Utilization of the Internet by Digital Businesses

Based on the 2021 E-Commerce Survey conducted by the Central Bureau of Statistics (BPS), 63.52 percent of respondent e-commerce businesses utilized internet services for digital marketing, both through social media and marketplaces.

The digital economy era has impacted changes in people's lifestyles, including the methods of transactions used by the public. Shopping no longer requires going to a physical store; it can be done through online stores.

According to the Ministry of Communication and Informatics' Agency for Telecommunication and Information Accessibility (BAKTI), the benefits of digital marketing include reaching a wider market, targeting the right audience based on the goods/services sold, cost-effective marketing, and encouraging innovation and competition.

Although the use of the internet for digital marketing is increasingly prevalent, the 2021 E-Commerce Survey shows that only 8 percent of respondent businesses had received digital marketing training. Of all e-commerce businesses that participated in the training, 77.2 percent received it from the private sector, while 25.4 percent received it from the government.

In addition to digital marketing, the survey published in the 2021 E-Commerce Statistics report shows that internet services can also improve supply chain efficiency in the production process.

55.5 percent of digital businesses utilize the internet for ordering raw materials. As a result, internet services not only help the development of businesses from businesses to end consumers (B2C) but also for business-to-business (B2B) sales.

Furthermore, the internet's function for internal company communication ranks third in the list of activities that most frequently utilize the internet, at 44.3 percent. Communication methods include email, instant messaging such as WhatsApp, and groups.

The internet is also used for external communication with customers, not just internal communication. This communication includes customer service, complaints, returns, and other two-way communication needs. 41.1 percent of digital businesses have used the internet for customer management.

Note that a portrait of the development of the e-commerce sector is now presented in the E-Commerce Statistics publication released by the Central Bureau of Statistics since 2019. This publication captures the potential and development of digital businesses, in terms of the number of businesses, transactions, workforce, payment methods, shipping methods, and even the reasons why businesses refuse to conduct online trading.

The survey included 1,774,589 digital businesses, or approximately 75.15 percent of the total online businesses in Indonesia (2,361,423 businesses) across 34 provinces, covering 303 regencies/cities.

Another finding is that 25.92 percent of businesses conducted e-commerce activities up to June 30, 2021. This figure indicates that Indonesian businesses are still dominated by conventional businesses, and most are located on Java Island.