ASEAN’s Billion Dollar Opportunity

A rapidly growing consumer class will unleash a wave of demand for packaged foods

Contributed by Dwight Hutchins, Managing Director, Accenture Strategy APAC

Robust consumption fuelled by a rapidly growing consumer class, rising incomes and urbanisation will generate $770 billion in new consumer spending in ASEAN over the next few years, according to a new report by Accenture.

This creates tremendous new business potential for consumer packaged goods (CPG) companies, if they can tap into this burgeoning consumer demand by applying digitally-driven strategies to reach increasingly plugged-in ASEAN consumers.

What does this opportunity look like for the food industry? There are three important factors to pay attention to.

First, the nature of these new and wealthier ASEAN consumers.

They are health-conscious, demanding healthier packaged food products. This trend is palpable in big cities such as Singapore and Manila, as residents are more affluent and better educated about nutrition. To accommodate this trend, food manufacturers should address these consumers by launching a variety of food products focused on healthy dining and wellness.

Second, rapid urbanisation means more time spent at work and more working mothers.

With limited time to prepare meals from fresh ingredients, these armies of office workers will require conveniently packaged food products to accommodate their busy lifestyles. Home delivery services will likewise experience a surge in demand.

Third, the explosion of mobile connectivity and the rise of social networks.

ASEAN consumers are becoming increasingly plugged in. Bangkok and Jakarta are home to some of the most active Facebook users in the world. Smart phones are pervasive, and in rural areas, 
the mobile phone is the preferred platform for communication, given the lack of fixed-line telecommunications infrastructure.

The hunger for digital interaction, including social media, has grown dramatically, creating new opportunities for global food companies to advertise their brands, gather consumer data and valuable feedback. More packaged food players are expected to use online marketing as a way to target their specific consumer segments and achieve higher sales.

While the region is far from homogeneous, most ASEAN countries enjoy stable political and economic conditions, creating a favourable investment climate. To reach consumers beyond Tier 1 cities, retailers have been expanding their reach into the rural parts of the country. This development has improved distribution of packaged foods, especially those requiring refrigeration and dependent on established channels.

While these trends are clearly favourable for global food companies to make an entrance, there are three big challenges to overcome to capitalise on the opportunity

  1. a highly fragmented retail landscape,
  2. the race for customer acquisition & loyalty
  3. the complex competitive environment.

Fragmented retail landscape

75% of all grocery sales
in ASEAN takes place through 5 million ‘mom and pop’ operators. Poor infrastructure in both cities and rural areas can burden the supply chain, even as consumer preference for fresher and wider varieties of foods create tough requirements such as short delivery times.

Getting your supply right and making your products available everywhere the consumer is will require improving salesforce reach and productivity as well as superb logistics management to ensure coverage across complex, multi-layered distribution channels. It will almost certainly require strategic partnering in local markets.

Gaining customer loyalty

With no direct access to consumers, foreign packaged food manufacturers will struggle to gain consumer insight as they try to win customer loyalty. Taste is the most local of buyer preferences. Customising product offerings to meet the needs of consumers is crucial in capturing their loyalty, but the lack of insight will make this especially difficult for foreign companies. Local food companies, some with powerful backers such as the state, have the advantage here.

Creating awareness of your product and locking in future demand by building loyalty requires engaging the new consumer early, often and with precision. Gaining deep customer insight through the use of digital technology and analytics will be critical to success.


Competition can be stiff, with retailers offering private label goods providing decent quality at a low price point, encroaching on what is the usual territory for global food brands. New players coming from other sectors are also emerging, such as messaging app LINE which will be launching online grocery shopping services in Thailand.

Given the massive opportunity in the ASEAN market, what can global food companies do to overcome these challenges to emerge champions? Visit for more insights.

About Dwight Hutchins

As Asia Pacific Managing Director – Accenture Strategy, Products, Dwight is charged with helping our largest Asia based clients improve their competitiveness and performance.

Dwight recently relocated from Washington DC with his wife and daughter, where he was Global Managing Director of Accenture’s Health and Public Service Strategy practice, helping clients around the world transform their enterprises.

Prior to Accenture, Dwight consulted banking and manufacturing clients with McKinsey & Co. and Bain.

Dwight received an MPA from the Kennedy School of Government at Harvard University, an MBA from Kellogg at Northwestern University, and a BS in Chemical Engineering from the University of Tennessee.

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