Local Over Global: How the COVID-19 pandemic is accelerating the “glocalization” of ASEAN economies

The COVID-19 pandemic has impacted all aspects of people’s lives, disrupting both short-term plans and long-term prospects. Around the world, people have had to adapt their day-to-day routines, adopting new “normal” behaviours that require a thorough re-evaluation of the way they spend their time, energy, and money.

This is especially true in Southeast Asian economies, where the use of innovative devices, platforms, and services has allowed new consumption patterns to emerge despite overall economic slowdown. And as consumers’ needs, habits, priorities, and preferences evolve, so do the market dynamics that they drive.

What are some of the key trends observed in the region? And how can businesses leverage this knowledge to stay ahead of competitors?

To answer these questions, Blackbox Research, Toluna, and Archetype have published Into The Light, an in-depth study that reveals the emerging patterns, trends, and dynamics across six key ASEAN markets – Indonesia, Malaysia, Philippines, Singapore, Thailand, and Vietnam.

This article is the first in a series of blog posts devoted to examining some of the major findings and implications of the study. It focuses on how the COVID-19 crisis has led ASEAN consumers to increasingly favour local products over more globalised offerings – effectively accelerating the “glocalization” of markets in the region.

A marked preference for local products

The study shows that a product’s country of origin is likely to impact nearly six out of ten consumers’ decision to spend. This is more pronounced in the Philippines (71%) and Vietnam (66%), and less prevalent in Singapore (47%).

Moreover, about eight in ten consumers declare being somewhat or much more likely to support local businesses. This is more pronounced in the Philippines (95%) and Indonesia (91%), and weaker in Vietnam (53%).

These findings are in line with the conversations that were taking place in most Southeast Asian cities during the most critical months of the fight against COVID-19.

Indeed, the ultra-restrictive measures adopted by most governments in the region impacted many local businesses. From neighbourhood restaurants and shops to service-oriented businesses, everyone took a hit. Bigger international chains had more cashflow to leverage, but it quickly became clear that smaller local businesses would likely not survive several months of limited patronage.

Thus began a series of campaigns by influencers, entrepreneurs, and trade associations to get consumers to #supportlocal – a movement that was relayed across government- and community-driven networks alike. In Singapore, for instance, Hawkers United helped connect consumers with small eateries that may not have the means to survive the measures meant to mitigate the spread of COVID-19.

In this sense, the pandemic awakened people’s drive to actively favour small, local businesses over bigger, more resilient chains and franchises.

Businesses can leverage the new normal

It is difficult to say whether this preference for regional or local businesses will be a permanent shift. One thing, however, is certain: small and large businesses alike must recognise the challenges that these new dynamics represent, as well as the potential opportunities they create.

How can an international brand further penetrate a market that has realised the importance of supporting local businesses? Conversely, how can a local brand effectively sustain the activity it has developed during these unprecedented times?

It may be useful to examine the strategies of NTUC FairPrice and DBS, two of Singapore’s top-ranked brands in this year’s Campaign Asia Top 1000 brands list. The key behind their success has been to create and leverage hyper-local messages that appeal to as many segments of the local population as possible.

NTUC FairPrice has run a post-lockdown campaign aimed at rallying customers behind the Singapore Spirit in the new normal. DBS, meanwhile, has launched the “DBS Sparks” series to demonstrate how it understands and embodies its customers’ shared values. At the same time, international brands such as Nestle have partnered with local entities to organically support local and national endeavours.

These examples show that the key is to ensure brand messages are in line with customers’ expectations. This involves conducting customer research to better understand specific needs and desires, and from there, adapting messaging frameworks so that they effectively fulfil or address them.

Looking ahead: driving the “glocal” recovery

Overall, the study conducted by Blackbox Research, Toluna, and Archetype points to an accelerated “glocalization” of Southeast Asian markets.

The way forward for brands in Southeast Asia seems to be an approach that both recognises the importance of local preferences – having their finger on the pulse of local needs, habits, and trends – and capitalises on global capabilities – globalised resources and know-how for operational and financial efficiency.

For example, Archetype has helped launch Fitbit into the Singapore market by building relationships with the Health Promotion Board (HPB) as well as local sporting communities. Such local tie-ups helped drive awareness across a core audience of health enthusiasts, allowing Fitbit to very quickly establish itself as the number one brand in the wearables space.

As 2021 draws nearer and the pandemic rages on in many parts of the world, it is both urgent and important for brands to adjust their strategies – messages, campaigns, objectives – accordingly. Indeed, closely aligning with consumers’ evolving demands and expectations will allow businesses to not only sustain the momentum they are currently building, but also ensure they are ideally positioned to drive post-COVID-19 economic recovery.

Download the Into The Light report for more insights to develop relevant and timely marketing and communications plans. And keep checking back as we will be sharing more insights from the report over the next few weeks.

This blog post is co-authored by Blackbox Research (Yashan Cama) and Archetype (Julian Chow).

Written by
Julian Chow
Written by
Yashan Cama