SINGAPORE: Asia will account for almost half of global consumer packaged goods (CPG) growth over the next five years, with China taking a 60% share of the Asian increase, according to a new study, which warns companies will need to make the digital marketplace a priority.
Consulting firm Accenture, in its report The future is now: understanding the new Asian consumer, estimated that that the consumer goods and services industry would will grow by up to $700bn globally by 2020.
Some $340bn of this, or 48.6%, was slated to come from the leading Asian markets of China, Indonesia, India, Singapore and Thailand, with China alone expected to account for around $200bn, or 58.9%, of that total.
"If CPG companies don't take action now, they risk losing out on the new generation of consumers," warned Fabio Vacirca, senior managing director in Accenture's Products operating group in Asia Pacific.
"These companies must couple traditional models with new ones where consumer engagement is digital and one2one, social influence is perceived to be the trustworthy source and shopping is one click away," he added.
The importance of digital was emphasised in the report's prediction that one quarter of the region's $10 trillion retail market would come via this channel in 2018.
It observed that the digital commerce market in Asia Pacific remained under-penetrated for CPG companies, particularly in the grocery-product category, but suggested there were "outstanding" opportunities for them to capture the next wave of growth if they could bridge existing gaps in consumers' purchase journeys and provide a truly seamless shopping experience.
Vacirca pointed out that the influence of technology was only going to increase. "By better using digital technologies, CPG companies can engage with consumers on a real-time basis, allowing the companies to provide the maximum value within the minimum time," he said.
"This will, in turn, create opportunities for CPG companies to control the consumer buying experience of tomorrow."
Ultimately, the report suggested, brands can become "smart assistants" capable of delivering solutions proactively to consumers without waiting to be asked.
Data sourced from Accenture; additional content by Warc staff