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Amazon to test Indonesian market

Amazon Indonesia is about to become a reality, with the US e-commerce giant planning an investment of $600 million for its first year in the market.

The move has been revealed by eCommerce Association of Indonesia (IDEA) chairman Daniel Tumiwa, who says he does not know when Amazon will launch in Indonesia.

However, he says the company will probably follow its usual pattern of expansion into large countries by testing the waters for a year followed by a decision on whether or not to stay.

Tumiwa says he believes Amazon would be able to grab half of the Indian e-commerce market within one year despite competitors like Flipkart, but says the company bowed out of China after 12 months, conceding the market to Alibaba.

However, Amazon will face the same major hurdles of other e-commerce companies in Indonesia – logistics and a general consumer distrust of credit cards and e-payments.

This story first appeared on sister site, Inside Retail Asia

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