Businesses are struggling to lock in long-term, sustainable growth as consumer behaviours change, according to new research from Kantar, the world’s leading data, insights and consulting company.
Following years of rapid economic development, growth in Asia Pacific is starting to slow. The results from Kantar’s Mastering Momentum report show that consumer spending behaviour is also changing, becoming increasingly careful and considered. The findings reveal that 85% of people questioned in the region say they are less impulsive in their spending compared to two years ago. Consumers are now making choices based on an ever-growing number of interactions, underlining the need for marketers to regain a focus on long-term brand building.
Brands across the world are struggling to secure growth in this environment. The report found that globally, fewer than 6% of brands grew market share over one year, and only 6 in 10 of those sustained that gain over three years.
But the findings also reveal opportunities for brands. The report highlights the need to establish meaningful connections with consumers to build the relationships that will result in long-term growth. When asked about their most recent purchase, 98% of people questioned said they were already familiar with the brand – of these, 72% ‘knew a lot’ about it.
Digital technologies are critical gateways to building a familiarity and predisposition towards the brand:
- Two thirds (65%) of people in Asia, and 78% of Millennials, said that their mobile is central to discovering new brands.
- Platforms like Instagram are now being used as a central ‘discovery’ channel in many markets, with people scrolling through to find new brands in the same way that they would a physical magazine.
- However, despite advances in programmatic technology and advertising becoming increasingly personalised, over a third (38%) of people say that the ads they see are not relevant to them, signalling the need for brands to hone their targeting skills.
Anita Rao Kapur, Regional Head of Brand for the Insights Division at Kantar, said: “Consumers in Asia today are far more discerning, making decisions based on a layered understanding of the brand, built up over numerous interactions. Brands that want to grow in a sustainable way need to make sure they have their finger on the pulse of all of the moments that matter and understand how interactions in the short term can contribute to the overall long-term picture.”
Research conducted by Kantar last year revealed that only 45% of marketers in the region measure both long-term brand building and short-term performance marketing.
The new report recommends marketers balance their investment across three key stages in the buyer lifecycle to create sustained growth:
- Experience: influence repeat sales and build loyalty by delighting existing users, as they are the foundation upon which growth is built
- Exposure: influence future sales by attracting new buyers and establishing meaningful difference through compelling creative and targeted media investment
- Activation: influence immediate sales by ensuring the brand triggers positive associations and its meaningful difference comes readily to mind at the point of sale.
Commenting on the findings, Nigel Hollis, Chief Global Analyst, Insights Division at Kantar said: “Sustained, long-term growth is hard, but there is a huge opportunity for businesses that are willing to look beyond simply delivering the next quarter’s numbers. The brands that concentrate marketing investment into the moments that matter will be the ones that thrive and grow regardless of fluctuations in the global economy.”
Anita continues: “We can’t map every thought that people have, but by monitoring sensitive indicators of change, marketers can optimise quickly, invest where necessary and keep the momentum moving forwards in a positive direction.”