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Infograph: How technology has changed Asia’s consumer behaviour

Dentsu Aegis Network has launched a white paper Asia’s Digital Disruption with the Economist Corporate Network on how technology is transforming the marketing profession at an unprecedented rate in Asia and driving consumer engagement in the world’s most exciting markets.

Here are some of the key findings:

The rise of the penetration of mobile phones in Asia drives widespread internet connectivity, and transforming consumer behaviour

In 2014, Asia had 3.3 billion mobile phone subscriptions, or nearly one for every man, woman and child. By 2019, the region will have almost 4.3 billion mobile subscriptions, or 117 for every 100 people.

digitalAsia chart 1

The average selling price of a smartphone in Asia is now 30% below the price in 2008. Many companies such as Xiaomi in China and Intex in India produce models that retail for less than US$100. Lenovo calculates that Asia bought 470 million new smartphones in 2013. By 2018, it reckons that number will rise to 970 million.

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As smartphones become more common, they are driving internet adoption. Increasingly, mobile internet access is not only the first, but also the preferred way for consumers to get connected. As such, the mobile revolution in Asia is causing the region’s online population to balloon.

digitalAsia chart 3

As the mobile internet spreads, the online population is getting both older (with higher incomes) and more rural.

As ever more consumers across Asia join online social networks, they are re-wiring the digital landscape

As consumers become increasingly connected to the internet via their mobile devices, they are joining social networks in ever greater numbers. Nearly one billion individuals across Asia are now active users of social media.

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Dan Neary, vice president of Facebook in Asia, says that users of Facebook in his region are growing by 50% a year, with 471 million active users in Asia in the first quarter of 2015 – a number that doesn’t include China, where the service is not yet available.

In China, the number of monthly active users of Weibo, a microblogging social media site, reached 198 million in March 2015, up 38% from a year earlier. Of those 198 million users, some 86% used the service via mobile devices.

As more and more consumers join social networks and messaging services, these platforms become important pieces of the online architecture and experience. For example, they help people to navigate the web and to find content, enable content and messages to be spread virally, contribute to reviews of products and services and highlight consumer preferences, encourage consumers to provide rich data about themselves that companies can use to target their marketing activities more accurately, and become platforms for “s-commerce” where consumers sell directly to each other.

China is now the world’s biggest e-commerce market, and the rest of Asia is following its lead. Together, the region is re-writing the rules of distribution and retail.

As Asia’s population moves online it is embracing digital commerce. In 2013, the value of e-commerce in China reached US$295 billion, overtaking the US to become the world’s biggest e-commerce market.

More than 8% of all retail sales in China are now conducted online. By 2018, e-commerce in China will make up more than 16% of retail sales. Similar patterns are unfolding in the rest of Asia too.

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Driven by the deepening penetration of smartphones and the emergence of mobile payments, it gives rise to m-commerce.

According to consultancy company KPMG, the value of m-commerce in China amounted to US$7.8 billion in 2012, but will come to US$41.4 billion this year. Thus, while the overall value of online commerce in China is growing by 35% a year, the value of m-commerce is growing twice as fast, by 74% a year.

With the world’s fastest growing consumer markets, with accelerating technology adoption, and with flourishing digital innovation, Asia is starting to shape the future of marketing

In 2014, the region made up 57% of the global population, with 58% of its mobile phone subscriptions, and 53% of its internet users.

In terms of global private consumption, Asia accounted for 26% in 2014, but will have 31% by 2019.

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The value of retail sales in the region will grow by 4.6% a year for the next five years, well above the global average of 3%.

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Asia is also home to an expanding number of technology giants. In 2014, Asia’s top 10 smartphone brands – the likes of Samsung, LG, Xiaomi and Sony – accounted for 69% of global handset sales. One third of the world’s 2.3 million app developers are also based in Asia.

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“We are living in a convergent world fuelled by ecosystems and devices. This means people are connected in ways we could never imagine before,” said Arvind Sethumadhavan, chief innovation officer at Dentsu Aegis Network Asia Pacific.

“Asian markets are leading the adoption of mobile internet platforms and consequently we are witnessing a mobile-first approach in people’s behaviour and the solutions being developed. The acceleration of this convergent world in Asia creates great potential for businesses to seamlessly drive customers from the point of engagement to the point of transaction for sales. Companies need to view Asia as a pilot market to future proof their business models and a hotbed for innovation prototyping.”

Justin Wood, chief economist at The Economist Corporate Network added that Asia will play an ever more important role in shaping how global companies use digital platforms to engage consumers.

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