The New Asian Shoppers
By Charu Harish, Grey Group Asia Pacific
Today, budgets are defined as rough ceilings based on the amount spent on regular shopping trips. Shoppers are no longer evaluating what constitutes a premium price in terms of individual product spends. For example, in China, the average basket spend is around RMB100 to 200 ($15-30) and shoppers are willing to experiment and possibly pick up premium products as long as they can stay within that ceiling.
This has implications on how brands and retailers structure their promotions. It is all about creating a basket for the shopper with the right balance of goods perceived as necessary with new offerings and giving them options or offers that bring in a variety of premium and value goods within their basket spend.
Secondly, most buyers' need for authenticity overrides the attraction of promotions. "I avoid brands that give me free gifts of their cheaper stuff--no sincerity," explained a Malaysian shopper.
Promotions are the oldest trick in the book, however in Asia, almost half of the promotions done in-store are wasted.
That's because over 57% of shoppers in fast emerging economies like India, Indonesia, Vietnam, China and Malaysia do not look for promotions because they buy the same brand every time. What's more, at least 45% agree that "if a well-known brand is often on promotion, I tend to doubt its quality."
Although the great recession is now behind us, the lessons learned by shoppers during that time are redefining their shopping habits. Shoppers are more cautious in their brand choice. And their need for authenticity--in terms of brand credentials and quality--shifts the balance of value, especially in countries which do not have very stringent quality checks.
In India, promotions that offer free packs make consumers feel as if they are over-indulging, while in Hong Kong such promotions are considered wasteful.
For the new Asian shopper, promotions are no longer about delivering monetary value but targeting the psychological need of consumers to feel that they are making smart choices. It needs to go beyond the notion of rewarding shoppers to look at the triggers that will possibly deliver authenticity and satisfy their need for variety.
Thirdly, companies should transform sales staff into personal advisors. "I don't ask for advice, but when I see people giving demonstrations, I do ask questions to know more," said an Indonesian shopper.
The common perception is that Asian shoppers do not like to be bothered by salespeople. However, Grey and G2 found that over 77% of Asian shoppers generally seek information at some level, even if not actively. And if approached at the right moment, the same shoppers are quite open to advice and recommendations.
Shoppers seek advice when choosing between products as well as when evaluating promotions. The combination increases the complexity of choice, instigating even non-advice seekers to ask advice. Overall, shoppers feel assured only if the advice is non-intrusive and not a hard-sell.
The study found that 56% of Asian shoppers actively look for demonstrations in-store before making a purchase. This showcases the need to touch and feel the product before buying. Beyond this, certain categories need a greater projection of professionalism in giving advice. For example, 24% of shoppers in India are active advice-seekers, encouraged to seek information from staff in white uniforms.
The need for information highlights that the methodology of training and placing salespeople in various channels needs to undergo transformation. Shifting the role of salespeople from navigators or hard-sellers to brand advocates or advisors would go a long way in guiding shoppers.
As Asian shopper behavior evolves, there is a need for brands to understand the change and create effective conversations to win the in-store battle.
Charu Harish is Grey Group Asia Pacific's Regional Communications Planning Director, and summarizes the latest Grey and G2 consumer study, Eye on Asia.
This article first appeared on , July 2010