The COVID-19 pandemic has impacted all aspects of people’s lives, disrupting both short-term plans and long-term prospects. Around the world, people have had to adapt...+
Government Satisfaction Index
Government Satisfaction Index
Despite booming sales accelerated by COVID-19, eCommerce players have taken growth for granted at the expense of consumer experience, according to new research released today. ...+
Local Over Global: How the COVID-19 pandemic is accelerating the “glocalization” of ASEAN economies
The COVID-19 pandemic has impacted all aspects of people’s lives, disrupting both short-term plans and long-term prospects. Around the world, people have had to adapt their day-to-day routines, adopting new “normal” behaviours that require a thorough re-evaluation of the way they spend their time, energy, and money. This is especially true in Southeast Asian economies,…
The COVID-19 pandemic has impacted all aspects of people’s lives, disrupting both short-term plans and long-term prospects. Around the world, people have had to adapt their day-to-day routines, adopting new “normal” behaviours that require a thorough re-evaluation of the way they spend their time, energy, and money.
This is especially true in Southeast Asian economies, where the use of innovative devices, platforms, and services has allowed new consumption patterns to emerge despite overall economic slowdown. And as consumers’ needs, habits, priorities, and preferences evolve, so do the market dynamics that they drive.
What are some of the key trends observed in the region? And how can businesses leverage this knowledge to stay ahead of competitors?
To answer these questions, Blackbox Research, Toluna, and Archetype have published Into The Light, an in-depth study that reveals the emerging patterns, trends, and dynamics across six key ASEAN markets – Indonesia, Malaysia, Philippines, Singapore, Thailand, and Vietnam.
This article is the first in a series of blog posts devoted to examining some of the major findings and implications of the study. It focuses on how the COVID-19 crisis has led ASEAN consumers to increasingly favour local products over more globalised offerings – effectively accelerating the “glocalization” of markets in the region.
A marked preference for local products
The study shows that a product’s country of origin is likely to impact nearly six out of ten consumers’ decision to spend. This is more pronounced in the Philippines (71%) and Vietnam (66%), and less prevalent in Singapore (47%).
Moreover, about eight in ten consumers declare being somewhat or much more likely to support local businesses. This is more pronounced in the Philippines (95%) and Indonesia (91%), and weaker in Vietnam (53%).
These findings are in line with the conversations that were taking place in most Southeast Asian cities during the most critical months of the fight against COVID-19.
Indeed, the ultra-restrictive measures adopted by most governments in the region impacted many local businesses. From neighbourhood restaurants and shops to service-oriented businesses, everyone took a hit. Bigger international chains had more cashflow to leverage, but it quickly became clear that smaller local businesses would likely not survive several months of limited patronage.
Thus began a series of campaigns by influencers, entrepreneurs, and trade associations to get consumers to #supportlocal – a movement that was relayed across government- and community-driven networks alike. In Singapore, for instance, Hawkers United helped connect consumers with small eateries that may not have the means to survive the measures meant to mitigate the spread of COVID-19.
In this sense, the pandemic awakened people’s drive to actively favour small, local businesses over bigger, more resilient chains and franchises.
Businesses can leverage the new normal
It is difficult to say whether this preference for regional or local businesses will be a permanent shift. One thing, however, is certain: small and large businesses alike must recognise the challenges that these new dynamics represent, as well as the potential opportunities they create.
How can an international brand further penetrate a market that has realised the importance of supporting local businesses? Conversely, how can a local brand effectively sustain the activity it has developed during these unprecedented times?
It may be useful to examine the strategies of NTUC FairPrice and DBS, two of Singapore’s top-ranked brands in this year’s Campaign Asia Top 1000 brands list. The key behind their success has been to create and leverage hyper-local messages that appeal to as many segments of the local population as possible.
NTUC FairPrice has run a post-lockdown campaign aimed at rallying customers behind the Singapore Spirit in the new normal. DBS, meanwhile, has launched the “DBS Sparks” series to demonstrate how it understands and embodies its customers’ shared values. At the same time, international brands such as Nestle have partnered with local entities to organically support local and national endeavours.
These examples show that the key is to ensure brand messages are in line with customers’ expectations. This involves conducting customer research to better understand specific needs and desires, and from there, adapting messaging frameworks so that they effectively fulfil or address them.
Looking ahead: driving the “glocal” recovery
Overall, the study conducted by Blackbox Research, Toluna, and Archetype points to an accelerated “glocalization” of Southeast Asian markets.
The way forward for brands in Southeast Asia seems to be an approach that both recognises the importance of local preferences – having their finger on the pulse of local needs, habits, and trends – and capitalises on global capabilities – globalised resources and know-how for operational and financial efficiency.
For example, Archetype has helped launch Fitbit into the Singapore market by building relationships with the Health Promotion Board (HPB) as well as local sporting communities. Such local tie-ups helped drive awareness across a core audience of health enthusiasts, allowing Fitbit to very quickly establish itself as the number one brand in the wearables space. Archetype has also worked with Amazon to cultivate brand awareness and recognition in Singapore. It did so by identifying new trends in customer behaviours during the lockdown – newfound passions such as gardening and online gaming, for instance – and leveraging them through targeted tie-ups with local publications and influencers.
As 2021 draws nearer and the pandemic rages on in many parts of the world, it is both urgent and important for brands to adjust their strategies – messages, campaigns, objectives – accordingly. Indeed, closely aligning with consumers’ evolving demands and expectations will allow businesses to not only sustain the momentum they are currently building, but also ensure they are ideally positioned to drive post-COVID-19 economic recovery.
Download the Into The Light report for more insights to develop relevant and timely marketing and communications plans. And keep checking back as we will be sharing more insights from the report over the next few weeks.
ASEAN study: Disgruntled consumers want regional eCommerce players to step up their game
Despite booming sales accelerated by COVID-19, eCommerce players have taken growth for granted at the expense of consumer experience, according to new research released today. Over a third of consumers in ASEAN (39%) say they are less than satisfied with their digital commerce experience, citing concerns about delivery costs and services, product reliability and the…
Despite booming sales accelerated by COVID-19, eCommerce players have taken growth for granted at the expense of consumer experience, according to new research released today.
Over a third of consumers in ASEAN (39%) say they are less than satisfied with their digital commerce experience, citing concerns about delivery costs and services, product reliability and the authenticity of in-app reviews (See Appendix 1).
Conducted by leading data content and social research agency Blackbox Research in partnership with consumer intelligence platform Toluna, the research report – Into the Light: Understanding What has Changed for the ASEAN Consumer During COVID-19 – analysed current sentiments, expectations and behaviours of 4,780 consumers across six ASEAN markets.
Interested in this report? Please click here to download a copy.
Generational gap in digital proficiency closing rapidly
Yashan Cama, International Commercial Director of Blackbox Research says the study has confirmed a significant change in consumer behaviour in recent months driven by an increasing necessity to shop online.
“Southeast Asia’s retail landscape has undergone a seismic shift since COVID-19 hit the region. While it has been clear for some time that consumers are more digitally adept, it is also clear that older consumers have grown in comfort with digital tools and services. That generational gap really has shrunk in recent months.”
According to the report, while 56% of Gen Zers reported more online spending, the increase is as much driven by older consumers, with the largest increases occurring amongst Gen X (60%) and Millennials (59%) (See Appendix 2).
Cama added, “However, as more shoppers move online, their expectations of the online retail experience have evolved, and this is where eCommerce players must step up their game.”
ASEAN consumers reported a spike in online spending in response to COVID-19, with over half of those surveyed (59%) now spending more online, and the total online spend for the average ASEAN consumer increasing by almost a third (32%).
ASEAN consumers dissatisfied with digital experience
While consumers across the region have access to the same online services, consumer satisfaction varies from country to country. Indonesia (54%) and Malaysia (57%) recorded the lowest satisfaction levels in the region when it comes to online experiences. Even in Thailand and the Philippines, which recorded the highest satisfaction scores, close to a third were less than satisfied (30% and 33% respectively). Meanwhile, a considerable fraction of consumers in Vietnam (38%) and Singapore (39%) are also disgruntled (See Appendix 3).
The findings suggest that that while major eCommerce brands including Shopee, Lazada and Grab, enjoy high usage rates in the region, this growth has come at the cost of greater scrutiny from consumers (see Appendix 4).
Cama says that consumer frustrations about service quality could become make or break for major eCommerce brands.
“We expect some of these cornerstone brands to experience a shake-up in the coming months if these existing problems are not quickly addressed.
“Our report has shown that consumers expect more from the eCommerce experience and will only become more discerning in future. Online retail has transformed from a niche operation to a key consumer service, and standards must improve in line with these expectations. eCommerce players need to rectify core elements of the customer journey and the fulfilment cycle to address these pain points.
“With consumers now better educated and informed, and 5G technology on the verge of transforming platform capabilities, current market leaders may fall by the wayside if they don’t shift to a more seamless experience.”
Consumers in the ‘new normal’: Home as hub, shift towards local brands
But it is not just eCommerce on the rise; even though the majority of ASEAN consumers remain pessimistic about the region’s economic outlook, they have not cut back on their overall spending. In fact, almost half (48%) say their weekly household expenditure has increased (See Appendix 5).
This is despite close to half (45%) of those surveyed anticipating that their national economy will take a greater hit before recovering. Notably, consumers in the Philippines, Malaysia and Singapore anticipate a longer recovery period than their more optimistic counterparts in Vietnam and Indonesia who are more likely to anticipate a V-shaped recovery.
Cama says COVID-19 is not only changing how and where consumers are spending their money, but it is also shifting how people are going about their day-to-day lives, which will have a tangible impact on future consumer behaviour.
“Since the onset of the pandemic, homes in ASEAN have emerged as the headquarters for learning, working and socialising. Over 90% of people are happy working from home, and the majority aren’t missing going to the movies or shopping at retail outlets.”
“Consumers are not rushing back to their old habits, so this new sense of life revolving around the home hub means companies need to rethink how they build this into the consumer experience in future. The home really has emerged as a new headquarters for many people. These changes go right to the heart of consumer behaviour and require innovative approaches across the board from property developers, landlords, employers, through to retailers.”
Another notable shift in consumer sentiment is a resurgence of interest in local brands. Four in five ASEAN consumers said they were more likely to support local brands in the future, driven by a desire to strengthen their local communities and economy (See Appendix 6).
“‘International’ might be on the verge of becoming a dirty word,” says Cama, concluding that “companies will need to assess their portfolios and seriously consider how they can localise their brands to reflect the values that matter most to ASEAN consumers.”
Interested in this report? Please click here to download a copy.
About the Survey
Blackbox Research and Toluna carried out an online nationally representative survey of n=4,780 across six countries, aged between 18 to 60. Stratified random sampling was applied across key demographic and geographic variables to ensure representative coverage. The survey was conducted in June 2020.
The pandemic has brought about many changes in Singapore, and it may be majorly impacting young adults’ ability to leave home. Singaporeans typically live with their parents until they are old enough to get married or to purchase their own apartment. But the recent generalisation of work from home (WFH) measures may be accelerating this…
The pandemic has brought about many changes in Singapore, and it may be majorly impacting young adults’ ability to leave home. Singaporeans typically live with their parents until they are old enough to get married or to purchase their own apartment. But the recent generalisation of work from home (WFH) measures may be accelerating this process.
Recent news articles suggest that not everyone is enjoying WFH while being stuck with family members. This has pushed younger Singaporeans to seriously consider moving out and renting their own personal space.
This month we asked if it is ok for young adults to move out of their parents’ house before getting married (or being financially secure to purchase) and choose to rent a place – nearly three in four (73%) Singaporeans approve of this in principle. Amongst Gen Zers approval is at 88%.
In the context of WFH, approval is even higher amongst Singaporeans, at 79%.
When asked if the Government could do more to encourage younger people to move out and rent their own places, Singaporeans are far less enthusiastic – only 31% support the idea of offering a tax deduction for young adults who choose to leave the nest and rent their own place.
Another option canvassed in our survey was the idea of the Government allocating a certain number of rent-controlled apartments for youths looking to move out, Rent-control apartments are popular in large cities like New York. Nearly half (47%) of Singaporeans approve of this idea. More generally, the Government’s policy of singles having to reach the age of 35 before being allowed to buy a HDB flat is now opposed by just under half (48%) of all Gen Zers.
COVID-19 has accelerated digitalisation in Singapore, affecting not just the way companies and businesses operate, but also how individual Singaporeans interact in their daily lives. From scanning QR codes at entryways to ordering food and groceries from mobile devices, a number of digital platforms have made it easier to comply with Circuit Breaker measures. More…
COVID-19 has accelerated digitalisation in Singapore, affecting not just the way companies and businesses operate, but also how individual Singaporeans interact in their daily lives. From scanning QR codes at entryways to ordering food and groceries from mobile devices, a number of digital platforms have made it easier to comply with Circuit Breaker measures.
More recently, it has been announced that Singapore will become the first country in the world to use Facial Verification for government benefits.
Our latest YKA poll supports the idea that Singaporeans are embracing technological innovation. It also reveals that the generational digital divide is less pronounced than it is made to be in the media. While Gen Zers actively seek out opportunities to try out new gadgets, Baby Boomers (60 years-old and above) are increasingly comfortable with new technology as long as someone shows them how to use it. However, about one in 10 Singaporeans still appear anxious about using technology. Moving forward, greater support and assistance to increase adoption and usage will be key.
Despite this growing appetite, tech developers still need to do more to shift people’s behaviour when launching new, innovative products and services:
- Internet of Things (IoT) devices and sensors in my home
About a third of Singaporeans have IoT devices in their homes, and half of them (50%) are open to acquiring them in the future. With only 13% pushing back, there is clearly a lucrative and untapped market in Singapore for better user-driven innovation in this space.
- Using wearables and analytics to change personal behaviour
While 28% of Singaporeans have used wearable technologies, a sizeable majority (51%) are open to it. There is more resistance to this tech though, with one in five (22%) claiming they are not inclined to try it.
- Telemedicine, where patients access healthcare from their homes
COVID-19 may not have driven mass adoption of telemedicine – only 17% of Singaporeans have tried such services so far. However, there is huge interest in it: 47% of Singaporeans are open to trying telemedicine, and 21% are actively considering it.
Note: SingPass Mobile currently rates as the most popular Government app, coming in at 85% take up. Interested to know which was least installed? Drop me a note at email@example.com to find out more.
Much has been said about how COVID-19 has decimated the retail sector in Singapore. According to SingStat, retail sales fell 8.5% year-on-year in July. This reflects an improvement over the previous month, where sales fell by 27.7%. This month, we take a closer look at Singaporeans’ shopping behaviours and see if the pandemic has brought…
Much has been said about how COVID-19 has decimated the retail sector in Singapore. According to SingStat, retail sales fell 8.5% year-on-year in July. This reflects an improvement over the previous month, where sales fell by 27.7%. This month, we take a closer look at Singaporeans’ shopping behaviours and see if the pandemic has brought about a change in our preferences.
As our recent Into the Light report shows, consumers across the ASEAN region are paying more attention to a brand’s country of origin, with a marked preference towards local brands. Six in 10 ASEAN consumers state that a product’s country of origin is an important factor in their purchasing decision, and 85% state they support local brands over international ones.
This shift is clearly reflected in our Singapore audience: our monthly poll reveals that close to half (48%) of Singaporeans are willing to pay more for a local brand than for a similar product from overseas.
But being local is not enough – for customers to be willing to pay more for the product, the brand also needs to be relatable and authentic (71% say these are important factors). The brand also needs to convey a sense of pride, highlighting our grit, our hard work, and what it means to be a Singaporean (58%). It will also help if the brand has demonstrated clear efforts to help the local community (51%).
The type of product also makes a difference when making purchasing decisions. Singaporeans are more likely to spend more on a local brand if the product is food and beverage (80%) compared to consumer durables (36%) or beauty products (35%).
But Singaporeans still find quality (85%) and price (81%) to be the key driver when adding goods to their baskets. Brand heritage (42%), stature (43%), and local relevance (52%) will only get you so far.
As the COVID-19 situation evolves, Singaporeans are becoming more discerning and conscientious, with heightened awareness of country of origin and a stronger preference towards homegrown innovation.
If you are a regional or international brand, how are you evaluating your brand and its relevance amongst a more locally minded consumer? Do you understand which elements of your brand draw appeal versus those that need to be refined or revisited entirely? What does “local” mean in the context of your business, and would a more localised strategy or brand image help create greater appeal?
If you are a local brand, how can you take advantage of this unique advantage? How can you set yourself apart from other local players and which elements of your brand can you amplify? COVID-19 has acted as a great accelerator and a massive change agent, so what steps are you taking with your brand to keep up?
Interested to know more about ASEAN consumer trends? Email me at firstname.lastname@example.org to find out more.