Arnold Sebastian Egg: A Promising Market for E Commerce

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ONLINE business is still a mystery to many Indonesians, so it is not surprising that they are often dismissive when they hear that someone is going into online business. Arnold Sebastian Egg also observed the question mark on people’s faces when he first started to seriously pursue the business.

But the man from the nation of windmills (Holland) did not give up easily as he was fully convinced of the bright future of online business here in Indonesia, which according to him is a promising market for e-Commerce. His conviction is based on the fact that the archipelagic nation can be unified through Internet technology.

When Arnold first set up the first online shop in Indonesia, TokoBagus.com in 2005 he started his business from the island of Bali. The island of Bali, in his view, is not only a popular tourism destination, but also lends much support to new businesses, especially those that are technology based. “At first it was only a small office in Bali,” he recalled while saying that the existence of an online shop is not limited to space as long as it has good infrastructure support.

Toko Bagus is indeed not an online store. “The transactions are still done offline,” said Arnold. He added that currently Indonesia is not ready with a website with a full e-commerce system as there are still many bugs in the payment system and the level of consumer trust in online transactions is still very low. “These are the reasons we have made TokoBagus.com more like an online catalog,” he explained.

Arnold has conducted aggressive awareness campaigns and promotions about TokoBagus.com to get as many members as possible and to convince them that online business can be profitable.  To further convince consumers and the public in general TokoBagus.com has also prepared rules and regulations for online business so that customers feel more secure about their transactions.

Slowly but surely Arnold’s efforts are bearing positive fruit. The popularity of TokoBagus.com continues to rise and today it is the largest, most complete, most popular free online site in Indonesia. It has various categories of advertisements covering numerous products and services. Every day Tokobagus.com receives as many as 10,000 new ads. Based on a survey released by alexa.com (for site rates) as per March 27, 2011 Tokobagus.com is number 23 among the sites most visited in Indonesia.

Arnold said that Tokobagus.com has a number of superior features. It is user friendly, has a large variety of products and services and live chat customer service. All these features meet customer requirements based on an internal survey.

Tokobagus.com also tried television advertising, however, according to Arnold it was not very effective.”To reach the online market our strategy has to be through digital marketing,” he explained. And, since 2008 Tokobagus.com has been quite aggressive in widening its market.

He said another plus point is the free space given to vendors. “We give them the space free. Their promos are considered ads and every free ad is organized according to when it is received so that the advertiser of today’s ad will appear before the ad of a vendor that placed an ad the day before,” he said.

Tokobagus.com is enjoying rapid growth with its current 700,000 plus members. “But that is the total number of members from the start while only 40 percent are active,” he said at Hotel Indonesia.

At present the store has 40 employees. The office moved from Denpasar to Jakarta in January 2011. “Our consideration in moving was easier access,” he said adding that here Tokobagus.com can coordinate more easily with its business partners.

Arnold explained that Tokobagus.com does not share any profits from transactions between the vendor and the buyer on its site.”This kind of website is also free in other countries,” he said. He explained that transactions take place directly between consumers (consumer to consumer — C to C) or business to consumer (B to C).

For Arnold the high quality of the products and customer satisfaction is very important so that he can filter fraudulent advertisers by rechecking first. “What is most important is our customers’ trust in us,” said Arnold who is applying for Indonesian citizenship.

He said that according to a survey transaction as per December 2010 were at Rp 300 billion. “This is only for products with a small value and does not include other commodities like property and automotive, because if we include all the results of the survey would not be valid,” said the graduate of telecommunications from James Madison University.

He said he has not focused on return of investment. “TokoBagus.com is still in the developing stage so profit is not yet our focus,” said Arnold.

However, he said, that although making profit was not yet the focus TokoBagus.com had a clear revenue source, which was from the numerous ads on its web pages.  TokoBagus.com also charges its members who wish to use its promo points to boost sales. Promo points are sold for Rp 20,000 for 20 points, Rp 50,000 for 50 promo points and Rp 100,000 for 100 points. (T. Hidayat)

The Jakarta Post, October 08, 2011