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8 ways ASEAN consumer habits will change by 2030 - shaped by COVID-19, tech and more

"ASEAN is poised to become a dramatic consumption opportunity, driven by four mega-forces: strong demographic trends; rising income levels; geopolitical shifts increasing foreign investment; and digital advances opening new consumer markets."
  • Over the next decade, ASEAN will become the world’s fourth-largest economy with a roughly $4 trillion USD consumer market. While the entire region will offer abundant growth opportunities, each market will evolve differently.

  • Eight key consumption themes will emerge, some of them accelerated by the COVID-19 pandemic.

  • In particular, COVID-19 is changing shopping behavior, radically speeding up the digital future and making sustainability a harder tradeoff for policymakers in the short-term.

While COVID-19 will cause a significant economic impact with potential GDP contractions in 2020 and likely spilling over to 2021, the long-term fundamentals of the ten Association of Southeast Asian Nations (ASEAN) member states are on the cusp of a tremendous leap forward in socio-economic progress. Over the next decade, the region will be the world’s fourth largest economy, with a $4 trillion USD consumer market. While each of the ten member states will evolve differently, all of them will offer abundant opportunities for growth.


The Future of Consumption in Fast-Growth Consumer Markets, a project in collaboration with Bain & Company, focuses on the emerging markets that comprise more than 40% of the world’s population. After studying China in 2017, India in 2018, for 2019-2020 it turned its attention to ASEAN.


For now, the ASEAN region is in the throes of the health, humanitarian and economic crisis resulting from the COVID-19 pandemic. A majority of ASEAN CEOs surveyed by Bain in April predict that COVID-related restrictions will last through Q3 and Q4 2020, with economic recovery in mid-2021.


The pandemic has caused noticeable changes in consumer behavior. Some of those changes bring short-term volatility while others will alter consumer relationships and spending patterns in the longer term. Overall, eight consumption themes will emerge across ASEAN, in the post-pandemic world, with slight nuances in each country:


Consumer spending will double, driven by ASEAN’s middle-class boom. While the looming recession triggered by COVID-19 will dampen consumer sentiment and reduce overall spending within the year, this behavior will self-correct as economies move into recovery. The Asian Development Bank (ADB) estimates Southeast Asian annual GDP growth to fall to 1% in 2020 and rebound to 5% in 2021. However, by 2030, 70% of ASEAN population will be middle-class. The middle-class boom will more than double consumption in the region.


Boundaries of premium and value shopping will blur. Consumption behavior has changed significantly as many communities quarantine across ASEAN. Disaster-preparedness categories and daily essentials spiked, while luxury and non-essential spending experienced a dip with a possible slow recovery. Goods focused on convenience and well-being are likely to see high demand persist even post-recovery.


Over the next decade, many of ASEAN’s new consumer class will buy their first luxury product and be willing to pay a premium for convenience, well-being and personalization. At the same time, they will seek more value for money, more than 60% of high-income consumers surveyed by Bain in 2019 rating price as a top purchase criterion.

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