Personalisation key to capturing millennial shoppers in Asia
Over 40% of millennials in Asia have shopped via their smartphone
Retailers must improve their understanding of the tech-savvy, media-connected millennial generation in Asia if they want to capture a share of the $6 trillion wallet in the region, new research suggests.
In particular, they need to embrace digital solutions so they can achieve the connected and integrated shopping experience that millennials are seeking, according to Accenture.
The consultancy notes that millennials represent more than 45% of the region's population, with 60% of the world's millennials expected to live in Asia by 2020.
According to its analysis, e-commerce adoption continues to increase, with sales in the Asia Pacific region expected to rise 300% to US$2.6 trillion by 2020. Indeed, millennials in Asia will have more spending power than any previous generation, it says.
"Digital is transforming the industry globally by empowering customers with more choices, insights and control," explains Teo Correia, senior managing director in Accenture's Consumer Goods and Services practice.
"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," he told the Accenture World of ME showcase at the Millennial 20/20 summit in Singapore.
Asia already accounts for the largest number of smartphone users globally at over 50%, with Singapore and Australia having the highest smartphone penetration globally at over 80%.
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% of millennials have shopped via their smartphone.
Accenture's analysis suggests that millennials are more open to receiving advice than other customer segments – and that retailers and consumer packaged goods (CPG) companies are trying to meet this need through personalization.
However, they must ensure their methods are acceptable to consumers. For example, in China and Japan, 60% of millennials surveyed are comfortable with giving retailers access to their information in exchange for more personalized experiences, compared to 47% of consumers overall.
In stores, 77% of millennials approve of items being automatically discounted for loyalty points and discounts, yet only 37% were interested in sales associates asking about their recent purchases. And 61% 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," adds 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."
Separate research on understanding millennial consumers also suggests it is a mistake to see the world's largest consumer generation as one homogenous group, and that retailers need to understand who they are, what they prefer and what life stage they are in.
Help test our new apparel sourcing tool.
- Unlocks for the future fashion sourcing landscape
- EU eyes mandatory due diligence for apparel supply
- Geo-political uncertainty and how to survive it
- What TTIP might mean for US, EU textiles & apparel
- Where next for Corporate Human Rights Benchmark?
- Li & Fung forms supply chain partnership with PVH
- US Q4 in brief – Finish Line, Oxford Industries
- Sears has "substantial doubt" of future
- World Bank commits $57bn to sub-Saharan Africa
- Target unveils "ambitious" store re-design plans
- Central and East Europe Report Package
- Central America strategic sourcing review - a focus on Guatemala, El Salvador and Honduras
- Southeast Asia strategic sourcing review – a focus on Cambodia, Vietnam and Myanmar
- When Things Go Wrong - A Practical Guide to Managing Common Problems in Apparel Sourcing
- Outdoor performance apparel 2016: A broader perspective