With the official launch of the ASEAN Economic Community (AEC) at the start of 2016, companies around the world want to seize the vast ocean of opportunities which Southeast Asia represents.
To do so, the first step is understanding how to advertise in the region.
Advertising in ASEAN is very different than in other places. For example, fast food giants such as Burger King and Carl’s Jr. didn’t succeed until they dropped prices and adapted to local flavors.
There’s still some time until AEC achieves its goals in becoming a single market and production base. But it’s important to first have an understanding of Southeast Asia and its consumers.
Only then can companies come up with the proper sales and marketing approaches when the time is right.
Why Expand into ASEAN?
ASEAN represents a huge trading bloc of over 634 million people. It’s also the third largest consumer market, trailing behind only China and India.
Key features which distinguish ASEAN from other big consumer markets are its rapid income growth and young consumer market.
Comparing median age across regions, Southeast Asia’s 28.9 has a populace younger than China’s 37.5, USA’s 37.8, and the EU’s 42.4.
Even though ASEAN is the third most populous consumer market, it’s only number seven in terms of trade value.
However, this will change very soon. Many organizations predict that before 2030, the ASEAN economy will be worth over US$3.0 trillion – ahead of Japan’s US$2.9 trillion, the UK’s $2.6 trillion, and even the entire Eastern Europe’s $2.5 trillion.
ASEAN is Diverse: A Challenge for Marketers
Firms shouldn’t dive into ASEAN without expanding their knowledge first. There are many things to consider, the most important being the great diversity in the region.
Southeast Asia is growing rapidly in both income and expenditure levels. But this growth isn’t evenly spread. For example, comparing Singapore and Vietnam, Singapore boasts an average household annual disposable income level of over US$100,000. Vietnam’s is below US$5,000.
These income disparities are explained by several factors. Reasons include uneven degrees of economic openness, trade liberalization, and financial market development.
Coming hand in hand with income levels are the expenditure levels. The gap here is as large, if not larger.
Singapore, the region’s most developed country, has an average household expenditure of over US$70,000. Myanmar’s is only US$3,000. This is why the “average household expenditure” figure in ASEAN as a whole is misleading.
As if the disparities in expenditure and income within the regions were not enough, extreme disparities also exist within each country itself.
Other factors to consider when marketing and advertising in ASEAN are the different cultures, languages, and religions.
Businesses Must Understand Advertising in ASEAN
Due to the ASEAN region’s extreme diversity, companies shouldn’t approach things with a “one size fits all” strategy. Many large, well-backed multinational firms look at Southeast Asia as just a single market though. That’s a huge mistake.
Before entering the market, firms must gain a thorough understanding of consumers and decide whether they should even do business in ASEAN at all. Afterwards, greater awareness will ultimately help them capture consumers’ attention.
ASEAN has many challenges. But those who overcome them will gain access to one of the fastest growing markets in the world made up of a young, aspirational, and connected population.
Skip the Next Western Recession
Learn the best places to invest – and where to avoid – by downloading our free Investment Cheat Sheet.
- Buying Property in China as a Foreigner? Bad Idea - November 14, 2018
- Property Investment Visas in Asia: Your 5 Best Options - November 3, 2018
- Don’t Buy Property in Dubai: Here’s Why - October 27, 2018
- Top 10 Thailand Property Developers: A Complete Guide - October 18, 2018
- Istanbul Property Market Becomes Cheapest in Asia - October 9, 2018
- Emerging vs. Frontier Markets: Which is Better for You? - September 29, 2018
- Countries With No Property Tax: Own Without Obligation - September 22, 2018
- This Country Avoided Recession for 30 Years - September 9, 2018
- 3 Best Investments to Avoid a US-China Trade War - August 5, 2018
- 4 Frontier Markets You Should Invest In - July 19, 2018