11

ECONOMIC OUTLOOK FOR

ASIA PACIFIC

222

OUR APPROACH

OUTLOOK FOR ASIA PACIFIC

IN THIS REPORT

2

33

ABOUT

OUR STUDY

7 MARKETSChina, Hong Kong, Singapore, Malaysia, Indonesia, Thailand, Australia

City tiers | Geographies

8,000 ONLINE INTERVIEWSAdults 18-45+

Millennials | Income segments

Results compared with “Economic Outlook Study 2009”

by Starcom and Mediavest

44

SHARPER CONTRASTSMoney is culture, money management is a cultural

web. People’s response will vary with their financial

situation and coping toolbox. While Millennials

are less concerned with the slowdown, they are the

most stressed about their future.

TRADE-OFFS OVER TRADE-

DOWNSCategories are at risk. People

demand for brands to be generous to them as

consumers. Child Education and Household Care are the

Non-Negotiables, Luxury is the most vulnerable.

MOBILE IS REDEFINING

COCOONINGMobile promises to make at-home

cocooning more pleasant, what can be good news for marketers. VR

and SmartTVs will leapfrog; Mwallets will mature beyond China.

Categories like budget apps, gaming, dine-in delivery stand to

benefit. People will expect more of their second-screen experiences.

VOLATILITY BREEDS CREATIVITYReview economy, Social

Marketplaces will thrive this slowdown as people seek to

make incremental income,

network and/or upskill without the perceived higher risk of being an

entrepreneur.

NO SLOWING DOWNPeople are not stopping

for a global slowdown. Many expect that worse is

yet to come. Brands are a

welcomed part of the solution, but must

demonstrate economic

and personal value. “What will you do for me?”

5 EMERGING THEMES

THINK LOCAL,

ACT PERSONAL.

DELIVER DUAL VALUE

– ECONOMIC AND

PERSONAL. ALIGN

VALUE EXCHANGES

TO POINT-IN-TIME

NEEDS.

ADOPT PRECISION

MARKETING. DESIGN

FOR CONVERGENCE

AND SECOND

SCREENING.

PARTICIPATE.

FACILITATE.

PARTNER FOR DATA

TO CONNECT

JOURNEYS.

KEEP PACE.

ORGANIZE FOR

ONGOING PULSE

CHECK AND

RESPONSE.

55

OUTLOOK FOR ASIA PACIFIC

CONTRASTS TRADE-OFFS SOCIAL COPING

666

SHARPERCONTRASTS

77

Millennials less worried about the slowdown, but most stressed.

Parents (with kids <18 years of age) who work for local companies see the slowdown, but more resilient.

Not all markets have the same outlook.

CAUTION IS

THE ‘NEW

NORMAL’.

78%of adults 18+ see an economic slowdown

in their home countries.

43%are concerned

but not directly

affected.

70%believe

alowdown will last 1-2

years

24%are deeply

worried, and have taken

actions.

50%agree worse is

yet to come

88

NOT ALL MARKETS HAVE THE SAME OUTLOOK.

VOLATILITY HEIGHTENS CONTRASTS.

ABOUT THE RESILIENCE SCOREThe score is tabulated based on responses to 4

questions: confidence in the government, strength

of the country, togetherness & sense of security,

and confidence in speed of recovery.

99

0% 100%

0% 100%

0% 100%

0% 100%

GREATEST PRESSURES ARE CLOSEST TO HOME.“Media” contributes little to their stress.

“My company isn’t making as much. We are told to focus on recruiting new customers. My company is also cutting costs...”

Female, 35 years old, married, Thailand

0% 100%

0% 100%

0% 100%

Politicalinstability

33%

Layoffs

41%

Stocks

48%

Property prices

60%

Lesstourists

25%

Political instability

40%

Property prices

51%

Stocks

55%

39%

Political instability

49%

Property prices

53%

Decreasing property value

Lesstourists

23%

Increasing interest rates

45%

Property prices

66%

Political instability

79%

33%

Stocks

43%

Layoffs

53%

Property prices

35%

Political instability

53%

Layoffs

59%

Property prices

Store closing

36%

Political instability

42%

Layoffs

45%

Property prices

43%

1010

51%

48%

48%

45%

MILLENNIALS LESS CONCERNED ABOUT THE

SLOWDOWN, BUT THE MOST STRESSED

ANXIOUS AND STRESSED ABOUT THEIR FUTURE

36%of Millennials say they feel stressed or anxious at least 2-3 times per week.

41%

How they fare this slowdown will have a lasting impact on their future choices and

society at large.

45%are concerned about their future.

That makes on average for 40% more

Millennials than Older Adults who are frequently stressed or anxious (2-3 times per week or more).

1111

WHAT IT MEANS

WE PREDICTThat the economic slowdown is creating social voids that brands can fill, particularly for Millennials.

Domestic indicators will make for stronger predictors of people’s attitudes than global ones.

Think local, act personal. Adopt precision marketing to respond to their individual needs and journeys. Revisit and reassess current market/regional groupings based on socio-economic indicators.

Track slowdown sentiments. Adopt a 360-lens at brand, people and marketplace. Include relevant local indicators such as property prices, layoffs, stock market, and even tourism (Hong Kong, Malaysia).

Look inwards. Your workforce is under pressure - at work and at home. Provide creative incentive and reward programs, for example ‘no computer after 9pm’, restaurant vouchers for meal with friends/family. Healthy minds make for a healthy workforce.

121212

TRADE-OFFSOVER TRADE-DOWNS

1313

Child Education and Household Care are the Non-Negotiables.

Luxury is the most vulnerable.

Opportunity for Financial Services and Fitness.

The worse the situation, the more versatile the response.

89% Millennials and 87% of their parents will changewhat they do, and how they spend.

CATEGORIES ARE AT RISK.PEOPLE OPT FOR TRADE-

OFFs TO KEEP TO THEIR

DESIRED QUALITY OF LIFE.

PROTECT/SPLIT/CUT REPORT CARDCATEGORY LEVEL SPEND TRADE-OFFS

1414

PEOPLE WANT BRANDS

TO BE GENEROUS TO

THEM AS CONSUMERS.

ECONOMIC VALUE

FIRST. PERSONAL

VALUE FOLLOWS.

‘WHAT CAN THE BRAND DO FOR ME’?

VALUE THAT SPEAKS TO ECONOMIC NEEDS

VALUE THAT SPEAKS TO BRAND CONVERSATION

VALUE THAT SPEAKS TO PERSONAL UTILITY

1515

WHAT IT MEANS

WE PREDICTBrands that adapt to the slowdown and deliver to people’s needs – will perform well this slowdown.

For now, people will continue to trade-off on categories rather than give up on their preferred brands and/or products within the brand portfolio.

But they ready to make more drastic changes should their situation worsen.

Harness the non-negotiables. Groom the next generation. For example, foster financial savvy in Millennials through gamification and edutainment. Relieve monetary pressures on parents by offering scholarships or other assistance. Focus on a happy home leveraging on tie-ins with related categories like Household Care.

Be generous. Embrace the new value exchanges. Deliver economic value first, followed by personal value. Pivot the conversation from brand to personal utility and consumer need.

Keep real-time pulse. People expect for this slowdown to last two years or longer, with more volatility to come. Check for shifts in people’s behaviours, attitudes and perceptions of brand value.

161616

SOCIAL COPINGMOBILE

SCREENCATIONMARKETPLACES

1717

While people continue to de-stress in traditional ways…

MOBILE IS ENHANCING HOW PEOPLE UNWIND AND COPE, OFFERING BRANDS NEW OPPORTUNITIES TO PARTICIPATE

There are 4 ways mobile is redefining how they cope

1

2

3

4

People are managing money through tracking apps

“Staying home more to save money” not as much of a sacrifice – keeps connected to friends, content and value via Mcommerce

Fitness and exercise gets gamified through ‘friend challenge’ apps

Social marketplaces provide platforms for people to generate extra income, network and/or upskill

1818

FROM STAYCATION TO SCREENCATION

Heineken’s campaignconnects home Champions League fans with former UCL stars via Twitter during the live event

EXAMPLE OF SECOND SCREENING

‘WILL STAY AT HOME MORE’ TO CONTROL SPENDIN A SLOWDOWN, PEOPLE WILL STAY HOME MORE TO SAVE MONEY, BUT COCOONING WILL CREATE NEW LEAPFROGS:

1. mCommerce will mature beyond ChinaGaming, home care products, dine-in delivery etc.Watch for growth of social marketplaces

2. Demand for / and expectations of second screen experiences will heighten Synced, interactive, linked to transactions

3. Investment into at-home entertainmentUptake of SMART TVs and VR will accelerate

19% 37% 38% 48% 43% 32% 46%

191919

NOWTravel, gaming,

concerts, short-form movies,

fashion catwalks

3 million VR devices expected to sell in 2016 (Juniper research)

Mobile VR usage over PC usage -scale of smartphone ownership, lower barriers to entry and user-friendliness earmark mobile to overtake PC VR (eMarketer VR 2016 report).

NEXTMovies, mcomm, wedding planning, architecture, urban design, home decor among other industries –and spurs new Friendtainment with self-created 360 content

VR SCALES INDIVIDUALSENSORIAL EXPERIENCES

2020

VOLATILITY BREEDS CREATIVITY IN GETTING TO

INCREMENTAL INCOME

“I am afraid this slowdown will discourage people

who are interested to be entrepreneurs, like me.” Female, 24 years old, college student

Slowdown is putting entrepreneurial ambitions on hold for some Millennials.

Success of Uber and Airbnb put a spotlight on sharing economy as a feasible way to earn and network.

This slowdown, we anticipate social marketplaces to thrive. For example - clothes resale, handyman services, tutoring and upskill exchanges, carpooling, holiday swaps etc.

THIS SLOWDOWN EXPECT A SHIFT FROM ENTREPRENEURSHIP

TO SOCIALPRENEURSHIP

“I prefer to drive on the weekend rather than stay at

home doing nothing. I can meet new friends.” Uber driver, Male, 30 years old, Manager at a commercial company, Guangzhou, China

YOU SAY THAT YOU FEEL THE ECONOMIC PRESSURE. WHAT DO YOU USUALLY DO TO GET RID OFF THAT PRESSURE?

2121

3 TYPES OF SOCIAL MARKETPLACES

WHICH ONE WILL BENEFIT THIS SLOWDOWN?

PUBLIC OVERSEAS AGENTS PRIVATEOnline marketplace for buying and selling pre-loved items. Hong Kong’s Carousell’stagline says it all -“sell with a snap, buy with a chat”.

WeChat, Facebook 1-2-1 marketplaces. Function on trust and expertise- think special coffee roast, imported pet food etc. In China, facilitated by WeChat pay.

Business model matches ‘overseas agents’ with customers based on products/categories they want to purchase. Originated in China with Diagou, but is set to expand across Asia. Mogujie is one of the fastest growing apps in China, but may be hindered by China’s import tax.

2222

WHAT IT MEANS

WE PREDICTThis slowdown, their homes will be their ‘castles’; and Screencation will do little to save them from spending online.

Mobile will redefine their social coping, accelerating:

Uptake of Mwallets.

Investment into at-home entertainment like VR, and new ways to “Friendtain”.

Uptake of social marketplaces.

Make mobile beyond an extension. Leverage on the ecosystem. Build programs that fluidly navigate between learn, play, connect and buy. Design experiences that are dynamic, sequenced and synced across other screens for second screening.

Lead the next. Enhance their at-home experience with immersive VR experiences. Help them develop their own content and “Frientainment”. Fulfill their appetite for the new and next.

Take part. Social marketplaces are an added source of data on your audiences, that helps uncover added context for their decisions and behaviours. Partner for data to connect knowledge across their journeys. Organize for active learning.

232323

NO SLOWING DOWN

2424

4 ACTIONS FOR BRANDS TO THRIVE THIS SLOWDOWN

THINK LOCAL. ACT PERSONAL.

BE GENEROUS.

LEAD THE CONVERGENCE.

Adopt precision marketing. Insist on content that is

sequenced, created to the right moment, place and

context.

Anchor brand in new value exchanges. Deliver to both

economic and personal needs. Align value to point-in-

time.

Sync content across screens creating fluid experiences from

learning to action. Mobile beyond an extension. Embrace

the new such as VR.

ORGANIZE FOR DATA-LED RAPID RESPONSE.

Track 360 lens at brand, people and market. Partner for

data to close knowledge gaps on journeys. Institutionalize

active learning – data led, insights rich, powered by tech.

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