Thursday, 22 October 2020 | 05:37 WIB

Aprindo: Unlike Online Stores, Offline Retailers Spend Less Money for Advertising

Illustration: Retail Industry.

JAKARTA, NETRALNEWS.COM - Online advertising (ad) spending apparently is bigger than retail ad spending. Referring to the results of monitoring of television commercial (TVC) by Adstensity, the money spent by offline retail companies throughout January-September 2017 was only IDR40.41 billion compared to online retail companies which reached IDR1.2 trillion.

Vice Chairman of the Indonesian Retail Entrepreneurs Association (Aprindo) Tutum Rahanta said retail entrepreneurs are unlikely to spend more on advertising expenditures because it means burning money.

Ad spending is reduced as retailers also see changes in consumer behavior that lead to more efficiency by choosing online shopping.

"So if we add ads now, anyone who has the funds or big group advertising their department store is burning money, it will not return. We know the direction of consumer development," said Tutum in a discussion themed "Retail Business of Current Age", Saturday (10/28/2017).

Online retail companies advertise excessively because they do not have physical goods that can be seen directly by consumers or stores that can be visited to see the condition of the goods.

"Online has no physical [place]. They should really introduce themselves to the public by advertising it heavily, if not who knows?" he said.

Meanwhile, offline retailers sell products that are collections of industry or industrial products of which the industry usually has advertised. They advertise retail company or store brands for certain region and within certain period.

According to Tutum, not all products can be sold by way of online such as food or daily necessities. "If for example, soy sauce, instant noodles are bought from online, [consumers] may starve," he said.

If there is now a sale of food through GoFood, the motorcycle taxi driver still needs to go to the restaurant to order food and only after being processed in the restaurant the consumers can enjoy the food.