OPINION, Thekabarnews.com— For decades, Matahari was one of the most popular shopping destinations in Indonesia. Families across the country rushed to its stores for Eid clothing, work clothes, school uniforms, shoes, bags, and children’s wear.

It had hundreds of outlets in the major cities and created a reputation for value, convenience, and promotional campaigns. These campaigns became part of the annual shopping calendar.

But Indonesia’s retail sector is changing fast today and forcing established brands to rethink their strategies.

With consumer tastes shifting to digital, social media fashion trends, and lifestyle shopping experiences, Matahari is trying to reinvent itself. It is launching two new private label fashion brands, SUKO and ZES.

That is amid rising competition from international retailers, e-commerce websites, and fast-fashion brands that have managed to woo younger shoppers.

Matahari’s latest financial results prove that the urgency of its transformation is clear.

The company booked a net profit of some Rp1.38 trillion in 2022. However, earnings fell to some Rp675 billion in 2023. Sales were modest. Nevertheless, earnings bounced back to about Rp828 billion in 2024.

The company said overall sales reached Rp11.05 trillion in 2025 with a net profit of Rp725 billion. The numbers reveal that profitability remains under pressure as it seeks to improve operational efficiency and retain market share.

Indonesian middle-class consumers have been more cautious about their discretionary spending. The skyrocketing costs of living, education, mortgage payments, and household budgets have made many consumers delay fashion purchases. Thus, consumers buy only if the products are really good value and attractive.

For years, Matahari heavily relied on promotions and discount campaigns to drive foot traffic. Such discount-driven strategies can boost sales but don’t create long-term loyalty.

Matahari has responded to this challenge by strengthening its brand identity and expanding consumer engagement initiatives.

SUKO is designed for consumers who seek minimalist, comfortable, and versatile wardrobe staples. Known for its clean designs, neutral colors, and everyday functionality, the brand has built a strong reputation. This approach is a strategy that has tapped into the growing popularity of modern basic wear.”

ZES, on the other hand, plays in the urban contemporary fashion space with collections that are a little more trend-right. These collections are targeted to a younger consumer who is interested in style, individuality, and social media appeal.

Not surprisingly, the strategy has been compared to global retailers like Uniqlo and Zara. Matahari isn’t competing with these global giants, but it is offering Indonesians a cheaper way to get their fashion fix.

The extensive physical presence of Matahari continues to be a benefit. The company operates more than 140 stores in nearly 80 cities across the country. This is a distribution network many up-and-coming fashion brands cannot easily duplicate.

The management is also changing the store layouts to make for a more modern shopping experience. Cleaner displays and minimal interiors, better lighting, and stronger visual merchandising are all about changing consumer perceptions of the brand.

Matahari has also intensified its marketing initiatives by collaborating with key opinion leaders (KOLs), fashion creators, and micro-influencers. These efforts aim to engage Gen Z and millennial shoppers.

The company is also making operational changes, such as closing under-performing stores and modifying its business model.

The company’s recent corporate transformation to PT MDS Retailing Tbk is part of a bigger aspiration. The goal is to transform from a traditional department store operator into a multi-concept retail company catering to different consumer segments.

Where Matahari goes from here will depend on whether it can balance modernization with its current customer base.

The company needs to attract younger shoppers, but without losing loyal customers who have supported the brand for decades.

The question is whether SUKO and ZES can strike that balance. But the strategy tackles one of the most significant problems legacy retailers face today. That problem is how to stay relevant in a market where perception of a brand can be as vital as price.

As Indonesia’s retail sector continues to evolve, Matahari’s transformation could be a major case study. It may show how traditional retailers adapt to changing consumer behavior, digital influence, and increasing competition.

For a brand that once defined family shopping in Indonesia, the next chapter may be less about discounts. Instead, it may be more about its ability to reinvent itself for a new generation. (By: PecahTelur)

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