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September 2008

ESOMAR Congress 2008: Mastering the “metaverse” – new approaches to researching Asia’s digital market and the ultra-luxury sector

James Aitchison managing editor of WARC Online, reports on the user-generated content boom in Asia and the difficulty of studying the super-rich.

This is one of a series of edited extracts from the ESOMAR 2008 Annual Congress in Montreal. Other articles cover: 

For WARC’s full coverage of ESOMAR Congress 2008, visit our conference blog page.


A common assumption of a decade ago was that Asian markets would follow the evolutionary path of the West. But according to TNS Singapore’s Lee Ryan, the experience to date suggests shows this view is wrong – particularly in the digital space.

In an exploration of the continent’s burgeoning enthusiasm for all things online, she showed how in many ways Asia had leapfrogged Europe and North America. This year, for instance, China (253m internet users and climbing) passed the United States as the country with the most internet users and Asia as a whole accounts for 40% of the globe’s online population.

Ryan puts the allure of the internet in Asia down to the freedom and anonymity it offers people in societies where social and cultural codes often inhibit behaviour. It certainly helps explain the explosion of instant messaging in the east, vis-à-vis its limited adoption elsewhere, as well as the fact that 40-50 per cent of online Asians are involved in user –generated content (UGC), compared to an estimated 10 per cent in the west.

Ryan believes the popularity of UGC-related activities to driving several key trends: 

So how can research keep pace with the Asian consumers that inhabit this fast-moving, digital world? It requires, argued Ryan, a three-pronged strategy: 

  1. Observation: research can create a ‘virtual closeness’ through the use of buzz-monitoring software that can semantically analyse UGC
  2. Conversation: the traditional focus group is not effective online, but incentives such as contests and competitions can be effective mechanisms to encourage participation. Offline meetings of panel members, trialled in Japan, have been found to cement bonds further.
  3. Interaction: engaging consumers is critical to ensure their participation. Clients need to be generous in their offering to ensure reciprocity.

Looking ahead, Ryan saw online gaming as a huge phenomenon in Asia and, specifically, the growth and popularity of avatars. But wider than that, she cited the February 2008 issue of Harvard Business Review which predicted online worlds as one of its “breakthrough ideas” of the year.

It’s further predicted that this will give rise to the next version of the internet – “the metaverse” – made up of multiple online spaces where people congregate as their avatars to chat, create and trade. You’ve been warned.

Can we research “extreme” luxury?

The world of luxury has changed. It’s no longer about physical products per se; it’s about health and service, life management and general wellbeing. But it remains a massive and growing sector, valued at between $160bn and $400bn globally, depending upon how you define it – and clocking 22% annual growth in Asia alone.

This was the scene set by Marco Revolo of Philips Design, as he introduced a panel discussion session on the “extreme” luxury market.

“Luxury is growing because we are getting richer as a planet”, explained Accenture consultant and Mass Affluence author Paul Nunes. There are 65,000 ultra-high net worth individuals in the world, he said, defined as being worth at least $30m – a group that’s expanding 15-20% every year. And there are 10 million “plain old” millionaires, a third of whom are in China where the number is expected to double over the next decade.

Such trends, he said, posed significant issues for luxury brands. How can Ferrari preserve its exclusivity if the number of people the brand reaches is twice that of its potential purchasers? And how does Champagne adjust to the world of 2030 when the global middle class is set to top two billion?

For Wolfgang Schafer, of boutique ad agency SelectNY, luxury requires careful definition. Because there’s a world of difference between the real high-end (aka “extreme”) luxury market (“wanting what no one else has”) and the upper end of the mass market (populated by premium brands that are coveted by people “wanting what everyone else has”).

And that difference has a marked impact on the relevance of research which, he argued, had very little role to play in the extreme luxury market where it was the creativity and inspiration of brands themselves that, akin to fine art, led and shaped consumer desires.

Scott Williams, the marketing chief of luxury hotel group Morgans, believed that the principles of luxury applied across sectors: the lure of access and prestige. And, at the top-end of the market, you need to provide “irrational, emotional reasons” for people to pay top-end prices.

Philip Verhagen, of the Canadian interiors company Umbra U+, said that for his customers “true luxury means the provision of a unique experience”. And as a result, research offerings such as trend analysis were of little use to him. Such data, he said, was telling him what has already happened elsewhere. He prefers to talk closely to key retailers who know his likely customers better than anyone.

If market researchers can take anything away from this session – other than the fact that market research has a very limited role to play in the upper echelons of the luxury market – it is this:  

Segment the luxury market in more imaginative ways. Socio-economic delineators are obvious in this market, whereas psychographic clusters could prove more subtle and fruitful.

Related articles on WARC Online

Asia’s digital growth

John Shanahan, Ray Poynter and Jason Ho, Homogeneity or heterogeneity? Social networks and Asia Pacific, ESOMAR, Asia Pacific Conference, Singapore, April 2008

John Coll, Radhecka Roy and Duncan Dodds, Me_Dia or You_Dia? New media trends across UK, Singapore and Thailand, ESOMAR, Asia Pacific Conference, Singapore, April 2008

Lee Ryan and Lisa Li, Dreaming of red mansions: brand experience, emerging stories and the digital world, ESOMAR, Asia Pacific Conference, Singapore, April 2008

Marketing to the rich

Geoffrey Precourt, The Media Habits of Wealthy Americans, WARC Online Exclusive, September 2008

Sue Philips, Chin Mun Hong, Geoffrey Yan and Sharanya Sitaraman, Inside the affluent space: a view from the top to anticipate the needs of the emerging affluent, ESOMAR, Asia Pacific Conference, Singapore, April 2008

Beth Uyenco, Olivier Goulet and Alex Charlton, Quality insights to solve a luxury problem - marketing to affluent consumers in the digital age, ESOMAR, Worldwide Multi Media Measurement (WM3), Budapest, June 2008

About the author:


James Aitchison is the managing editor of WARC Online.

You can read further reports from ESOMAR 2008 Congress and other recent marketing events here.


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