TNS boss: Indonesia lacks a strong ‘status brand’; who creates one will make ‘tons of money’

Suresh Subramanian


Indonesia lacks a strong local “status brand” and marketers who can create one – and not get too price-focused as the economy falters – could make “tons of money”, a market research agency boss said today.

In an interview with Mumbrella in Jakarta, Suresh Subramanian, the managing director of TNS Indonesia, said that one of the biggest struggles of brand owners in the archipelago has been how to create a strong brand that affluent Indonesians buy in pursuit of status.

“There are very few premium status brands in Indonesia. Not because people don’t have money – there’s a lot of money at the top end of the market. It’s because there are no Indonesian brands that appeal to this market – it’s a very under-utilised segment,” he said.

“Indonesia is going through tough economic times after years of largesse. But the answer is not to cut prices. It’s to premium-ise. And no-one has done that well.”

Who can crack that will makes “tons of money” at good margins, Subramanian said.

But premium does not necessarily mean expensive, and what is defined as status or ‘badge’ values is out of date, he said.

“In the past it was about flashy cars. And the ads were so predictable. But today it’s about exclusivity. Having access to what others don’t – and that doesn’t have to mean expensive. An iPhone is not out of reach, but having it first has status. It’s about being first or having exclusive access.”

Customised batik clothing is an example of the movement towards exclusivity in Indonesia, but the branding and advertising industry has not picked up on this, and is “still stuck in the old cues of status,” he said.

Indonesian consumers are changing fundamentally and becoming more demanding, Subramanian said.

Ads by youth brands that show crowds of young happy people are “old fashioned” and don’t work anymore, he contended. “They want a different form of identity. It’s now about how brands can be personally relevant.”

The challenge for brands now is to fight for share rather than rely on the category growth that has been a luxury in recent years as Indonesia’s ad sector has boomed.

“Brands used to surf on category growth. But these years will teach people that it’s not about surfing, it’s about fighting for share. The easy growth has gone.”

To get the “tough growth” requires different thinking, he said. “That’s where Indonesia is today – it’s on the cusp. Brands that understand that will thrive,” Subramanian said.

“Indonesia is good on activation rather than real strategy, which is reflective of the mindset. The level of marketing eduction is poor, which is a real problem,” he said.

However, Subramanian noted that a new generation of Indonesians entering the workforce – the post-Suharto generation (Gen PS) – was more “provocative” and questioning.

“The desire to question is there – and it wasn’t there earlier,” he said reflecting on the 15 years he has worked in Indonesia since moving from India.

“India over-intellectualises and over-thinks. It’s the opposite here. The answer is somewhere in the middle.”

“Indonesians underestimate their own thinking. They’re humble to the point of not believing in themselves,” he commented.

“India has complexity of diversity and width. Each state is hugely different. Here you don’t have complexity of diversity, but of depth.”

“Self expression is weak in Indonesia, whereas in India there’s over self-expression. Here, people are taught to wear a mask.”

He said: “It’s interesting that the language [Bahasa Indonesia] does not have swear words. This is reflective of a culture that is very nuanced. Just because it is not expressed, this does mean it is not there. Here what you see is not what you get – and complexity comes from that.”

The market is often misunderstood because nuance is overlooked, he said.

“There is a lot that is layered and behind the scenes – shadow puppetry – that is not picked up on. This is another big opportunity for brands,” Subramanian said.


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