From a time when Asia-Pacific was a trend laggard, following or importing patterns set by consumers in the west in North America and Europe, the region today is a trailblazer. A decade ago, the region had around 764 million internet users, today it has 2.3 billion and climbing. In fact, the top three most engaged mobile internet countries in the world are from the region—Thailand, Philippines and Indonesia—catalysing a whole new set of marketing and branding opportunities, according to a new report from Google.
Home to 60% of the global population, APAC is the world's fastest growing internet market and consists of two impossible to ignore markets—India and China—each with a population of over a billion. The report points out that APAC boasts of the world’s largest Muslim nation, Indonesia, the sixth largest country globally in Pakistan and overall, has half of the internet population residing in the geo, and 70% of them own a smartphone.
According to data from the report, APAC generated over half of the world’s total app revenue in 2016, along with 86.2 billion downloads, with as many as 98% of users accessing the web on their phones, compared to 86% in The US.
Google cites southeast Asia is a strong example of APAC's leap. The cumulative internet economy of Indonesia, Vietnam, Malaysia, Philippines, Thailand, and Singapore is currently pegged at $100 billion and has received more than $37 billion in capital over the last four years. While the majority has gone to e-commerce and ride-hailing unicorns, investments in nearly 3,000 start-ups in the region also remain sizeable, the report states.
Unlike other geographies, Asia Pacific has several pockets that are growing rapidly, this report states. In Southeast Asia's metros, per capita spending is around $600 versus $100 in the hinterland. However, the non-metro spending is expected to grow four-fold between 2019 and 2025, almost twice as fast as in the big cities.
As APAC achieves this critical mass across multiple metrics, it is important for marketers to grasp the fast-shifting preferences of the region's consumers, Google says in the report. The company highlights three consumer shifts, 'with me', 'all to gather' and 'shared commerce', that it contends are likely to be the three broad trends driving marketing interest and spending in the region.
According to the report, in Asia, 'with me' emphasises the importance of gaining a sense of community via the consumption of interactive and experiential online videos for consumers. A full 51% of online APAC consumers responded that they are part of a bigger community when they watch a livestream.
In South Korea, over a decade ago, the practise of ‘mukbang’—an activity where creators livestream themselves eating large amounts of food while interacting with online audiences—it was viewed as fringe behaviour. Today, this activity hasn't just gone mainstream, it has expanded beyond food and in the first half of 2019 alone, YouTube viewers in Korea watched over 500 years of this form of content, opening up a range of opportunities for brands and marketers.
As consumers look for a sense of community online, they are flocking to a wide array of videos ranging from cooking macarons to shopping for outfits and from packing suitcases to cleaning bedrooms. The range goes all the way from lighthearted to more serious viewing to in-depth tutorials and serious commentary.
Consider something as banal as watching someone properly packing their suitcase—and following their lead simultaneously. With consumers in APAC forecast to spend $200 billion on online travel in the next five years—this could be a big opportunity for a host of brands in this space. Other categories are massively popular too: In Japan, watch time for “cook with me” videos has increased by over 500% in the last year.
The second factor that Google sees strongly emerging, 'all to gather', focuses on what it says is a growing sense of inclusion among consumers. For example, the report reveals that two-thirds of Chinese consumers agree that this subject is important to them and 78% are in agreement with the statement: The world would be a fairer place if more people practised inclusivity.
As consumers have become more accepting of some of these trends, their search queries have surged. According to this report, searches related to veganism in Japan grew by 8X, while for ketogenic diet in India grew by 14X since 2014. Global searches for Halal as a topic have increased by 10X since 2004 too, the report noted. This growth is a massive opportunity for local brands such as Wardah Cosmetics in Indonesia, which has a 30% share in the market, per Nielsen estimates.
The third driver for brands and marketers in Asia will be the area of shared commerce, with a growing positive sentiment among consumers in the region for second-hand goods and shared experiences. In a sign of changing times, over half of millennials and Gen Zs in APAC think pre-owned products have better value for money than new items.
This trend is best seen in markets like China, where the size of the secondhand market is expected to double by 2020 to more than $140 billion, as consumers embrace the re-commerce trend. This attitude seems to be catching with consumers, According to According to a survey by Gmarket, a Korean shopping service, renting of clothes dryers has increased by 111%, air purifiers by 106%, and massage chairs by 435% since 2018.
Another driver for brand-conscious Asians to adopt this shared commerce trend is the need to balance certain brands and the reality of limited financial means. Given the sheer size of the market in Asia, brands in the top of the consumer packaged goods and beauty categories are innovating (MAC and Nykaa, for instance) with smaller packages to meet these tight budgets. As they seek to grow their Asia business, this trend is only likely to extend deeper in this region.
With these changing norms and despite being historically seen as followers, there is growing evidence that Asian consumers could soon become trendsetters themselves.