Babar Khan Javed
Jul 5, 2017

CMOs should activate categories on a micro region basis: Nielsen

In order to succeed in the ASEAN region, new market entrants must understand the takeoff points that make or break categories and align their distributors across nations.

A tourist town in Thailand
A tourist town in Thailand

A new report from Nielsen titled "Rethinking ASEAN: Dispelling 8 Myths About Consumer Markets" is taking a closer look at ASEAN economies beyond the big cities.

ASEAN countries have continued to experience "remarkable" economic gains in recent years. When viewed as a single entity, the ASEAN region would rank as the sixth-largest economy in the world, and the second largest destination for Foreign Direct Investment (FDI).

Ironically, very little is known about the many cities and regions that comprise this archipelago. To close the knowledge gap, Nielsen and AlphaBeta's analysis tries to uncover the current and future potential consumer demand for this key region.

Per the report, there are six factors driving growth are

  1. cross-border trade and logistics
  2. the presence of economic clusters and business process outsourcing areas
  3. the rise of satellite regions
  4. natural resources
  5. vibrant tourism
  6. a growing consumer base

“The new consumption hotspots emerging across ASEAN are the result of a combination of several growth drivers,” explains Patrick Dodd, Nielsen Growth Markets Group President. “Companies need to examine the forces that are driving growth in middleweight regions to understand past growth as well as assess the sustainability of those growth trajectories.”

Dodd recommends three key actions for companies looking to leverage ASEAN’s middleweight regions. Companies should:

  1. develop category activation on a micro region basis
  2. establish strategies targeting specific segments and regions.
  3. look into the distribution structure within countries so they can better manage relationships and identify where best to cultivate distributor relationships

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