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ASEAN Consumers After AEC 2015


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By Kannapon Lopetcharat, PhD, Managing Director, Sprim Thailand

Published in: Food
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ASEAN Consumers After AEC 2015

  1. 1. THAILAND THAILAND ASEAN Consumers after AEC 2015 Harmoniously Differences Similarity and Difference – How to Gain  Consumer Insights and Understanding for  Product Development SPRIM  CONFIDENTIAL 19/22/2011 Presented by: Kannapon Lopetcharat, Ph.D. Managing Director, SPRIM (Thailand)
  2. 2. THAILAND ASEAN Consumers after AEC 2015 Harmoniously Differences Abstract AEC 2015 will connect ASEAN countries together in an unprecedented way.   The connections will impact the allocation of products and consumers that will  change the landscape of both local and regional markets.  There will be “ASEAN  Diasporas” who will create cliques and communities within a local market.  Also  there will be an explosion of new territories for exporters.  Understanding the  similarities and differences among ASEAN consumers will be critical for marketing  and new product development.  This presentation use the similarities and  differences of three demographic parameters (ethnicity, religion and language)  that are bases of believes and behavior and national diets to highlight the  “harmoniously differences” among ASEAN consumers.   Also, this presentation will  propose new approach, Multi‐faceted Consumer Research Approaches, to study  and understand consumers in order to gain “in‐depth” understanding and  consumer insights that can be used in new product development and marketing.   SPRIM  CONFIDENTIAL 29/22/2011
  3. 3. THAILAND ASEAN Economic Community by 2015 SPRIM  CONFIDENTIAL 39/22/2011
  4. 4. THAILAND AEC 2015 connects countries through three  major connections SPRIM  CONFIDENTIAL 49/22/2011 Institutions: standards, laws, regulations, agreementsInstitutions: standards, laws, regulations, agreements Physical: logistic, productions, resourcesPhysical: logistic, productions, resources People: professionals, culture, tradition, religion, language,  communication People: professionals, culture, tradition, religion, language,  communication
  5. 5. THAILAND ASEAN Community  Harmoniously‐Different Market SPRIM  CONFIDENTIAL 59/22/2011 ReligionReligion EthnicityEthnicity LanguageLanguage DietDiet
  6. 6. THAILAND Indonesia and the Philippines differ from the other  countries the most because of their ethnic diversity SPRIM  CONFIDENTIAL 69/22/2011 Brunei Cambodia Laos MalaysiaSingapore Thai Indonesia Myanmar the Philippines Vietnam - 4 - 2 0 2 4 6 8 - 6 - 4 - 2 0 2 F1 (23.5%) 4 6 8 F2(20.3%) Indonesia and the Philippines differ from the other countries the most because of their ethnic diversity Myanmar and Vietnam differ from the other countries because of the lack of ethnic diversity This group is more similar to each other because they have an ethnicity in common, the Chinese.
  7. 7. THAILAND Even though, Brunei, Malaysia, Singapore & Thailand   have more than 10% Chinese, their ethnic compositions  still differ greatly. Singapore Malaysia Thailand Brunei Myanmar Cambodia Indonesia Laos Philipines Vietnam SPRIM  CONFIDENTIAL 79/22/2011 0.0 10.0 20.0 30.0 40.0 50.0 60.0 70.0 80.0 % of Chinese in each country population Hm ong, 2 Indian, 2 indigenous, 2 M alay , 2 Thai, 2 M on, 1 Banjar, 1 Banten, 1 Betawi, 1 Bicol, 1 Bugis, 1 Burm an, 1 Cebuano, 1 Hiligaynon or Ilonggo, 1 Hoa, 1 Ilocano, 1 Indians, 1 Javanese, 1 Karen , 1 Khm er, 1 Khm ou, 1 Khom e, 1 Kinh (Viet) , 1 Lao, 1 M adurese, 1 M alays, 1 M inangkabau, 1 M uong, 1Nun, 1 Pam pango, 1 Pangasinan, 1 Rakhine, 1Shan , 1 Sundanese, 1Tagalog, 1 Tay, 1 Vietnam ese, 1 W aray, 1 Others, 9Chinese, 6
  8. 8. THAILAND Buddhism and Islam are major religion among ASEAN  countries with exceptions in Vietnam and the Philippines  SPRIM  CONFIDENTIAL 89/22/2011 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Cambodia Thailand Myanmar Laos Singapore Malaysia Brunei Vietnam Indonesia the  Philipines Religion distribution within each ASEAN country Buddhist Muslim Christian (Roman Catholic) Christian (Protestant) Christian (unspecified) Hindu Others or unspecified None
  9. 9. THAILAND ASEAN countries have their own official languages but  they are migrating toward English and Chinese SPRIM  CONFIDENTIAL 99/22/2011 KhmerLao Vietnamese BurmeseThai French Mandarin Chinese Malay TagalogBahasa- Indonesia Bahasa- Malay Malay ChineseEnglish
  10. 10. THAILAND Comparison of diet among ASEAN countries SPRIM  CONFIDENTIAL 109/22/2011 Cambodia Laos VietnamMyanmar Thailand Singapore Brunei PhilippinesIndonesiaMalaysia Note: the ratio of the bars is for demonstrating purposes only
  11. 11. THAILAND ASEAN “Diaspora” A diaspora* (from SPRIM  CONFIDENTIAL 119/22/2011 Greek διασπορά, "scattering, dispersion") • The movement, migration, or scattering of people away from an established or ancestral homeland Source: *Wikipedia **Countdown AEC 2015: Opportunities that come with risks, สารวิจัยธุรกิจ (Volume 14, Issue 32) December 2010. Business Risk Research Department (Krung Thai Bank Pcl. **
  12. 12. THAILAND The explosion of new markets SPRIM  CONFIDENTIAL 129/22/2011 Expands market size from 500K‐ 2 million consumers to 600 million consumersExpands market size from 500K‐ 2 million consumers to 600 million consumers Local & NativeLocal & Native Local & DiasporasLocal & Diasporas New consumers in  new territories New consumers in  new territories
  13. 13. THAILAND The impacts of diasporas and new consumers  to exporters SPRIM  CONFIDENTIAL 139/22/2011 Local &  Native Local & Local &  NativeNative Local &  Diasporas Local & Local &  DiasporasDiasporas New  Consumers New New  ConsumersConsumers Who are  they? Who Who are are  they?they? Natives  consumers Natives  consumers Professionals &  skilled labors Professionals &  skilled labors New consumers in  new territories  New consumers in  new territories  What do  they bring? What What do do  they bring?they bring? Local believes,  habits and  cultures Local believes,  habits and  cultures Different believes,  habits and  cultures Different believes,  habits and  cultures Different believes,  habits and  cultures Different believes,  habits and  cultures Where will  they be? Where Where will will  they be?they be? Established  communities with  local movement Established  communities with  local movement Near by work  place and near by  their own cliques Near by work  place and near by  their own cliques New territories  with local  movement New territories  with local  movement How long  will they be  here? How long How long  will they be will they be  here?here? Permanent with  some travelling  for pleasure Permanent with  some travelling  for pleasure Few years with  some home visits Few years with  some home visits Permanent with  some travelling  for pleasure Permanent with  some travelling  for pleasure
  14. 14. THAILAND AEC 2015 changes Who, Where, When and  How products are experienced SPRIM  CONFIDENTIAL 149/22/2011 Extrinsic Brand, Imagery, Price, Package Intrinsic Ingredients Product Features Functions Benefits Drivers How one develops products when the environments keeps changing?
  15. 15. THAILAND Instead of treating consumer as “respondents,  subjects or statistics” SPRIM  CONFIDENTIAL 159/22/2011 Gender: Female Averaged age: 35 years old Average income: $35,000/year Marital status: Married 40%, Divorce 35%, Single 25% Ethnicity: Asian 10%, Caucasian 80%, Other 10% Country: Thai, US, UK, Nigeria, Singapore Religion: Buddhist, Muslim, Christian Gender: Female Averaged age: 35 years old Average income: $35,000/year Marital status: Married 40%, Divorce 35%, Single 25% Ethnicity: Asian 10%, Caucasian 80%, Other 10% Country: Thai, US, UK, Nigeria, Singapore Religion: Buddhist, Muslim, Christian
  16. 16. THAILAND You need to treat consumers as “people” SPRIM  CONFIDENTIAL 169/22/2011
  17. 17. THAILAND Applying consumer understanding enhances new  product development at various stages Final Product Ideation Conceptua- lization Feasibility/Development (Primary R&D Function) Commercialization & Launch Concept Prototypes STRATEGY & INNOVATION REGULATORY & SCIENTIFIC AFFAIRS ISSUE & QUALITY MANAGEMENT RESEARCH & CLINICAL SERVICES MARKETING COMMUNICATION Product testing for consumer perception claim substantiation Effective product screening Product category appraisal Support upstream innovation CONSUMER & TECHNICAL INSIGHTS SPRIM  CONFIDENTIAL 179/22/2011
  18. 18. THAILAND Multi‐faceted Consumer Research Approaches SPRIM  CONFIDENTIAL 189/22/2011 Sub-conscious measurements Video diaryEthnography Online blogging Online community Value DiagramNeeds, Wants and Ideas Survey Live- Interview
  19. 19. THAILAND Great innovation happens when innovators  truly understand consumers TECHNOLOGY CONSUMER INSPIRED Technology  identified at  Extremes and  Fringes Technology  identified at  Extremes and  Fringes Multi-faceted Approaches Sub-conscious measurements of consumer perception Emotion measurements In-context ethnography (consumer observation and conversation) Qualitative Multivariate Analysis of products and consumers You will get… Product that consumers actually “love” and “excited” Know the performance of your communication and product at emotional level Know actual and real consumer’s behavior quantitatively Truly understand the connection between values, emotions and product attributes SPRIM  CONFIDENTIAL 199/22/2011
  20. 20. THAILAND Drivers of Choices of Latte‐style coffee* SPRIM  CONFIDENTIAL 209/22/2011 •Quiet with soft music •More casual looking crowd •Staying for long time with minimum order •Place for job interview •PM: More casual with increase sale of more indulgent coffee •Free Wi-Fi •Coffee with donut •Ice coffee Black coffee •Drive-thru •Most coffee ordered by 11 AM •No coffee ordered after 5 PM •Wi-Fi available but not free •Business casual •In-and-out not staying •Most coffee ordered by 11 AM •No staying customers •Black coffee with lightener and sweetener •More family-type customers (family for breakfast and parent ordered coffee) • Free Wi-Fi •Loud atmosphere •Business casual •In-and-out not staying •AM: Mostly black coffee and modified with lightener and sweetener on their own •PM: More casual crowd socializing with increase sale of more indulgent coffee •Free Wi-Fi Ethnography Knowledge Mapping Conjoint Design Consumer feedback *Sponsor by Dairy Research Institute and presented in Pangborn 2011, Toronto, Canada
  21. 21. THAILAND Drivers of Choices of Latte‐style coffee* SPRIM  CONFIDENTIAL 219/22/2011 Indulgent consumers More 25-29 lightener-type and sweetener, specifically milk-based and sugar Coffee house/Location More 30-44 7-8AM in car going to work PM use cream as treat or with desert Health conscious More 45-54, more male Fat reduction and no calorie PM use cream as treat or with desert Latte Experience Experience of the latte purchase (e.g., coffee house, location, atmosphere The makes up of the latte itself :-Customizing their own latte using lightener and sweetener Calorie and fat reduced are preferred Lactose intolerant consumers prefer lactose free milk over non-dairy alternatives *Sponsor by Dairy Research Institute and presented in Pangborn 2011, Toronto, Canada
  22. 22. THAILAND Six keys actions to bring insights to life* Expand  regionally Expand  regionally Low‐end  disruption  innovation Low‐end  disruption  innovation Deeper not  broader Deeper not  broader Honor local  differences Honor local  differences Compromised  solution Compromised  solution Solution for  occasions Solution for  occasions SPRIM  CONFIDENTIAL 229/22/2011 *Adapted from The Future of Food Service (Dec. 2010) the Boston Consulting Group
  23. 23. THAILAND AEC 2015 brings opportunities with  changes to ASEAN ASEAN is growth People will move…ASEAN Diaspora Foreigner cliques and communities within  local markets alter the landscapes New market open exponentially ASEAN consumers will be  harmoniously‐different  markets Understand consumers deeper as “people” not statistics Understand the “why” behind the numbers Multi‐faceted  Consumer Research  Approaches SPRIM’s  capability  and  expertise  is  based  on  its  experience  in  managing   local  CTI  challenges  with  global  reaches. •Global,  Regional  and  Local  Team  of  Regulatory  and  Scientific  Affairs  Professionals  •understanding  specific  Industry needs  (Food, Pharma, Cosmetics, Hygiene…)  SPRIM’s  capability  and  expertise  is  based  on  its  experience  in  managing   local  CTI  challenges  with  global  reaches. •Global,  Regional  and  Local  Team  of  Regulatory  and  Scientific  Affairs  Professionals  •understanding  specific  Industry needs  (Food, Pharma, Cosmetics, Hygiene…)  SPRIM  CONFIDENTIAL 239/22/2011
  24. 24. THAILAND CONTACT Kannapon Lopetcharat, Ph.D. Managing Director, Southeast Asia S.P.R.I.M. (Thailand) Co., Ltd. Unit 810, 8/F Sitthivorakit Bldg. 5 Soi Pipat, Silom Rd., Silom, Bangrak Bangkok 10500 THAILAND Tel: +66 2 2345612 Fax: +66 2 2345614 Mobile: +66 80 2173489 Email: Skype: sprim_kannapon.lopetcharat SPRIM  CONFIDENTIAL 249/22/2011
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