Disruptive innovation for online informal sector in Palembang City

Abstract

The Internet has aided the informal sector to make an innovation in a business transaction. There is a shift from a conventional or face-to-face meeting with the consumers to online transactions. The present study aims to describe the disruptive innovation for the online informal sector in Palembang City. The method employed was quantitative with a descriptive approach, while the data were collected through a survey of 382 respondents. The data were then analyzed using the descriptive statistic method. The research resulted in several findings. The online informal sector is dominated by e-commerce through social media, such as Facebook, Instagram. YouTube, and others. The average income of the founders reached Rp250,000 - Rp500,000 per day. Meanwhile, the number of workers in the online informal sector is 1-4 people with an average income ranging from Rp1,000,000 to Rp2,000,000 per month. The workers mostly graduated from Senior high schools (SMA), Vocational high school (SMK), or Madrasah Aliyah (Islamic Senior high school). The main issue faced by the founders of online informal sectors includes strategic locations (near school, campus, markets, and others).