By Catherine Wolkers, national head of reasearch and insight, Wavemaker
While many in Asia-Pacific remain optimistic, new normal confidence and behaviour varies greatly between markets and demographics.
We are optimistic
Despite very real worries over economic recession and job security, the latest research from Wavemaker suggests many in Asia-Pacific have held onto a sense of optimism.
In its Braving the New Normal study, Wavemaker pulled together a quantitative study of 8,784 APAC respondents that included its poll of 4,116 in mainland China from February 15th to 17th, together with an expanded survey from Australia, India, Hong Kong, Japan, Malaysia, Philippines, Singapore, South Korea, Thailand, Vietnam and Indonesia between March 26th and April 16th.
It found that consumer optimism has remained throughout the crisis, with 78% of respondents in China and 63% in Wuhan stating they were optimistic even when the pandemic peaked in February. Six weeks later, 57% of people across APAC still felt optimistic (55% in Australia), especially 18 to 29 year-olds (63%).
Context is everything
It’s clear from the many studies being undertaken that attitudes are changing every day and Wavemaker too has found that optimism levels are highly situational. Whilst the average remains positive, it’s more useful to examine optimism levels in context. Here you can see a correlation with the relative level of consumer confidence prior to the start of the outbreak:
Context is likely the best indicator of recovery
As countries slowly get Covid-19 under control, it’s this context that will likely be the best indicator of how we recover. Wavemaker and Kantar suggest high consumer confidence before Covid-19 may see a V- Shape while markets with lower confidence may see a U. For Australia, a W feels quite likely, with some sectors recovering faster than others.
An L-shape recovery is considered unlikely, with many experts likening this to a natural disaster, not a financial crisis. This is because the human capital is being affected, not the physical capital – something that will ease when self-isolation and social distancing measures are relaxed.
“This is not a financial shock, not a regular recession…It’s a natural disaster.”
Antonio Fatás, Professor of Economics, INSEAD
Trend acceleration in China gives us a view to the future
Consistently across Asia-Pacific we are seeing huge changes in behaviour but not all trends will continue to the same degree that they have been under the pandemic. Looking at the Chinese experience, Wavemaker has seen how some consumer behaviours like ordering fresh food online (which had already been steadily rising and accelerated during the peak of COVID-19) reach new levels of sustained growth. Other trends like fitness apps used at home are more likely to receive a short-term bounce, which may not be sustained through the recovery period.
Since many Chinese brands are looking to capitalise on accelerated trends there is a lot of pressure to rapidly innovate. For example, a lot of brands are quickly jumping on new emerging channels, such as livestreaming, which Wavemaker says has resulted in "a chaotic battle with limited observable effectiveness." Brands are encouraged to review the balance of "noise" around a new trend to resist copycat innovation, keeping all initiatives relevant to core objectives and ideally to brand purpose.
What about Australia? Younger Aussies are the most optimistic
By the time Covid-19 hit Australia, our country was already reeling from a three-year drought, extreme floods and devastating bushfires. Thinking that the fires had ended, Australians were suddenly being told to cancel their holidays and that it was no longer safe to go to work, see their friends, or do any of the outdoor activities that make Australia, Australia. The last major fire went out on 10 th February, but the first Australian Covid-19 case was January 25 we were blindsided at a time when we were hoping to come up for air.
Concern accelerated quickly, with Kantar research showing that Australians with ‘significant concern’ about COVID-19’s impact jumped from 16% to 45% over a two-week period, around mid-March (concern has since eased, according to Nine’s Consumer Pulse surveys). Wavemaker research shows that younger Aussies are more likely to feel ‘very optimistic’ about the future while older Aussies are more likely to feel extreme pessimism, indicating that older generations may be more cautious with spending habits as we emerge out of this crisis.
"At home" behaviours surge
Wavemaker sees a huge increase in a variety of ‘at home’ behaviours here in Australia, particularly the desires to stay hyper-informed, look after the family and home, and find sources of relief (distraction through TV, hobbies, reading and games). Finding new ways to connect is also more important than ever, particularly for 18-29 year-olds: almost half say they have increased the amount they talk to others.
Recommendation: Brands should find ways to facilitate these growth areas and make declining behaviours more accessible. For example, Colgate recognised that we need to stay connected, and smile, now more than ever, so they created a new TVC using the one thing that unites all our virtual sharing – smiles.
Life after Covid-19
Wavemaker research shows that 75% of Aussies believe the outbreak will be under control within 6 months. When this happens, the biggest behaviours expected to bounce back are travel, being with family, shopping, meal gatherings and outdoor dining – providing rich opportunities for brands to help people celebrate reconnecting and togetherness.
These behaviours are closely followed by self-improvement: being more grateful, doing more sport and exercise, replanning their life, finding a new job, and getting fit and losing weight – brands should be thinking now about how they can facilitate this during recovery.
Recommendation: Whilst downturns will take time to work through, many of the facts about culture and society will look quite consistent. Many will also sustain their consumption habits. But consumers will feel differently. Brands should think about how they can bring people together, create an emotional connection and actively contribute – now is the time to act on brand purpose.
Brands should be grounded in the every day – recognise that dreams are not just exotic travels and life overhauls. Celebrate the small pleasures and bring your brand closer to daily life.