Outlook 2024: APAC POV
With the era of passive growth over, here’s how brands can navigate the downstream effects and ensure sustained growth in APAC
Written by: Sharon Soh, Chief Planning & Audience Officer, UM APAC
Like its western counterparts a century ago, the Asia Pacific (APAC) region came roaring into the 2020s marked by significant growth over the past three decades built on strong fundamentals. The creation of a new middle class that paved the way for large domestic consumer bases, supported by rapid improvements in infrastructure development such as education and healthcare, as well as digital and technological advancements have all played critical roles in fueling the ascent of APAC in the global economy. Since 2000, the weight of APAC in the global GDP has increased by 10% while, in contrast, the European Union’s (EU) and US’s weight has declined by 8.6% and 6.4% respectively. Today, the region’s share of global GDP is over 54% and is likely to reach 58% by 2030. Certainly, the importance of APAC is an abiding reality of the 21st century.
Historically, the region’s rapid growth has enabled it to overcome disruptive events whilst dealing with political and social instability, as well as weak infrastructure in many countries. A few economies in APAC have also started to transition from relatively passive growth to being more proactive and self-reliant, capitalizing on opportunities such as Industry 4.0, regional growth and innovation, labor re-skilling, and environmental sustainability.
The beginning of the decade saw the world first hit by the COVID-19 pandemic then followed by the Russian-Ukraine war. Whilst these events have not quite diminished APAC’s upward trajectory and the shift of the global economy from West to East, their substantive impact has accelerated the necessity for the region to take more decisive actions as the signs of slowing growth have become evident even before the turn of the decade.
Amidst global trade uncertainties and geopolitical tensions, the enabling of regional enterprise growth and connectivity, alongside rebalancing supply chains, advancing digital transformation, and fostering innovation, will become more important than ever before. Changing demographics in various parts of the region, be it a rising youth population or an aging workforce, are also creating employment and productivity concerns, driving the need to evolve further and future-proof. Moreover, with many extreme weather events magnifying in recent years, the call for climate action and a net-zero future can no longer be ignored as ecological crises continue to escalate, impacting the food security and health of the region.
As APAC marches forward into the mid-2020’s, it is imperative to acknowledge that the factors which drove its strong growth in the past will not be sufficient to steer it through challenges ahead. With the era of passive growth over, let us examine the downstream effects on brands and consumers alongside the new actions that must be taken to ensure sustained growth.
Life’s New Beat
The first half of 2023 saw more workers return to the office full time with APAC countries leading the world in the back-to-office movement. In a report by real estate and investment management company JLL, while employees globally were spending an average of just over three days per week in the office, markets like China, India, and South Korea have workers back at least 4.2 days per week. Even then, being in the office is no longer all about the hustle, especially for Gen Z that are estimated to make up 30% of the global workforce. They are pushing back against typical nine-to-five workday norms, finding new aspirations and self-expressions beyond the mainstream, and practicing more fluid ways of working.
Being in the office is no longer all about the hustle, especially for Gen Z.
In turn, a side hustle culture has emerged. No longer wanting to be restricted to a single work identity, many are turning their passions into profit, with nearly 7 in 10 successfully managing a side-hustle along with their day jobs, according to a poll conducted by Get Hired LinkedIn News Asia. In Australia, for instance, the side hustle culture has been booming with 61% of Australian entrepreneurs running a side hustle business alongside their full-time job, empowered by the availability of a wide range of online tools and services. The creator economy, now worth more than USD104 billion, has been growing in tandem with ecommerce and social commerce, with both expected to maintain growth rates of more than 10% in APAC. Meanwhile, platforms like TikTok, LINE, Lazada, and Shopee have made it easy for anyone to set up shop and start selling to millions of potential customers.
Nearly 6 in 10 youths in APAC are now also equating success with a work-life balance defined on their own terms. Personal wellness and passions are the new status symbols and the traditional ‘work hard, play hard’ mindset and ‘rise-and-grind’ mentality is increasingly becoming a red flag amongst the younger generation. In Southeast Asia for example, 50% of employees report feelings of burnout at least a few times a month, leading to many and especially the Gen Zs refusing to sacrifice their mental health or personal time for short-term gains. The concept of “tang ping” (躺平), meaning “lying flat” has become popular in China, reflecting the rejection of overworking and an emerging lifestyle of intermittent working. More recently, amidst the slowing economy in the market, another related trend of “bai lan” (摆烂) or “letting it rot” has surfaced, with the term first gaining popularity among gamers where it was used to describe players who retreat or give up during a difficult battle to take up easier tasks.
Both anti-hustle attitudes appear to have parallels to the quiet quitting movement that went viral on TikTok globally and which propagated the idea of quitting from going above and beyond in one’s job. In a recent survey of more than 1000 employees about quiet quitting, conducted by South Korean search website Incruit, 52% say they have done so. Whereas in the past, an ideal job in South Korea was defined by having higher wages and social prestige, a growing number these days are putting emphasis on jobs that give them time to pursue what they want to do beyond their work. Indeed, the pandemic and factors like rising inflation have raised stress levels but Asians are responding by seeking more ways to achieve equilibrium.
Since the disruption of the pandemic and as the region continues to tackle economic and financial challenges, businesses and consumers alike show a readiness to reinvent and evolve. The 2023 APAC Workforce Hopes and Fears report by PwC reflects for the first time, a striking similarity between employees and employers on the critical need to transform. According to Mintel’s Global Consumer data for 13 markets in APAC, 78% of those surveyed are looking to learn more things than they used to, 79% love trying new experiences, and 84% are always on the lookout for things to make life easier. So, whilst there is a push back to the legitimacy of a hustle lifestyle borne from traditional societal expectations, APAC consumers are not standing still and look toward opportunities for self-growth and development, seeking them from beyond the workplace and classroom.
With soft skills and life-hacking tips deemed necessary for success in the ever-changing environment, many are turning to digital resources — TikTok and Instagram to discover digestible content that inspire resourcefulness, YouTube for in-depth tutorial videos to learn new skills, as well as online and social accounts of news publications to stay up to date with trending news.
For younger generations, the use of AI tools as part of their repertoire for crowdsourcing information from multiple sources is becoming a norm. Compared to other consumer groups in APAC, Gen Zs are 49% more likely to use AI platforms to find information. Many have already tried AI-driven search engines to facilitate easier discovery of products and services and found the results more satisfying. AI has also been deemed especially helpful for online shopping with the idea of an AI assistant that caters to shopping-related needs particularly appealing. Alibaba, China’s leading ecommerce company, today deploys five AI chatbots to handle customer engagements for more than two million daily sessions and over 10 million lines of daily conversations on Taobao, helping raise customer satisfaction by 25%.
For younger generations, the use of AI tools is becoming a norm.
Suffice to say, the underlying values of the Asian culture and society are changing, shifting from collective expectations and interest to a greater emphasis on individualism and focus on self. Personal wellbeing alongside self-growth and development as well as self-acceptance and expression, are now key drivers for the APAC consumer. The use of AI is also starting to become an inherent part of the consumer’s daily life. Amidst a new beat burgeoning in the region, brands will be required to rethink past assumptions, reinventing themselves to cohere to new behaviors, needs and wants, alongside adopting new ways of segmenting and targeting audiences.
Remixed City
Today, APAC cities house 2.2 billion people or half the global urban population and this is expected to grow by a further 50% by 2050. Many have been lauded as economic powerhouses as well as dynamic hubs of innovation and transformative urban solutions. In an analysis by JLL, the APAC region is now home to half of the world’s top 10 most innovative cities. For these city dwellers, evolving retail and mobility solutions are part and parcel of their daily life.
The APAC region is now home to half of the world’s top 10 most innovative cities.
In China, for example, a fourth retail revolution is already taking shape with “instant retail”. Facilitated by online ordering, offline distribution, and fast last-mile delivery, products like fresh vegetables, bread, beverages, electronics, and cosmetics are delivered within hours. A Ministry of Commerce report has predicted that the instant retail market volume will be three times that of 2022 by 2025. Capitalizing on this trend, local ecommerce platforms like Meituan are already using drones for deliveries. Autonomous flying taxis might soon also become a reality. EHang, a leading autonomous aerial vehicle technology company, has received a production certificate to mass manufacture the EH216-S, an eVTOL vehicle for passenger transport, enabling applications in air taxi services, aerial tourism, airport shuttles, and cross-island transportation.
Aside from a focus on innovation, many APAC cities are now also emphasizing quality of life. In another report, The Smart City Index, the region dominates the list, especially leading the charge for using data and technology to help improve the quality in living standards. Here, not only Asian cities like Singapore, Beijing and Seoul feature strongly but Australian cities rank high as well with Canberra placing third worldwide and number one in APAC.
Canberra’s success can be attributed to its efforts in digital transformation, sustainability, and quality of life, implementing various solutions to improve the lives of its residents and visitors. Amongst its standout initiatives is the development of a “Digital Twin”, a city-wide Internet of Things (IoT) system that allows real-time monitoring and management of various city functions including traffic flow, energy usage, water management, and other aspects of city life, using the information to make data-driven decisions to improve city services. Canberra’s focus on sustainability is also apparent with its investments in renewable energy sources, development of smart waste management systems to reduce landfill waste as well as the encouraged use of electric vehicles and reduction in carbon emissions. In fact, the capital has been leading the EV revolution for Australia with the latest new car sales report in February 2024 indicating that one in four new car sales in Canberra is fully electric.
Amongst Canberra’s standout initiatives is the development of a “Digital Twin”, a city-wide Internet of Things (IoT) system that allows real-time monitoring and management of various city functions.
Singapore too is widely recognized as one of the world’s leading smart cities and this year, it plans to launch Tengah, a new smart eco town and pioneering concept in urban living. This is a testament to the country’s commitment to a greener and smarter future. The town is designed to be eco-friendly and sustainable, with features such as centralized cooling, automated trash collection, energy monitoring systems to optimize and conserve energy use as well as a car-free town center. It is also being developed with a biophilic framework, with 20% of the land in Tengah being set aside for green spaces, and nature and greenery being integrated into the design and planning of the town. The design of the town will also allow walking, running and cycling in a user-friendly manner, accommodating a growing interest amongst Singaporeans for outdoor activities even as land becomes scarcer. The roads are planned with the future in mind when autonomous vehicles and self-driving vehicles become a reality. Moreover, sustainable energy sources will be used to power smart lighting in common areas and charging stations for electric cars.
In contrast, there are several Southeast Asian cities like Jakarta and Bangkok that have been plagued by rapid urbanization issues including pollution, a lack of green spaces, vulnerability to floods, and traffic congestion. Perhaps the most threatening is the rising of sea waters and this has spurred policymakers in Indonesia to take the decision to relocate its capital to Nusantara in East Kalimantan. The future capital city has plans to become “livable and lovable” as efforts are underway to build a city that is smart, green, inclusive and resilient, with the government shifting its focus to citizen-centric needs and giving precedence to green technological projects. Thailand too is now considering relocating its capital given similar challenges. Meanwhile, in a bid to increase the green space in its current capital of Bangkok, new policies such as 15-minute pocket parks throughout the city as well as the conversion of public and private space into green space, have been initiated. For example, the Phra Pok Klao Sky Park that opened a few years ago has been built on an old, abandoned railway line, turning the unused space into a much-needed green area that boosts well-being and mitigates climate-change impacts.
Across APAC, existing cities are continually reinventing themselves even as new smart cities and eco towns are being built. With consumers in the region wanting to lead a more sustainable lifestyle and as digital innovations become more omni-present and influential in the urban consumer’s life, marketers must consider how to integrate brands into smart homes, vehicles and systems whilst balancing with sustainability practices, ensuring actions are being taken on reducing carbon emissions at every point in a product lifecycle.
Across APAC, existing cities are continually reinventing themselves even as new smart cities and eco towns are being built.
Revenge Of The Monoculture
Since the launch of ChatGPT some 18 months ago, adoption of artificial intelligence (AI) worldwide has surged and begun to become mainstream. In fact, the AI revolution in APAC is anticipated to be more pronounced, with a study by Allied Market Research projecting a 41% compound annual growth rate (CAGR) in the region through to 2030, higher than the 38% CAGR globally.
Still, as much as APAC consumers are embracing the efficiencies derived from AI-driven automation and the enhanced personalization resulting from algorithm-fueled discovery, the craving for human connection and shared experiences remains to be an intrinsic need. According to a study by VML, many are demanding authentic connections at scale. with 76% believing that technology is meant to help bring people together.
Even as TikTok faces bans in many Western markets, its growth prospects have been strong in its home region, where nearly 60% of the world’s social network users are based. Based on eMarketer data, TikTok has been the fastest-growing social platform in APAC in 2023, its user base increasing by 13.6%, nearly double that of Instagram. From cultural moments to fandoms, TikTok has been a driving force for connections and community. Many celebrate key festive occasions for the region together, be it Tet in Vietnam, or Ramadan in Indonesia and Malaysia, or Christmas in Australia and Japan. Users are taking to the platform to seek inspiration (#HalloweenMakeup — 15.7B views), prepare for important Holidays (#GiftWrapping — 2.7B views), and celebrate a religious month of fasting, prayer, and reflection (#RamadanKareem — 2.8B views).
TikTok is also propelling other passions and interests with its blend of entertainment and community. Gamers, for instance, are not only actively engaging with gaming content on the platform, but they are also inspiring each other through fan edits, animations, and cosplay. Using their creative skills, gamers share engaging fan edits that drum up hype and awareness for the characters and titles they love. They are also leveraging new technologies like voice filters and AR effects, blurring the lines between in-game universes and real-life scenarios.
TikTok has been the fastest-growing social platform in APAC in 2023, its user base increasing by 13.6%, nearly double that of Instagram.
Indeed, despite the diversity of cultures and languages, consumers across the region are still connecting with one another through content and entertainment, with the market size for APAC estimated at USD1,227 billion this year and expected to grow at a CAGR of 4.77% through to 2029. Whilst the Korean Wave, akaK-wave. remains the most prominent and continues to unfurl in various verticals from beauty and fashion to food and beverage, other regional entertainment has started to emerge in popularity. Like its Korean counterpart, the T-wave has come to the forefront of influence through the rise of Thai entertainment in the region.
Like its Korean counterpart, the T-wave has come to the forefront of influence through the rise of Thai entertainment in the region.
From adaptations of previously successful K-drama series to the increasingly popular genre of “Boys-Love” (BL) dramas, Thai dramas have been captivating millions regionally, even breaking through into the sizeable China market thanks to the constant import of the content through streaming channels such as Tencent and iQiyi. Thai TV stars are fueling this growing fandom by interacting with fans on Chinese social platforms such as Sina Weibo. For instance, Thai actor Mike Angelo has over 8 million followers on Weibo. Netflix’s Thai productions, such as “Hunger” and “Girl From Nowhere,” are gaining fans in Singapore and Malaysia, thanks to their gripping storytelling and stunning visuals.
Beyond TV, this “T-wave” is also sparking interest in Thai pop music, fashion, and aesthetics, comparable to South Korea’s cultural impact. Thai pop idols like Jeff Satur performed sold-out concerts in Singapore, and rapper Milli’s Coachella performance boosted international interest in Thai hip-hop and mango sticky rice. Mainstream luxury brands are also noticing; Gucci appointed Thai actress Davika Hoorne as a brand ambassador, and actor Metawin Opas-Iamkajorn recently promoted the Tiffany Lock jewelry in Singapore.
As the K-wave continues to mature, its popularity is also transcending into the anime, comics and games (ACG) territory in the form of webtoons. Originally called manhwa, a Korean term for comics and print cartoons, webtoons have gained popularity across Asia. A South China Morning Post report projects the webtoon market in APAC to reach $1.3 billion by 2027. Designed for mobile devices and optimized for scrolling, webtoons’ growth in South Korea, China, and Japan is boosted by platforms like LINE Webtoon, Naver Webtoon, and Tencent Comics, offering diverse genres from romance to horror. Webtoons are easy and inexpensive to publish, allowing amateur creators to reach global audiences. The industry is also thriving in India, Indonesia, and Thailand, reigniting interest in manhwa, (also known as manhua in China and manga in Japan.) While all three share visual storytelling, they each have a unique identity, reflecting the unique artistry and rich cultural heritage of their home country. Manhwa’s popularity mirrors a newfound appreciation for traditional culture among APAC consumers, driving a creative renaissance marked by nostalgia and a Y2K movement in Gen Z fashion, and inspiring young Asians to explore their heritage through travel.
If there is but one universal learning to take away from the pandemic lockdowns and isolation, it is that humans are inherently social beings with an innate need for emotional connection. Amidst this paradigm shift that AI is driving, the imperative for marketers is to ensure the authentic connection between brand and consumer. And with APAC being the epicenter of today’s popular culture and driving influential trends that are synonymous in the region, brands can tap into the APAC consumer’s shared interest in Asian culture to reinforce connections.
Amidst this paradigm shift that AI is driving, the imperative for marketers is to ensure the authentic connection between brand and consumer.
Expanding Experience Economy
There has never been a better time than now for the experience economy in APAC. Consumers are desiring to return to “in-real-life experiences” driven by fatigue with digital and virtual engagements and this has ignited a significant recovery for live events and experiences.
As superstar performers resume global tours, fans are eager to experience the magic of live performances again. Visa’s Green Shoots Radar survey shows 33% of APAC respondents attended a live concert in the last 12 months. The return of live events has generated immense anticipation, so much so that BLACKPINK’s Born Pink world tour sold out its Hong Kong concerts in hours, and 22 million people registered for pre-sale tickets for Taylor Swift’s Eras Tour in Singapore, four times the city’s population, with strong demand from fans in neighboring Southeast Asian countries.
22 million people registered for pre-sale tickets for Taylor Swift’s Eras Tour in Singapore, four times the city’s population.
The success of these events is significant; the Taylor Swift and Coldplay shows are expected to contribute 0.25% to Singapore’s first-quarter GDP growth. Overseas fans quickly secured flights and hotel accommodations, with Agoda reporting an 870% increase in searches during Coldplay’s concert period. To leverage this momentum and enhance Singapore’s appeal as a destination for entertainment and sports events, the government has allocated USD 120 million to attract major international sports events. One such event is the World Aquatics Championships in 2025, being held in Southeast Asia for the first time.
Even as live performances return, hybrid formats from the pandemic era persist. HSBC held the “DuoVerse” in Hong Kong, a live music show synchronized between the real-world venue and the HSBC Metaverse Stadium, featuring local singers Tyson Yoshi and Serrini. Audiences could experience the performance both in-person and in the metaverse, with options to change avatar outfits for party looks. HSBC also celebrated the Hong Kong Sevens with virtual rugby quests in The Sandbox, engaging audiences with challenges, mini-games, and educational quizzes related to the sport.
Consumers are gravitating towards “hyper-physical and tactile experiences,” desiring excitement and newness even in their everyday life. Known to be a shopping haven pre-pandemic, many malls in the region are now driving recovery with a vengeance with 71% of APAC retailers planning to expand or add new stores, but leveling them up such that they are more than mere retail spaces and placing emphasis on authentic human connections. Many malls in the region have become architectural marvels and all-encompassing destinations for entertainment, fashion, and gastronomy, captivating visitors with unique immersive experiences.
Many malls in the region have become all-encompassing destinations for entertainment, fashion, and gastronomy, captivating visitors with unique immersive experiences.
For example, several malls across the region have seamlessly woven pop culture concepts into the shopping experience. GinzaSix in Tokyo has placed the display of rotating art exhibitions at the heart of the mall, spotlighting installations by local and international artists like Yayoi Kusama, Daniel Buren, and Chiharu Shiota. Meanwhile, the Hyundai Seoul emphasizes K-pop by organizing pop-ups and activations throughout the year that showcases K-pop stars as well as periodic collaborations to attract K-pop enthusiasts from around the world. Local media reported that these pop-ups have attracted over 100,000 visitors in just one month. Brands like Sulwhasoo are curating experiences in similar ways as well. The Korean skincare brand hosted a month-long exhibition of international artworks entitled “Sulwhasoo Rebloom” in the history-steeped village of Bukchon, providing customers with a cultural experience whilst showcasing the main elements of the brand’s story.
No doubt, the lines between retail malls and leisure destinations are blurring. Many attractions can now be found within mega malls drawing interest from not just local shoppers but tourists too. In Seoul’s Gangnam district, Starfield Coex, Asia’s largest underground shopping center, features the iconic Starfield Library, popular with both tourists and residents. Similarly, Vietnam’s newly launched Lotte Mall West Lake Hanoi has become a must-visit destination, offering over 230 stores, a lakeview hotel, the country’s largest city aquarium, and its first KidZania, a giant indoor role-playing playcenter for kids.
Experiential attractions driven by digital and tech innovation are also competing with traditional leisure attractions. Last year, Hong Kong unveiled Bluetopia, the world’s first digital aquarium, offering a multi-sensory ocean journey through digital art. Recently, the Singapore Tourism Board expanded its augmented reality (AR) guided tour, ‘Merli’s Immersive Adventure,’ featuring new landmarks and powered by Google’s ‘ARCore Geospatial AI’ for location-based AR experiences.
Experiential attractions driven by digital and tech innovation are also competing with traditional leisure attractions.
Japan, South Korea, and India are also leading in adopting AR and VR technologies to revitalize heritage sites, museums, and galleries, providing new ways for tourists to experience rich history and culture. India, which has the sixth-most UNESCO World Heritage Sites, plans to introduce AR at protected heritage sites, starting with a pilot at the Nalanda ruins in Bihar, allowing visitors to see how the site appeared in the 6th to 7th century and its subsequent destruction. Other notable sites include the Group of Monuments at Hampi, the archaeological sites at Rakhigarhi in Haryana, and Dholavira in Gujarat.
The APAC consumers of today are more inclined to pay for memorable experiences that enriches their lives rather than just spending money on material things. Given the myriad opportunities in the experience economy, brands should partake in creating experiences and memories for the consumer. Authenticity will be key, and the approach will need to be more about brand storytelling than selling, also helping the customer better understand the product and what the company stands for.
Amidst the downstream effects of the last few years, for brands to build lasting relationships with the consumer means offering something more than just their goods and services. Brands will need to emphasize the human element by fostering more meaningful connections alongside showing empathy for the wellbeing of the consumer, community and society.
