Technology breakthrough especially in AI, lifestyle changes after the pandemic, and the rise of Gen Z have been driving Digital Living, Shopper Reinvented and Personalisation in Asia Pacific. Euromonitor has identified these megatrends as the top three influential ones transforming the region’s future towards 2032. Truly engaging, customised and responsible customer relationships and shopping experience should be prioritised by businesses in order to grow.
Asia Pacific's surge in Digital Living and the metaverse
According to Euromonitor International’s Megatrends Quantification Model, Digital Living ranks as the third fastest growing megatrend in the region.
Over 2022-2032, forecast per capita growth of consumer spend for Digital Living in Asia Pacific registers 9%
Source: Euromonitor International
New technologies such as generative AI and the metaverse are changing how consumers live, work, play and shop. They continue to see high engagement in technologically developed Asian countries such as South Korea, China, and Japan, while rapidly gaining consumer awareness in others.
The metaverse is the key evidence of how engaged Asia Pacific consumers are, as interest remains high despite a decline in the Western world. This is expected to continue as, by 2032, 45% of Asia Pacific consumers will comprise Generations Z and Alpha, who might have never experienced a world without the internet.
The metaverse will play a critical role in Digital Living with growing interest in gamification and digital doppelgangers. Gamification could help brands engage consumers beyond the pure transaction while collecting user data. Meanwhile, digital doppelgangers, which produce an exact copy of a real-life product in the digital world, are used as a marketing tool to create product awareness within young consumers.
Face-to-face interactions will take a back seat as individuals immerse themselves in virtual realms. This shift presents businesses with an opportunity to cultivate stronger consumer relationships and drive productivity to new heights.
Customer experience optimisation and business cost reduction drive Shopper Reinvented
Per capita consumer spend on Shopper Reinvented in Asia Pacific is projected to see double-digit annual growth over 2022-2032. AI avatars, offline experiential retail, and cross-selling are three key pillars.
Leapfrogging with AI, digital avatars (referring to the digital clones of humans) have emerged in China. With mass consumers in emerging markets more open to innovation to enjoy convenience by sharing personal information, this is expected to disrupt livestreaming e-commerce and social e-commerce regionally. For example, in 2024, 47% of respondents in Japan would not be willing to share any personal information with a technology company, compared to only 17% of respondents in India, according to Euromonitor International’s Voice of the Consumer: Digital Survey, fielded March to April 2024 (n=20,056).
From the business side, growing labour costs have stimulated innovations such as AI avatars and unmanned stores, for decreased operational expense in developed markets as well as key cities in emerging markets such as Shanghai, China.
Customer-centred design experience is the key to offline retail, defending against the expansion of retail e-commerce. Exiting the pandemic, offline retail stores focused on the customer journey experience to differentiate themselves. Key examples include Arc’teryx’s destination experience store and Pangdonglai’s foodservice within supermarkets, both in China. Cooking appliance manufacturers have also added app purchase functions embedded in receipts, enhancing customer satisfaction. At the same time, manufacturers can diversify revenue streams, while increasing customer lifetime value.
Growing individualism and generative AI fuel Personalisation
Personalisation is a key emerging megatrend in Asia Pacific, being the third fastest growing region globally in terms of consumer spend per capita growth from 2022 to 2032, based on Euromonitor International’s Megatrends Quantification Model. The region’s rapidly changing demographics and the rise of individualism increasingly shift consumer preferences towards personalised products and services.
In 2024, 55% of consumers in Asia Pacific “want products and services that are uniquely tailored to me”
Source: Euromonitor’s Voice of the Consumer: Lifestyles Survey (fielded January to February 2024, n=40,236)
Manufacturers are responding by offering a wider variety of options and tailoring their marketing messages to resonate with specific consumer segments. Consumer appliances, beauty and personal care, finance, fashion and travel industries are at the forefront of Personalisation.
With developed markets being the backbone of personalisation consumption in Asia Pacific, Southeast Asia will emerge as the new growth driver. Uniqlo Malaysia's introduction of StyleHint, an app to help discover and personalise your Uniqlo style and look, can be seen as a strategic move within the apparel market. Leading e-commerce platforms in Southeast Asia such as Shopee, Tokopedia and Zalo are enhancing AI to personalise product feeds and search results for each user. Asia Pacific boasts a rich tapestry of ethnicities, languages and traditions. This heterogeneity necessitates personalisation to cater to the specific preferences of a wide range of consumers, considering cultural nuances and preferences.
Prioritisation and innovation to drive sustainable growth
Digital Living, Shopper Reinvented, and Personalisation are expected to see acceleration in Asia Pacific by 2032, driven by technological breakthroughs, lifestyle and demographic shifts. Businesses must prioritise cultivating truly engaging, customised and responsible customer relationship and shopping experience using technologies to grow their customer base.
Meanwhile, investors and stakeholders have been increasingly scrutinising models and innovations, challenging assumptions and demand for sustainable profitable growth. Further analysis of specific consumer segments in targeted markets is needed to guide business strategy. Furthermore, convenience generated from technologies for megatrends requires input of customer data. Besides obtaining customer consent, businesses should continuously adopt and upgrade techniques in privacy computing and anti-fraud to enhance customer loyalty.
Learn more about future business opportunities from megatrends in our report, Unveiling Transformative Megatrends in Asia Pacific Towards 2032, to stay ahead of the curve and understand research-driven actions.