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Market research company Nielsen recently published insights about Asia’s retail landscape during the digital disruption. Two words were consistently used: ‘change’ and ‘uncertainty’.

How have the last five years affected Asian consumers, and in turn, retail performance?

1. Increasingly comfortable consumers

Almost three out of four Asia Pacific consumers believe they are financially comfortable enough to buy things because they want them. This correlates with the upgrade in everyday items, where Asian consumers are choosing more premium versions of daily necessities like milk and shampoo.

Asia Pacific benefits from vast opportunities within its own borders. This is a region with burgeoning population growth, a predominantly young workforce, improving living standards and a growing middle class with an increasing desire to spend.

Two out of three consumers across the region feel they are better off than they were five years ago, the global average is 55%.

2. More access to technology and products 

61% of consumers in Asia Pacific cite ‘improved technology’ as the key service they didn’t have access to five years ago.

More premium products, broader assortment and better technology are the key factors that have driven ecommerce forward in the region.

Access to better technology, increasing internet penetration and the rise of different online platforms mean that consumers in Asia Pacific constantly have new ways to shop, to interact with each other, and are always accessible.

37% of respondents from Asia Pacific also cite “better retail formats” as something new that did not exist five years prior.

Very simply, Southeast Asians are more financially stable than five years ago, have more access to a variety of products and technology that enables them to live comfortably. This has resulted in the much-discussed ‘ecommerce boom‘ and will continue to allow the online retail industry to flourish.

This is also the first time Nielsen has included a portion of survey results from consumers in Myanmar, an indication that the country’s developing economy will play a more significant role in Southeast Asia’s growth as a retail market to look out for. For more on Myanmar, read eIQ Insights on the country’s ecommerce potential here.


Survey results included in this article were originally published on Nielsen.

Shoppers around the world are making more room in their budgets for the finer things in life – not in the sense of designer handbags or diamonds but upgrades in everyday consumables.

31% of global respondents say they consider a product to be premium because it’s expensive — a warning to companies who push up prices without providing a very clear value proposition to support the change.

Nielsen‘s latest global report on “Premium Potential” takes a look at growth of different categories based on consumer input around the world and how well do premium products will perform. For example, almond milk versus regular milk.

Unsurprisingly, respondents in Southeast Asia, Latin America and Africa/Middle East are willing to spend more money on better electronics and clothing/shoes, 37% & 36% respectively.

30% of global respondents say they’ll consider paying more for dairy products or better meat or seafood.

More than a quarter of global respondents say they’ll consider spending a few more dollars for premium hair-care (27%), body-care (26%) and oral-care (26%) products.

The premium segment accounts for roughly 23% of sales in the personal category in Southeast Asia.

In Southeast Asia, premium products accounted for 55% of face moisturizer sales, 39% of face cleanser sales and 36% of toothpaste sales, 31% of shampoo sales.

Unilever has also responded to increased demands for personal care within its Southeast Asian markets by launching shop-in-shops on marketplaces in Indonesia and Thailand to heighten visibility.

Unilever on Shopee Indonesia

Vitamins were among the top five categories in the region, which should be encouraging to companies like Blackmores that have gone online to widen its customer reach with a shop-in-shop on Lazada.

 

Blackmores on Lazada Thailand

Although “premium products” seem to be more attractive, it’s still important to note that customers won’t give up their dollars so easily.

“Many are looking for everyday items that perform better or fulfill their emotional needs or social aspirations at a price that doesn’t break the bank,” said Liana Lubel, senior vice president, Nielsen Innovation Practice.

Source: Nielsen

It’s important for brands in Southeast Asia to understand that the growth of premium goods will open up opportunities for distribution and product variation within the scope of fast moving goods. These premium brands are able to bring new consumers into the category and reengage lapsed consumers.

Read Nielsen’s original research on premium goods here.