Southeast Asia-Proliferation of mobile facilitates market entry

June 15, 2017
Industry News
Content Provided By:

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Rupam Borthakur
CEO, Kantar Insights Hong Kong
Rupam.Borthakur@kantar.com

Marketers view Southeast Asia as an enormous opportunity to build brands in a fast-growing region where national GDP often exceeds 5 percent annually.

Opportunity for local and multinational brands in Southeast Asia exists in many categories. Cosmetics and fast-moving consumer goods (FMCG) brands especially are finding a growing customer base. Telecom providers also are expanding rapidly with the growth of mobile communication and internet use, although carriers vary by country and Singtel is the only brand with regional presence.

In certain categories, the urban consumers of the major Southeast Asian cities, like Bangkok or Saigon, are comparable in their tastes and interests to their peers in the West, sharing an interest in health and wellness, for example. Cultural differences apply in other categories, such as cosmetics, where local practices, including greater attention to male grooming, influence Western trends.

E-commerce has facilitated market entry in Southeast Asia, but market penetration has become more competitive and complex, and media more fragmented. Geographic location can be an important market- entry consideration. The politics and economies of Myanmar, Laos, and Cambodia differ, but the countries share some cultural commonalities — most inhabitants practice Buddhism, for example. And shared national borders facilitate marketing and distribution. Messaging the growth

Mobile first

Brands already in Southeast Asia continue to pursue urban consumers. They also penetrate deeper into some countries, like Indonesia, their expansion facilitated by the availability of advanced feature phones or cheaper smartphones and the development of e-commerce. Mobile phones — even smartphones — proliferate in places like Myanmar that lacked fixed-wire infrastructure. Consumers are leapfrogging the desktop computer phase and going directly to mobile. And brands are adept at creating messages specifically for the mobile medium.

Consumer mindset

Reflecting these extremes, Southeast Asia is home to some of the world’s most advanced shopping centers and sophisticated e-commerce operations, as well as to meandering shopping districts with mom-and-pop shops lining narrow streets. The move to modern retail proceeds at varying speeds depending on the local economy.

Urban consumers, particularly the young, resemble those in Western capitals in many ways, but also retain local characteristics. They are more communal.

The communal mindset affects purchasing motivation. A young Asian woman might desire the latest smartphone as an expression of “collective individualism,” so that everyone in her group of friends has the same phone, and she is part of the group that stands out. In the Western expression of individuality, a young woman more likely would want to stand out from the group. Attitudes are changing, and members of Gen Y (the millennials), are more individualistic than their Gen X predecessors.

In some categories, like FMCG or personal care, brands are more likely to market across entire national populations than target the urban segment.

Media and messaging

Media use varies by market and category, depending in part on media ownership, as censorship and regulation sometimes dictate what can be done — or not. The presence of government media control is one of the factors driving the popularity of bloggers and the trust consumers invest in them.

As in most markets, media in Southeast Asia is experiencing a shift to digital. However, TV is still relatively expensive in places like the Philippines and Indonesia, and the growth in digital is coming at the expense of other channels, including print and radio.

And media consumption habits vary by country. For example, media in Thailand is screen-based and includes both TV and digital. In contrast, Myanmar is print-based and outdoor because the electricity supply in Myanmar still is erratic.
About Kantar MillwardBrown
Kantar Millward Brown is a leading global research agency specialising in advertising effectiveness, strategic communication, media and digital, and brand equity research. The company helps clients grow great brands through comprehensive research-based qualitative and quantitative solutions. Kantar Millward Brown operates in more than 55 countries and is part of WPP’s Kantar group, one of the world’s leading data, insight and consultancy companies. Learn more at www.millwardbrown.com.
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