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Business

Indonesian retailer taps Disney to fight e-commerce

Matahari Department Store targets family shoppers to boost sales

"Disney corners" aimed at attracting family shoppers to Matahari Department Stores (photo courtesy of Matahari Deparment Store)

JAKARTA -- Matahari Department Store, Indonesia's largest chain, on Wednesday announced a partnership with Walt Disney to sell goods with designs featuring Disney characters at its outlets.

Under the four-year partnership, Matahari stores will feature "Disney corners" that sell clothes, shoes, household goods and toys featuring Disney, Marvel and Star Wars characters. The concept was first launched in September at a store in Karawaci, west of Jakarta, and will be spread across all 155 stores in more than 70 cities by November.

The products will be designed and made by Matahari's local suppliers but approved by Disney. Their prices will range from around 100,000 rupiah ($7.50) to 250,000 rupiah, according to the company.

Christian Kurnia, merchandising, marketing and store operation director at Matahari Department Store, left, and Herry Salim, country manager at Walt Disney Indonesia, during a press conference on Wednesday (Photo by Wataru Suzuki)

Matahari, partly owned by the Lippo Group conglomerate, has grown into the dominant department store operator in the country by targeting the rising middle class. But a recent slowdown in consumer spending has capped the company's growth. Year-on-year same-store sales growth declined to 8% for the first six months of 2017, compared with 27% a year earlier.

Some analysts have also highlighted the growing competition between physical retailers and e-commerce players, which are quickly growing in popularity. Matahari recently shut two stores in Jakarta, where shoppers are the most tech-savvy.

Christian Kurnia, merchandising, marketing and store operation director at Matahari, said the collaboration with Disney will bolster segment targeted at kids and youths, and attract families to its stores. "We want to give a different shopping experience," he said. "This is something that online retailers cannot provide."

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