Beer - Indonesia

The Beer market in Indonesia has been experiencing significant growth in recent years, driven by changing customer preferences and local special circumstances.

Customer preferences: Indonesian consumers have shown a growing preference for beer over other alcoholic beverages. This can be attributed to the increasing popularity of social drinking and the influence of Western culture. Beer is often seen as a more casual and social drink, making it a popular choice for social gatherings and events. Additionally, the younger generation in Indonesia is more open to trying new and different flavors, leading to a rise in demand for craft beers and imported beers.

Trends in the market: One of the key trends in the Indonesian beer market is the increasing demand for low-alcohol and non-alcoholic beers. Health-conscious consumers are looking for alternatives to traditional beers that offer a lower calorie content and reduced alcohol content. This trend is in line with the global shift towards healthier lifestyles and the rise of the wellness trend. Brewers are responding to this demand by introducing a wider range of low-alcohol and non-alcoholic beer options in the market. Another trend in the Indonesian beer market is the growing popularity of flavored beers. Fruit-infused beers, such as mango, lychee, and passion fruit flavors, have gained traction among consumers who are looking for unique and refreshing taste experiences. This trend reflects the increasing consumer demand for innovative and diverse flavors in the beer market.

Local special circumstances: Indonesia has a large and young population, which contributes to the growth of the beer market. With a median age of around 30 years, the country has a significant proportion of young adults who are entering legal drinking age and becoming potential consumers of beer. This demographic factor, combined with the increasing urbanization and rising disposable incomes, has created a favorable environment for the growth of the beer market. Additionally, the tourism industry in Indonesia has been booming in recent years, attracting a large number of international visitors. This has led to an increase in the demand for beer, as tourists often seek to experience the local culture and cuisine, including the consumption of local alcoholic beverages. The presence of international beer brands and the availability of a wide range of beer options cater to the preferences of both domestic and international consumers.

Underlying macroeconomic factors: Indonesia's strong economic growth and increasing consumer purchasing power have played a significant role in the development of the beer market. The country's expanding middle class and rising disposable incomes have led to an increase in consumer spending on discretionary items, including alcoholic beverages. This has created a growing market for beer and encouraged both domestic and international beer companies to invest in the Indonesian market. Furthermore, the government's efforts to promote tourism and attract foreign investments have contributed to the growth of the beer market. The relaxation of regulations and the implementation of policies that support the hospitality industry have created a favorable business environment for beer manufacturers and retailers. In conclusion, the Beer market in Indonesia is experiencing growth due to changing customer preferences, including a preference for beer as a social drink and the demand for low-alcohol and flavored options. The country's young population, growing middle class, and booming tourism industry are also contributing to the expansion of the market. Additionally, Indonesia's strong economic growth and government policies supporting the hospitality industry have created a favorable environment for the beer market to thrive.

Data coverage:
The data encompasses B2C enterprises. The at-home market covers retail sales via super- and hypermarkets, eCommerce, convenience stores, or similar sales channels. The out-of-home data encompasses all sales to hotels, restaurants, catering, cafés, bars, and similar hospitality service establishments. Combined numbers encompass both the at-home market and the out-of-home market. Both the at-home and the out-of-home market are valued at retail selling prices including all sales and consumption taxes.

Modeling approach:
Market sizes are determined through a Top-Down approach, building on specific predefined factors for each market segment. As a basis for evaluating markets, we use resources from the Statista platform as well as in-house market research, national statistical offices, international institutions, trade associations, companies, the trade press, and the experience of our analysts. In addition, we use relevant key market indicators and data from country-specific associations, such as GDP, consumer spending (e.g. consumer spending on alcoholic beverages, consumer spending at Hotels, Restaurants etc.), and price level index. This data helps us estimate the market size for each country individually.

Forecasts:
In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the relevant market. For example, the exponential trend smoothing is well suited for forecasting the Alcoholic Drinks market with a projected steady growth. The main drivers are GDP per capita and consumer spending per capita.

Additional notes:
The data is modeled using current exchange rates. The impact of the COVID-19 pandemic and the Russia-Ukraine war are considered at a country-specific level.