He was studying a Facebook-commissioned study by Bain & Company. The title page was intriguing. 200 million new consumers by 2025 in Asian markets.
What grabbed my eye was: the average spend per consumer is expected to more than triple from USD 125 in 2018 to USD 390 within the same time frame.
The good news: This is an opportunity.
The not-so-good news: Loyalty remains a key challenge.
Clothing and personal care are emerging as two of the leading categories; and the middle class is accounting for 70% of the growth. Curiously enough, quite unlike India and China, consumers across Indonesia, Malaysia, the Philippines, Singapore, Thailand, and Vietnam (Southeast Asia nations) do not have one dominant eCommerce platform to select from.
Therefore, the commissioned study talks about brands building loyalty with consumers through loyalty programmes. This got me thinking. Does our industry have loyalty programme? The statistics show purchase is boosted by 1.5 times more than those without a loyalty programme. In addition there
are 45% more recommendations across categories, 25% more likely to have higher purchasing frequencies across categories and 20% more likely to have higher spending across categories.
The Facebook-commissioned study by Bain & Company also looked at discovery and innovation boosting eCommerce businesses.
The top three reasons for making a purchase are: positive reviews from other users, good deals or promotions, and interesting products.
And so, two-thirds (67%) of respondents said they do not exactly know what they want to purchase before they shop online, with more than 50% of respondents saying they learn about new products and brands via social platforms. The shoppers showed a strong preference for omnichannel, with over 80% saying they compare prices across online discovery platforms and in-store before they make a purchase decision. Over 40% have tried an online store they have never heard of in the past year.
According to a Neilsen study, Indian consumers are finishing the first half of 2019 by declaring strongly that they are ready to purchase. India's Consumer Confidence Index level is 138 points, the highest score in the world and far beyond the regional APAC average of 117 points.
Every one in two Indian consumers believe the timing is just right for purchasing and once consumers have covered essential living expenses, they will be vacillating between spending on holidays and vacations and buying new clothes. Moreover, compared to five years ago, nearly half of the consumers (49%) say they spend more on groceries and education, and 47% of consumers say they spend on technology and communication.
The future of our industry lies in three developments: technological upgrade, creation of new business models, and holistic insight into consumer behaviour. We are doing quite alright with one and two; we need to look at three.
Is it do-able? Oh yes, of course.
Look at OOH and outdoor media. I feel, the future is in lower-tier cities in India. For one, these cities have populations with low brand awareness. I don't think outdoor media agencies are capitalising on this gap. Another space is OOH experts that are exporting their services and products abroad. This year in the
PrintWeek Award's Wide-Format Printer of the Year category, there were firms which were leveraging their international reach. Some of them are even trying to measure the effectiveness of offline advertising with sophisticated algorithms. Is this is a dream? Perhaps yes. But, algorithms are dominating marketing communication and business operation systems, and clients are increasingly demanding greater synergy between sales and marketing.
Noel D'cunha is the managing editor of PrintWeek and WhatPackaging? magazines