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Middle Class Research
- 1. The Rise of Middle Class This data is used as reference to build communication platform for Panasonic.
- 2. Asian Middle Class • The emerging middle-class consumers differ in their preferences, demands and habits. People belonging to this class are not wealthy enough to spend as much as they would like to and they are extremely conscious and sensitive about their status where they are sandwiched between the wealthy and grassroots. • The middle class in Asian emerging markets is made up of a younger population compared to their counterparts in the US and Europe. • Young middle-class consumers are particular about product quality, trendiness and user experience, which are reflected by the values associated with a brand. They will only stick to trusted and widely recognised brands. Apart from the quality of a product/service, these consumers also take into account the buying experience such as the vendor’s sales service and product/service knowledge, plus the after-sale services. • Thirdly, the emerging middle class is embracing online shopping. Thanks to years of development of B2C, C2C, group buying and ranking e-commerce websites, online shopping is gaining popularity through promotions on various social media platforms including Facebook, blogs and microblogs.
- 3. Indonesian Middle Class • There are 75 million middle-class consumers in Indonesia, which will increase by 10 million per year for the next 10 years. • These emerging middle income earners – said to number 35 million – are proving eager and discerning consumers, who will seek out and pay for quality. They are a key driver of the Indonesian economy, tipped to increase by more than 6 percent in 2013. • Gleen Maguire, chief economist for the Asia-Pacific region at ANZ, believed that Indonesia's economy will improve in the next five years. In addition 79 percent of Indonesian people will have an improved financial condition a year ahead as Indonesia has survived from the Federal Reserve's tapering off. • By 2020, China’s middle class will become the top consumers, while India and Indonesia will rank third and eighth respectively. By 2030, the middle-class population will account for more than half of the overall population in most of the developing Asian countries. By then, Asia’s annual expenditure will amount to USD 32 trillion, or 43 percent of the global total.
- 4. • Indonesians are getting more confident with their financial condition that it would encourage consumption. Jan-Mar Apr-Jun Jul-Sep Oct-Dec Jan-Mar Apr-Jun Jul-Sep Oct-Dec Jan-Mar Apr-Jun Jul-Sep Oct-Dec Jan-Mar Apr-Jun Jul-Sep Oct-Dec Jan-Mar Apr-Jun Jul-Sep Oct-Dec Jan-Mar Apr-Jun Jul-Sep Oct-Dec January February March April May June July August September October November December January February March April May June July August September October November December January February March April May June July August September October November December January 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 ANZ-Roy Morgan Indonesian Consumer Confidence (2005 - 2014) January 2014
- 5. • The survey includes the Top 22 cities, smaller cities and towns as well as many more villages in the rural hinterland, reflecting all of Indonesia. Men and women aged 14 and over were randomly selected during the month of January 2014. • Indonesia’s consuming class — people whose daily spending ranges from US$2-$10 — will double to 150 million people over next 10 years, ANZ-Roy Morgan Research predicts. ANZ-ROY Morgan Indonesia Consumer Confidence Table
- 6. Source Research Journal ANZ-Roy Morgan Indonesian Consumer Confidence: Statistical Release , February 2014. BCCI Bulgaria: Indonesia The Next Economic Powerhouse, 2013. KPMG Adversory China: The Rise of the Middle Class in Asian Emerging Markets, April 2012.
- 8. The developing economy of Indonesia is going through an upgrading phase where consumers are switching to newer, better, and more expensive technologies. Households in the world’s fourth largest country are buying more of and upgrading their small domestic appliances such as rice cookers, vacuum cleaners, blenders, irons and electric fans, etc contributing to sales of over 24 million units worth USD595 million in 2012. “
- 12. Total
- 13. Market Highlight • Consumers’ purchase of LED TV this year increased so quickly over last year. This year 2 out of 3 total flat-screen TVs sold were LED, while last year's 1 out of 4 TVs sold was in this segment. Driven mainly by the manufacturers and cheaper price of LED TVs are the main reasons in the growth of these products. • Air conditioner continued to gain around 28% in April, albeit of its slight decline compared to last year. Inverter share in air conditioner remains small compare to air conditioner with no inverter which is only 9%, and 91% share still driven by the non-inverter function. Price remains a consideration for consumer whom still prefer the non-inverter function. • Market for cooling/fridge continued to show a strong growth with around 20% increase compare to previous year. The sales remained dominated by 1 door cooling which contributed around 64%. However, the shift in trend towards the middle and mid high segment indicated the increase in consumer purchasing power as well as the growth of replacement market.
- 14. Market Highlight • Washing machine sales increased up to 42% in January 2013 compared with the same month last year. Although the market is still dominated by segments double tub at 51%, but there is also a huge growth in the segment front-load, ie up to 75%. It shows the evolution of consumer demand towards products with better quality. • The Small Domestic Appliances (SDA) market in Indonesia in the last 12 months totaled more than USD 1.6 billion, expanding by nearly 6 percent in value compared to the same period a year ago. According to GFK retail audit findings, this value growth is a result of consumers buying nearly one million more small household appliances such as food preparation appliances, irons, rice cookers and vacuum cleaners compared to the previous year. Source: GFK Market Insight Indonesia, January-April 2013.