Asia Pacific is a powerhouse within the global consumer markets landscape. It’s home to 60% of the global population and represents 46% of global GDP. It is projected to make up nearly two-thirds of the global middle class by 2030. The opportunities for retailers and consumer markets companies are immense.
Its diversity presents further opportunity — as well as risk — with its multitude of market archetypes, economic realities and buying patterns across multiple territories. Add to this a backdrop of economic and environmental uncertainty, ‘trust’ is the key to thriving and realising the potential of this dynamic market.
This is the central insight of our Voice of the Consumer study. We polled over 7,000 consumers across 11 Asia Pacific territories, as part of a global survey. In interviews conducted alongside our quantitative survey, senior executives in the region added texture to these insights. They confirm the importance of cultivating trust in strategies and growth plans.
Shoppers are prioritising reassurance and reliability from the brands they engage with. This means that consumer-facing companies need to know how to build multi-faceted trust and form meaningful bonds with a newly-empowered and diverse consumer base.
We have organised our survey findings into three sections: Respond, Rethink and Reimagine. Each highlights survey findings that can inform business actions today, in the near future and over the longer-term, to strengthen trust with consumers.
Respond to immediate issues facing consumers today
Rising prices and affordability tops the list of challenges that consumers are facing today. While the regional economy shows signs of resilience, the impact of rising prices for food, energy, housing and other essentials over the next 12 months is considered the leading risk among the majority (61%) of consumers in Asia Pacific. Wider macroeconomic volatility is second, at 46%.
Inflation still looms large in shoppers’ minds across Asia Pacific
Question: Which of the following potential threats/risks do you feel could impact your territory most in the next 12 months?
Showing percentage of respondents ranking each risk in their top three
Base: 7,279 (all Asia Pacific respondents)
This is turning consumers away from luxury items and focusing their spending on necessities instead. 65% expected to spend more on groceries, followed by health and beauty products (54%), and clothing and footwear (52%). However, they are still comfortable with some discretionary spending on travel, electronics devices and home improvement. These figures have increased across the board, when we compare 2023 to this year’s survey. This reflects a continued resolve to pursue healthier, more conscious lifestyles.
Overall, consumers are more mindful of how they spend. This may play out in several ways, from price comparing more earnestly across channels and retailers, to searching for value through promotions or discounts, or postponing spend altogether in certain categories.
Consumers anticipate spending less on luxury and designer products
Question: Thinking about your spending over the next six months, please choose, to the best of your ability, your expectations on spending in the following categories.
Base: 7,279 (all Asia Pacific respondents)
Although the spending preferences may seem concerning for the luxury sector, we believe wealthier consumers show remarkable resilience with luxury purchase habits, despite more uncertain economic conditions. There are opportunities for growth with the second generation of wealth too.
A recent report by PwC China “Unlock infinite growth possibilities and sustainable value of luxurious lifestyle”, delves into these themes in detail. It points out that the next generation of high-net-worth individuals are favouring sustainable value, quiet luxury and experiences. This presents immense opportunities for brands to focus on offerings these consumers care about, such as the sustainable transition, culturally distinctive features and personalisation, to name a few.
Nearly 4 in 10 said that getting more value for their money would entice them to try a new brand. However, reputational excellence is also influential in driving consumer choice.
Question: Thinking of one of your favorite brands that you are loyal to, which of the following would entice you to try out a new brand that offers the same type of product(s)?
Note: Don’t know: 1%
Base: 7,279 (all Asia Pacific respondents)
In terms of safeguarding market share against inflationary pressure, companies that experienced significant revenue gains due to increased prices need to be cognisant not only of consumers’ pain points, but losing consumer trust in their brand. “There is huge pressure on [consumer goods] companies that enjoyed price increases during Covid but are now finding it increasingly challenging to deliver volume growth on top of pricing,” said Kyle Artz, vice president of strategy for Coca-Cola based in Shanghai. “So we have to be prudent and continue to monitor the right balance of volume and price at both a global and local level.”
But value isn’t just about lower prices. Nearly 40% of respondents said that getting more value for their money would entice them to try a new brand. This is even more so in Australia (48%) and the Philippines (47%). And roughly one quarter said they were also attracted to brands known for maintaining high quality, garnering positive reviews and being trustworthy.
This suggests that a more ‘holistic approach’ to maintaining or building brand loyalty may benefit consumer companies. This could be by amplifying a range of other product or brand features (unrelated to price), communicating the unique brand promise, ESG performance, value to communities or exceptional customer service.
Rethink your strategy and prioritise building consumer trust
Trust must be the cornerstone of any strategy. When times get tough and consumers confront a set of competing priorities, they will instinctively turn to the brand they trust, one that provides them with reassurance and reliability.
Build brand loyalty based on trust
To make sense of ‘trust’, we asked our survey respondents to rate how much they trust an industry on a scale of 0 to 10. Healthcare companies, on average, are most widely trusted, while social media companies and platforms ranked least trustworthy.
Retail and consumer goods companies fall in the middle, perhaps explained by their frequent and visible interactions with consumers, over other industries listed. This highlights a clear advantage for companies to build trust through consumer experience. Showcasing an authentic brand story is one way to forge a deeper bond. It is crucial to prioritise transparency, consistency and emotional resonance throughout the entire customer engagement journey.
Asia Pacific consumers rank healthcare companies as the most widely trusted, while social media companies are least trustworthy, consistent with their global counterparts
Question: On a scale of 0 to 10, to what extent do you think companies in each of the following industries are generally trustworthy?
Base: 7,279 (all Asia Pacific respondents)
When we compare the results from different territories, Australia is less trusting of all companies in the industries listed, joined by South Korea, compared to Asia Pacific overall. This variation highlights the importance of understanding the unique cultures and preferences of consumers in each territory when building trust.
Solving the social media paradox
Our survey reveals that Asia Pacific consumers have a complicated relationship with social media. They like using social media as a shopping channel with 56% saying they have purchased products directly through this platform — nearly double the 31% reported in our overall global consumer research in 2019. This trend is even more pronounced in emerging markets with Thailand (73%), Vietnam (71%) and Indonesia (69%), outstripping the global average of 46%.
Consumers in the region also actively engage with social media throughout their purchasing journey. 74% use it to discover new brands, and 76% seek reviews to validate a company before making a purchase.
But at the same time, they rank social media companies and platforms as the least trustworthy. 74% are concerned about privacy and data-sharing. 50% are not comfortable purchasing via social media.
Two-thirds of Asia Pacific respondents report concern when purchasing via social media
Question: To what extent do you agree or disagree with the following statements about social media?
Base: 7,279 (all Asia Pacific respondents)
Striking the right balance on social media is crucial for companies when it comes to building consumer trust. Brands need to create authentic content that resonates with their target audience, while also being mindful of the concerns that consumers have on trust. Data protection was the leading factor that influenced consumer trust — 82% of respondents consider it a top priority. The message here for companies is use it, but don’t abuse it. Make sure to safeguard personal data, while using it to elevate customer experience.
Make use of influencers, but with caution
The popularity of social media has brought with it the meteoric rise of influencers who persuaded 50% of respondents to buy a product or service. This compares with 41% globally. “Influencers are playing a much bigger role than even a year ago,” said Nitish Gupta, managing director in Vietnam for Kimberly-Clark. “Across our medical, beauty, baby and childcare, and personal care categories, when I look at the social commerce landscape, it’s a sea change.”
What makes influencer marketing successful? It boils down to trust. External research shows half of consumers make regular purchases due to influencer posts. 30% place even greater trust in influencers compared to just six months ago. This is particularly true for Gen Z, whose buying power is quickly growing.
But, there are risks. One, is the inherent unpredictability of influencers negatively impacting brands. There have been notable cases where brands have had to sever ties with problematic influencers, even after years of partnerships. Choose wisely with a mix of micro, macro and mega influencers who can target a specific audience group.
Blend the in-store and online experience
Brands and retailers must embrace a more flexible omnichannel strategy to meet consumers’ evolving expectations for a dynamic mix of online and offline experiences. By providing a consistent and effortless experience across various touchpoints, they can instil a sense of reliability and dependability in their consumers.
Our survey echoes this sentiment. We found a near-even split between a preference for shopping in physical stores (46%) versus online shopping via smartphones (45%). Online shopping via PCs ranked a distant third at 26%.
Shopping is predominantly carried out in-store or online using a mobile phone
Question: In the last 12 months, how often have you bought products, excluding groceries, using the following shopping channels?
Base: 7,279 (all Asia Pacific respondents)
How the region has leapfrogged Europe and the U.S in terms of mobile adoption rates is a well-known story – shopping via mobile is higher for Asia Pacific (45%) than global (34%) – although there are some stark differences within the region.
In Australia, in-store shopping is predominant against online (48% vs. 29%), while in Chinese Mainland, where online marketplaces like Taobao, JD.com and Pinduoduo have a high market penetration, the reverse was true (42% vs. 60%). With the popularity of ecommerce platforms including Shopee and Lazada, Vietnam stands out with the highest rate of online shopping (67%), although in-store shopping also remains strong (63%).
There is variation in the most frequently used shopping channels across Asia Pacific territories
Question: In the last 12 months, how often have you bought products (e.g., clothes, books, electronics) using the following shopping channels? Please do not include grocery shopping.
Note: Showing only ‘daily/weekly’
Base: 7,279 (all Asia Pacific respondents)
The region’s varied infrastructure development means that these differences have real meaning for consumer companies and retailers trying to increase e-commerce sales throughout Asia Pacific. For example, the cost of distribution/fulfilment of an online order is dramatically higher in Indonesia than in Vietnam, partly explaining why online shopping is so prevalent in Vietnam. A company’s playbook in one region, or even within another territory in Asia Pacific, may need to be somewhat reshaped to make it work effectively in another.
There is mix of online and offline shopping when it comes to consumer journey
Question: Thinking about when you shop for products, which of the following channels, if any, do you anticipate using in the discovery, research & purchase stages?
Note: If a channel shows no results, the activity doesn’t apply. The data in this chart represents a summary view of responses. Consumers were asked about up to two randomised product categories (drawn from the pool of categories that they already expect to spend on in the next six months). The average figures across the ten product categories are shown.
Base: Respondents who plan to spend in at least one category = 1225 - 1664
In parallel, consumer companies should also improve in-store experiences. Asia Pacific consumers say they prefer the human touch, particularly in their discovery of new brands. 55% say they choose to visit physical stores and 39% engage with salespeople, compared with 50% who seek out recommendations from family and friends, and half who turn to online browsing. This perhaps reflects the ubiquity of small retail shops in many parts of the region.
In-store strategies that boost this personal connection, either through investment in knowledgeable frontline employees, by creating interactive and personalised shopping experiences, or hosting in-store events and workshops can enhance customer satisfaction. Loyalty programs and exclusive member benefits can further strengthen the personal connection between a store and its customers.
Finding the right mix with advertising channels
While brands and agencies still place ads on legacy media to reach older generations, and increasingly on streaming video services, 80% of respondents are most likely to be influenced to purchase by advertisements via social media. This is higher than the global average of 72% and North America (59%), Western Europe (57%) and Central and Eastern Europe (68%).
This may have to do with the extent of mobile penetration in Asian economies and a rapidly emerging digital-first culture around discovery and purchase.
The power of social media; social media advertisements influence purchases for 8 in 10 Asia Pacific consumers
Question: Which type of personalised digital advertising is most likely to influence you to purchase?
Base: 7,279 (all Asia Pacific respondents)
The trend is even more pronounced in Indonesia, Philippines and Vietnam (all 91%), Thailand (90%) and Malaysia (86%).
Interestingly, email (52%) and text messaging (40%) continue to play a role. Consumers from South Korea (48%) and India (48%) are more likely to rank ‘advertisements via text message’ in their top three.
Global social media ad spending is projected to reach US$220 billion this year compared to US$207 billion in 2023. “Five years ago, we were spending half of what we spend now on digital advertising,” said Coca-Cola’s Artz, stressing the importance of budgeting to innovate consumer engagement.
Reimagine your business, for a sustainable future
Global megatrends may seem abstract and ‘far away’, whether it is the disruptive impact of technology or sustainability, but present opportunities for consumer-facing companies to innovate for sustainable growth.
Build premium sustainable products
Climate change and how that affects’ companies’ plans for a sustainable future is a hot topic in corporate boardrooms and governmental institutions alike. But what about consumers? In our survey, we asked respondents about their personal, day-to-day experience with climate change. A staggering 88% of Asia Pacific consumers reported experiencing disruptive effects of climate change in their daily lives – which should make businesses sit up and take note.
In response, half reported buying more sustainable products, with over 40% being more considerate of their overall consumption.
Half of Asia Pacific consumers are changing their purchasing habits to mitigate climate change, while 40% are being more mindful of overall consumption
Question: What actions or behaviors, if any, have you taken to reduce your impact on climate change?
Base: 7,279 (all Asia Pacific respondents)
Significantly, consumers expressed a willingness to pay nearly 11% above the average price for sustainable products, surpassing the global average of 9.7%. Consumers from the Philippines (13.4%), India (13.1%) and Indonesia (13.1%) were willing to pay the highest percentage above the average price, while those in Australia (8.4%) were willing to pay the least. However, whether this intent to pay a premium turns into reality may depend on factors including inflation, macroeconomic volatility and cost-of-living concerns, among others.
The most impactful sustainability incentives influencing purchasing decisions revolve around tangible attributes, including eco-friendly packaging (41%), waste reduction and recycling (39%), efforts towards nature preservation and water conservation (35%) and using renewable energy (31%).
Create a product portfolio that reflects wellness, nutrition and sustainable food production
Consumers are increasingly mindful of what they eat and where it comes from. Nearly 60% of respondents report eating more fresh fruits and vegetables in the past six months, with intentions to stick to a healthier diet, with 20% planning to cut back on red meat. And that’s not all — about a third (31%) are eyeing plant-based meats, while 42% are planning to eat more seafood.
This finding somewhat flies in the face of conventional thinking around rising income levels contributing to over-indulgence and unhealthy eating in developing economies.
Asia Pacific consumers are embracing a diet rich in fruits and vegetables, with an increased intake of additional dietary supplements, fish and plant-based foods
Question: How do you expect your consumption of the following food groups to change, if at all, in the next six months?
Note: ‘I do not consume this food group’ responses are not shown in the above chart
Base: 7,279 (all Asia Pacific respondents)
What is also intriguing is the backdrop against which these choices are made: despite worries about climate change, only 19% factor in the environmental impact of their meals, with 55% focused on personal health and 44% on the price tag.
It’s clear that the drive towards healthier, eco-friendlier eating can't rely solely on consumers; producers and retailers need to step up too. With the global population set to soar from 8.1 billion today to 9.7 billion by 2050, the challenge of feeding more while lessening the ecological strain of food production is becoming increasingly urgent.
Changing lanes with sustainable transport
A significant 78% of respondents express keen interest in owning an electric vehicle (EV) or hybrid (HV), with particularly high enthusiasm noted in Vietnam, India (both 85%), Indonesia (84%), and Chinese Mainland (83%). Surprisingly, only 9% have made the leap to purchase one, signalling a vast, untapped market potential for automakers.
Notably, those considering acquiring an EV is higher in Asia Pacific (40%) compared to the global average (32%).
Over three quarters of consumers have an appetite for future ownership of a hybrid or electric vehicle, with less than 10% already owning one
Question: Would you consider acquiring (e.g. owning, leasing or subscribing) an electric vehicle (EV) or hybrid vehicle in the next three years?
Base: All Asia Pacific respondents who plan to drive in the next three years = 6346
This finding is in line with another PwC study that highlights a strong interest in e-mobility with consumers in the region. The study also reveals that Chinese Mainland, Hong Kong SAR and Singapore are among the most eReady nations, taking into account factors such as government incentives, infrastructure and supply and demand. Australia is the least mature for e-mobility.
Are Asia Pacific consumers ready for artificial intelligence (AI)?
AI has made its mark in Asia Pacific, but the extent to which consumers are ready to trust AI to replace human-managed activities, will affect their customer experience with brands.
Over half of consumers would trust AI to support them with low risk activities, but are less so on higher risk activities
Question: Considering the recent advancements in artificial intelligence (AI) technology, which of the following activities would you trust AI to do accurately in place of a human interaction?
Base: 7,279 (all Asia Pacific respondents)
In comparison to the global survey, Asia Pacific consumers are more confident that their data is being responsibly stored (59% vs. 52%) and shared (60% vs. 53%) – suggesting that they are probably more AI ready than their global counterparts. They are also more willing for technology brands to use their data to deliver useful features (60% vs. 49%).
However, our survey also reveals more than half are comfortable using AI to replace human interaction for low-risk activities. This includes providing information and recommendations for products and services, drafting emails and tracking orders. Less so when it comes to higher risk activities.
Key success factors for consumer AI adoption include education, transparency and better consumer experiences with user-friendly interfaces. Educate consumers on how GenAI is used, its benefits and safeguard in place to mitigate risks, fostering transparency and long-lasting trust. Integrate generative features and leverage more natural language models seamlessly into consumer workflows, offering options for users to customise the level of AI integration to suit their comfort levels.
Considerations for leaders
Equipped with a better understanding of today’s consumer challenges and opportunities, there are several ways leaders can adapt and accelerate plans for growth.
Address conflicting priorities in a cost-escalating economy: Identify alternative value sources that resonate with consumers, beyond price. Highlight a range of product brand features, communicate a unique brand promise or deliver exceptional customer service to gain a competitive edge.
Infuse trust into strategy: Be transparent in communications and consistent across all consumer touchpoints. Build a community of brand-advocates to bring greater value to consumers. Dig deep into the region's cultural diversity to understand the nuances and unique consumer preferences – the fact that trust varies across cultures calls for tailored approaches.
Be measured: Balance social media commercial success with consumer trust concerns. Use authentic content to build trust, while safeguarding personal data to enhance customer experience. Navigate the online/offline experience by providing a consistent and effortless experience across touchpoints, to instil a sense of reliability and dependability.
Build shopper missions into your strategic plan: Consider the customer experience and product offering according to the shopper mission (rather than just on-line users vs off-line users) and ensure that the product/assortment/pricing strategy are designed accordingly.
Bridge the intent/reality divide: Support consumers in their ambitions to eat more healthily and make more ethical choices. Be a proactive health partner. This could be by expanding your product categories with healthy and sustainable choices, upgrading relevant features such as packaging, and promoting ESG elements of the brand.
Adopt genuine sustainability practices: Meet consumer expectations on the environment and maintain their trust. Be transparent and integrate meaningful sustainability practices across the board. Clearly communicate these efforts to consumers and consider obtaining third-party certifications and labels, such as Fair Trade, to build authenticity.
- Build trust with consumers along on your GenAI journey: Develop a GenAI strategy with a clear risk management framework. Engage consumers in your journey by building trust through involvement and transparency. Safeguard your reputation by piloting features with receptive groups and avoiding hasty implementations. Leverage GenAI's strengths to address straightforward issues, delivering quick and tangible benefits. The pathway of embedding GenAI into consumer experiences is a marathon and not a sprint. Establish trust early on with carefully-planned, value-adding examples.
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