Indonesia Macroeconomy

& FMCG Update Q1 2023

Data ending Mar 23

Presented by : Elisabet Kurnia

[email protected]
+628119123438

© 2023 Nielsen Consumer LLC. All Rights Reserved. © 2023 Nielsen Consumer LLC. All Rights Reserved.
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 BPS

GDP growth maintained in Q1’23, while inflation remains high

The CPI still increases above 5% despite it was lower compared to the previous quarter.

GDP Growth (%) Annual inflation (%)

2014-2021 2022 2023 2014-2021 2022 2023

FY 2022: 5.3
8.4

5.7
5.0 4.8 5.0 5.1 5.2 5.0 5.0 5.4 5.0 5.0
3.7 6.0
5.5
5.0
4.4
-2.1 3.6
3.4 3.1
3.0
2.7 2.6
1.7 1.9

FY FY FY FY FY FY FY FY Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 DEC DEC DEC DEC DEC DEC DEC DEC MAR JUN SEP DEC MAR JUN SEP DEC
14 15 16 17 18 19 20 21 22 22 22 22 23 23 23 23 14 15 16 17 18 19 20 21 22 22 22 22 23 23 23 23

Source: BPS | Bank Indonesia

© 2023 Nielsen Consumer LLC. All Rights Reserved. 3

 BPS

HH consumption maintained, export drives the growth

Investment spending grows relatively slow to the previous year while Government spending accelerated in Q1’23. Foreign
trade remains an essential contribution to driving GDP growth this year

Q1 2023 – GDP contribution by expenditure (%) GDP expenditure growth

Export/GDP* Import/GDP Net export Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
2017 2018 2019 2020 2021
’22 ’22 ’22 ’22 ’23 ’23 ’23 ’23
22.7% 19.6% 3.2%
Household consumption

5.0 5.1 5.0 4.9 4.3 5.5 5.4 4.5 4.5

2.0
HH Consumption 52.9
-2.6

Gov. Spending 5.3

Government spending

4.8 3.3 4.2 4.0

2.1 1.9
Investment 29.1
-2.9
-4.5 -4.9 -4.8
-7.7

Net Export/Import 3.2 Gross-fixed capital formation

6.2 6.7
4.5 3.8 3.9 4.1 5.0
3.1 3.3 2.1

Others 9.5
-5.0
Source: bps.go.id

© 2023 Nielsen Consumer LLC. All Rights Reserved. 4

 BPS

Inflation is slightly slower in early 2023, but still higher compared to LY

It is seen faster for all sectors in the annual Mar’23, highest in transportation due to fuel price increase

Monthly inflation & CPI* Annual inflation by composition

120 2.0 Annual Mar'22 Annual Mar'23

116.6
General 2.6
5.0
115 1.5
Food, beverages & cigarette 3.6
6.1

Clothing and footwear 2.0

1.2
1.2
110 1.0 Housing, water, electricity, and household fuel 1.8
2.7
1.0
Equipment and maintenance of household routes 3.8
3.7

0.7 Health 2.1

2.7
105 0.5
Transportation 2.4
13.7
Information, communication, and financial -0.2
services -0.2
100 0.0
Recreation, sport, and culture 1.9
2.5

Education 1.7
2.8
95 -0.5 Restaurant 3.1
4.0
Sep-21

Sep-22
Dec-17

Jun-21

Jun-22
Jun-18

Jun-19

Sep-19

Jun-20

Sep-20

Mar-23
Sep-18
Mar-18

Mar-20
Mar-19

Mar-21

Mar-22
Dec-18

Dec-19

Dec-20

Dec-21

Dec-22

Personal care and other services 4.4

4.7

*) Index to CPI Dec’17 -2 -1 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18

Source: bps.go.id

© 2023 Nielsen Consumer LLC. All Rights Reserved. 5

 Bank Indonesia

Indonesia consumer confidence in economic growth remains solid

This is reflected in the CCI which remain stable and strong at 123, despite retreating from 118 the year earlier

CCI CECI CEI

Consumer
Consumer Consumer future
economic Local COVID-19
confidence index
condition index
expectation index
Pandemic Mar’23
150 141 Confidence about future condition
140
137
140 134
134
130 129
126
123
120 118 Consumer confidence
105
110
113
95
116
113 123
100
90 100
Confidence about current economic condition
80
70
78 77
113
60
50 59
51
40
30
20 1st year Delta Omicron
10 local Covid-19 variant variant

0
JUN19 SEP19 DEC19 MAR20 JUN20 SEP20 DEC20 MAR21 JUN21 SEP21 DEC21 MAR22 JUN22 SEP22 DEC22 MAR23

Source: Bank Indonesia

© 2023 Nielsen Consumer LLC. All Rights Reserved. 6

 Bank Indonesia

It is supported by the income and job availability expectations

.. which have remained stable in the past 9 months.

Consumer current economic condition by components*

Mar'20 Apr'20 May'20 (space) Jul'22 Aug'22 Sep'22 Oct'22 Nov'22 Dec'22 Jan'23 Feb'23 Mar'23

120 120
118 120 119
116 118 119
114 114 114 114
112 112 111 110 111 112 110
108 107
103 103 103 105 106 107 105 106

86
84

73

64

51

41

28

Current income expectation Job availability expectation Durable goods purchase

.*) Consumer Current Economic Condition compared to 6 Months Ago.

Source: Bank Indonesia

© 2023 Nielsen Consumer LLC. All Rights Reserved. 7

 OJK
Trends in bank savings & investment funds remained positive
Savings and time deposit funds continued to increase in Q1 2023, with both saving accounts and time deposits contributing
almost equally to the growth. With the post-pandemic situation, the TD shifted to a more short-term orientation.

Q4 Position Rp5,549,171
Rp5,284,884
+7.9% +5.0%
Fund from saving account + Rp4,896,716
time deposit
(in billion Rp)
2021 Q1 (Up to Feb) 2022 Q1 (Up to Feb) 2023 Q1 (Up to Feb)

Composition of saving account & time deposit Time deposit by type

Q4 Position – Up to November Q4 Position – Up to November
(in billion Rp)
(in billion Rp) +4.9%
+5.2% +23.6%

+3.3%
-24.3%
Rp1,715,794
-17.4%
Rp3,016,762 Rp1,388,091
Rp2,407,687 Rp2,532,409 Rp2,877,197

Rp546,571 Rp560,466
Rp330,116 Rp424,281
Rp529,062 Rp399,579

Saving account Time deposit Period Period Period Period

1 month 3 month 6 month >= 12 month

2022 Q1 2023 Q1 2022 Q1 2023 Q1

Source: Otoritas Jasa Keuangan Q1 2021– Q1 2023 / www.ojk.go.Id

© 2023 Nielsen Consumer LLC. All Rights Reserved. 8

 CPS
Increase in spending is still happening across SES compared to last year
Q1 is typically when HH is not spending as much as the rest of the year.

Avg. monthly spend/HH – 000 IDR HH spending growth

Q1’23 vs YA (not in particular order)

% Growth  Total
Food
8,000 Q1‘23 vs YA  9%
Housing Related
7,000
Transportation
6,000
Strong Growth  Telecommunication
5,000 Education

4,000 Leisure

3,000 Insurance

Saving + Loans
2,000 
Moderate Growth
FMCG
1,000
Decline Growth  Health
0
Q1'21 Q2'21 Q3'21 Q4'21 Q1'22 Q2'22 Q3'22 Q4'22 Q1'23
 Strong  Moderate  Decline
(above +5) (between +5 to -5) (below -5)
Source: NielsenIQ Consumer Panel - Total Family Spending – Q1’23 vs YA

© 2023 Nielsen Consumer LLC. All Rights Reserved. 9

 RMS
In Retail sales, FMCG is growing 9% this year MAT
Price per volume measurement is continue to increase; 15% this year. Price per unit is also start to increase in Q1, resulted in
softening volume this quarter.

Value, volume growth & price/unit % change | Top 81 FMCG categories

GDP Growth 5.2 5.0 -2.1 3.7 5.0 5.0 5.0

Inflation 3.1 2.7 1.7 1.9 5.5 5.0 5.0

FMCG Price/Eq
1 4 9 2 12 15 13
Change %
11 12
8 9 9
7
5 4
4 5 4
1 0
2
-1 -1 0
-1 -1
-3
FMCG -7

FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 MAT MAR23 vs YA Q1'23 vs YA

Source: Bank Indonesia | NielsenIQ RMS Data

FMCG Value Growth % FMCG Vol Unit Growth % FMCG Price/Unit Change %
FMCG period 2019 and before use total market Indonesia exclude Maluku+Papua

© 2023 Nielsen Consumer LLC. All Rights Reserved. 10

 RMS

FMCG growth rate decelerated in Q1 2023

The deceleration happens almost in all categories. Basic necessities such as Food, Beverages, Basic Personal Care, and
Hygiene seem to hold up better in Q1
 Strong  Moderate  Decline
Retail sales value % growth (above +5) (between +5 to -5)Data ending in MAR23
(below -5)

P12M P3M P3M P12M P3M P3M

vs YA vs YA vs PP vs YA vs YA vs PP
FMCG (Cont.) FMCG (Cont.)
Cooking aid (8%)
Food (34%) Instant food (11%)
Snack + confectioneries (14%)
Dairy (12%)
Beverages (30%) Non RTD (6%)
RTD (12%)
Beauty Care (5%)
Personal care (18%) Basic PC (12%)
Decorative (1%)
Hygiene (7%)
Homecare (8%)
HC Others (2%)
Healthcare (1%) Healthcare (1%)
Pharma (3%) Pharma (3%)
Source: NielsenIQ RMS Data

© 2023 Nielsen Consumer LLC. All Rights Reserved. 11

 List of Categories
FOOD BEVERAGES PERSONAL CARE HOMECARE PHARMACEUTICAL
Chilli Sauce Analgesic And Cold
Liquid Milk Baby Diapers Bleaches
Remedies
Cooking Oil
Dairy Powder Milk Razor Blade Detergent Cough Syrup
Seasoning Flour
Sweetened Condensed Sanitary Napkin Dishwashing Liquid Cough Tablet
Cooking Aids Margarine Milk
Hygiene
Coffee Shampoo Fabric Conditioner
Soy Sauce Basic PC Eye Drops
Stock Soup Non Toilet Soap
Tea Cleaners Muscular Pain Relief
RTD
Coconut Milk Toothbrush
Syrup Non Powder Detergent Medicated Oil
Baby Cereal Toothpaste
Carbonated Soft Drink Battery Pharma Medicated Plaster
Breakfast Cereal Adult Diapers
Dry Noodle & Energy Drink Air Freshener Plaster
Instant Food Cologne Others
Vermicelli
Flavored Water Insecticides Antacids
Instant Noodles Hair Conditioning
Gel Dessert RTD Scourer Anti-Dhiarreal
Frozen Food
Skincare
Biscuit Juice Vitamin
RTD Beauty Care Talcum Powder
Chocolate Coffee RTD HEALTHCARE Fever Compress
Hair Styling
Gum Honey
Isotonic Drink Cold Rubs
Snack + Face Mask
Snack Herbal Remedy &
Confectioneries Mineral water
Soft Cake Mouthwash Medicine
Healthcare
Tea-RTD Condom
Total Candies Hair Coloring
Decorative
Remedy Drink Lubes & Gel
Make Up
Nut & Pilus

Note : Category with Bold color is new category added

© 2023 Nielsen Consumer LLC. All Rights Reserved. 12

Channel and Area
Performance

© 2023 Nielsen Consumer LLC. All Rights Reserved. 13

 RMS
RMS

Traditional format stores are more impacted with current situation

As decelerating growth rate is seen faster in traditional than modern format
Data ending in MAR23

Value (Rp) index – Mar’20

MT Hyper/Super MT Minimarket General Trade H&B Medical H&B Cosmetic

175

150

125

100

75

50

25
MAR20 JUN20 SEP20 DEC20 MAR21 JUN21 SEP21 DEC21 MAR22 JUN22 SEP22 DEC22 MAR23

Source: NielsenIQ RMS Data

*) Universe RRES Dec’21 vs Quick Count Jan’21

© 2023 Nielsen Consumer LLC. All Rights Reserved. 14

 CPS
FMCG Online is still thriving
Dominated by upper and middle classes, while lower class try to maintain their spending

Penetration (%) Total Spending (Bill IDR) Spend/HH (000 IDR)

Total Upper (16%) Middle (57%) Lower (27%)

5,587

28.7

24.1
3,587 536
18.9
431
14.7 2,418 371
11.8
14.2
9.4
11.3
9.1
6.9
5.6
4.6

Mar-21 Sep-21 Mar-22 Sep-22 Mar-23 Mar-21 Sep-21 Mar-22 Sep-22 Mar-23 Mar-21 Sep-21 Mar-22 Sep-22 Mar-23

Source: NielsenIQ Consumer Panel – FMCG - Online - Trended Rolling MAT

© 2023 Nielsen Consumer LLC. All Rights Reserved.

Price increase slow down the FMCG growth rate

ALL INDICATORS CONSUMER EVOLVING OFFLINE CHANNEL ARE MAINTAINING & FMCG E-
ARE MAINTAINED NEEDS & PRIORITIES COMMERCE IS CONTINUOSLY GROWING

Economic growth is maintained with GDP stays at 5% • Increase of spend is still happening across SES from • With current situation, traditional format stores are
level in the first quarter of 2023 driven by HH last year, Q1 is typically when HH is not spending as more impacted as decelerating growth is seen faster in
consumption and export. much as the rest of the year. traditional than modern format.
• As mobility recovers, leisure keeps increasing along
Indonesia consumer confidence remains solid supported with transportation and education. • FMCG eCommerce is still thriving driven by frequency
by the income and job availability expectation, yet and more categories are in the “basket”
careful-spending mode remains as :
• Inflation remains high with pressure observed across
sectors, highest in transportation
• Price increase continue for most of categories

As a result, FMCG and Cigarettes sales are decelerated

in Q1’23. All categories are under pressure, with ‘basic-
need’ categories seems to hold up better.

© 2023 Nielsen Consumer LLC. All Rights Reserved.

Thank You.
Elisabet Kurnia
[email protected]
+628119123438

© 2023 Nielsen Consumer LLC. All Rights Reserved. © 2023 Nielsen Consumer LLC. All Rights Reserved.