Hacking the ASEAN Consumer Economy

Since I relocated to Malaysia, a few brave and (frankly nosey) souls privately asked, "You look miserable (it’s the heat and the haze folks), so why'd you leave that cool, boutique agency with all the sustainable brands in SF that does all that cool, yoga, organic, save-the-planet stuff to work for a giant corporate agency in an emerging market?"  It’s a valid question. It feels like a tough question because I’m am inclined to say, “I have no idea”. This response most likely stems from the jet lag that has lasted three weeks and the haze that hasn't lifted since I landed in Kuala Lumpur. In reality, I know exactly why I moved here and took this job. I am here to experience global markets as they take shape. 

I moved to have greater impact in the largest, most interesting markets in the world as they adapt, adopt and shape western style consumerism to their own value systems and needs. The consumers of Southeast Asia and their economies will have a profound net-effect on the global economy in the next 10-15 years. Even as Asia’s economic growth rate shows signs of slowing, the region is still widely expected to play a key role in driving global growth, especially relative to other emerging markets like LATM and the BRICS. * 

The creation of the ASEAN Economic Community (AEC) in December 2015 will unite the ten members of the ASEAN into a single market and production base. This will thrust Southeast Asia into the spotlight, attracting greater attention from multinationals which have so far been drawn mainly to China and India. By 2030, ASEAN is expected to become the third largest economy behind the US and China at US$3.1 trillion in constant 2014 prices. *

You can literally sense the robust consumption fueled by a rapidly growing consumer class, rising incomes and urbanization that will generate $770 billion in new consumer spending in ASEAN over the next few years. According to a this report by Accenture this power will create tremendous new business potential for consumer packaged goods (CPG) companies.  Brands and their agencies need to do some deep thinking about how to tap this burgeoning consumer demand and apply digitally-driven strategies to reach the plugged-in, always-on ASEAN consumers.*

So , what does this opportunity look like from the ground? There are three important factors to pay attention to:

First, the dual nature of ASEAN consumers. 

The ASEAN consumer is fickle, and varied in mind-boggling ways. Beyond the obvious rule of thumb that they are profound cultural differences between Malaysians, Indians, Burmese, Thais, Indonesians, and Vietnamese, there are nuances that bind them. Noodles for instance, can be found just about anywhere, but the sheer variety of preparations and dishes is astounding. This might sound trite, but telling confusing Indonesian noodles and Malaysian noodles might get you into a fist-fight! 

For instance, yes, there are health-conscious consumers demanding healthier packaged food product-but their numbers are small and limited to the big cities such as Kuala Lumpur, Singapore, Mumbai, and Manila. Not all ASEAN consumers have been exposed to western culinary trends, or are interested in them for that matter. The ones that are tend to be more affluent, better educated and know more about nutrition then their counterparts in lower income cities and suburbs . The vast majority of these consumers are economically poor by western standards. There is a very big difference between those consumer's eating at Nobu in KL, and the hawker stands on the side-streets--and often, they are the same person. To accommodate these peculiarities and overall trends, food manufacturers in particular can address these consumers by launching a variety of food products.  Brands that focus with a hyper-local understanding of values foremost--and secondly (but no less importantly) things like affordability, convenience, and wellness can slowly scale these economies over time. The insights derived as this growth occurs will be invaluable to how we look at whatis and is not desirable about hyper-growth. 

Second, rapid urbanization means more time spent at work and more working mothers--the "traditional nourishment planners" of these households.  Unfortunately, with limited time to prepare meals from fresh ingredients, the new work-force will look to and require conveniently packaged food products to accommodate their busy lifestyles that provide the kind of nutrition and taste they want from home. Home delivery services will likewise experience a surge in demand. Overall--brands that find ways to allow the worker to bring a little bit of home with them will win and win big. 

Third, the explosion of mobile connectivity and the rise of social networks is impressive. 

ASEAN consumers are some of the most plugged in people in the world. Kuala Lumpur, Bangkok and Jakarta are home to avid Facebook users. Smart phones are more than pervasive--they are in everyone's pocket young and old. Even in rural areas, the monsoon-proof mobile phone is the preferred platform for communication, given the lack of fixed-line telecommunications infrastructure. 

Why ASEAN Markets?

Having gone from MD of a SF-based “sustainable marketing firm” to “National Head of Planning” of a very large MNC agency in Asia is obviously a bit of leap.  The disconnect for me personally is interesting. Usually people take the opposite trajectory. I'm quite sure that this will not make me terribly popular in some quarters--but in reality, selling gluten-free chips or fossil-free mutual funds to monied white people isn't exactly ground-breaking or innovative. 

Though new sustainable products, participatory and shared-economics has great appeal in the States, by and large these measures do little more to the offset gargantuan brushfires in the emerging markets (no pun intended). None of this should be new to the readers. That Uber is everywhere means that there are lots of people in need of jobs, and the fact is that 99% of the work produced by “green marketers” effects a very small # of consumers-mostly in the Western hemisphere. Add to this that preaching to the choir is as boring for the preacher as it is for the choir-and here I am.

Some of you might loathe to admit it, but social responsibility movements in the US effect mostly upper-class elites and may never "trickle-down" into the desperate  markets that need them the most—markets that being over-developed to some degree as we speak. I hate too break it to your garden-variety yoga loving, vegan eating, Ted-talk listening, save the planet folks, but the ethos of "save the planet" applies to mostly wealthy, western people—while the serious structural, economic issues that are plaguing the third world beg a more informed response.  Most if not all the action is taking place in these consumer economies. Brands that can address the consumer in real, authentic ways will take center stage from those brands trying to sell the consumer on western values. Am I suggesting that corporate brands will effect societal development? Yes, I am. Like it or not--multinational corporations have immense impact on economic development--good and bad.

Will it be easy to have an influence change here? No. That's exactly why I am here. I am here, to be here. There is something to be said for experience on the ground or what a former intelligence officer once told me—soaking it up with the locals. That is—try and say as little as possible, hang around, eat the kabobs, try the mi gorang, smoke the cigarettes, and drink the tea, and eventually you might learn the culture’s nuances. I also found cab (Uber) drivers and hotel staff to be incredibly knowledgeable. I asked one man working in my hotel what he thought of all the construction in KL for instance--and he responded plainly--"We have jobs--but I don't know if we have a life." 

All of these random conversations, bowls of noodles and mispronounced words point to the necessity of how we hack into cultural nuance or "earn our way into culture," an MWG (MCcann Worldgroup) niche.  What does wage inequity that is 3000x worse than the US really look like? It's not about being a visionary, or even wanting to have an impact--it's about doing a thing that requires a sacrifice, that requires being way, way, way the f-ck out of one’s comfort zone to find out more about who I am and what I am here on this planet to do and to find out if have anything worthwhile to offer my colleagues in these markets. It requires patience and antacids. To sum it up, I didn't do this because I thought it would be easy or digestible.

First and foremost, I try and remember that I am not addressing my own needs or the needs of people like me so it is highly unlikely that I will be able to truly understand those needs without some time on the ground. The problems, underlying resentments, and continual frustration of your average New Yorker are markedly different than those of a person living in Manila, Kuala Lumpur or Tokyo.

Taking this one step further, it helps to become more conscious of own one’s motives. While there is nothing wrong with creating meaning for people while their interact with brands-doing good things for people is nice—understanding the difference between what is meaningful to them is far more important.

So instead of presuming that people share commonality of meaning—one must “earn their way into culture”, to find inevitably that it often better to ask others what they really want and need first. As marketers we are moderately gifted at accurately intuiting others’ feelings and needs, but that does not necessarily mean that they want their “problems” remedied by us. This is a far larger and more compelling question for society than just how it effects marketing. Imagine if someone raised this line of inquiryin 2003 during the Capital Hill hearings on whether or not to invade Iraq.

I think it’s best to communicate the simplest of intentions, and be willing to accept difference as something that ultimately creates more dialogue. Someone deciding that they do not want your particular ‘brand’ of meaning does not mean that they dislike you or are rejecting you—it means they are different and different is good. This is hugely important in establishing relationships, and relationship is everything.

* Respectfully-- the data referenced in this article can be found here and here.

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