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Newsletter March 2015 SOCIAL MEDIA ANALYSIS ON SPENDING AND SAVING BEHAVIOR

Provetic Newsletter March 2015

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Newsletter — March 2015

SOCIAL MEDIA ANALYSIS ON SPENDING AND SAVING BEHAVIOR

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Dear Valued Clients,

Financial matter is one of the most crucial aspect of

people’s everyday lives that affect all sort of decision

making processes —something that will also affect

decision making and strategy formulation for many

business and organizations.

Many matrices and indexes had been invented and

heavily used to measure financial state of Indonesian

—mostly in quantitative terms. In this edition, we

would like to present to you another way to gather

information about people’s financial matter: through

their daily reflections and reports recorded in social

media.

Although this approach might have seemed to be less

noise-free than the other measurements, we believe

that social media data will provide insightful quality

for better understanding of Indonesians financial

matters, trend in the wishlist of many people, as well

as hidden motivations behind two simplest financial

activity: spending and saving.

We would also look into the general landscape of

banking industry; and also, into the advancement of

banking industry in the digital world.

We hope this edition will serve as an insightful

reading for you.

Best Regards,

Iwan Setyawan, CEO

WORDS FROM THE CEO

EDITORIAL TEAM Board of Advisors

Iwan Setyawan, Roby Muhamad, PhD,

Shafiq Pontoh, Budhi Sumarso

Managing Editor

Smita Sjahputri

[email protected]

Jl. Kerinci 1 no. 2, Kebayoran Baru

Jakarta Selatan 12120

T: +6221 72799613

F: +6221 72799613

www.provetic.com

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Money matter is incredibly crucial for many

people. Hence, it is only natural to expect that

people would also take it into social media to

talk about financial issues —from merely

expressing their feelings about their financial

state, conversing about their needs (and wants),

up to seeking information about banking and

investment products and services.

For us, this means access to yet another pool of

data that would provide insightful peek into

financial matter of Indonesian. In this edition of

Provetic Newsletter, we would look into several

aspects about people’s everyday financial matter

and break them down into several key points.

Saving and spending are two of the most basic

financial activities related to people’s daily

financial matters. These two behaviors also play

a very important role in understanding people

basic motives: what are the things people are

spending on as well as what are the things

people are saving money for. Understanding this

information would help business and

organization to capture the trend in people’s

consumption pattern to be able to anticipate

what people want and need.

Other than personal financial matters, we also

looked into the landscape of banking industry in

Indonesia; as social media conversation might be

utilized as benchmark to map out brand

awareness and people’s top association of

certain services.

Moreover, in the recent years, there has been a

trend towards establishing the market for Digital

Banking, starting with the more emphasis on

mobile and online banking transactions.

Although this shift is relatively early, but we

investigate the data to see how much it has

impacted the urban Indonesian financial habits.

Although this data on Digital Banking might be

rather limited, but this limitation alone might

help to highlight that there is indeed a very large

room to grow the market. Furthermore, we can

also identified how the market is understanding

this shift to online and mobile banking practices.

Lastly, we believe that these qualitative data can

be utilized as complementary data to give

deeper understanding about Indonesian

financial behavior landscape, anticipating trends

in people consumption, and identifying people’s

basic motivation in saving and investment.

INDONESIAN MONEY MATTERS: SOCIAL MEDIA CAPTURES EVERYDAY FINANCIAL MATTERS

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Conversation about financial

matters could reflect the general

landscaped about consumer

behavior. In the objective to

attain this understanding,

Provetic analyzed the social

media conversation on people’s

financial matters and divided the

analyses into discussion of basic

financial activities, such as

saving, investing, and personal

financial crisis management.

People are more expressive

about financial crisis than

about savings or investment

strongly associated with the term

“Gajian" or payday; indicating the

most reported period of financial

crisis is on days before the payday.

Other than that, "Ngutang" or

lending money from other people

is also the most common term

used to indicate activity during

financial crisis.

Although the conversation about

financial crisis condition might

indicate hardship, but looking

deeper into the content of the

social media conversation, it

appears to be more of a light-

hearted conversation. Major topic

in the conversation is the

expression of optimism to survive

the cashless state of "tanggal tua"

or critical days before the pay day.

How people handle financial

constraints is also seen as measure

of characters, as several

conversation topics expressed that

people would rather have easy-

going and fun friends who won't

fuss so much when the money is

tight, over "cool" friends who

spend too much for style.

When comparing between the

conversation in which people

expressed financial crisis versus

conversation about saving and

investment, it appears that people

are more expressive about having

financial crisis than the latter

topics.

Although this finding might not be

unexpected because saving habits

might not be a conversation topic

that people are normally and

actively expressing on social

media, however this might also be

seen as an indicator that people

might be more sensitive towards

financial crisis and would be more

likely to comment publicly about

their financial crisis instead of

reporting their means of fixing the

situation.

In the conversation regarding

financial crisis, "Bokek" is the most

used terms to refer to condition of

being broke, or having no money.

This term appears to be very

Chart I — Total Buzz and Average Daily Distribution for

conversation on financial crisis, saving, and investment

Total Buzz Average Daily Distribution

N = 176,353 tweets

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People main motivation for

savings seems to be to buy

premium goods, own a house,

or going for Hajj trip

amount of tweets.

Three of the most mentioned items

of what people try to pursue by

saving money are mobile phone,

Hajj trip, and housing. Other

motivations for saving money are

getting married, buying books, and

financially supporting their kids.

When we compared this list of

items to the public general wish

list (things people reported that

they want at the moment), we

found several items that

overlapped in both lists, such as

owning a house, gadgets (SLR

camera, mobile phone), clothes,

starting a business, as well as going

on a vacation. This similarity

indicated that people are generally

more in line in what they want and

what they strive to have.

However, it also appears that what

people save up more is for things

that are of responsibility-driven,

such as owning a house, caring for

children, getting married, as well

as investment plan; while general

wish list indicates more of a

hedonistic-driven items such as

gadgets, clothes, and vacation.

In the conversation which people

talks about saving, mostly

consisted of the kind reminder to

"Rajin Menabung" or to diligently

save money whenever possible.

This indicated that the habit of

being frugal and saving money is

still one of the most important

values being taught in the society.

However, the conversation data

suggest that the intention to save

money is almost always being

accompanied with the expression

of having difficulty to continue

doing it; the latter, indicated by the

phrase “Susah Nabung” is also one

of the most mentioned topics,

following very closely behind the

"Rajin Menabung" reminder which

is the most mentioned topic.

Looking at the motivation behind

why people save, there's a very

strong indication that people save

money as a means to be able to

purchase something instead of an

act of investment —as the latter is

being recorded in a very small

Top Words for

Financial Conditions

Top Motivations

for Saving

Top Things on

People’s Wishlist

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being involved in online shopping

transactions.

In the landscape of Digital Banking,

BCA and Bank Mandiri are also two

of the most associated banks with

the practice of internet and mobile

banking in general.

However, general conversation

trend indicated that there is very

limited awareness that public have

regarding the practice of digital

banking.

Although some people, especially

in the urban areas, are already

more familiar with internet

banking and mobile banking,

However, it appears that most of

the conversation are driven by

customer servicing practices by

several bank official accounts to

answer people’s inquiries about

their online and mobile

transactions, instead of more in

organic and in-depth discussion of

the practice.

Based on the social media

conversation, data suggests that

BCA is the most prominent bank,

followed by BNI and Bank Mandiri

in the second and third place.

In terms of product association,

BCA is very highly associated with

product services that support

people’s daily transaction such as

“[money] Transfer”, “Payment” and

“ATM [transaction]”. BNI is more

associated with their “Credit”

services, and Bank Mandiri have

similar association with BCA, such

as “ATM (transaction)” and

“Payment”.

Other than that, BCA and Bank

Mandiri are also very much

associated with “online shop”

which indicates that these two

banks are the one most commonly

Chart II — Total Buzz for Banking industry

landscape in Indonesia.

Insights from general

conversation on banking

industry indicated that people

are still more comfortable with

conventional banking practices.

The newer shift into cashless

society is still very limited in its

influence on people’s financial

behavior; regardless the fact that

the urban Indonesian might

already be familiar with internet

and mobile banking practices.

BCA is the most popular bank

in social media, and is

especially associated with

everyday transaction.

N = 107,689 tweets

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In general, financial matters are

very important for most

Indonesian, as reflected in the

high number of conversation

level in social media.

Looking at the theme of what

people is most concerned about

in the conversation about their

financial condition, it appears

that people are more expressive

when it comes to voicing out

personal financial crisis rather

than reporting saving and

investment habits.

The most reported personal

financial crisis in social media is

about “bokek”, or not having

money, and having to lend some

from other people, or informally

known as “ngutang”. Meanwhile

the most reported event is

“tanggal tua” and “gajian”

indicating the importance of the

week before payday where

money usually is very tight.

Although this theme of

conversation might indicate

hardship, but it appears that

people are taking it rather light-

heartedly.

Although savings are relatively

under-reported in people daily

conversation, however, further

analysis is able to identify the

motivations that drive people

to save.

Data indicated that most people

save money to be able to

purchase something; however

most of the items mentioned

could be considered as long-

term investment such as

owning a house, providing for

their children, or getting

married. However, there are

also big amount of mentions

about premium goods as well as

tertiary needs.

These premium and tertiary

items are proven to be the most

sought-after things that people

converse about in social media.

In another conversational data,

which look into people’s

general wish list, most of the

items that appear in the

previous list also surfaced in

the general wish list.

The data helped to identify

people’s basic needs and

wishes, which would be

beneficial to be addressed by

businesses and organizations

aiming to help increasing

people’s wellbeing.

Focusing on banking industry,

BCA and Bank Mandiri are two

of the most popular bank,

especially in relation to basic

daily financial transaction such

as “transferring (money)” and

“(making) payment”.

The two banks are also the top

of mind brands when it comes

to online and mobile banking

transaction.

However, in general people’s

awareness of digital banking is

extremely limited —which

indicate that there’s a need of

greater push to establish the

move into digital banking and

cashless society.

KEY TAKEAWAYS AND

FURTHER IMPLICATIONS

© March 2015 — Provetic

Photo Credits:

Cover Photo by Tiltti

1. “Dirty Sexy Indonesian Money” by Ryan Tir

2. “Market” by Roberto TRM

All rights under Creative Commons Liscense