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Building consumer trust: why Indonesian brands should invest beyond programmatic advertising 

Programmatic advertising used to be one of the most reliable ways to generate new revenue for Indonesian brands. But the consumer demand for privacy protection and brand authenticity coupled with the increasing advertising costs means brands need to find a new channel. That’s where partnerships come in.

Myre Gustam, Account Director, Indonesia
Myre Gustam
Account Director, Indonesia
Read time: 2 mins

Programmatic advertising allows brands to rely on an algorithm to determine where to spend money best. All a media buyer needs to do is feed the campaign, audience, and key performance indicator (KPI)  information to the program,  and the algorithm will do the hard work — or so they thought. 

The issue is ads are no longer creating as many dream outcomes due to privacy concerns and lack of consumer trust.

These changes happened for three main reasons:

  1. Brands need to constantly monitor traffic optimization, making the entire process time-consuming and costly.
  2. It’s difficult to weed out ad fraud, and brands can’t tell if clicks and impressions come from bots and other non-human traffic.
  3. Brand safety is uncertain. Ads might appear next to irrelevant or harmful content because you can’t control placement.

And yet, many brands in Indonesia continue to increase their spending on programmatic ads annually. Between 2021 and 2022, this amounted to $1.69 billion, or 79.7% of their total digital advertising spend.

The truth is, it’s getting harder to sustain growth through programmatic advertising. 

If programmatic ads aren’t getting the job done anymore, what’s the solution then? 

Building a circle of trust to win new customers

Brands need to show t they possess the authenticity, trust, and values consumers want. A 2021 study by Ipsos found that 81% of Indonesians trust online recommendations from well-known sites or applications. A whopping 67.5% of Indonesians now research brands online before making a purchase, compared to just 16.2% who still click on banner ads. 

These stats mean there’s a vital need to build trust between your brand and your consumers. 

Partnerships offer a way to connect with new audiences with authentic content from reputable individuals or businesses. You can work with others who have a trusted relationship with your target customers and will refer them. 

These partners help nurture their audiences toward purchasing your products or services in return for a commission. They create opportunities through reviews, content, social media posts, or brand collaborations.

Many Indonesian brands have turned to influencers (i.e., key opinion leaders/KOLs). These content creators and traditional affiliates ( like coupon and cashback sites) drive specific business outcomes, such as a lead, install, or sale. 

The scoop on influencer partners

Celebrity influencers such as singer Ayu Tingting or power couple Raffi Ahmad and Nagita Slavina have millions of Instagram followers. It’s no wonder Indonesian brands have flocked to them like bees to honey.

However, brands also work with micro- or nano-influencers to reach small but highly-engaged audiences. ZALORA Indonesia’s Community Influencer program empowers its customers to become influencers by rewarding them with commissions for sales resulting from their recommendations.

Getting to know content partners

Content partnerships are collaborations between your brand and a publisher or media outlet in the form of reviews, listicles, or product guides. Unlike sponsored articles or advertorials, publishers maintain editorial integrity even as they organically promote products to their readerships. You also only pay publishers for each sale they help to close rather than for the piece of content itself.

Jagat Review focuses on independent, expert reviews of products such as laptops, gadgets, and video games. Jagat Review has worked with some of tech’s biggest names, including Tokopedia, Shopee, TikTok, and Lenovo. 

Don’t forget traditional affiliate partners

The most known affiliate partners are cashback or coupon sites. These partners promote your brand by offering discount codes or highlighting promotional deals. They then give consumers a cut of their affiliate commissions through cashback or loyalty rewards. All they need is an affiliate link from your brand to track their success in helping you achieve your business outcomes.

Global beauty retailer Sephora has an affiliate program that works on such a model, rewarding affiliates with an agreed-upon commission for all confirmed sales. The program has been growing well in Indonesia, Singapore, Malaysia, and Thailand.

Partnerships are an effective performance channel because brands only pay commissions after successful results. This model keeps costs per acquisition low. Brands find investing in this alternative channel can help brands in industries like travel and electronics achieve 25 times their return on investment (ROI). 

Interested in kickstarting your partnership program? Contact impact.com’s Southeast Asia team at grow@impact.com to learn more.

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