 37-48, 2023
http://myjms.mohe.gov.my/index.php/ajrbm
This fulfills the author's criteria, which was to collect data with millennials as the main target
market for DIMO and dominated by males as the major gender with experiences in car
transaction. Research shows a highly dominant perception of the residents living in
Jabodetabek and have a good financial ability to afford owning a car. In terms of experiences,
shows very positive outcome as the majority of respondents have had transactional experience
with cars. The survey results also cover a sample of respondents who have never experiences
in car transactions, making this survey capture more comprehensive outcomes.
In terms of top-of-mind, DIMO is still significantly behind its competitors, however the
awareness result shows it is a fairly good result, considering that the DIMO brand is a relatively
young company.
The results below show the variables that are considered important in the process of selling
used cars. These variables are the unique selling propositions of DIMO.
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Asian Journal of Research in Business and Management
e-ISSN: 2682-8510 | Vol. 5, No. 3, 37-48, 2023
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Most of the metrics mentioned above are considered strongly important aspects. In addition to
that, competitive price offerings and cars inspected by experts are two crucial factors in the
used car business.
DIMO is generally positioned below its competitors, namely Autos and CS Indonesia, when
considering variables such as expert inspection of used cars and having a transparent, safe, and
convenient process. These perception results present an opportunity for DIMO, as despite being
a relatively new brand, it has a fairly good perception regarding having a team of experts for
inspections and offering a transparent, safe, and convenient process. In other words, while
DIMO may not currently be perceived as strongly as its competitors in terms of expert
inspection officer and a transparent process, it still holds potential due to its positive perception
in these areas. This provides an opportunity for DIMO to further strengthen its position in the
market and build a favorable reputation among potential customers.
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Asian Journal of Research in Business and Management
e-ISSN: 2682-8510 | Vol. 5, No. 3, 37-48, 2023
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The figure above illustrates the positioning of used car platforms based on variables related to
providing competitive prices and fast price offerings. According to the above results, Autos, as
the top-of-mind brand, has the highest score among its competitors, followed by CS Indonesia
and DIMO in the third position. This aligns with the perceptions depicted in figure 1. Based on
these results, there appears to be a positive correlation between brand recognition among the
public and the perceptions that arise in society regarding the services provided by each brand.
This highlights the importance of brand recognition and its impact on the public's perception
of the services provided by each used car platform.
The author uses VRIO Analysis and Value Chain Analysis to identify the internal conditions
of the used car industry. The internal analysis was conducted using a quantitative method by
conducting in-depth interviews with DIMO management in May 2023.
As one of the subsidiaries of PT Mobil Indonesia, DIMO can maximize the opportunity to
collaborate with the value chain within automotive industry such as the financing, new car
dealers and insurance (official business partner). DIMO has features to sell, buy and trade-in
both for Used to Used or to New Car.
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The new car trade-in features is available due to the strategy to capitalize of the PT Mobil
Indonesia’s automotive ecosystem. DIMO has 154 inspection point across Indonesia, also
support with the affiliated new car dealer as the additional point to maximize the value chain.
5. Business Solutions
The author will provide a proposed business strategy for DIMO to enhance transaction volume
purchase based on the analysis above. The author used SWOT and TOWS to formulate the
business strategy proposal.
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Asian Journal of Research in Business and Management
e-ISSN: 2682-8510 | Vol. 5, No. 3, 37-48, 2023
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5.1 SWOT
Table 8: SWOT Analysis
DIMO has the ability to collaborate and synergize with other automotive ecosystems
as an official business partner. The companies that collaborate and synergize with
Strength
DIMO include new and used car dealer, financing, and insurance, as PT Mobil
Indonesia has specific subsidiaries operating in those fields.
The analysis of perceptions given by potential customers in Figure 2 shows that
DIMO has a relatively low score in terms of competitive prices offering. This poses
Weakness
a challenge for DIMO to improve its perception in the eyes of potential customers
to meet their desires.
One of the significant opportunities is the highly fragmented used car market, which
is starting to shift towards utilizing technology to search for used cars.
According to figure 1, the variable "skilled inspection officers," DIMO's score is
Opportunity almost on par with competitors who have higher top-of-mind scores. This can be
attributed to DIMO being a subsidiary of PT Mobil Indonesia, a renowned player in
the automotive industry in Indonesia, which influences the perception of the
inspection officers' quality.
DIMO faces a threat concerning the electric vehicle trend. Considering that all of
DIMO's current stock units are vehicles with combustion engines, the growing trend
of the public shifting towards electric vehicles poses a threat to DIMO. This is
Threat
because DIMO may encounter difficulties in acquiring electric vehicle stock due to
the limited number of electric vehicle users in Indonesia, resulting in low
transactions for electric used cars.
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Asian Journal of Research in Business and Management
e-ISSN: 2682-8510 | Vol. 5, No. 3, 37-48, 2023
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The conclusion reveals that DIMO currently lags behind its competitors in terms of brand
perception on DIMO’s unique selling proposition. This finding highlights the need for DIMO
to invest in brand building and marketing efforts to increase awareness and differentiate itself
from competitors. By understanding the perceptions of potential customers, DIMO can identify
areas for improvement and tailor its messaging and offerings to better meet customer
expectations.
The proposed business strategies suggest that collaboration will be a key driver for increasing
purchase transaction volume. Trade-in programs can incentivize customers to upgrade their
cars, thereby generating more used cars for DIMO's platform. Collaborating with new car
dealerships, financing and insurance partners can create synergies that attract a broader
customer base. Digital marketing campaigns will be essential for reaching and engaging
potential customers effectively. Leveraging digital platforms and social media can expand
DIMO's reach and influence, ultimately driving more transactions to the platform. These
campaigns should highlight DIMO's unique selling points and emphasize its value proposition
to entice customers to choose DIMO over competitors. Creating a pricing data analytics
database is crucial for DIMO to establish itself as a reliable and transparent marketplace for
used cars. Having comprehensive and accurate pricing information will build trust with
customers and encourage them to transact on the platform with confidence. Focus on
developing a special trade-in program for electric cars demonstrates DIMO's proactive
approach to tapping into the emerging market of electric vehicles. As the electric vehicle
market grows, having a specialized program catering to this segment will attract
environmentally conscious customers and set DIMO apart as an innovative and forward-
thinking platform.
The company must leverage PT Mobil Indonesia's ecosystem to enhance DIMO's market
penetration through a collaborative approach for each strategy it intends to implement. This is
crucial because as a used car business platform, DIMO cannot thrive in isolation without the
support of other automotive ecosystem components, such as new and used cars dealer,
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Asian Journal of Research in Business and Management
e-ISSN: 2682-8510 | Vol. 5, No. 3, 37-48, 2023
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financing, and insurance. Adopting a collaborative approach will also have positive
implications for increasing DIMO's awareness among the public and improving its perception
in the market.
This research is limited to potential customers, focusing on those who have experience in
transactions involving both new and used cars. The author recommends that future research
should shift its focus towards customers who have already used the DIMO platform. By doing
so, the analysis can extend beyond perception and delve into evaluating the actual customer
experience.
Expanding the research to include existing DIMO platform users will allow for a more
comprehensive evaluation of their interactions with the platform. This approach can shed light
on strengths, weaknesses, and areas of improvement, ultimately providing valuable insights to
enhance customer satisfaction and retention. Understanding the customer experience will
enable the company to refine its services, address pain points, and cater to their needs more
effectively.
Furthermore, exploring customer experiences on the DIMO platform can aid in identifying
potential opportunities for cross-selling and upselling. Satisfied customers are more likely to
engage with other offerings within the ecosystem, such as purchasing insurance or considering
financing options through PT Mobil Indonesia.
By focusing on the customer journey and experience, the company can better align its strategies
and services with customer expectations, building stronger relationships and fostering loyalty.
Additionally, positive customer experiences will lead to positive word-of-mouth, contributing
to increased awareness and attracting new customers to the DIMO platform.
References
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Communication. 7th ed., Pearson Education, 2018.
Czepiel, J. A., & Kerin, R. A. (n.d.). Competitor Analysis. Handbook of Marketing Strategy.
Delgado-Ballester, E., & Hernández-Espallardo, M. (2008). Effect of Brand Associations on
Consumer Reactions to Unknown On-Line Brands. International Journal of Electronic
Commerce, 12(3), 81–113. doi:10.2753/jec1086-4415120305
Kazi, A., Khalid, W. (2012). Questionnaire designing and validation. Journal of the Pakistan
Medical Association, 62(5), 514-6.
Kotler, Philip, and Kevin L. Keller. Marketing Management. 14th ed., Prentice Hall, 2012.
PwC Indonesia. 2023. PwC Indonesia Economic Update: Second Quarter2023. Jakarta: PwC
Indonesia
Rothaermel, Frank T. Strategic Management. 4th ed., McGraw-Hill Education, 2019.
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