Anxious consumers to hold back APAC retail spending

Two in three respondents still continue to work from home and are more heavily online.

Despite growing adoption of e-commerce by customers, retail spending in Asia Pacific is still expected to be held back by lingering concerns on the pandemic, as 83% of consumers in the region are still worried about its impacts, according to a report from GlobalData.

Two in three or 66% are still extremely or quite worried about their financial situation. Furthermore, 61% of respondents in the region are still concerned about their physical fitness and health due to COVID-19.

“The survey results suggest that the economic impact of COVID-19 on the region has been weighing on the minds of consumers due to which they are inclined towards products that provide more perceived value for money,” said GlobalData’s retail analyst Ankita Roy.

The concern for health has encouraged more of them to start exercising at home more often in the last three months, which could provide an excellent opportunity for sportswear brands as the region is strongly expected to retain the habits they formed during the pandemic, Roy said.

While some began to go back to normality, 66% of respondents continued to work from home in Q3, leading to an increase in their online presence with 90% of respondents started or continued to spend more time online in general.

This suggested that online demand will remain strong after the pandemic, Roy said. As a result, e-commerce giants will rush to grab market share in emerging digital economies, with India particularly set to be the primary battleground.

Consumers who had been reluctant for the longest time to shop online have embraced e-commerce, especially older generations, as 85% of the respondents above the age of 65 years in the region are spending more time online in general.

“To meet the needs of these new online shoppers, brands and retailers must provide user-friendly websites and apps that work effectively on both mobile and desktop devices,” Roy said.

About 67% of respondents reported that they are socialising virtually with friends/families. With over half the population in the region connected to the internet, retailers were advised to understand the power of developing a robust digital media presence.

“Retailers must communicate with consumers on a personal level in real-time, utilising social media platforms that have seen a surge in usage as populations turn to apps for round the clock entertainment. Making this digital transition will be beneficial for retailers in the long-run to gain customers, drive global reach and leap ahead of others in the evolution of retail,” Roy said.