the age of asean cities - nielsen · new cities and areas on the back of this. although there have...
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FROM MIGRANT CONSUMERS TO MEGA CITIES
THE AGE OF ASEAN CITIES
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TODAY’S PRESENTER
Regan James Leggett
[email protected] Regional Director, Client Services Southeast Asia, North Asia and Pacific Nielsen
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A: 532M
B: 632M
D: 832M
C: 732M
POLL 1: HOW MANY PEOPLE LIVE IN ASEAN TODAY?
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FROM ISOLATED VILLAGES TO HIGH RISE MEGA CITIES Southeast Asia has them all
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v
You are a product of your environment. W. CLEMENT STONE
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v 632M
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POLL 2: IN 2025, ABOUT HALF OF ASEAN’S POPULATION WILL LIVE IN……
A: RURAL VILLAGES AND SMALL TOWNS
B: SMALL CITIES /LARGE TOWNS: <500K
E: SUPER & MEGA CITIES: 5M +
D: MID DENSITY CITIES: 1 – 5M
C: MIXED DENSITY CITIES: 500K – 1M
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IT’S NOT A SIMPLE EQUATION
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UNDER DEVELOPED OR OVERBURDENED? Both exist in Southeast Asia
5M+ 1–5M 500K–1M <500K RURAL
• Limited infrastructure
• Supply issues • Disease and
hygiene challenges
• Small infrastructure projects – small schools and medical
• Hubs to rural outposts
• High-density • Rich vs.. poor • Overburdened
infrastructure
• Boom cities: demand does not outpace infrastructure and development
• Business moving to new centres for lower costs; invigorating other industries
LANDSCAPE
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v IT’S NOT A SIMPLE EQUATION
2%
18%
51%
GROWTH: IN BIG CITIES, OFF A SMALL BASE
-6.3M
+35.6M
+16.7M
+17.7M
-0.9M 5%
32%
LARGE TOWNS AND RURAL REIGN
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ASEAN 69m
32%
52.7m
51%
16.8m
-5%
231.8m
18% <500K
500K–1M
5M+
1–5M
2025: OPPORTUNITY IS IN THE MASSES
SMALL CITIES
MID DENSITY
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REBALANCING OF GDP CONTRIBUTION
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CONSUMER STRATIFICATION
AGE
WEALTH
HOUSEHOLD SIZE
LOCATION
EDUCATION
ACCESS TO TECHNOLOGY
ACCESS TO PRODUCTS
MILLENNIALS
LOW INCOME
SINGLE UNIT
RURAL
LOW
LIMITED
SILVER TIDE
TRADITIONAL/ MODERN TRADE
MILLIONAIRES
FAMILY UNIT
URBAN
HIGH
24/7
E-COMMERCE
CONSUMER STRATIFICATION
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POLL 3: WHICH CONSUMER ENVIRONMENT IS YOUR ORGANISATION FOCUSED ON TODAY?
A: RURAL VILLAGES AND SMALL TOWNS
B: SMALL CITIES /LARGE TOWNS: <500K
E: SUPER & MEGA CITIES: 5M +
D: MID DENSITY CITIES: 1 – 5M
C: MIXED DENSITY CITIES: 500K – 1M
(You can choose more than one option)
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CAPITALISE on the opportunities of tomorrow
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ASEAN 2025: WHERE ARE YOUR BEST BETS?
Based on U.N. Population Projections
Monywa Mandalay
Nay Pyi Taw
Bago
Yangon
Lampang
Hue Da Nang
Vientiane Udon Thani
Mawlamyine
Nakhon Ratchasima
Krung Thep (Bangkok)
Chon Buri
Rayong
Medan
Phnum Pénh (Phnom Penh)
Nha Trang
Vungtau Can Tho
Hat Yai Kota Bharu
Kuala Terengganu Ipoh
Kuantan
Seremban Batam
Pekan Baru
Padang
Bengkulu
Jambi
Palembang
Pontianak
Kuching
Hai Phòng Hà Noi
Bandar Lampung
Kota Kinabalu
Sandakan
Jakarta
Bogor
Cirebon
Semarang
Surabaya
Malang
Mataram
Denpasar
Benjarmasin
Balikpapan
Samarinda
Baguio City
Angeles City Manila
Lipa City Batangas City
Iloilo City Bacolod
Cebu City
Butuan Iligan
Cotabato Davao City
General Santos City
Manado
Ambon
Makassar (Ujung Pandang)
2025
Southeast Asia city tiers
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WHICH CITIES ARE YOU OPPORTUNISTIC ABOUT?
BANGKOK
HO CHI MINH CITY
JAKARTA
MANILA CEBU
MEDAN
SURABAYA
CHON BURI
MANADO
BACALOD
JAMBI
YOGYAKARTA
HUE
CIREBON JOHOR BAHRU
KOTA KINABALU
OUR COUNTRY LEADERS WOULD LOVE TO
CONTINUE THIS CONVERSATION WITH YOU…..
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Rural is such a large piece of the Vietnam pie and cannot be ignored. This consumer is changing and doing so fast. They are increasingly well educated, have higher levels of disposable income and are more aware of trends in the market than ever before. These guys know what they want. NIELSEN VIETNAM MD VAUGHAN RYAN
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We are seeing some blurring of rural and urban as not only rural consumers migrate to small towns and larger cities but the connectedness between centers grow between rural and large towns but also large towns and cities. Transport veins into Bangkok have become economic corridors that allow cheaply sourced goods from the surrounding area to come in and this is being repeated in some of the tourist hubs in other areas. We believe it is continuing the growth of small urban and rural economies and part of the reason that the penetration of things like smart phones and the internet will continue to rise in these areas.
NIELSEN THAILAND MD SURESH RAMALINGAM
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In terms of where there will be spending power growth over the next 10 years, we are seeing investment flowing into the cities of 500k-1m (Bacolod, Cagayan de Oro City, and Iloilo City) and 1M -5M (Cebu city – Davao city – Zamboanga city) and into some of the smaller provincial cities (Baguio, Dagupan, Lipa and Naga). The BPO’s (Business process outsourcing) are driving this initially and we expect that this may have a knock on effect to other industries and businesses increasing the GDP of these smaller cities.
NIELSEN PHILIPPINES MD STUART JAMIESON
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Malaysia has had a number of infrastructure projects started and completed in the last 5-10 years and many businesses have been able to enter new cities and areas on the back of this. Although there have been numerous national projects I think the smaller cities and of course KL have received much of the benefit from these investments as they are more connected and accessible to each other.
NIELSEN MALAYSIA MD RICHARD HALL
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If you look at the list of cities in the 1M to 5M and even those in the 500k-1M bracket what is noticeable is that many of them are the provincial capitals and are acting as centers of commerce, industry and business for the smaller cities, towns and rural areas surrounding them. The big retailers are also using these as distribution centers to get their products into the less populated areas as they have not yet gone into the urban centers of less than 300K and 500K. This will be the next wave of investment. NIELSEN INDONESIA MD AGUS NURUDIN
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The limited amount of space in these smaller units means that some of them do not have the traditional kitchen or food preparation facilities as they are typically equipped with small open concept kitchen. It is not only changing the way people in these environments approach FMCG and move away from cooking at home - apart from heating food - it is also influencing pack size choices and storage options, and it is transforming the way people socialize, their transport choices, furniture, technology and so on. People are increasingly living fast paced on-the-go lifestyles and are starting homes that are accessible to work, transport hubs, restaurants and other amenities. The space challenges may even discourage larger families from living in high density areas and thus drive a demographic skew to the young and aged singles and couples.
NIELSEN SINGAPORE & MALAYSIA MD JOAN KOH
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HOW DO YOU WIN IN A DISPERSED ECONOMY?
Take the early mover advantage – focus on small
Innovate to the needs of each tier
Reach new consumers in new regions in new ways
Adjust tier 1 offering for uniqueness
Differentiate strategies to
connect
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<500K
500K–1M
5M+
1–5M
?
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SECONDARY CITIES
DISTINCTLY DIFFERENT
NEEDS
DIGITISE YOUR
STRATEGY
DESIGN FOR DENSELY
POPULATED CITIES
Q&A
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THANKS FOR JOINING US!
Download our report
Click-through url: http://www.nielsen.com/content/dam/nielsenglobal/apac/docs/reports/2015/Nielsen-age-of-asean-cities.pdf
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THANKS FOR JOINING US!
Download our infographic Click-through url: http://www.nielsen.com/apac/en/insights/reports/2015/the-age-of-asean-cities.html
