Asian consumers plan to cut back

12 October 2009

SINGAPORE: Consumers in many Asian markets are concerned about their personal financial situation, and may reduce their purchase levels as a result, contradicting widely-held perceptions that buying habits in the region have been largely unaffected by the recession.

BBDO, the global advertising agency network, surveyed 15,000 people in 15 different countries around the world between May and August this year.

It found that 72% of respondents in Malaysia "worry constantly" about financial matters, a figure that fell to 66% in South Korea, 60% in Japan, and 56% in Taiwan.

By contrast, just 48% of Americans, and 28% of Germans, reported they were currently adopting a similar form of behaviour.

Japan was the most pessimistic Asian nation of those assessed by BBDO, with just 17% of adults expressing optimism about their personal finances.

Furthermore, a majority of Chinese, Indian, Indonesian, Malaysian, South Korean and Thai participants argued they would like to buy fewer products, but many said they would pay more if these goods were of high quality.

More than eight in ten contributors in Indonesia, South Korea and Taiwan added that they were now more regularly comparing both prices and brands before making purchases.

Similarly, a majority of people in Malaysia, India and Thailand were spending an increased of time discussing possible acquisitions with their friends.

Over two-thirds of Taiwanese, Indonesian and South Korean shoppers were also hesitant to buy products they had no previous experience with.

Andy Wilson, chairman of BBDO's Asian Planning Circle, said the desire to "feel more in control of spending" was the main catalyst of consumer behaviour in many Asian nations.

"Reminding or explaining why a brand is great value for money gives consumers more confidence in their purchase. Brands that have done more of that have been shown to do better," he said.

Sustainability and corporate social responsibility were also regarded as being increasingly important matters in many markets, the survey found.

Almost three-quarters of people in Asia were pursuing activities that were good for the environment and saved money, like recycling, measured against 52% of the panel in the US.

Other important trends include appealing to family values, a strategy adopted by Mercedes-Benz in promoting one of its vehicles in Vietnam.

"Multiply the cliché that Asians love communal relationships by five and you've got a very powerful marketing strategy," said Wilson.

Data sourced from Media; additional content by Warc staff