MLM in Indonesia: K-Link’s digital strategies attracting youngsters into supplement business
K-Link is a direct-selling company from Malaysia that started in 2000. It specialises in selling dietary supplements, skincare, cosmetics, lifestyle, and household items.
Its biggest market is in Indonesia where it has been present since 2002. One of its bestsellers in the country is its liquid chlorophyll supplement.
The company has set up an online shopping mobile app known as K-Mart in Indonesia in July to help customers to continue to have access to its products despite the rapid spread of COVID-19.
“Since COVID-19, there's a lot of people who can’t go out, especially because the daily infected cases are increasing. So, we try to help our distributors and customers by making our own e-commerce platform to make it easy for our consumers to buy the products,” senior manager digital network marketing Ainaa Radzi, who is based in K-Link Indonesia, told NutraIngredients-Asia.
Customers can purchase products from K-Mart and key in the referral code of their distributors for the latter to continue to earn their profit.
In fact, K-Link started its digital plan in 2017, with the aim of attracting youngsters into the MLM dietary supplement business.
Most of our active distributors are in their 40s. We wanted to attract youngsters to join our business, but if we were to stick to the old ways of marketing [face-to-face MLM], the youngsters might not be attracted to the business model, because there’s a lot of things that people are saying about MLM.
We are still a MLM company, but we have integrated digital network marketing to suit the market trends and so we are doing both online and offline business these days.
- Senior manager digital network marketing Ainaa Radzi
The company set out an official digital network marketing department two years ago, which focused on designing videos, photos, and posters which distributors could simply circulate via Whatsapp and their social media to grow their business.
The digital plan has been timely especially since COVID-19 hit last year. She said there were 30 to 35 per cent of the distributors who have been doing online business in the past year.
“Indonesia is our biggest market. After starting the K-Mart app in Indonesia, we will expand it to other markets such as Malaysia.”
Its bestseller K-Liquid Chlorophyll is said to be an antioxidant and a source of vitamin A and C.
“In fact, if you talk about chlorophyll, people in Indonesia will straightaway think of K-Link. Its like how people in Malaysia will think of Maggi when you talk about instant noodles,” she said.
K-OmegaSqua and propolis platinum are also amongst the top three bestsellers in the past year.
K-OmegaSqua softgel capsules contain omega-3 derived from Norwegian salmon, squalene from shark’s liver oil, and vitamin E for skin health, while the propolis product is said to have originated from Brazil and contained antioxidant properties.
“Health supplement sales have increased because of COVID-19. Awareness about supplements have increased in Indonesia and the youngsters are also starting to take care of their health.”
The company declined to reveal their sales revenue but a November 2020 report from Euromonitor highlighted K-Link as a leading dietary supplement brand in Indonesia.
The report also said that e-commerce and direct selling business were expected to deliver strong growth as consumers were avoiding outdoors and both channels offered home delivery.
Within Indonesia, the company enjoys the greatest market presence in Jawa Barat (West Java), Jawa Tengah (Central Java), and Jakarta.
In fact, the company owns a 28-storey tall K-Link Tower located at Jalan Gatot Subroto, south of Jakarta, since 2011.
Some reasons for its popularity in these areas include a higher purchasing power and a well-developed logistics network.
“We are also present in the less-developed areas, but we are trying to make improvements because it is harder for us to arrange logistics and make our products accessible in these areas in the less developed areas.”
K-Link also operates in India, Philippines, Vietnam, and Singapore.
Similarities between Malaysia and Indonesia
According to Radzi who left Malaysia to expand the company’s business in Indonesia, the company first expanded from Malaysia into Indonesia partly due to similar health concerns and product demands.
“If you look at the way of living and also our diet, they are similar. We eat a lot of oily stuff, and so, most people face the same problem of high cholesterol and diabetes. As such, the health market demands are similar.”
The company first went into Indonesia’s dietary supplement market with two products, K-Liquid Chlorophyll and Riddance – a detox product that contains radix panax ginseng, radix glycyrrhizae glabra, and radix ledebouriella divaricate – a herb used in Chinese medicine.
New product launch
For its new product line, it is currently developing a collagen drink which is expected to be launched during year end.
This will complement the company’s growing skincare and cosmetics product range.