The Trends Asia Leads ... and the ones set to grow

Foresight Factory,

August 2016

2

Conversational

Commerce

Trends Asia leads... Trends set to grow...

Appearance Matters

Life on Demand

Content a la Carte

De-Pop!

Immerse Me

Cashless Society

Enterprise Nation

The Everyday

Athlete

Story Seekers

Here we have selected five trends where we see market-leading innovation in Asia, as well as

established consumer behaviour. We have then selected five where, despite limitations, we

see the early signs that these trends are set to grow in Asia in the short to medium term.

This sample report covers two in each section.

Trends Asia leads

4

Messaging apps are overtaking social networks in terms of users - and brands are starting to follow, engaging consumers via instant message to allow for friendlier, more personalised communication and helps eliminate friction on the path to purchase.

We first spotted this trend in China, where messaging services such as WeChat have been ahead of the curve, with official branded accounts on WeChat launched in 2013. These networks understand that consumers are more likely to engage with brands in less public social media surroundings. Asian e-commerce also has a history of implementing more chat functions: Alibaba launched Aliwangwang in 2004, an instant chat service which allowed for interactions between buyer and seller.

Source: nVision Research | Base: 1000-5000 online respondents per country aged 16-64 (Indonesia & S. Africa 16-54), 2016 February

Conversational Commerce

Used a chat/messenger service to speak

to a customer service assistant | 2016

0%

20%

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80%

100%

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China leads, with two thirds of consumers having used a

chat customer service, which is currently predominantly

manned by human customer service workers. Malaysia,

India, Indonesia and Thailand follow and all are significantly

ahead of Western markets.

5

Conversational Commerce: innovation

The Walking Dead TV show’s official LINE account hosts

discussion sessions after episodes are shown on TV.

Laiye is an on-demand concierge service, which is built into the WeChat app and claims to be able to take care of anything you need.

In January 2016, Burberry and WeChat launched their “A Lunar New Year Gift” campaign to celebrate

Chinese New Year. Users could tap, swipe and shake the app to unwrap and personalise some of the brand’s

iconic items.

6

Now

Conversational Commerce: what will happen next?

in 5 years

It has become an all-encompassing platform for

conversation, advice, ordering products, making

payments, service after-care... Consumers now use

messages in instances where it seems unnecessary

or potentially even more time-consuming, for

example to carry out online banking.

Line launched Line@ in 2015 as a way for brands

and businesses to engage with their customers

through promoting content and direct

communication without the need for an expensive

official Line account.

In 2016 the messaging app started to allow AI-

powered bots to manage official Line accounts on

behalf of the brand.

Conversational Commerce has been a feature of

China’s largest social network - WeChat -

since 2013.

Currently, Conversational Commerce is mostly

manned by human customer service, with bots

answering simple requests, but chattier

conversations still answered by humans.

However, we see early signals of AI-powered

conversations.

7

Shrinking delivery times, tap-of-a-button services and instant gratification: on-demand services are constructing a world in which patience is no longer a virtue. Cheaper labour in developing Asian countries has meant a marketplace for on-demand service has existed for longer than in the West, but technology is still revolutionising and democratising these offerings.

Source: nVision Research | Base: 1000-2000 online respondents per country aged 16+ (China 16-64), 2015 September Global Trendspotter Network, 2016

Life on Demand

0%

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Ch

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Fra

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GB

I have not done this AND am NOT interested in doing it

I have not done this, BUT am interested in doing it in the future

I have done this

Used a delivery service to get an item delivered to a

specific location in less than 2 hours

An on demand service in Hanoi that I had success

with was VietMade Pro. At new year’s we had planned a large gathering with many guests but the friend of mine

that was due to host cancelled last minute. We moved the venue to our

house and we were able to book a cleaner to come within the hour to clean the house ready for our

guests, extremely convenience service offered

in English, Korean, Japanese and Vietnamese.

Daniel VIETNAM

8

There are currently 10 On-Demand start-ups worldwide which are classified as unicorns - valued at over $1 billion. Of these, 5 are Asian companies, signalling the strength of on-demand innovation in the region.

Source: CBInsights

On Demand unicorns: significant in Asia

Company Valuation Country

Uber $68 USA

Didi Chuxing $36 China

Lyft $5.5 USA

Olacabs $5 India

Ele-me $4.5 China

Instacart $2 USA

GrabTaxi $1.8 Singapore

BlaBlaCar $1.6 France

Go-Jek $1.3 Indonesia

Deliveroo $1 UK

9

2015

Source: nVision Research | Base: 1000-5000 online respondents per country aged 16-64 (Indonesia & S. Africa 16-54), 2016 February

Life on Demand: what will happen next?

Now

in 5 years

Indonesian on-demand service Go-Jek expanded its offering from transport,

food and grocery deliveries to include on-demand beauty and cleaning.

Bottles XO offers a 60 minute wine bottle delivery service to any location in

Singapore, Hong Kong and selected Chinese cities.

Previously, delivery services were powered by cheap labour in Asia.

Social networks are exploring on demand, with plans to dominate delivery by

becoming the one-stop interface for consumers looking to order anything.

We anticipate the arrival of invisible commerce,

where smart household devices will

automatically re-order products when they are

running low.

Line, a messaging app specialising in one-line, brief messages, launched a delivery

service in their biggest market, Thailand, in May 2016. The app’s couriers are to deliver

everything from food and parcels to groceries and other goods.

Interest in a service that automatically bought and

delivered basic household supplies when they ran out

45% 52% 49%

South Korea India Malaysia

Trends set to grow

11

While mobile wallets and payment systems multiply, for many occasions cash is still king, even in developed Asian countries. Markets such as Japan and Hong Kong have had contactless payment systems in place for transport and convenience stores for many years, yet remain predominantly cash-based societies. While trial of new technology in Asia’s tech-savvy markets is likely to be strong, flexibility in payment options is critical.

Cashless Society

Interest in using an app or swiping your mobile phone to pay for something

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I have done this I have not done this, but am interested in doing it in the future

PayPal launched New Money, a

faster, one-touch payment system, in

APAC, enlisting the help of millennial

entrepreneurs in India, China,

Singapore and Hong Kong.

12

Limitations to Cashless Society

Source: Global Trendspotter Network, 2016

Gift giving

The culture of giving money as a gift for special

occasions has previously been a barrier to

Cashless Society. However, social networks

have led innovation here, developing cashless

mechanisms for monetary gift-giving.

We have L Pay, Kakao Pay, Syrup Pay,

Pay Call, Pay Now, Samsung Pay and

SSG Pay… Kakao Pay is linked to my

Kakao Talk account so through it I can

send gifts to friends and family like coffee,

pizza, cosmetics, everything. So I can send

my friend a Starbucks Frappucino and

they will get a message with the gift and

barcode and can go straight to

Starbucks and get it

Leehana

SOUTH KOREA

Over 8 billion red envelopes

were sent over WeChat during

Chinese New Year

Cash is King

In order to reach as wide an audience as possible,

Spotify has launched in Indonesia in 2016 with cash

payment options. Uber also announced they would

be accepting cash payments in Singapore, the most

developed economy where this is offered.

Many On-Demand or subscription services in

Asia also offer the option to pay in cash, in

order to cater for consumers who might not own

a credit card.

SoCash is an Indonesia-based

start up that lets you access cash

without an ATM by placing an order

with your bank and picking up the

cash from a local merchant.

13

We measure a palpable interest in fitness amongst consumers. Growing minorities seek to professionalise their approach and aspire to infuse their lifestyles with athleticism. This trend has arrived in Asia, though it has been slow to take off, with particularly low interest in Japan.

Chinese and Japanese respondents are the least likely to agree that sports and exercise are very important to their sense of identity, although many more Chinese respondents report that it is quite important.

Source: nVision Research | Base: 1000-2000 online respondents per country aged 16+ (China 16-64), 2015 September Global Trendspotter Network, 2016

The Everyday Athlete

Importance of sports/exercise to sense of identity

0%

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Chin

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Spain

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Fra

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Not applicable - this doesn't apply to me

Not at all important

Not very important

Quite important

Very important

We are lazy people, I mean lets

not talk about exercising,

because the only time we walk is

to the car park! We need to

educate and re-instill the sense

of eating well and exercising.

Yvonne MALAYSIA

KFit is a mobile app which offers users one-pass access to gym, fitness

classes, beauty and wellness activities. It started in Kuala Lumpur

and now operates in 13 markets.

14

Facilitated by tracking apps and wearables, we see a growing interest in measuring physical activity. Interest is markedly high in Asian markets, perhaps also driven by the fact that we track high levels of excitement and interest in new technology in the region.

Source: Global Trendspotter Network, 2016 nVision Research | Base: 1000-5000 online respondents per country aged 16-64 (Indonesia & S. Africa 16-54), 2015 February

The Everyday Athlete

“Which, if any, of the following do you monitor yourself

via your smartphone/using another device?” | My

performance / distance covered when exercising

0%

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2013 2015

The National Steps Challenge by the governmental Health Promotion

Board gave out thousands of free steps trackers to citizens in order to encourage them to walk more for health reasons, and

incentivised such efforts with material rewards. Ever since the launch of the

programme, I have seen more people wearing the steps trackers during their

daily routine.

Daniel SINGAPORE

For more information please contact Michael Agnew

Michaela@foresightfactory.co