Retailers and Consumer Packaged Goods Companies Must Enhance Their Understanding of Millennial Consumers to Capture Share of $6Trillion Wallet in Asia, Accenture Warns

Guía de Regalos

Millennials represent more than 45 percent of the region’s population,
with 60 percent of the world’s millennials expected to live in Asia by
2020

SINGAPORE–(BUSINESS WIRE)–Retailers and consumer packaged goods (CPG) companies must improve their
understanding of the millennial generation in Asia, according to
Accenture (NYSE:ACN), with millennials set to dominate the consumer
market in the region.

Looking at the millennial generation in the region, Accenture analysis
from a number of research reports including Accenture
Adaptive Retail
and the “The
future is now: understanding the new Asian consumer
” reveals the
extent to which this group is set to dominate spending across the
region. This potential impact highlights the need for retailers and CPG
companies to embrace digital solutions so they can achieve the connected
and integrated shopping experience that millennials are seeking.

The opportunity is here and now

According to Accenture’s analysis e-commerce adoption continues to
increase, with sales in the Asia Pacific region expected to rise 300
percent to US$2.6 trillion by 2020. Millennials in Asia will have more
spending power than any previous generation – estimated to be US$6
trillion in disposable income by 2020. Millennials represent more than
45 percent of Asia Pacific’s population, and with 60 percent of the
world’s millennials expected to live in Asia by 2020, retailers and CPG
companies must improve their understanding of this tech-savvy,
media-connected generation to capitalize on the huge opportunity and
capture this powerful customer segment.

Speaking at the Accenture World
of ME
showcase at the Millennial
20/20
summit in Singapore, Teo Correia, senior managing director in
Accenture’s Consumer Goods and Services practice, said, “Digital is
transforming the industry globally by empowering customers with more
choices, insights and control. Millennials expect easy and delightful
experiences that are tailored to their interests and lifestyles. They
are more difficult to predict, increasingly segmented, and devoted to
powerful brands and engaging shopping experiences. To win their loyalty,
it is imperative for brands to keep it simple but make it personal using
data-driven applications.”

Millennials are shopping on the go and demanding more

Consumers are increasingly embracing digital technology and services as
part of their everyday life. Today, Asia accounts for the largest number
of smartphone users globally at over 50 percent. Within the region,
Singapore and Australia have the highest smartphone penetration globally
at over 80 percent. Meanwhile, millennials in the region spend an
average of 2.8 hours per day (or 42.5 days per year) on their
smartphones, and over 40 percent of millennials have shopped via their
smartphone.

Accenture’s analysis suggests that millennials are more open to
receiving advice than other customer segments. Retailers and CPG
companies are trying to meet this generational need through
personalization – but must ensure their methods are acceptable to
consumers. For example, in China and Japan:

  • Sixty percent of millennials surveyed, compared to 47 percent of
    consumers overall, are comfortable with giving retailers access to
    their information in exchange for more personalized experiences.
  • In stores, 77 percent of millennials approve of items being
    automatically discounted for loyalty points and discounts, yet only 37
    percent were interested in sales associates asking about their recent
    purchases.
  • Sixty-one percent of this group wants promotions sent to them online
    for items they are considering.

“We see successful brands ramping up their data and analytics
capabilities to enable personalised customer experiences and pricing
based on loyalty, purchase history, and demographics,” added Correia.
“They are increasingly utilising predictive analytics to provide
personalised service offerings, and taking advantage of location-based
services to embed themselves within customer lifestyles. The key to
success is communication with the customer on every level. The customer
has to have a satisfying brand experience from the very beginning of the
experience to the end.”

Even buying a car is a new experience

In an upcoming research report by Accenture on the automotive retail
market, millennial car buyers indicate they are more likely to be
seeking excellent customer experience than other groups. In China
millennials have a strong affinity to the car-maker’s flagship
dealership, with 40 percent of millennials preferring this buying
format. In addition, Accenture’s research has found that millennials
want digital advice but at the same time seek personal interaction.
Finally, when buying a car, millennials don’t want to wait for their
purchase once they have decided on a model to buy, with 87 percent of
Chinese millennials ranking “immediate availability” of the desired
model after configuration as important in the buying process.

Digital solutions for a digitally empowered generation

At the Millennial 20/20 summit, Accenture is staging The World of ME, a
pop-up concept store of the near-future, which demonstrates some of the
most innovative products, services and experiences in the consumer
retail sector that Accenture believes will impact the Asia Pacific
region. It examines the evolving relationship between millennials and
retailers, featuring start-ups from around the globe.

“The key challenge today is ‘digital innovation at speed’ and at
Accenture, we believe that start-ups and big brands have something to
admire in each other and to learn from each other,” continued Correia.
“The pace of change has increased and in a world where new markets and
services are created almost overnight, connecting and collaborating to
enhance their operations, services and business to better serve their
customers will separate winning retailers from the laggards.”

Methodology

Accenture surveyed more than 10,000 consumers across 13 countries for
the Adaptive Retail Research report. As part of the study Accenture drew
out 746 millennial respondents who shopped online and in stores during
the last three months of 2015 in China and Japan. Sourced from panel
data, survey respondents were vetted by ESOMAR, which adheres to strict
international guidelines for market research. The sample of shoppers
came from seven equally weighted sectors: apparel; consumer electronics;
department stores; discount, mass, and hypermarket stores; grocery
stores; drug stores; and home improvement outlets. The survey’s
respondents represent a range of gender, generation, household income
level and place of residence. The survey screened all shoppers for
regular Internet and smartphone use and has a 95 percent confidence
level with a margin of error of plus or minus 3.6 percent.

Accenture also carried out a range of qualitative and quantitative
research for “The
future is now: understanding the new Asian consumer
” report. It
included the creation of “online consumer communities” across China,
Indonesia and Singapore to better understand e-commerce preferences,
pain-points, and motivations in relation consumer goods and services
purchases. The communities were active from December 2015 to January
2016. In addition, Accenture hosted interviews with a sample of senior
level executives with a strong exposure to the CPG industry. and desk
research was used to complement this.

About Accenture

Accenture is a leading global professional services company, providing a
broad range of services and solutions in strategy, consulting, digital,
technology and operations. Combining unmatched experience and
specialized skills across more than 40 industries and all business
functions – underpinned by the world’s largest delivery network –
Accenture works at the intersection of business and technology to help
clients improve their performance and create sustainable value for their
stakeholders. With more than 375,000 people serving clients in more than
120 countries, Accenture drives innovation to improve the way the world
works and lives. Visit us at www.accenture.com.

Contacts

Accenture
Caroline Douglas, + 35 3 87 680 0074
caroline.douglas@accenture.com