The ever-evolving modern retail landscape is the focus of GWI’s latest commerce study, ‘You Are What You Buy,’ which delves into the shopping carts of consumers in the region, uncovering intriguing insights about their buying behaviours in terms of how, where, what, and why they make purchases.
Interestingly, the study reveals that the cost-of-living crisis has paradoxically resulted in a rise in emotional spending as a coping mechanism for stress. Social media has surpassed search engines as the primary platform where both younger and older shoppers discover new products. Furthermore, there is a shift towards quiet luxury, with flashy designer pieces moving into a less prominent role.
Retail in Asia speaks with Jo Ling Sun, senior trends analyst at GWI, on key takeaways from the report.
The cross-generational shift to social commerce
The shift of the purchase journey towards social media is not limited to younger consumers alone. Older demographic groups are increasingly following suit, indicating a significant trend.
“Product discovery is happening much more naturally in recent times, especially for younger consumers. Social media has a big part to play in this,” says Sun. “Social media ads are now the top way Gen Z is finding brands, overtaking search engines for product discovery. Gen Z in the APAC region are more likely to use the internet to find new ideas and inspiration than to research products or brands.”
And while older consumers may not be the primary target for most brands’ social marketing efforts, they represent a growing online demographic that should not be underestimated. Baby boomers, in particular, are spending more time on social media, including platforms like TikTok, compared to before the pandemic. This presents a valuable opportunity for brands to engage and connect with a broader range of consumers across generations.
Diverse audiences, unique behaviours: Unveiling distinct consumer patterns
In the dynamic world of consumer behaviour, no two audiences are identical. Whether it’s different generational groups, varying countries, or consumers seeking specific product categories, each group exhibits its own distinct behaviours when it comes to discovering brands, conducting product research, and ultimately making purchase decisions.
Understanding these unique patterns is crucial for businesses aiming to engage and cater to their target audiences in a personalised and effective manner.
“For instance, having insider knowledge about a brand or its products is the main factor that drives brand advocacy among beauty buyers in the region, whereas for luxury buyers, it’s aligning with a brand that enhances their online reputation or status,” Sun says.
“Among different generational groups, millennials stand out with the strongest preference for online shopping, with two-thirds preferring it over in-store experiences. In contrast, baby boomers are more divided, with nearly half of this generation expressing a preference for in-store shopping,” adds Sun.
Purchase drivers are not always rational
According to the report, factors such as free delivery (38 percent), coupons and discounts (29 percent), reviews from other customers (24 percent), next-day delivery (22 percent), and quick or easy checkout processes (21 percent) are important drivers for online shopping.
“Free delivery and coupons have become integral aspects of the online shopping experience for consumers of all generations. People have grown accustomed to not incurring additional costs for shipping and have come to expect the option to apply coupons during checkout,” Sun says.
Generational differences also come into play. “Gen Z, for instance, value having the option to pay in cash, especially since not all of them possess credit cards. This also means services like click & collect delivery and cash-on-delivery are essential for this group. Millennials prioritise a quick and hassle-free checkout process that doesn’t require extensive sign-up procedures. Gen X consumers seek comprehensive product information and tend to rely on ‘likes’ and positive comments to learn more about products and brands before making a purchase. Baby boomers, on the other hand, tend to appreciate exclusive content and services more than the younger generation,” says Sun.
However, Sun notes that consumer behaviour isn’t always rational.
“Despite the increased cost of living in many markets, consumers are splurging on treat purchases to feel better about their plight and boost their moods. This trend is particularly pronounced among millennials, who are more inclined to indulge in impulse buying as a way to cope with stress. In addition to emotional spending, 41 percent of impulse buyers in the region also cite taking advantage of sales and deals as a main reason for their indulgence.”