Creative, Local and Online
Bobobobo founder Jimmy Akili believes e-commerce start-ups should be confident and adapt to the fast-moving dynamics of the industry
By Tellisa Ramadhani
Saturday, September 12, 2015
Founded by Jimmy Akili, it provides a wide range of products channeled through more than 1,000 brands across seven categories: women, men, living, travel, food, wellness and events. It aims to win over the Indonesian millennial generation by partnering with hot and up and coming brands and business groups.
Despite the challenges in Indonesia’s e-commerce marketplace such as lack of infrastructure and regulatory confusion, Bobobobo is booming, and Akili says that visits are increasing by at least 20 percent every month.
Akili has always had a passion for design, and that led him to see the potential of Indonesia as a creative community. For him, the nation is unique and limitless. As a result he saw the potential for something like Bobobobo and switched from his career in the hospitality industry to e-commerce to tap that potential.
Akili shared with AmCham Indonesia how he sees Indonesian products and local brands as a business opportunity, and his strategy to expand the market.
AmCham Indonesia: What is Bobobobo?
Jimmy Akili: We created Bobobobo as a lifestyle destination, where we want to introduce to the Indonesian market an alternative to mainstream e-commerce sites. We see Indonesia’s potential in small to medium sized enterprises and the creative economy industry. In the past five years, there has been a boom in pop-up markets and bazaars in big cities throughout Indonesia, where the players are small local entrepreneurs. Despite being a small to medium scale businesses, the quality they have is undoubtedly great and has potential.
When we created Bobobobo, we were thinking that, rather than importing things, why don’t we feature these homegrown industries. The 18-35 market, in my observation, has been spending less and less time shopping in stores. But with the pop-up markets, the market keeps growing and expanding. Also, the development of traditional markets like Pasar Santa has also caught the attention of this age group.
I think Indonesians are very creative, and it is much easier now than 10 years now to start a brand. For example, clothing, in the past we had to build a factory. But now, we can search online for small-scale makers that cater to small businesses. This is an industry that if we nurture it well, will be very good for Indonesians.
Our strength is that we are known as champions of Indonesian homegrown brands in fashion and other products such as restaurants and travel packages. We specialize in offering travel packages for the weekend and to places often unheard of, like Derawan Island, Weh Island, Alor Island and many more. Our mission is to create an e-commerce platform with an end-to-end concept. We support the brands by providing them with a platform. Our specialty is in marketing and branding for those local brands.
I jumped into the e-commerce world because of its huge potential. This industry does not mean you have to have the biggest funding or the biggest networks ever, but it is about who has the brightest idea and executes it well. So, Bobobobo has the ambition to create a sustainable company. With our product offerings we see all the preferences of our target market, and it turns out they like indie brands, events, traveling and eating outside.
Who is your target market?
We target our core audience as being 18-35. We do not target any income level, but more on urban people. Our primary target is people in Jakarta, but revenue or orders from outside of Jakarta multiply every month. We do not look at it from the income perspective because there are things we offer that are available for free, and the prices range between Rp 50,000 to somewhere in the millions of rupiah. We want everyone to be able to use our website.
The e-commerce business is experiencing significant growth at the moment. For Bobobobo itself, we get at least 20 percent growth every month. Whereas the opposite is happening to the real trading sector. When it comes to competition, I think it’s not that we are getting more of the existing ‘pie’ but that we make that ‘pie’ bigger.
Our biggest markets after Indonesia are Singapore, Australia, the Middle East and a few [orders] from the United States. Some 4 percent of our customers are from abroad. That number has been stable because we have not targeted exports, because we are still focusing on expanding within Indonesia. But the demand from abroad is there.
What foreigners seek on Bobobobo is clothing from Indonesian designers and also unique products, like teapots made as a result of our partnership with contemporary artists in Jogja and Bali or lamps that are limited edition pieces.
How do you select the products that can join Bobobobo?
Firstly, the product must be authentic — it cannot be a counterfeit, the quality must be the best, and they have to pay attention to their branding too. But, our uniqueness is the way we curate those things. We have teams that are passionate, such as one that is interested in novelty and craft items or another that is passionate about fashion.
Where are the vendors from?
We have vendors from many places all over Java and Bali. Recently we sold products using fabric from Sumba. We want our audience to discover products from all over Indonesia, but sometimes we also feature products made in other countries, for example Japan. We have partnerships with more than 1,000 vendors.
More than 90 percent of our retail products come from local brands. But with our travel packages, since we offer packages abroad too, we have many partnerships with foreign vendors.
How do you create those partnerships with vendors?
We create the partnerships by approaching the vendors, or there are vendors who came to us and ask how to be featured on Bobobobo. We have a team that curates the products according to the theme we create.
What are the challenges when dealing with local vendors?
This industry is still young, therefore most of the players are also youngsters. Sometimes they do not have the resources, for example when Eid is coming there are a lot of delays in production due to the lack of human resources available. Discipline is also an issue – oftentimes there is no product as a result of lack of discipline. And also, since these are small to medium scale businesses we cater to, their products are mostly made in small quantities. We see our mission as to nurture and guard these local industries, but at the same time be sustainable for our own company.
When you speak to the older generation, they still think that selling through technology would be too complicated so they prefer to just open a store. But I always try to convince them that it would be a waste if they did not expand their market to more than just the people who come to their store. We are ecstatic when we manage to convince people who are very talented but still a bit shy or intimidated to use the technology. Our merchants enter a long-term partnership with us, not just for a one-time thing, realizing that selling through this platform will be more profitable. There are a lot of merchants who have supported us since we started.
These obstacles force us to be creative and unique. This is very promising, and there are many success stories of Indonesian creativity. There are many famous brands that came from here and then went international. For example, the founder of Aman resorts is Indonesian, Alila hotels started in Indonesia, and the Ismaya Group was founded by Indonesians. Sometimes this is being overlooked by people.
That is why we can only be successful if we succeed in giving value back to our partners. It is about how to be the best online business partner for those brands.
How hard is it to find the available desired curated items?
There is an abundance of items out there. But this market is fragmented, you cannot only find it at one place as it is scattered all over the islands. Since we just started, it really is hard work to gather all those things together.
Since I started Bobobobo, I have been learning what kind of hardships these businesses are going through. Human capital is one of the challenges. For example, when a fashion designer does not know where to find a great tailor. Raw materials is another one, with most still having to import the materials. Third is access to the market and branding. The first and second issues we can help them with references. But we are focusing on the third issue: marketing, branding, positioning.
What is your strategy to expand the market?
First, we do it through our platform of course: the Internet. The objective is to create networks or get into communities and make them join us through that network. The other way that is most effective for the time being is through social media and bloggers.
There is definitely the ‘offline’ way to do it. When there is bazaar — which are scattered across cities in Indonesia now — we can promote it through those events. Our merchants inform their customers in stores that they also sell their products through our website.
We are very happy if there are more players popping up in Indonesia, especially the local players. It creates a healthy competitive industry. If I want to educate the market, it will be more effective if I cooperate with other players, the competition, especially with the local players, could turn into a form of alliance. Our solution to face the competition is to be confident and execute everything perfectly; there is no shortcut for that.
Some people assume that local products tend to be more expensive than imported ones, what do you say to this?
That is very interesting, isn’t it? Maybe 10 years ago, I remember people were saying imported things were much better than the local brands and were more expensive. But now, if people see local as more expensive than imported, I am happier. Because I personally know that most of the local brands are handmade, whereas the imported stuff is factory-made. So with that price, you should compare it with the quality: is the material better? Is it more unique? Or is it a limited edition? And I think our local products are still cheap considering the way they are made and the materials. If local products were made from the same materials and using the same techniques as foreign products, the local products would still be cheaper.
How did you get the funding for this business?
The funding still comes from locals. In the future, we look for potential partners or investors who believe in our vision.
What do you think of the government’s support when it comes to e-commerce?
For now, e-commerce is included in the government’s negative investment list. Of course the government’s intentions are good, to protect the local players. However, I believe that if you want something to grow, you should not do it by protecting it, instead you allow healthy competition.
What is your advice for other e-commerce startups?
They should be confident. In my experience, the difference between the real sector and e-commerce is movement. E-commerce moves so rapidly, so to make decisions you have to be very swift. My advice is do not ever regret those decisions and if you make a bad one, just learn from it. That is why confidence is the foundation for any e-commerce player.