Wine - Indonesia

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

Customer preferences: Indonesian customers have shown an increasing interest in wine, particularly among the younger generation. Wine is no longer seen as a luxury item reserved for special occasions, but rather as a trendy and sophisticated beverage that can be enjoyed on a regular basis. This shift in consumer behavior can be attributed to several factors, including increased exposure to Western culture and the influence of social media. As a result, there has been a growing demand for a wide variety of wines, ranging from affordable options to premium and rare bottles.

Trends in the market: One of the key trends in the Indonesian wine market is the rise of domestic wine production. While imported wines still dominate the market, local wineries have been gaining traction in recent years. This trend can be attributed to the increasing quality of Indonesian wines, as well as the government's efforts to promote the development of the local wine industry. As a result, consumers now have more options to choose from, including wines made from locally grown grapes. Another trend in the market is the growing popularity of online wine sales. E-commerce platforms have made it easier for consumers to access a wide range of wines from around the world, including rare and hard-to-find bottles. This has contributed to the democratization of the wine market, allowing consumers to explore different varieties and regions without having to rely solely on traditional brick-and-mortar stores.

Local special circumstances: Indonesia's unique geography and climate pose challenges for the wine industry. The country's tropical climate is not conducive to grape cultivation, and the lack of suitable land for vineyards has limited the growth of the local wine industry. However, some regions, such as Bali and Lombok, have shown potential for wine production due to their volcanic soil and cooler climate. These areas have become popular destinations for wine tourism, attracting both domestic and international visitors.

Underlying macroeconomic factors: The growing middle class in Indonesia has been a key driver of the wine market. As disposable incomes rise, consumers are increasingly willing to spend on premium products, including wine. Additionally, the government's efforts to attract foreign investment and promote tourism have created a favorable business environment, attracting international wine producers and distributors to enter the Indonesian market. In conclusion, the Wine market in Indonesia is experiencing growth due to changing customer preferences, the rise of domestic wine production, the popularity of online sales, and the country's unique geography and climate. These factors, combined with the growing middle class and favorable macroeconomic conditions, have created a thriving market for wine in Indonesia.

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.