The fastest-growing consumer in the toy industry is not a kid. A new generation of adults is rewriting the rules of play, driving billions in annual sales and reshaping how toy brands approach product development and marketing. These buyers, known as kidults, are fueling growth as they seek nostalgia, collectables, and high-end toys once marketed exclusively to children. Their spending habits have become a defining force in the industry, outpacing traditional toy buyers and reshaping market strategies.

According to NPD Group data, these consumers now account for one-fourth of all toy sales annually, generating around $9 billion in revenue. Their presence in the market is not new, but spending has accelerated since the pandemic, leading to year-over-year gains despite challenging economic conditions. At a time when overall toy sales volume has dipped, higher prices and strong demand from kidults have offset losses and kept the industry growing.

Brands that once targeted parents shopping for kids are now catering directly to an audience willing to spend more for limited-edition action figures, premium Lego sets, and collectables tied to their beloved franchises. The shift is not a passing trend; it is a transformation in consumer behaviour that companies can no longer ignore.

Who are Kidults and Why are they Buying Toys and Games?

Play is no longer just for children. Adulthood has been redefined by a generation that sees nostalgia as a lifestyle rather than a fleeting indulgence. Millennials and Gen Z, raised in an era of immersive entertainment and franchise-driven storytelling, embrace toys as symbols of identity and self-expression.

Kidults are particularly drawn to cartoons, superheroes, and collectables that remind them of their childhood. They buy merchandise such as action figures, Lego sets, and dolls that might typically be meant for kids. In response, toy makers have created entire product lines tailored for these buyers, recognising that demand for nostalgic and high-quality collectables continues to surge.

Social media has amplified this shift, turning fandoms into global communities where collectables are status symbols. Limited-edition releases, high-end figures, and retro-inspired toys are not just purchases – they are cultural markers. What was once considered a niche hobby has become mainstream, with brands tapping into a lucrative market that values authenticity, nostalgia, and exclusivity.

Beyond nostalgia, psychological factors like stress relief, escapism, and personal identity also drive this trend. Many adult toy buyers see these purchases as a way to disconnect from daily pressures, embrace childhood joy, and express individuality. 

For many kidults, these purchases provide a sense of relaxation and familiarity, helping them cope with daily stress and responsibilities. The ritual of collecting, displaying, and engaging with nostalgic brands creates a sense of stability in an unpredictable world.

Case Study: Funko’s Collector Market Success


Image Credit: The Gamer

Funko, best known for its Pop! Vinyl figures have built an empire catering to adult toy collectors. The brand strategically partnered with major franchises like Marvel, Star Wars, and Harry Potter, offering limited-edition releases and convention-exclusive drops that create demand through scarcity.

Focusing on pop culture nostalgia and tapping into fan-driven communities, Funko has positioned itself as a powerhouse in the collector market. The brand’s direct-to-consumer strategy and exclusive collaborations with major retailers have made it a staple for kidults looking to expand their curated collections.

Toy Companies Are Rewriting Their Playbook for Kidults

The world’s biggest brands are no longer designed solely for children. Lego, Mattel, and Hasbro have pivoted to meet the demands of adults in the toy market, launching premium product lines tied to pop culture, gaming, and blockbuster franchises. High-end collectables, intricate building sets, and nostalgia-driven reboots now dominate shelves, targeting consumers willing to pay a premium for quality and exclusivity.

Lego’s detailed Star Wars and architecture sets, Mattel’s collector-edition Barbie dolls, and Hasbro’s Black Series action figures are just a few examples of how the industry has evolved. Limited-edition drops and direct-to-consumer sales have become critical strategies, leveraging scarcity and brand loyalty to drive demand.

At a time when traditional toy sales have slowed, kidults have emerged as the industry’s biggest growth driver. While board games, puzzles, and playsets saw a pandemic-fueled boom, the first nine months of 2022 recorded a 3% drop in sales volume. Higher prices helped offset this decline, boosting overall sales revenue by 3%. Kidults, who tend to spend more per purchase, have maintained industry momentum.

For toy companies, catering to adults is no longer an experiment; it is a core business strategy.

Kidults Around the World

Kidults-around-the world

Case Study: Lego’s Strategic Pivot to Capturing the Kidult Market

Image Credit: Lego

Lego, known for its interlocking brick sets, has skillfully targeted the growing kidult demographic. Recognising the growing demand among adults for complex and nostalgic play experiences, Lego expanded its product line to include intricate sets that appeal to mature consumers.

In 2024, Lego reported a 6% increase in sales, largely attributed to the popularity of its Botanics flower sets specifically designed for older consumers. These sets offer a blend of creativity and relaxation, resonating with adults seeking mindful activities. Lego’s collaborations with popular franchises have bolstered its appeal to the kidult market. Lego taps into the nostalgia and fandoms that drive adult toy purchasing decisions by producing detailed models tied to beloved series.

Lego’s success with the kidult segment shows the value of catering to adult consumers’ desires for nostalgic and hands-on experiences.

What Toys are Kidults Buying?

Kidults are not just a niche segment – they are the backbone of the toy industry’s growth. While they make up only a quarter of total toy buyers, they account for 60% of dollar growth, according to NPD’s Checkout data. Their willingness to pay for premium products has created a revenue stream that far outpaces spending by parents buying for children.

Unlike cost-conscious parents who seek budget-friendly options, kidults gravitate toward collectibles, high-quality models, and limited-edition releases with higher price points. Their spending is not dictated by seasonality in the same way as traditional toy buyers. While holiday shopping remains a peak sales period, this audience purchases year-round, making them a more predictable and stable consumer base.

This shift has allowed toy companies to move beyond the cyclical boom-and-bust nature of holiday-driven sales. Even as inventory challenges and inflation pressure retailers, demand from kidults has remained strong. As a result, brands are increasingly designing marketing campaigns and product launches with this audience in mind, ensuring their place as a long-term driver of industry revenue.

Marketing Strategies For Toy Brands Targeting Kidults

Toy brands no longer rely on traditional retail displays or children’s TV ads to drive sales. Instead, they target kids where they are most engaged – on social media, in collector communities, and through direct-to-consumer platforms. Digital-first campaigns, influencer collaborations, and nostalgia-driven storytelling have become essential tools for capturing this audience.

Limited-edition drops and exclusive collaborations create a sense of urgency and exclusivity that resonates with collectors. Brands like Lego and Mattel have successfully leveraged pre-orders and premium-tier product launches to tap into this demand. Hasbro’s Black Series and Mattel’s Hot Wheels Red Line Club offer high-end collectables directly to fans, bypassing mass-market retail channels and reinforcing brand loyalty.

Community engagement is also key. Toy companies invest in fan-driven events, interactive content, and product tie-ins with entertainment franchises to keep their audiences invested. This approach has expanded beyond the toy aisle – adult-focused toy marketing now includes lifestyle branding, apparel collaborations, and interactive experiences designed to deepen brand attachment.

The brands that understand how to market to kidults are not just selling toys – they are selling identity, nostalgia, and belonging.

Case Study: Pop Mart’s Success with Labubu Collectibles

Image Credit: Los Angeles Times

Pop Mart, a Chinese toy company, has achieved remarkable success by targeting the adult market with its Labubu collectable figures. Created by Hong Kong artist Kasing Lung, Labubu features distinctive rabbit-like ears and spiky teeth, appealing primarily to adults seeking nostalgic and comforting collectables. Priced between $15 and $85, these figurines often sell out within minutes of restocking, leading fans to rely on group chats for updates and endure long lines. Celebrity endorsements, particularly from Lisa of Blackpink, have further boosted Labubu’s popularity. Collectors view these toys not just as playthings but as art pieces that add personality to their homes. Despite the prevalence of knockoffs, demand for Labubu continues to grow, with Pop Mart expanding its presence in the U.S. and reporting strong sales figures. This trend reflects a broader rise in kidult-targeted emotional comfort toys. 

The Future of the Toy Industry Belongs to Adults

Kidults are not just spending – they are shaping the industry’s future. The brands that continue to evolve, embracing technology, sustainability, and personalisation, will lead the next evolution of the toy market. Augmented reality experiences, app-connected toys, and AI-powered collectables are emerging as the next “it” toys, blending nostalgia with modern tech. Eco-conscious buyers also influence brands to redesign packaging, adopt sustainable materials, and explore digital collectables.

The next step for brands is clear: those who embrace innovation while preserving nostalgia will remain at the forefront of this booming market.

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The second-hand goods market in Japan has seen extraordinary growth over the past decade, more than doubling in value since 2010. This surge reflects a shift in consumer behaviour toward more sustainable and economic choices, driven by the rising popularity of second-hand goods platforms and a cultural focus on quality and reuse.

Our sister company, Cross Marketing Inc., recently conducted a study exploring the purchase behaviours, benefits, and concerns of Japanese consumers regarding second-hand goods. This research highlights key trends shaping the second-hand market and provides valuable insights for brands looking to tap into this growing sector.

Understanding Japan’s Second-Hand Ecosystem

The second-hand market in Japan has evolved into a dynamic and thriving sector driven by affordability, sustainability, and a cultural appreciation for quality. According to our latest study, books and manga are the top choices for second-hand purchases, with almost half of respondents identifying these as their top choices. Games, CDs, and DVDs follow closely at 38%, and cars, bikes, and bicycles at 27%. 

Top-Categories-for Second-Hand-or-Reused-Goods-Purchases

Japan’s focus on meticulous product preservation and high-quality standards plays a crucial role in the popularity of reused goods. Unlike in some Western markets, where thrift shopping often involves bargain hunting, Japanese consumers seek items that retain their original value, emphasising condition and authenticity.

Generational differences further highlight the diverse appeal of second-hand goods. Younger consumers in their 20s favour clothing and accessories, reflecting a growing trend toward sustainable fashion. Meanwhile, respondents in their 30s preferred entertainment products like games and DVDs, often driven by nostalgia or affordability. 

Second-Hand-Goods-Purchase-Trends-by-Age-Group-in-Japan

These preferences underline a broader cultural shift toward sustainable consumption, with second-hand shopping becoming a practical and socially conscious choice. As Japan’s second-hand market grows, brands have a unique opportunity to align with these values while addressing consumer concerns about product authenticity and condition. 

Benefits-of-Buying-Second-Hand-or-Reused-Goods-Japan

Comparing Japan’s Second-Hand Market to the US and UK

While Japan’s second-hand market is rooted in quality and sustainability, its Western counterparts offer a contrasting yet complementary picture, particularly in the US and UK. In the US, thrift shopping has long been associated with affordability and individuality, with platforms like Goodwill and Poshmark. Meanwhile, the UK has seen a rise in sustainability-focused resale platforms such as Depop and Vinted, driven by a younger audience concerned about environmental impact.

Key Differences in Consumer Behavior

  • In Japan, second-hand goods are often valued for their pristine condition and longevity, reflecting a cultural emphasis on care and maintenance. By contrast, in the US, the “thrill of the hunt” for unique or vintage finds plays a larger role in consumer motivation.
  • Western markets, particularly in the UK, see a stronger emphasis on sustainability as a driver for second-hand purchases, aligning with broader environmental movements.

Retail Strategies Across Markets

  • In the US and UK, the second-hand ecosystem thrives on a mix of traditional thrift stores and digital marketplaces. The convenience of online platforms has expanded their reach significantly, mirroring Japan’s growing reliance on e-commerce for second-hand goods.
  • Japanese brands can integrate Western best practices, such as authenticity certifications and user-friendly online interfaces, to address domestic consumer concerns about quality and transparency.

Lessons for Global Brands

Understanding cultural nuances is key for brands operating across these regions. Western markets offer insights into leveraging sustainability and community-driven marketing, while Japan provides lessons in quality assurance and brand trust. Together, these approaches highlight the global potential of the second-hand market, which continues to grow as consumers increasingly prioritize affordability and environmental impact.

Japanese-consumer-concerns-about-second-hand-goods-market

Opportunities and Challenges for Brands in the Second-Hand Market

The second-hand market in Japan presents a unique opportunity for brands to tap into shifting consumer behaviours and the growing demand for sustainable solutions. However, with these opportunities come challenges that require strategic navigation.

Opportunities for Brands

  1. Incorporating Resale Initiatives:
    Brands can embrace resale programs to strengthen their sustainability credentials. Companies like Patagonia and Uniqlo have successfully introduced programs for reselling used items, building trust and fostering customer loyalty.
  2. Meeting Demand for Affordability and Quality:
    By offering second-hand options at competitive prices, brands can attract cost-conscious consumers while maintaining quality assurance, a key expectation in Japan.
  3. Leveraging Digital Platforms:
    As e-commerce dominates second-hand transactions, brands can partner with online platforms or build resale marketplaces, offering enhanced transparency, authenticity guarantees, and user-friendly experiences.
Japanese-attitudes-toward-second-hand-goods

Challenges for Brands

  1. Addressing Consumer Concerns:
    Trust remains a significant hurdle, with concerns about product condition, authenticity, and hygiene topping the list. To alleviate these fears, brands must invest in clear product descriptions, certifications, and return policies.
  2. Balancing Resale and New Product Sales:
    Expanding resale operations without cannibalising new product sales requires careful pricing strategies and consumer education about the benefits of new and used offerings.
  3. Navigating Cultural Nuances:
    Focusing on pristine condition and authenticity in Japan is critical, whereas Western consumers may be more accepting of minor imperfections. Tailoring marketing strategies to these expectations is essential for success.

Case Study: Mercari – Transforming Japan’s Second-Hand Marketplace

Image Credit: Forward2Me

Background

Established in 2013, Mercari has rapidly become Japan’s leading community-powered marketplace. It enables individuals to buy and sell various items directly from their smartphones. The platform boasts over 23 million monthly active users (MAUs) in Japan.

Approach

Mercari’s success can be attributed to several strategic initiatives:

  1. User-Friendly Platform
    Mercari’s intuitive interface simplifies buying and selling, making it accessible to a broad demographic. Users can list items by simply uploading photos and adding descriptions, while buyers can easily search and filter listings to find desired products.
  2. Trust and Safety Measures
    Mercari has implemented an escrow-based payment system to foster trust among users. This system ensures funds are securely held until the buyer confirms receipt of the item in satisfactory condition. This approach minimises the risk of fraud and enhances user confidence in transactions.
  3. Promotion of the Circular Economy
    Mercari’s mission emphasises creating value in a global marketplace where anyone can buy and sell, promoting the reuse of goods and contributing to environmental sustainability. Mercari supports the reduction of waste and efficiently uses resources.

Results

Mercari’s innovative approach has solidified its position as Japan’s largest C2C marketplace. The platform’s extensive user base and diverse listings have made it a go-to destination for consumers seeking common and unique items. Mercari’s efforts have also contributed to normalising second-hand shopping in Japan, aligning with global trends toward sustainable consumption.

Takeaway for Brands

Mercari’s model demonstrates the potential of combining user-centric design with robust safety features to build a thriving online marketplace. Brands looking to enter or expand within the second-hand market can draw valuable insights from Mercari’s strategies, particularly in fostering trust, promoting sustainability, and leveraging technology to enhance user experience.

Patagonia’s Worn Wear program is another example of how brands can integrate sustainability and second-hand initiatives into their core operations, enhancing their environmental impact and consumer loyalty.

Strategic Insights: Leveraging the Second-Hand Trend for Brand Success

As the second-hand market expands in Japan, brands have a significant opportunity to align with shifting consumer values while addressing key challenges. Below are actionable strategies for brands to capitalise on this growing trend.

1. Build Trust Through Transparency

Consumer trust is paramount in the second-hand ecosystem, especially in Japan, where authenticity and quality are critical. Brands can:

  • Implement product certifications to verify authenticity.
  • Provide detailed product descriptions and high-resolution images for online listings.
  • Offer buyer protection programs, including inspection guarantees and hassle-free return policies.

2. Embrace Digital Innovation

E-commerce drives the second-hand revolution, and brands must prioritise digital platforms to stay competitive. Strategies include:

  • Creating dedicated second-hand sections on official websites.
  • Partnering with popular resale platforms like Mercari or Rakuma to reach existing audiences.
  • Leveraging AI and data analytics to personalise recommendations and identify resale demand trends.

3. Integrate Sustainability Into Marketing

Highlighting the environmental benefits of second-hand shopping can resonate with eco-conscious consumers. Brands should:

  • Promote circular economy initiatives, such as buy-back or trade-in programs.
  • Use storytelling to emphasise the sustainability impact of choosing reused goods over new items.
  • Collaborate with sustainability influencers to amplify their message.

4. Balance Resale with New Product Strategies

Second-hand sales should complement, not cannibalise, new product sales. Brands can achieve this by:

  • Pricing second-hand goods strategically to differentiate them from new products.
  • Using resale platforms to attract new customers who may transition to buying new items.
  • Introducing exclusive collections or limited-edition items for resale to maintain product desirability.

5. Draw Inspiration from Global Markets

Western markets like the US and UK offer valuable lessons on branding and consumer engagement in the second-hand space:

  • Adopt the community-driven marketing tactics popular on platforms like Depop.
  • Explore partnerships with thrift-focused organisations to enhance brand visibility and credibility.

The Second-Hand Market as a Long-Term Strategy for Brands

The rise of Japan’s second-hand market signals more than just a shift in consumer preferences – it reflects a broader evolution in how value, sustainability, and quality are perceived. From books and clothing to cars and collectables, Japanese consumers are embracing reused goods for their affordability, unique appeal, and contribution to a circular economy.

This presents a compelling opportunity for brands to innovate and connect with consumers on deeper levels. Companies can build trust by addressing key concerns like product authenticity, quality, and transparency while carving a niche in this growing sector. Initiatives like resale platforms, trade-in programs, and partnerships with second-hand marketplaces are no longer optional – they are critical strategies for staying relevant.

The success of platforms like Mercari demonstrates the immense potential of this market, while global examples from Western markets show the scalability of second-hand strategies. As the reuse economy grows, brands that adapt quickly and strategically will thrive and lead toward a more sustainable and consumer-centric future.

The second-hand market is here to stay. For brands ready to align with this transformative trend, the time to act is now.

Contact us today for in-depth insights and strategic recommendations tailored to your brand’s needs. Let’s explore how your business can tap into Japan’s second-hand market and drive sustainable growth.

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Alexa, which stores have the best deals right now? 

Once a futuristic notion, this question is now a reality for millions of consumers who rely on voice-activated devices for shopping lists, product recommendations, and more. As conversational AI becomes an integral part of daily life, voice-first commerce is reshaping brand engagement, challenging traditional marketing approaches, and unlocking new revenue opportunities.

But are brands truly ready for this shift? 

While some have embraced the potential of conversational AI, others are scrambling to catch up, struggling to redefine their strategies at a time when hands-free shopping and personalised voice interactions are the norm.

The question isn’t whether voice commerce will dominate – it’s how soon. Brands that adapt quickly and strategically will set themselves apart in this voice-first future, while the rest risk being left unheard.

The Rise of Voice-First Commerce

Voice commerce is rapidly becoming a mainstream consumer behaviour. 

The global voice recognition technology market is projected to grow to nearly $50 billion by 2029.

Consumer preferences are steering the surge in voice commerce, with hands-free convenience redefining how people shop, search, and interact. Smart speaker users now average 12.4 weekly tasks on their devices – nearly double the 7.5 recorded in 2017 – highlighting the growing integration of voice technology into everyday routines.

Brands must act now. This shift isn’t just about new tech; it’s about meeting customers where they are – on the go, multitasking, and expecting seamless experiences. For brands clinging to traditional e-commerce strategies, the window to pivot is closing.

How Conversational AI is Reshaping Brand Strategies

Conversational AI is transforming how brands interact with customers, pushing the boundaries of personalisation and engagement. Unlike traditional e-commerce, where interactions are largely visual and transactional, voice-first commerce creates opportunities for real-time, human-like conversations that build deeper connections.

Personalisation at Scale
AI-driven voice assistants use advanced natural language processing to deliver tailored recommendations. By analyzing past purchases, search history, and real-time preferences, these systems can create “segments of one,” offering highly personalised experiences. For example, a voice assistant can suggest a product refill based on a consumer’s purchase history or recommend a new service aligned with their preferences.

Improved Accessibility and Inclusivity
Voice technology breaks barriers, offering accessibility to older adults and individuals with visual impairments. For brands, this means tapping into previously underserved demographics and expanding their reach.

Enhanced Customer Service
Conversational AI is revolutionising customer support, from resolving issues instantly to guiding users through complex buying decisions. Voice assistants can handle inquiries 24/7, minimising wait times and enhancing satisfaction. Brands like Sephora and Domino’s have implemented conversational AI to simplify appointment bookings and food orders, creating frictionless customer journeys.

Challenges Brands Face with Conversational AI

The promise of conversational AI is immense, but its implementation comes with notable challenges that brands must overcome to fully leverage its potential.

Understanding Diverse Accents and Dialects
A significant barrier to effective conversational AI adoption is the ability to interpret diverse accents and dialects accurately. For instance, studies have shown that accents from regions like New York City, New Jersey, and Boston within the US market pose considerable difficulties for voice recognition systems. Distinct pronunciations and local slang in these areas often lead to misinterpretations, frustrating users and undermining trust in the technology. This highlights the need for brands to train AI models to handle linguistic nuances across regions and demographics.

Privacy and Data Security Concerns
Data privacy is another pressing issue. In a high-profile example, Italy’s data protection authority fined OpenAI 15 million euros for processing user data without adequate legal justification and transparency. The authority also cited inadequate age verification measures, exposing minors to potentially inappropriate content. These instances reflect broader consumer concerns about how personal data is collected, stored, and used in conversational AI systems.

Turning Challenges Into Opportunities
Brands that tackle these challenges head-on can gain a competitive advantage. Building AI systems that are linguistically inclusive and ensuring robust data privacy protocols will not only improve user experience but also foster trust among increasingly cautious consumers. Those proactively addressing these hurdles position themselves as leaders in the voice-first era, where reliability and consumer confidence are critical to success.

Brands Leading the Way with Conversational AI

As conversational AI becomes a cornerstone of voice-first commerce, some brands leverage its potential to drive engagement and boost sales. These early adopters offer valuable lessons for those looking to stay ahead of the curve.

Amazon’s Alexa: Setting the Standard for Voice Commerce
Amazon’s Alexa ecosystem has transformed how consumers shop, from reordering household essentials to discovering new products. With Alexa Skills tailored for brands, companies like Tide and Starbucks have seamlessly integrated into the consumer’s voice-enabled routine. Tide’s Alexa Skill, for instance, provides stain removal tips while subtly promoting its products, showcasing how conversational AI can blend utility with branding.

Sephora: Redefining Beauty Retail
Sephora has embraced conversational AI through virtual assistants that guide customers in selecting makeup and skincare products. By integrating its AI systems with Google Assistant, Sephora enables voice-driven appointment booking for beauty consultations, merging convenience with personalized recommendations. This approach not only enhances customer experience but also drives foot traffic to physical stores.

Case Study: Domino’s Frictionless Ordering Experience
Using Conversational AI

Image Credit: Shorty Awards

Since its founding in 1960, Domino’s Pizza has expanded to over 20,000 locations across 90 countries. A key milestone in this journey was the adoption of conversational AI to streamline operations and enhance customer experiences.

The Challenge

As consumer behaviour evolved, Domino’s recognised the need to offer more intuitive and convenient ordering methods. While effective, traditional online and phone orders lacked the seamless interaction modern consumers desired. The challenge was to develop a system capable of understanding and processing how customers express their orders, accommodating various accents, languages, and preferences.

The Solution

Image Credit: Google Cloud 

In August 2016, Domino’s began exploring Natural Language Understanding Solutions (NLU) and ultimately selected Google’s Dialogflow for its scalability and robust NLU capabilities. This platform allowed Domino’s to handle the extensive range of customer intents and ordering options inherent in its menu. By leveraging over 60  years of customer service expertise, Domino’s developed “Dom,” an AI-powered chatbot integrated across multiple platforms, including Google Assistant-enabled devices. Customers could now place orders by simply saying, “Hey Google, talk to Domino’s,” initiating a conversational ordering experience.

Implementation

The implementation process involved training the AI to manage both simple and complex ordering scenarios, ensuring it could handle the diverse ways customers might place orders. The user-friendly interface facilitated rapid development and deployment, enabling Domino’s to efficiently meet or exceed project milestones. The AI system was designed to integrate seamlessly with existing operations, providing a consistent and reliable customer experience across various digital platforms.

Results

Image Credit: Google Cloud

The introduction of conversational AI surpassed Domino’s initial expectations. The AI-powered ordering system not only enhanced customer convenience but also improved operational efficiency. The system’s performance led to continuous refinement of the conversational experience, allowing Domino’s to stay ahead of customer expectations and adapt to new interaction patterns. This commitment to innovation reinforced Domino’s position as a leader in digital transformation within the food service industry.

Learning from the Leaders

These examples highlight the versatility of conversational AI across industries. By focusing on consumer needs – whether it’s saving time, offering expert guidance, or simplifying everyday tasks – brands can create meaningful voice interactions that drive loyalty and revenue.

For brands still on the fence, these success stories highlight an essential truth: conversational AI is not a passing trend but a transformative force that will define the future of customer engagement.

The Future of Conversational AI in Voice Commerce

The evolution of conversational AI is accelerating, with innovations poised to redefine how brands engage consumers in the coming years. This isn’t just an extension of existing technology; it’s a shift toward a more intuitive, predictive, and immersive future.

Natural Language Processing Reach New Heights
Advances in NLP enable voice assistants to understand context, sentiment, and even subtle nuances in conversation. This development allows brands to move beyond basic commands and create meaningful, two-way interactions that feel almost human. Imagine a virtual shopping assistant that remembers your preferences and anticipates your needs before you articulate them.

Integration with Immersive Technologies
Converging conversational AI with augmented and virtual reality promises a new dimension of voice-driven engagement. Consumers could soon “walk” through virtual stores guided by a voice assistant, combining the convenience of e-commerce with the immersive experience of physical shopping.

Predictive Voice Analytics for Proactive Engagement
Predictive analytics powered by AI will allow brands to forecast consumer behaviour with unprecedented accuracy. Voice assistants will be able to recommend products based on upcoming events, seasonal trends, or personal milestones, creating hyper-relevant shopping experiences.

Generative AI Redefining Personalisation
Generative AI will further enhance voice commerce by creating highly customised interactions. From crafting personalised product descriptions to generating dynamic recommendations during conversations, this technology ensures every interaction feels uniquely tailored to the consumer.

The Ethical and Privacy Imperative
As the future of conversational AI unfolds, ethical considerations will take centre stage. Brands must be transparent about how they collect and use voice data, addressing consumer concerns about privacy and surveillance. Building trust will be just as crucial as building technology.

How Brands Can Prepare for the Voice-First Era

To thrive in the age of conversational AI, brands must adopt a proactive, voice-first strategy. Success will depend on blending innovative technology with a deep understanding of evolving consumer expectations.

Invest in Voice-Ready Infrastructure
Brands need robust systems that integrate with conversational AI platforms like Alexa, Google Assistant, or proprietary solutions. This includes optimizing product listings for voice search, ensuring seamless compatibility with voice-activated devices, and developing APIs for real-time interactions.

Prioritise Multilingual and Inclusive Design
Global markets demand voice solutions that cater to diverse languages, dialects, and accents. Brands must train AI systems to understand regional nuances, making their offerings accessible to a broader audience. Inclusivity should also extend to designing interfaces for users with disabilities, tapping into underserved markets.

Focus on Data Privacy and Ethical AI
Building trust is critical in a voice-driven world. Brands should establish clear policies on data collection and usage, ensuring transparency with consumers. Adopting ethical AI practices, such as eliminating bias in voice recognition, will enhance credibility and foster loyalty.

Collaborate with AI Ecosystem Leaders
Partnerships with technology giants and AI innovators can accelerate voice-first strategies. Whether leveraging Google’s advanced NLP or collaborating with Amazon on Alexa Skills, aligning with established platforms ensures smoother implementation and greater reach.

Measure and Adapt Through Key Performance Indicators
Voice commerce success must be quantifiable. Brands should track engagement rates, voice search conversions, customer retention, and satisfaction. They can continuously refine their voice strategies by analyzing these insights to better meet consumer needs.

Prepare for a Voice-Only Future
While omnichannel strategies remain vital today, brands should experiment with voice-only campaigns and interactions. Developing exclusive voice-driven experiences will help them prepare for a future where voice commerce dominates.

The transition to voice-first commerce requires foresight and innovation. Brands that invest now in building their conversational AI capabilities will not only capture today’s opportunities but also shape the future of customer engagement.

The rise of conversational AI and voice-first commerce represents a massive shift in how consumers interact with brands. From streamlining purchases to creating deeply personalised experiences, voice technology revolutionises the customer journey. But this transformation comes with a challenge: brands must act swiftly and strategically to harness their potential.

As consumers prioritise convenience and personalisation, the question for brands is no longer whether to adopt conversational AI but how to do it effectively. The future belongs to those willing to innovate, adapt, and amplify their voice.

For brands willing to invest, the rewards are clear: deeper customer relationships, enhanced loyalty, and a competitive edge in the voice-first marketplace. The future of voice commerce isn’t distant—it’s unfolding now. Is your brand ready to be heard?

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As online commerce in Japan grows and consumer expectations peak, the way e-commerce brands approach delivery services has never been more critical. By navigating a blend of convenience, environmental consciousness, and economic pressures, Japanese consumers are redefining what they want from delivery. 

Recently, our sister company, Cross Marketing Inc., conducted a comprehensive “Survey on Home Delivery” across all 47 prefectures of Japan. Targeting 2,500 men and women aged 20 to 69, the survey revealed detailed insights into the current landscape of delivery services, encompassing usage patterns, preferred receiving methods, redelivery prevention strategies, common complaints, and reasons for using these services. This data is invaluable for brands looking to optimise their delivery offerings to meet the shifting demands of Japanese consumers.

The survey findings provide direct data and broader market implications for brands, including the need for convenient, flexible, and environmentally responsible delivery solutions. 

Japan’s ageing population, growing e-commerce sector, and evolving post-pandemic behaviours all play a critical role in shaping these expectations. 

Changing Delivery Preferences and the Impact of Broader Trends

The survey’s findings offer a window into the complex motivations and pain points Japanese consumers experience with delivery services. Here are the key findings and insights from the study.

  • Decline in Delivery Service Usage Post-Pandemic

According to the survey, only 38% of respondents reported using a delivery service within the last three months — a notable 10-point decline since 2022. The decline in delivery usage post-pandemic suggests that Japanese consumers are shifting back toward in-person shopping, a trend mirrored in other regions as restrictions ease and physical stores reopen. During the pandemic, delivery services were a necessity, and demand spiked due to safety concerns and convenience. However, with more freedom to shop in-store, consumers may now feel less need for delivery services. Cultural factors in Japan, where shopping in person is often associated with quality assurance and customer service, could further contribute to this shift. Shoppers may be seeking the experience of direct product interaction, which e-commerce and delivery lack.

delivery-service-usage-study

Implication for Brands: To retain customers who may now have more choices between in-person and online shopping, brands should offer additional value through delivery, such as loyalty rewards, tailored options, or enhanced convenience.

  • Preference for Convenient and Secure Receiving Methods

While delivery preferences have diversified, hand-delivery to the home remains dominant, with 79% of respondents choosing this method despite a slight decrease from previous years. When it comes to delivery preferences, it’s clear that people value security and reliability. Approximately 50% of individuals opt for mailbox deliveries, while 28% drop off their packages at designated locations. This trend highlights a growing desire for peace of mind when receiving their items.

delivery-service-usage-by-age

Implication for Brands: Brands should continue prioritising home delivery while offering flexible options, such as secure drop-offs or mailbox deliveries. This aligns with a broader trend toward tailored service experiences that meet consumers’ specific lifestyles.

  • First-Attempt Delivery Success and the Aging Population

Interestingly, the survey unveiled that first-attempt deliveries achieved an impressive 65% success rate, marking a remarkable 7-point increase from 2022. Success rates were higher among older respondents, with those in their 60s experiencing an impressive 79% rate. Japan’s growing ageing population likely influences this trend, as seniors spend more time at home.

Japan’s ageing population comprises around one-third of its total demographic, as reported by Japan’s Ministry of Internal Affairs and Communications (MIC). With this demographic segment increasing, seniors often have specific delivery needs, such as scheduled delivery times and easy-to-access drop-off locations.

methods-to-prevent-redeliveries

Implication for Brands: Catering to older consumers by providing time-specific deliveries or easy-access delivery options can strengthen customer loyalty among this growing demographic. Clear communication and reliable, first-time delivery can also help brands effectively meet the needs of these customers.

  • Preventing Redelivery through Advanced Notification Systems

The survey found consumers prefer preventive measures to avoid redelivery, with four in ten favouring advance notifications and 37% opting for designated drop-off points if unavailable. Younger respondents in their 20s also preferred “unavailable times” over specific delivery times, indicating a need for flexibility.

reasons-consumers-use-delivery-services-in-Japan

Implication for Brands: Incorporating technology to support real-time updates, predictive delivery times, and flexible scheduling could cater to these preferences and reduce the frequency of redelivery.

  • Cost-Sensitivity and Demand for Affordable Delivery Options

In terms of motivations, half the respondents cited online affordability as a key reason for choosing delivery services, with 41% prioritising free or low-cost shipping. Economic pressures may drive this cost sensitivity as Japanese consumers become increasingly selective.

According to the Ministry of Economy, Trade and Industry (METI), Japan’s e-commerce sector has grown 6% over the past two years, leading to higher expectations for efficient and cost-effective delivery options. This trend reflects consumer demand for affordable, reliable online shopping.

Implication for Brands: Brands should consider offering free shipping thresholds, bundled shipping discounts, or subscription models to meet cost-conscious consumer expectations. Clear communication around shipping fees can also build trust and reduce the likelihood of abandoned carts.

  • Sustainability Concerns and Consumer Expectations for Eco-Friendly Practices

Complaints about excessive packaging show that sustainability is crucial for Japanese consumers. Many respondents expressed frustration with oversized packaging and issues related to waste and environmental impact.

Implication for Brands: Implementing eco-friendly packaging solutions and minimalistic designs that reduce waste can appeal to the environmentally-conscious Japanese consumer. Highlighting these efforts in marketing communications can strengthen brand reputation and increase appeal.

Case Study: Yamato Transport – Flexible Delivery and Redelivery Reduction

Image Source: Channel X

Approach

Yamato Transport, one of Japan’s largest logistics companies, introduced the “Kuroneko Members” service, enabling customers to customise delivery times, select drop-off locations, and access open lockers. This level of flexibility aligns closely with consumer preferences for convenience and transparency.

Sustainability Initiatives

Yamato has also committed to eco-friendly measures by reducing packaging materials and increasing reusable packaging options, directly addressing environmental concerns and consumer expectations.

Outcomes

The flexibility of the “Kuroneko Members” service has been well-received, reducing redelivery rates and increasing customer satisfaction. Yamato’s annual reports indicate that these innovations have also contributed to a more efficient operational model, reducing logistical strain and enhancing customer loyalty.

Strategic Recommendations for Optimising Delivery Services

Here are actionable strategies for brands seeking to align their delivery services with evolving consumer demands.

  • Embrace Flexibility and Real-Time Communication

Implementing flexible delivery options, such as selectable time slots and drop-off locations, can enhance convenience. Real-time tracking and notifications are essential for transparency and meeting consumer expectations.

Example: Brands can follow Yamato’s model of providing customisable delivery windows and tracking updates, allowing customers to manage deliveries easily.

  • Offer Affordable Delivery through Subscription Models

For cost-sensitive consumers, consider subscription models, bulk shipping discounts, or free shipping thresholds. These options not only increase affordability but also encourage larger purchases.

Example: ZOZO’s loyalty programs and cost-saving measures attract repeat customers, providing an affordable yet reliable delivery experience.

  • Adopt Sustainable Packaging and Logistics

Reduce waste and enhance brand perception by adopting minimal packaging and eco-friendly materials. Promoting these efforts to consumers can improve brand reputation.

Example: Using recyclable packaging, ZOZO aligns with sustainability values, resonating with consumers who prioritise eco-friendly practices.

  • Tailor Delivery Services for an Aging Population

As Japan’s population ages, delivery solutions that cater to older adults are crucial. Time-specific deliveries and secure drop-offs can improve accessibility and satisfaction for senior consumers.

Example: Sagawa Express’s focus on rural and senior-friendly deliveries provides a model for brands aiming to effectively serve Japan’s older demographic.

  • Leverage Feedback for Continuous Improvement

Implement post-delivery feedback mechanisms to capture consumer insights and refine delivery strategies. This approach allows for data-driven improvements.

Example: Brands can adopt feedback systems similar to Yamato’s, enabling adjustments based on real-time consumer needs.

Case Study: ZOZO – Eco-Friendly and Customised Delivery

Image Source: Janbox

Approach

ZOZO, Japan’s leading online fashion retailer, has integrated flexibility and sustainability into its logistics. ZOZO, Inc. operates online shopping sites. The Company sells apparel, garment accessories, bags, tableware, magazines, and other products. Customers can choose specific delivery times and receive pre-delivery notifications to fit their schedules, aligning with consumer preferences for convenience and transparency.

Sustainability Focus

ZOZO has prioritised eco-friendly practices by minimising packaging waste and utilising recyclable materials. This appeals to Japan’s environmentally conscious consumers and sets a standard for sustainable delivery practices in the industry.

Outcomes

This approach has enhanced customer loyalty and satisfaction, as reflected in positive consumer feedback. ZOZO’s sustainability reports highlight these efforts, demonstrating the brand’s commitment to customer experience and environmental responsibility.

Case Study: Sagawa Express – Rural Outreach and Last-Mile Solutions

Image Source: Sagawa

Approach:

Sagawa Express acts as the sender for the packages entrusted to it by customers. They deliver these packages to the post office, where they are dispatched to destinations in over 120 countries and regions worldwide through the EMS (Express Mail Service) delivery network.

Sagawa Express has focused on improving delivery services for rural and remote areas, where logistics can be challenging. Sagawa has enhanced last-mile delivery by investing in partnerships with local providers, making it more accessible for Japan’s rural residents, particularly the ageing population.

Results

Sagawa’s efforts to support rural and senior-friendly delivery solutions have been met with positive feedback. By improving access to delivery in these areas, Sagawa has strengthened its customer satisfaction and reduced service complaints in less accessible regions, as documented in their annual reports.

Embracing Consumer-Centric Delivery for Long-Term Success

Our survey underscores the need for Japanese brands to adapt to evolving consumer expectations around flexibility, sustainability, and cost-efficiency. By aligning with these expectations, brands can enhance customer satisfaction, operational efficiency, and long-term market competitiveness. 

Interested in uncovering more consumer insights to refine your brand’s strategy? Contact us for customised market research to help your brand stay ahead of the curve, better understand consumer preferences, and create impactful solutions that resonate with your target audience.

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The ecommerce industry, a cornerstone of modern retail, is entering a new phase of transformation. As technology evolves and consumer behaviour shifts, businesses are under increasing pressure to adapt quickly and stay competitive. With the rise of AI, social commerce, faster logistics, and the push for sustainability, the ecommerce landscape is rapidly changing. Companies must innovate to meet the growing demands of consumers who now expect faster, more personalised, and environmentally conscious shopping experiences.

In this blog, we will explore the four key trends expected to redefine ecommerce in 2025: AI-driven shopping experiences, the expansion of social commerce, logistics innovations, and the focus on sustainable ecommerce. Each of these trends presents new opportunities and challenges that will reshape how businesses operate and engage with customers in the years ahead.

Trend 1: AI-Driven Shopping Experiences

Artificial intelligence is transforming the way consumers shop online, creating highly intuitive and personalised shopping journeys. From product recommendations based on past purchases to virtual shopping assistants that guide customers through their buying process, AI is playing an increasingly central role in enhancing the ecommerce experience. As technology continues to advance, AI is set to become integral to driving customer engagement and boosting conversion rates.

AI allows brands to deliver tailored experiences that increase customer satisfaction by offering personalised product suggestions, content, and promotions. This level of customisation fosters stronger customer loyalty and enhances the overall shopping experience. On the operational side, AI enhances efficiency by automating inventory management and demand forecasting, ensuring that products are in stock and ready to meet consumer needs.

In addition, AI-driven solutions can predict consumer behaviour and anticipate their needs, which leads to higher conversion rates. 

By analysing data from browsing patterns, previous purchases, and even social media activity, AI can help businesses address specific consumer needs at the right moment, optimising the path to purchase. As AI technology continues to evolve, it will only become more integral to the ecommerce landscape, helping brands stay competitive in a rapidly changing market.

Case Study: Carrefour – Leveraging AI for Enhanced Customer Interactions

Carrefour, one of France’s largest retail chains, has successfully integrated AI-powered chatbots and generative AI into its operations to elevate its customers’ shopping experience. The brand’s AI assistant, Hopla, helps customers find products, answer queries, and provide personalised recommendations, improving the overall shopping experience.

By utilising AI to handle routine customer inquiries, Carrefour enhances the customer service process and streamlines internal operations, freeing up employees to focus on more complex tasks. Hopla’s use of natural language processing and AI-driven algorithms allows it to assist customers in real time, guiding them through product searches and even assisting with checkout. This integration of AI into both customer-facing and internal processes highlights Carrefour’s commitment to leveraging technology to improve efficiency and customer satisfaction.

This case study is an excellent example of how AI can enhance the customer journey and operational efficiency, making it a perfect illustration of AI-driven shopping experiences.

Trend 2: The Expansion of Social Commerce

Social media platforms are increasingly doubling down on their ecommerce capabilities, transforming how consumers discover and purchase products. With seamless integration of shopping features into social feeds, users can now shop directly from posts, stories, and livestreams, blurring the lines between content consumption and shopping. Livestream shopping and shoppable posts are becoming dominant in social commerce, turning these platforms into powerful sales channels.

This shift changes the way consumers interact with brands, making shopping more immersive and engaging. By combining entertainment with purchasing, platforms like Instagram, TikTok, and Facebook are creating a dynamic shopping experience that encourages impulse buying and fosters deeper consumer-brand connections. As a result, marketing budgets are being redirected toward influencer-driven campaigns and interactive content formats that engage users in real-time.

This expansion of social commerce forces brands to rethink their customer acquisition and engagement strategies. Traditional advertising is no longer enough—brands must now focus on creating compelling, shareable content that fits seamlessly into the social media experience. The rise of micro and nano influencers, who have more engaged, niche followings, further emphasises the importance of building authentic relationships with consumers.

As social commerce continues to grow, it will redefine the consumer journey, making social media platforms central hubs for discovery, engagement, and shopping. Brands that effectively leverage this trend will be well-positioned to capture the attention of today’s digital-first consumers.

Case Study: Pinduoduo – Transforming Social Commerce through Instant Messaging

Pinduoduo, a leading Chinese e-commerce platform, has revolutionised social commerce by enabling users to make everyday purchases directly through instant messaging platforms. By integrating shopping into social interactions, Pinduoduo has created a seamless and engaging shopping experience that encourages users to interact, share, and purchase products all within a single platform.

This innovative model has attracted a vast user base, especially in China’s lower-tier cities, where it has become a dominant force in the e-commerce space. Pinduoduo’s integration of social elements with e-commerce not only fosters a sense of community but also encourages group buying, where users can share deals with friends and family to access discounts. This approach has proven highly effective, as it taps into the power of social interactions to drive consumer purchases, demonstrating the growing importance of social commerce in today’s digital economy.

Pinduoduo’s success illustrates the future of social commerce, where social platforms and shopping experiences are increasingly intertwined, creating new opportunities for brands to reach consumers and engage them in innovative ways.

Trend 3: Logistics Innovations and Quick Commerce

Speed and convenience have become non-negotiable for today’s consumers, significantly influencing the way e-commerce operates. To meet these expectations, innovations in logistics, such as drone deliveries, dark stores, and micro-fulfilment centres, are reshaping the delivery landscape. These advancements are enabling ultra-fast delivery times, providing the speed and efficiency that customers now demand.

With the rise of quick commerce, consumers expect their orders to arrive not only quickly but also at a lower cost. To keep up with this demand, e-commerce companies are investing heavily in logistics infrastructure and advanced technologies. Automated warehouses, AI-powered delivery routing systems, and drones are just a few examples of the tools being used to streamline operations and speed up delivery times. This requires significant capital and resources, pushing larger retailers to invest in cutting-edge solutions to stay competitive.

Interestingly, these innovations are levelling the playing field for smaller players in the market. Many small and medium-sized businesses are adopting third-party logistics (3PL) solutions to access these advanced capabilities without the hefty infrastructure investment. This democratisation of logistics allows smaller retailers to compete with larger companies in terms of delivery speed and efficiency, further driving competition in the e-commerce space.

As logistics technologies continue to evolve, the expectation for faster deliveries will only increase. Retailers that invest in these innovations will be well-positioned to meet consumer demands and thrive in the increasingly competitive e-commerce environment.

Case Study: Flipkart  – Revolutionising Delivery with Sustainable Logistics

Flipkart, a leading Indian e-commerce platform, is enhancing its delivery capabilities by integrating 25 liquefied natural gas (LNG) trucks into its logistics network. This initiative is part of the company’s broader strategy to reduce carbon emissions and improve delivery efficiency across India.

By adopting LNG trucks, Flipkart is taking significant steps towards a more sustainable logistics model, as LNG is a cleaner alternative to traditional diesel fuel, resulting in lower greenhouse gas emissions. This shift not only supports Flipkart’s commitment to sustainability but also improves delivery speeds, enabling the company to meet the increasing demand for fast, efficient service in a competitive market.

Flipkart’s investment in eco-friendly logistics demonstrates how e-commerce giants can innovate to address both environmental concerns and the growing consumer demand for faster, more reliable deliveries. This case study highlights the importance of sustainability in logistics, setting a benchmark for other companies looking to integrate greener practices into their supply chain operations.

Trend 4: Focus on Sustainable Ecommerce

Sustainability is becoming a top priority in ecommerce as both consumers and regulators demand greener practices. From eco-friendly packaging to carbon-neutral shipping options, brands are being pressured to adopt more sustainable operations. Beyond packaging, companies are also exploring second-hand marketplaces and product take-back programs to extend the life of products and reduce waste.

This focus on sustainable ecommerce will disrupt the industry in several ways. First, it forces brands to rethink their entire supply chain and packaging strategies, ensuring that every aspect of the process is aligned with environmental responsibility. Brands that demonstrate genuine commitment to sustainability will not only meet regulatory requirements but also increase consumer loyalty, as today’s shoppers are increasingly making choices based on ethical practices. However, there’s a fine balance between sustainability and cost efficiency. 

Companies must innovate to deliver on both fronts, without driving up prices or reducing operational efficiency. As the pressure for greener practices grows, the ecommerce landscape will continue to evolve toward more sustainable solutions, reshaping the way businesses operate.

Case Study: H&M Group’s Commitment to Sustainable Sourcing

H&M Group, a leading fashion retailer based in Sweden, has made significant strides in integrating sustainability into its operations. As of 2023, the company reported that 85% of its materials were recycled or sustainably sourced, aiming for 100% by 2030.

This commitment is part of H&M Group’s broader strategy to reduce its environmental impact and promote a circular economy.

In addition to sustainable sourcing, H&M Group has implemented several initiatives to enhance its sustainability efforts:

  • Sustainable Impact Partnership Program (SIPP): This program assesses supplier compliance with the company’s sustainability standards, ensuring that partners adhere to ethical and environmental guidelines.
  • H&M Foundation: Established in 2014, the H&M Foundation funds projects aimed at creating a socially inclusive and planet-positive textile industry. The foundation has invested over SEK 1.7 billion since its inception.

H&M Group’s dedication to sustainable sourcing and its comprehensive initiatives demonstrate a proactive approach to addressing environmental challenges within the fashion industry.

Final Thoughts

The trends shaping the future of e-commerce—AI-driven shopping experiences, the expansion of social commerce, logistics innovations, and the focus on sustainability—are not just altering how businesses engage with customers but setting new benchmarks for success in the industry. As these trends continue to evolve, they will define the future of retail, demanding greater agility and innovation from businesses aiming to stay competitive.

Adaptability is key to thriving in this fast-paced environment. Companies that invest in cutting-edge technologies, embrace new consumer behaviours, and prioritise sustainability will be best positioned to capitalise on the opportunities presented by these disruptions.

For more insights into the latest trends and strategies shaping the future of the e-commerce industry, subscribe to Connecting the Dots, our monthly e-newsletter. Stay informed, stay inspired, and lead the change in your industry.

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Indonesia is on the brink of a healthcare revolution fueled by the rapid rise of online pharmacies. With a population exceeding 275 million, the country presents a significant market for digital health solutions. Combining vast geography and increasing digital adoption creates unique opportunities and challenges for enhancing healthcare access. Online pharmacies are redefining how Indonesians engage with healthcare, promising to make access to essential services more convenient and widespread.

Population Size– World’s fourth most populous country with over 275 million people.
– Substantial market for healthcare, with vast potential for business growth.
Geography and Population Distribution– Spread over 17,000 islands, from urban hubs (Jakarta, Surabaya) to remote islands (Sumatra, Kalimantan, Papua).
– Diverse geography results in significant gaps in infrastructure and service access.
Healthcare Access in Rural Areas– Remote communities face limited access to healthcare and pharmacies.
– Challenges in delivering medical supplies across islands; long travel distances to pharmacies.
Potential for Online Pharmacies– Online pharmacies can improve access for underserved rural populations.
– Reduces delays in accessing critical medications and enhances healthcare delivery.

The State of Healthcare in Indonesia

Indonesia’s archipelago, spanning over 6,000 inhabited islands, creates a fragmented healthcare landscape. Many rural communities face severe shortages in medical facilities and professionals, with only 0.4 physicians per 1,000 people—well below the global average of 1.6.

For residents in these areas, access to healthcare often requires long travel times to the nearest clinic or hospital, delaying critical treatments. Limited transportation options and underdeveloped infrastructure exacerbate these challenges, leading to disparities in health outcomes between urban and rural populations.

The Role of Pharmacies in Primary Healthcare Delivery

In Indonesia, pharmacies play a key role in healthcare, especially in areas lacking medical facilities. Often the first stop for minor ailments, pharmacies provide essential services—from dispensing medications to offering health advice and managing chronic conditions.

Yet, traditional pharmacies face limits. Stock shortages, restricted hours, and sparse locations in rural areas make timely access difficult for many. These challenges underscore the need for innovative approaches, such as online pharmacies, to improve nationwide access to essential medications.

Rise of Digital Technology in Indonesia

Increasing Internet Penetration Rates

Internet access in Indonesia has exploded, reaching over three-quarters of the population. With expanding 4G and new 5G networks, digital platforms are now reaching every corner of the archipelago.

Growing Adoption of Smartphones and Digital Services

Fueled by more than 190 million smartphone users, online shopping is transforming daily life and driving rapid e-commerce growth. Healthcare is jumping in, too—top pharmacy chains like Kimia Farma and Apotek K-24 are now offering over-the-counter products through mobile apps, meeting Indonesia’s growing need for digital health solutions.

According to Statista, Indonesia’s over-the-counter (OTC) pharmaceuticals market is on track for nearly 8% annual growth, projected to reach around USD4.4 billion by 2029.

Health-conscious consumers are increasingly seeking nutritional products and supplements online, taking advantage of the convenience of digital shopping.

Impact of Government Initiatives and Telemedicine

Indonesia’s national health insurance program, Jaminan Kesehatan Nasional (JKN), has reshaped healthcare access, boosting demand for prescription and generic drugs.

Telemedicine platforms such as Halodoc, Alodokter, SehatQ, and KlikDokter have emerged as key players supporting the sales growth of medicines. These companies offer virtual consultations and seamless access to medications, which is particularly beneficial when physical movement is restricted, such as the pandemic.

The Emergence of Online Pharmacies

Impact of COVID-19 on Consumer Behavior

The pandemic accelerated the adoption of digital services across Indonesia. Lockdowns and social distancing measures limited access to physical pharmacies, prompting consumers to seek online alternatives for their healthcare needs.

The demand for OTC products surged in the healthcare sector as individuals focused more on health and wellness. The country’s OTC sales are forecasted to reach USD 6.31 billion by 2040, and this growth is driven by increased health awareness and the convenience of purchasing medications online.

Successful Online Pharmacy Brands in Indonesia 

GoApotik

Image Source: Mix Marcomm


GoApotik, launched by PT Global Loket Sejahtera, exemplifies how online pharmacies transform healthcare access in Indonesia. As a pharmacy-focused e-commerce platform, GoApotik allows consumers to purchase various medications, including prescription drugs, from the comfort of their homes. The platform collaborates with licensed pharmacies to ensure the authenticity and quality of products.

During the pandemic, GoApotik experienced significant growth due to heightened demand for safe and convenient access to medications. By integrating with telemedicine services, the platform enables users to obtain prescriptions through virtual consultations, streamlining the process from diagnosis to delivery.

Halodoc

Image Source: Bacalagers Media Digital Group


Halodoc is another prominent player that has successfully integrated telemedicine with pharmaceutical services. Offering a comprehensive mobile application, Halodoc provides virtual consultations with doctors, digital prescriptions, and medicine delivery services. Their partnership with Gojek, Indonesia’s leading on-demand multi-service platform, enhances their logistical capabilities, ensuring timely delivery even in remote areas.

Halodoc’s user-friendly interface and commitment to data security have built significant consumer trust. Their success illustrates the potential of combining technology, strategic partnerships, and a customer-centric approach to thrive in Indonesia’s online pharmacy market.

Strategies for Online Pharmacies in Indonesia

The online pharmacy market in Indonesia is becoming increasingly competitive. Major pharmacy chains such as Kimia Farma and Apotek K-24 have launched their e-commerce platforms and mobile apps to meet evolving consumer needs. International players like Watsons and Guardian are also expanding their digital presence.

To stand out, companies are adopting various strategies:

  • Digital Marketing Innovations
    Brands leverage social media platforms like Instagram, Facebook, and TikTok to engage with younger demographics. Influencer partnerships and interactive campaigns are common tactics to increase brand visibility and consumer engagement.
  • Personalised Customer Experience
    Online pharmacies use AI and data analytics to offer personalised product recommendations and health advice. This approach enhances customer satisfaction and encourages repeat business.
  • Loyalty Programs and Promotions
    Implementing loyalty programs, discounts, and bundled offers attracts price-sensitive consumers. These incentives are particularly effective in a market where competition is intense and consumers have multiple options.

Challenges and Opportunities for Online Pharmacies in Indonesia 

Cultural and Behavioral Insights

In Indonesia, traditional preferences for face-to-face healthcare still influence many consumers’ attitudes toward online health services. Concerns about medication authenticity and the impersonal nature of digital transactions can slow adoption.

However, younger, tech-savvy Indonesians are more open to online healthcare. Education campaigns showcasing the safety, convenience, and benefits of online pharmacies could help shift perceptions. Building trust through transparency and top-notch customer service will be essential for wider acceptance.

Logistics and Infrastructure Challenges

Indonesia’s geographical complexity poses substantial logistical hurdles. Delivering medications across islands and remote areas requires robust infrastructure.

  • Innovative Solutions
    Companies are partnering with local logistics providers and utilising ride-hailing services like Gojek and Grab to improve delivery efficiency. Some are investing in cold chain logistics to safely transport temperature-sensitive medications.
  • Overcoming Last-Mile Delivery Issues
    Implementing localised distribution centers and leveraging community networks can enhance last-mile delivery. Although regulatory and practical challenges remain, drone technology is also being explored for remote area deliveries.

Consumer Segmentation and Targeting

Understanding different consumer segments is vital for effective marketing and service provision.

  • Urban vs. Rural Consumers
    Urban consumers are more likely to adopt online pharmacies due to better internet access and familiarity with e-commerce. Tailoring marketing strategies to highlight convenience and time-saving benefits appeals to this group.

    Rural consumers may prioritise accessibility and affordability. Education on using online platforms and assurances of product authenticity can encourage adoption.
  • Age Groups and Income Levels
    Younger consumers are generally more receptive to digital solutions. Offering mobile-friendly platforms and engaging content can attract this demographic.

    Middle to higher-income individuals may be interested in premium services like personalised health consultations and wellness products. Budget-friendly options and promotions can appeal to lower-income groups.

Integration with Traditional Channels

Online pharmacies can complement traditional brick-and-mortar pharmacies rather than replace them.

  • Omnichannel Strategies
    Implementing an omnichannel approach allows consumers to choose between online and offline purchasing. For example, click-and-collect services enable customers to order online and pick up in-store, combining convenience with personal interaction.
  • Collaborations with Local Pharmacies
    Partnering with existing pharmacies can expand reach and leverage established trust. This model supports local businesses and enhances the overall healthcare ecosystem.
beauty-trends

Strategic Insights for Online Pharmacy Brands

Actionable Strategies

  • Enhance Digital Marketing Efforts
    Utilise targeted advertising, SEO optimisation, and content marketing to increase online visibility. Engaging storytelling and educational content can build brand authority.
  • Invest in Consumer Education
    Through informative campaigns, address misconceptions about online pharmacies. Highlighting safety measures, certifications, and customer testimonials can build confidence.
  • Focus on Customer Experience
    Simplify the user journey with intuitive website/app design. Offer responsive customer support through chatbots or live agents to assist with inquiries and concerns.
  • Leverage Data for Personalisation
    Use data analytics to understand consumer behaviour     and preferences. Personalised offers and recommendations can enhance engagement and loyalty.

Market leaders are encouraged to:

  • Innovate and Adapt
    Stay abreast of technological advancements and be willing to adapt business models. Experimenting with new services like subscription models or wellness programs can differentiate a brand.
  • Collaborate for Greater Impact
    Partnerships with tech companies, healthcare providers, and government initiatives can amplify efforts and resources. Collaborative approaches can more effectively address systemic challenges.
  • Champion Regulatory Progress
    Engage with policymakers to shape regulations that balance safety with innovation. Advocating for clear guidelines and supportive policies benefits the entire industry.

Final Thoughts

The rise of online pharmacies is transforming healthcare access in Indonesia, offering innovative solutions to the challenges of a vast and diverse archipelago. By harnessing digital technology, these platforms bridge gaps in healthcare delivery, reaching underserved populations and meeting the growing demand for convenient medical services.

Understanding these dynamics is crucial for pharmacy and healthcare brands. The Indonesian online pharmacy market presents significant opportunities for growth and innovation. By aligning strategies with consumer needs, cultural nuances, and market trends, brands can gain a competitive edge while contributing to improved healthcare access nationwide.

This is a pivotal moment to shape the future of healthcare in Indonesia. By embracing digital transformation, investing in consumer education, and fostering collaborative partnerships, brands can not only achieve business success but also make a lasting positive impact on society. Now is the time to innovate, adapt, and lead in Indonesia’s burgeoning online pharmacy market.

Partnering with experts in market research and branding is essential to capitalise on these opportunities and navigate the complexities of Indonesia’s online pharmacy sector. Contact us today to discover how we can help your brand innovate, adapt, and lead in this dynamic landscape.

Customer reviews are pivotal in guiding purchase decisions, especially for bargain-conscious shoppers. Platforms like Amazon, eBay, and AliExpress drive online bargain shopping and rely heavily on customer feedback to influence purchasing behaviour. 

For budget-conscious shoppers, reviews serve as more than just product insight—they establish trust, offer social proof, and ensure assurance in a marketplace where price often trumps brand loyalty. 

Consumer Behavior: Why Bargain Shoppers Rely on Reviews

Bargain shoppers prioritise price over brand loyalty, increasing the perceived risk of purchasing lower-cost or lesser-known products. To mitigate this risk, they depend heavily on customer reviews. 

Understanding the Bargain Shopper vs. Brand Loyalist: A Deeper Look into Their Psyche

A bargain shopper isn’t simply someone who finds a good deal. The impulse to shop based on lower prices or promotions is often driven by complex psychological factors—beyond just the thrill of saving money. For these shoppers, price may serve as both an emotional trigger and a strategic decision-making tool. On the other hand, brand loyalists cultivate deep emotional connections with specific brands, making their shopping behaviour more driven by trust and consistency than by cost considerations.

Psychological Traits and Behaviors: Bargain Shoppers vs. Brand Loyalists

AspectBargain ShoppersBrand Loyalists
Primary MotivationPsychological reward from securing value, often driven by a sense of competition or fear of missing out (FOMO)Deep emotional connection to a brand, often linked to identity and past experiences
Shopping BehaviorSeeks out discounts, compares prices across multiple brands, and views shopping as an ongoing challengeDriven by short-term satisfaction and an emotional rush to acquire a deal
Emotional ResponseSatisfaction from the perceived win or validation of making a smart purchaseComfort and security from the predictability and reliability of their chosen brands
Decision-MakingDriven by short-term satisfaction and an emotional rush of acquiring a dealInformed by long-term emotional attachment to the brand, often involving a sense of loyalty
Risk ToleranceHigher willingness to explore unfamiliar products or brands in search of the best dealLower risk tolerance; preference for sticking to tried-and-true brands
Brand AttachmentMinimal attachment, focused on functional value and immediate savingsStrong emotional attachment, often using brands to express identity or personal values
Frequency of PurchasesMore frequent, reactive to sales and promotions, often impulse-drivenRegular and habitual, based on a deeper brand relationship rather than external incentives
Post-Purchase BehaviorMay experience buyer’s remorse or continue to search for better deals; satisfaction linked to the deal itselfGreater post-purchase satisfaction and reduced remorse due to the emotional connection to the brand
Loyalty ProgramsValues practicality and financial savvy over luxury or status; sees shopping as a practical exercise.Selective loyalty, often engaging with fewer programs but valuing exclusive perks tied to brand affinity
Influence of AdvertisingHighly responsive to price-based promotions, sales events, and discountsInfluenced by brand narrative, values alignment, and lifestyle messaging
Cultural PerceptionValues practicality and financial savvy over luxury or status; sees shopping as a practical exerciseAssociates brand loyalty with personal identity, status, or lifestyle aspirations

Psyche of a Bargain Shopper: Beyond the Discount

  • Impulse to Save: For bargain shoppers, the psychological reward from saving money can create an almost competitive thrill, making the search for deals feel like a game or challenge. The act of securing a lower price often becomes more important than the product itself, leading to satisfaction from “winning” the deal.
  • Fear of Missing Out (FOMO): This shopper type is motivated by the anxiety of missing out on better opportunities. They may spend time comparing prices, checking deals, or waiting for the next big promotion, driven by the fear that they might miss the “best” deal.
  • Value-Oriented, Not Brand-Loyal: While they seek good value, they aren’t necessarily attached to a specific brand. The idea of switching brands for a lower price doesn’t create any emotional conflict. They’re adaptable and view shopping as a pragmatic decision based on price and perceived value.
  • Short-Term Gratification: The satisfaction of securing a deal can often outweigh long-term brand loyalty. For bargain shoppers, the immediate reward of a purchase feels more impactful than the enduring satisfaction of sticking with a brand.
  • Flexibility and Adaptability: These shoppers are flexible, often willing to adjust their preferences based on availability or changing sales trends. They’re attuned to price fluctuations and seek opportunities to maximise savings.

How Customer Reviews Build Trust

For bargain shoppers, trust is often established through peer feedback rather than brand recognition. Positive reviews provide confidence, especially when purchasing products from lesser-known or untested brands. 

According to a PowerReviews 2023 study, 83% of consumers are likelier to buy a product with positive reviews, particularly in price-sensitive categories. This peer endorsement creates a layer of trust, making it easier for consumers to make a purchase decision.

According to a 2023 PowerReviews survey, 91% of consumers read online reviews before making a purchase. Bargain shoppers, in particular, scrutinise these reviews to ensure they get the best value for money. Reviews highlight product quality and usability and provide insights into the durability of affordable items, making them crucial for decision-making.

Customer reviews directly and significantly impact the purchasing decisions of bargain shoppers. 

In BrightLocal’s 2023 survey, 79% of consumers stated they trust online reviews as much as personal recommendations, with this figure especially relevant for low-cost products. 

Real vs. Fake Reviews: Addressing Concerns and Maintaining Authenticity

While reviews are critical to decision-making, the rise of fake reviews has caused some scepticism among consumers. Platforms like Amazon and AliExpress use advanced algorithms to detect fraudulent reviews and ensure authentic feedback. 

A BrightLocal 2023 survey revealed that 62% of consumers are sceptical of reviews that appear overly positive or negative, underscoring the need for authenticity. Bargain shoppers, in particular, are cautious of fabricated reviews and often read positive and negative feedback to form a balanced understanding of the product.

Case Study: IKEA’s Strategy for Trust through Customer Reviews

Example: IKEA’s Strategy for Leveraging Customer Reviews

Image Source: CNN

IKEA is a strong example of a brand that has effectively integrated customer feedback into its marketing and product development processes. By promoting customer reviews through email campaigns and engaging with shoppers via multiple platforms, IKEA encourages customers to share their honest experiences. This approach has helped build trust around its affordable product lines, particularly by emphasising durability and design. 

The Role of Reviews in Product Discovery and Comparison

Influence on Search Rankings: How Reviews Drive Product Visibility

Customer reviews play a crucial role in boosting product visibility on e-commerce platforms. Positive reviews can significantly impact search rankings, leading to better discoverability for budget-conscious shoppers. According to Moz, customer reviews account for 15.44% of how Google ranks local businesses, and similar algorithms apply to platforms like Amazon and eBay. For bargain shoppers, reviews that push a product higher in search results serve as a quick indicator of its quality and reliability.

Comparison Shopping: How Reviews Aid in Decision-Making

Bargain shoppers are meticulous in comparing products before making a purchase, and customer reviews are a critical part of this process. Reviews offer detailed insights into product quality, features, and value, which are often missing from product descriptions. In a 2023 iPrice Group study, 80% of Southeast Asian consumers reported that they rely on reviews to compare products in lower-priced categories. This level of comparison is crucial for budget shoppers seeking the best deal across multiple products.

Customer Insights: Discovering Product Quality, Features, and Durability

Customer reviews are especially valuable for bargain shoppers looking to understand how a product performs in real-world use. A 2022 GfK report found that 70% of consumers believe reviews are the most reliable source of information about a product’s durability and usability. Bargain shoppers use reviews to discover key product insights—such as whether a low-cost item delivers value for money or is worth upgrading.

Example: Xiaomi’s Review-Driven Success

Image Source: 9to5Google 

Xiaomi, the Chinese electronics giant, effectively uses customer reviews to boost sales of its budget smartphones. By encouraging user feedback across platforms like Amazon and Flipkart, Xiaomi not only gathers product insights but also enhances product visibility. In 2022, Xiaomi’s Redmi Note 11 became one of the best-selling smartphones in India, driven by positive reviews emphasising its affordability and quality. This review-driven approach significantly contributed to Xiaomi’s growth in emerging markets, where bargain shopping is widespread.

Impact of Negative Reviews on Bargain Products

Consumer Reactions: How Negative Reviews Deter Bargain Shoppers

Negative reviews have a heightened impact on bargain shoppers, who are often wary of taking risks with lower-cost products. 

This is more pronounced for budget-conscious buyers, as even minor criticisms can deter them from purchasing a low-cost item.

Handling Negative Reviews: Strategies for Sellers

Effectively managing negative reviews is essential for brands. Engaging with customers, offering solutions, and improving products based on feedback can help mitigate the impact of negative reviews. A BrightLocal 2023 report noted that 97% of consumers are more likely to forgive a brand that responds well to negative reviews. For bargain products, transparency and responsiveness are key to regaining trust and driving sales.

Example: Dyson’s Response to Negative Reviews

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Despite being known for high-end products, Dyson effectively handles negative reviews for its lower-cost models, such as the V7 vacuum cleaner. After receiving complaints about battery life, Dyson introduced an extended warranty and actively responded to reviews on platforms like Amazon and Best Buy. This approach helped reverse negative perceptions, increasing the product’s rating and boosting sales by 15% over the next quarter.

The Social Proof Phenomenon in Bargain Shopping

The Role of Positive Reviews in Shaping Behaviour

Social proof is a psychological phenomenon where individuals follow the actions of others to validate their own decisions. For bargain shoppers, positive reviews act as powerful social proof, encouraging them to trust a product recommended by other shoppers. 

The Growing Impact of Visual Social Proof

As consumers seek more engaging content, video and image reviews have become increasingly important in online shopping. Platforms like Amazon and Shopee allow customers to upload visual reviews, adding another layer of authenticity. A Wyzowl 2023 report found that 79% of consumers are more likely to buy a product after watching a video review or seeing user-generated content, underscoring the growing influence of visual social proof in bargain shopping.

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The Role of Review Aggregators and Influencers in Guiding Bargain Shoppers

Third-party review aggregators like Trustpilot and ResellerRatings play a crucial role in guiding bargain shoppers. These platforms consolidate reviews across multiple sites, offering a broader picture of a product’s reception. A Statista report showed that 72% of consumers consult multiple review platforms before making a purchase, particularly for budget items, as these reviews provide an extra layer of verification and comparison.

Influencers and Bargain Recommendations

Influencers have emerged as powerful drivers of product discovery, particularly for budget-conscious consumers. Platforms like Instagram and YouTube offer authentic product reviews from influencers who specialise in finding deals. 

According to Influencer Marketing Hub, 61% of consumers trust influencer recommendations, with bargain shoppers in markets like India often following influencers to discover low-cost, high-quality products.

Recent reports show that Southeast Asian consumers are more likely to purchase a product if recommended by a trusted influencer, especially in the beauty and electronics categories, where low-cost items dominate. Influencer reviews not only increase product visibility but also build credibility, particularly in price-sensitive markets.

Key Models for Pricing and Consumer Sensitivity

Here are some key models used to understand how price sensitivity affects bargain shoppers’ purchasing decisions:

  • Van Westendorp Price Sensitivity Meter (PSM)
    Overview: The Van Westendorp model is a well-known method for measuring price sensitivity. It asks respondents a series of four questions designed to identify the range of prices consumers perceive as too cheap, acceptable, expensive, or too expensive.
    How it Works: By plotting the responses, a price range is determined where consumers are most likely to purchase. The intersection points provide an optimal price range, showing where demand might drop if prices go too high or too low.
    Application: Commonly used in retail, consumer goods, and pricing strategy for new products.
  • Gabor-Granger Method
    Overview    : This method involves asking consumers how likely they are to buy a product or service at different price points. The Gabor-Granger technique helps to estimate the demand curve for a product by identifying the optimal price that maximises revenue or sales.
    How it Works: Respondents are presented with a product and asked how likely they would be to purchase it at varying prices. This creates a price-demand curve, showing how demand changes with price increases or decreases.
    Application: Used in industries where businesses need to understand demand elasticity, such as retail, subscription services, and consumer products.
  • Conjoint Analysis
    Overview    : Conjoint analysis is a more advanced technique that helps businesses understand how consumers value different product attributes, including price.
    How it Works: Consumers are presented with product profiles featuring different combinations of attributes (e.g., price, brand, features), and their preferences help reveal the optimal product configuration.
    Application: Used in industries like electronics, automotive, and food to assess product preferences and pricing strategies based on attribute trade-offs.

Final Thoughts

Brands must recognise bargain shoppers are seeking discounts and a sense of value, trust, and smart shopping. By leveraging customer reviews and applying proven pricing strategies, brands can build a loyal customer base that sees value in both price and product. In an increasingly crowded market, those who master leveraging consumer feedback, social proof, and strategic pricing will be well-positioned to succeed with bargain shoppers and other price-sensitive consumers.