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Social Media and Consumerism in Indonesia

How social media platforms contribute to growing consumerism among Indonesian youth.

Indonesia is a nation of 258 million people. Of that, nearly 124 million are in the labor force — the fifth largest in the world. So, it is easy to see that Indonesia carries enormous potential to keep improving its economic growth and to become a powerhouse in Southeast Asia. The country’s demographic composition is also promising: there are many young people. With a median age of 29.9, around half of Indonesians are under 30.

Added to this, the country’s GDP per capita increased from $857 in 2000 to $3,603 in 2016. Mercer Indonesia, a consulting and HR research firm, conducted a survey late last year regarding the salaries of young Indonesians. Having reviewed data from 127 companies that operate in industries such as oil and gas, telecommunications and pharmaceuticals, it found that graduate salaries range from 5 to 11 million rupiahs ($375 to $825) per month. With the monthly minimum wage in Jakarta set at 3.4 million rupiahs ($255), the average graduate salary is still higher than the capital’s living costs. Despite this, many young people are not happy with their pay.

SOCIAL MEDIA AND CONSUMERISM

Millennials in Indonesia apparently have a “saving attitude.” But, according to research by Provetic in 2016, the two primary reasons that youth save money are to buy concert tickets and to fund their traveling expenses. The result of this survey shows that the young generation has a growing consumerism mentality. In fact, a 2014 McKinsey & Company survey revealed that Indonesia has one of the fastest-growing consumer markets in the world.

One of the largest monthly expenditures by Indonesian youth is spent on leisure or entertainment activities. Wages are often saved to purchase concert tickets. The most recent example of this phenomenon was at the Coldplay show in Singapore on April 1. Live videos and photos flooded major social media platforms such as Facebook, Twitter, Instagram and Snapchat. Taken together, the concert tickets, airfare and accommodation cost quite a lot.

So, what has led to this trend?

The high consumerism culture among Indonesian youth is primarily a result of internet availability and social media platforms. Indonesia has seen greater internet access over recent years with 88 million people connected online, including 79 million active social media users. Nearly 90% of users are below the age of 34, and 54% are between 16 and 24. Indonesia is ranked high for social media penetration. With 111 million Facebook users — active and inactive — Indonesia comes fourth globally and first in Southeast Asia. The country has 24 million users on Twitter, one of the highest in the world, and 8.9 million are on Instagram.

Clearly, social media networks are growing more popular than ever. It is, however, important to highlight the way Indonesian youth use these platforms. Aside from personal use, these networks are utilized for ecommerce marketing strategies because young people are more likely to be influenced via social media in their purchasing options. In fact, the three main activities Indonesian youth do on Instagram is explore online shopping, check funny jokes and post their traveling photos.

Growing up in an inclusive digital environment, young people in Indonesia and around the world have been targeted as the largest market for ecommerce. Social media spaces that previously served only as platforms for communication and networking have now turned into showrooms for companies to target consumers. Becoming the world’s 10th largest economy in terms of purchasing power parity, many Indonesians spend their money after hours of surfing the web through social media.

Peer pressure undeniably also plays a role in promoting lavish lifestyles among the youth. They are expected to wear the latest fashionable brands and to travel to places both near and far, just for the sake of taking photos and uploading them to social media.

THE YOUTH NEED TO THINK ABOUT TOMORROW

Rising consumerism and poor spending habits should turn into long-term financial planning. Instead of spending most of their cash on concert tickets or travel, it is important to encourage millennials in Indonesia to invest.

Enjoying life, especially when financially independent, is not wrong. The problem, however, arrives when young Indonesians spend most, if not all, of their income on temporary pleasure without saving and planning for the future.

In moving toward a future-oriented consumption and savings lifestyle, the advancement of the internet and social media can help enhance the entrepreneurial spirit and opportunities for the younger generation. Today, financial stability can no longer be achieved only through working. Income, if managed properly, can be used not only to buy houses, land or other assets, but it can also become an additional source of income when leased. In addition, savings can be spent on buying a car to support mobility in daily life. Being a young entrepreneur by building a startup is also a promising choice for both the individual and the economy.

Indonesian youth should not only spend their income on temporary pleasures. Rather, they should start thinking about long-term investments for themselves and the nation.

The views expressed in this article are the author’s own and do not necessarily reflect Fair Observer’s editorial policy.

Photo Credit: Hocus-Focus