Indonesia 2015 | Overview | BrandZ Analysis
The age of brands in the Top 50 is relatively young by global standards, if not quite as young as the China index, which includes many technology-focused brands which are inherently young.
The average age of Indonesian brands in the Top 50 is 45 years old, though there are some very old brands whose heritage is not reflected in this average. The second-highest ranked brand, the bank BRI, for instance, is more than a century old, and Dji Sam Soe, the brand of clove or kretek cigarettes that ranks ninth in the Top 50, dates back to 1913.
To be eligible for inclusion in the Top 50, brands must be owned by a publicly listed company. In other markets, particularly China, the brands that have achieved such scale in just a few years have been fast-growing technology companies. The scarcity of young brands in the Indonesian Top 50 brands reflects the fact that technology brands in Indonesia have yet to achieve significant scale.
Those few Top 50 brands launched since 2004 include two cigarette brands launched by a parent company with decades of heritage and several older brands in their stable, along with a property developer. The only relatively new brand to reflect a real shift in the consumer market is Hypermart (ranked 23rd and launched in 2004). Hypermarkets began to launch in Indonesia in the 1990s, but it was only in the 2000s that this way of shopping became the phenomenon it is now.
The younger half of brands in the Indonesia Top 50 are together worth US$29.9 billion, and the older half are worth slightly more, US$34.7 billion.
The relative youth of Chinese brands can be explained by the reforms and opening up of the Chinese economy, a process that began in 1978.
The older brands in the index reflect the early stages of Indonesia’s economic development; they are predominantly banks, while the FMCG brands that have made the Top 50 came later.
All brands in the Indonesia Top 50 are publicly listed, but the ownership of their shares varies; in some cases, a portion of shares is owned by the Indonesian government, and in others, there is a multinational parent company that owns a stake in the listed company. The Indonesian Top 50 brands are dominated, in both number and value, by private brands – those with neither a government nor multinational parent.
There is also a strong showing by multinational brands. Most of the state-owned brands in the ranking are older brands, and tend to be in the banking sector.
Brands owned by multinationals outperform the rest of the Top 50 on measures of saliency and how loved they are – but this is likely to be a reflection of the categories in which multinational brands have launched, primarily FMCG categories, rather than the fact they are owned by a multinational parent.
The strong performance of private and multinational brands in this market shows that that for international brands with hopes of expansion into Indonesia, there is ample opportunity for success. While home-grown brands dominate the Top 50, those that have been imported and have done well have proved popular because they have adapted to reflect local needs and values.
Ownership of Top 50 Indonesian brands