Staying grounded, staying close

to your on-the-go basics

October 2020
Contents

Introduction 2

1. Smaller Purchasing Window 5

2. Different Impact Towards Different Categories 6

3. Different Regions, Different Regulation, Different Behavior 9

4. Know your brand buyer structure and how their purchase

10
behaviour has changed

5. Safety first will mean greater relevance of proximity 12

Summary 14

Staying grounded, staying close to your on-the-go basics

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 Staying grounded, staying close to your on-the-go basics

COVID-19 cases in Indonesia are still rising as we

cannot completely stop outside home mobility
without halting the economy
After overcoming the shock from initial COVID-19 outbreak period,
Indonesians have started to go out again and do activities outside,
indicating reconciliation to the fact that this situation is not going away
any sooner.

However, the mobility recovery pattern is still selective, mainly seen in

retail, recreation places and outdoor parks. At the same time, the
government keep encouraging everyone to practise physical distancing
and follow the health protocol when doing activity outside their home,
across Indonesia.

This new behaviour impacts everyone, including consumers and

businesses. Every brand needs to adjust the way to reach consumers. And
more than ever, there is a need to understand how shoppers’ purchasing
behaviour has changed, in home and on-the-go consumption.

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 Staying grounded, staying close to your on-the-go basics

Out of home mobility continues to increase despite rising cases

indicating that people are trying to reconcile to the fact that this situation
is not going away soon…

Source: Kantar, Covid19 Pulse, Google National Mobility index

Mobility mainly driven by increase in retail & recreation places and outdoor parks etc.
Transit stations and workplaces are not seeing any increase in traffic. So, people are
being selective in their mobility

Source: Google National Mobility index

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 Staying grounded, staying close to your on-the-go basics

In urban Indonesia, activities

outside home have become
increasingly prevalent and as a
result drove the impulse purchases
of snacking and beverage sectors.
Proximity becomes a focal point,
and this benefitted both general
trade and modern trade outlets.

On-the-go consumption occasion growth

MAT Mar 2019 vs. YA MAT Mar 2020 vs. YA

General Trade 4% 4%

Modern Trade 22% 14%

Indonesia Urban, Channel contribution, Occasion growth, MAT March 2020

Indonesia Urban, In home vs. On-the-go, This change requires us to re-think how
Channel contribution (occasion)
we see on-the-go consumption for
General Trade Modern Trade snacking and beverage market.
On-the-go On-the-go

It has become critical for us to de-

aggregate markets, segments, and
demographics to ensure that we are not
missing out on any opportunity.

And at the same time, fully informed to

93% 91% 90%
plan for market risks. This pandemic
drives stronger relevance for some
categories, while painfully hurting others.

9% 10%
7%
MAT Mar’18 MAT Mar’19 MAT Mar’20

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 Staying grounded, staying close to your on-the-go basics

1
Smaller purchasing window
(decline in occasions of impulse buying)

It is critical for brands to ensure both physical and mental availability,

especially when the purchasing window is smaller. People shop less frequent
than they normally do, five percent lower compared to last year.

The implementation of curfew in some areas gives directly limit impulse

buying behaviour. It forced consumer to choose products which are more
relevant or urgently needed. With a more limited outside home activities,
this naturally gave a positive push to a “more planned” in home purchase
behaviours. However, it is important to note that this shift unfortunately does
not happen across all snacking and beverage categories.

Purchase Occasion Frequency

YTD June 2020 vs LY YTD June 2020 vs LY

In-home +3% -1%

On-the-go -2% -5%

Indonesia Urban, Growth, YTD June 2020

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 Staying grounded, staying close to your on-the-go basics

2.
Different impact towards different
categories

Among impulse categories, Snacking and Dairy sector managed to book a

positive performance, while beverage is challenged.

Indonesia Urban, Value Growth

Snacks Dairy Beverage

YTD June’19 vs YTD June’20 vs YTD June’19 vs YTD June’20 vs YTD June’19 vs YTD June’20 vs
LY LY LY LY LY LY

In-Home 2% 12% 12% 23% 7% -1%

On-the-go 11% 6% 14% 5% 23% -9%

Indonesia Urban, Value contribution

Snacks Dairy Beverage

In-Home
73% 71%
70%

56% 59% 59%

55% 55%
54%

On-the-go

YTD YTD YTD YTD YTD YTD YTD YTD YTD

June’18 June’19 June’20 June’18 June’19 June’20 June’18 June’19 June’20

6

Snacking sector showed a similar
shift, where in home purchase
growth is faster than on-the-go
during this pandemic.
However, this category likely
benefits from a shift in consumption
occasion more than nutrition /
health angle. With less option for
snacking options beyond packaged
snacks (i.e. roadside fritter sellers
are now less than before COVID-19),
this brings a tailwind by enlarging
potential snacking occasion to the
sector.
Some brands have also
communicated that categories like
biscuit is a viable option for hunger
filling, which may be relevant to
those in need of quick and
affordable hunger fix.
Staying grounded, staying close to your on-the-go basics
In both dairy and snacking sector,
there has been a shift in consumer
purchase behaviour.
On-the-go consumption growth has
slowed down, while in home quickly
took over and showed a strong
performance.
These two sectors similarly benefit
from the pandemic although driven
by different reason. Dairy has been
at the forefront in relevancy as it
brings nutrition and immunity
boosting into the product promise.
Liquid Milk and Yoghurt Drink
category are the stars in this sector,
driving market growth from
penetration and consumption angle.
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 Staying grounded, staying close to your on-the-go basics

Beverage sector is hardest hit by the pandemic as both

on-the-go and in home purchases are declining.

This highlights a bigger challenge
than just declining occasion.
Relevancy could be a big hurdle for
this sector to overcome as beyond
“refreshment” there is limited angle
on functionality that the sector can
work on. An interesting observation
was found in mineral water category.
Larger pack size (1.5L) is still able to
grow for on-the-go purchases which
may indicate that consumers still
have thirst quenching need when on-
the-go, but might look for lesser
purchase frequency hence opting for
a bigger pack size that will last
throughout the day. This trend in
larger pack size is limited though and
cannot be assumed symmetrically
across all beverage categories.

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 Staying grounded, staying close to your on-the-go basics

3
Different regions, different regulation, different
behaviour

Different area has different ways to implement the mobility restriction. Hence,
consumers also adapt differently and exhibit different purchase behaviour.

Greater Jakarta is an example of heavily impacted area, where the market

declined -7% . On the other hand, non PSBB cities are still able to, although in a
modest state. This highlights the fact that brands must not use Jakarta as a lens
for Indonesia. We need to de-aggregate Indonesia and devise our strategy
accordingly.

Indonesia Urban, On-the-go spending, household expenditure

Top 13 Cities Growth On-the-go Spending Household Expenditure

MAT July 2020 vs. YA Q2 2020 vs. YA

PSBB Cities -2.0 -11.7

Note: Greater Jakarta, Greater Bandung, Greater Surabaya, Malang, Palembang, Pekanbaru,
Banjarmasin and Greater Makassar

Non-PSBB Cities 2.5 -8.0

Note: Greater Semarang, Greater Yogyakarta, Medan, Manado and Denpasar

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 Staying grounded, staying close to your on-the-go basics

4
Know your brand buyer structure and how their
purchase behaviour has changed

With school from home, it is only natural that younger consumer group will show
the biggest decline in on-the-go purchases. From Kantar data, consumers 20
years old and below shows a significant drop in value spend vs same period last
year. While the older age groups are able to maintain their value spend, likely
due to the necessity to still go outside and earn their living.

Indonesia Urban, Value Contribution, On-the-go consumption, by Age Group YTD P6 2020

≤20 Years

>20-35 Years

>35 Years
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 Staying grounded, staying close to your on-the-go basics

This situation will mean different thing for different brands, depending on
how heavy our brand’s reliance to certain age group is. At the same time,
this also highlights the possibility to drive traction among older age groups
as long as we can build relevance and understand what their trigger /
barrier is to purchase.

Indonesia Urban, Share of throat, On-the-go consumption, YTD June 2020

≤ 20 Y.O >20 - 35 Y.O >35 Y.O

RTE Sausage RTD Coffee Mineral Water

Cereal bar Soya Milk Isotonic

Ice Cream Energy/ Energy/

Vitamin Drink Vitamin Drink

Healthy Food Soft Drink Soft Drink

Drink

Candy and Isotonic RTD Coffee

Gum

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 Staying grounded, staying close to your on-the-go basics

5
Safety first will mean greater relevance of
proximity

With health becoming main concern, consumer is seeking for a secure and
hygiene place to shop. We have also seen that consumer’s mobility is still
not back to normal, which points out the fact that consumers will consider
their channel selection.

Kantar’s panel tracking has shown that modern trade (especially

minimarkets) are able to retail growth, while traditional trade declines.
However, we must not lose sights that while traditional trade declines, it is
still the largest channel with more than 80% value contribution to on-the-go
/ impulse purchases.

Indonesia Urban, On-the-go consumption, Value contribution, YTD June 2020

58% General
81%
GeneralTrade
trade
Modern trade
Modern
38%
19% Trade

On-the-go In-home

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 Staying grounded, staying close to your on-the-go basics

With a greater interest on hygiene and sanitation, brands could tweak the point
of sales material along this line, i.e. support in branded wash basin, or hanger for
hand sanitation. This would benefit both the outlet and consumers in driving
traffic and attending to their concern on hygiene.

We have pointed out in point 1, with lesser window of purchase, physical and
mental availability is more critical now than ever. And in Indonesia, we cannot
avoid traditional trade.

By now we have summarized the changes and identified the potential opportunity
and threats that we need to consider. A close monitoring of how the situation further
develops is important to guide us in course correction and make sure that we don’t
miss any opportunity.

It’s also interesting to note that during this pandemic 47% of snacking and beverage
brands are still able to grow for on-the-go purchases, although this number will vary
across sectors. This further highlight that growth is possible, even within on-the-go
purchases provided that our brand can justify relevance for our consumers.

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Staying grounded,
Staying close to your
on-the-go basics
COVID has changed the dynamic of impulse market. It forced
consumers to adapt and adjust their purchase behaviour. And from
what we have seen, these are the key areas that brands need to
keep in mind:

#1
Maintain physical and mental availability. Traditional trade
is still important, we need to ensure our brand can still
reach our retail partners and consumers across the country.

#2
More than ever, we need to understand how have
consumers re-prioritized their purchases. Understand what
the trigger and barrier are to purchase across our brand
buyers.

#3
De-aggregate. Generalizing could mean lost opportunity.
Deep slice of market, demography, and segment is
important for us to properly map risk and opportunity
areas.
 ABOUT US

OUR CONTRIBUTORS

Venu Fanny Andi Dimas

Madhav Murhayati Siswanto Anggoro
General Manager Marketing Director New Business Senior NBD Manager
Kantar Indonesia Kantar Indonesia Development Director Kantar Indonesia
Worldpanel Division Kantar Indonesia Worldpanel Division
Worldpanel Division

Kantar is the world’s leading evidence-based insights and consulting company. We have a
complete, unique and rounded understanding of how people think, feel and act; globally and
locally in over 90 markets. By combining the deep expertise of our people, our data resources
and benchmarks, our innovative analytics and technology, we help our clients understand
people and inspire growth.

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CONTACT US

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Jl. Prof. Dr. Satrio No. 164, Jakarta, 12930

✉ venu.madhav@kantar.com
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✉ andi.siswanto@kantar.com
✉ dimas.anggoro@kantar.com
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