Country by country, peak viewing times vary somewhat:

• South Korea has the latest viewing peak, with the highest proportion of viewers (26%) tuning in between 10pm and 11pm
• New Zealand and Australia have the highest proportion of viewers tuning in at any particular time – on average, 40 percent of New Zealanders and Australians watch television between the hours of 8pm and 9pm, closely followed by the Philippines with 39 percent
• New Zealand has the highest number of viewers outside of the 8pm to 9pm peak time – between 7pm and 8pm 39 percent of New Zealanders tune in to their televisions and the 6pm to 7pm time slot also enjoys around 35 percent of New Zealand viewers
• Malaysia has the largest proportion of late night viewers, with one quarter of Malaysians still watching television between the hours of 11pm and midnight
• Filipinos are the most likely to tune in to daytime television – more than one in five (22%) watch television between 12pm and 2pm.

To get a better sense of where the fast moving consumer goods industry stands – and where it’s going – in Asia Pacific Nielsen has released its comprehensive mid-year report highlighting regional trends such as total FMCG category growth, the role of hypermarkets and the changing gender profile of shoppers as well as country highlights on retail trends in 14 key nations.

FMCG Growth
Volume growth in the industry was down across many Asia Pacific countries as consumers cut back during the recession.  But there were some standouts: India and Vietnam posted value sales rises of nearly 15%.  In China, where value sales had been posting double-digit gains for much of the decade, growth slowed to just 3% in 2009.  But thus far in 2010, the segment has rebounded nicely, with 11% in the sector in the first quarter of the year.

Modern vs. traditional
The traditional retail trade, both wet markets and counter service mom & pop stores, continues to play an integral role throughout much of Asia.  Even in countries experiencing rapid growth such as China, Vietnam, Indonesia and Malaysia, the wet market continues to be the main place for buying fresh food.  But modern grocery stores, such as hypermarkets and convenience stores are now an established presence in most urban areas, with the strongest growth for such formats seen in China and Korea.

Modern channels have continued to grow steadily and now account for 53% of all packaged grocery sales in the region, up from just 35% in 2000.  But that trend varies widely: almost all packaged grocery shopping was done in the modern market in Taiwan and Singapore (94% and 92%, respectively) while in India, just 5% went through self-service outlets.

China has been the most dynamic country over the past decade, with the modern trade growing from 34% in 2000 to 64% in 2009, the fastest retail ever seen with Korea fast on its heels, expanding from 63% in 2000 to 86%.

Format Wars
The expansion of hypermarkets has been a boon for many shoppers, especially those in urban areas.  Today, this format is the strongest modern trade channel, accounting for 28% of packaged grocery sales in China.  In Shanghai, 77% of shoppers use hypermarkets as their main store, while in Beijing, 45% do the same.  In Korea, the channel accounts for 31% of trade.  Meanwhile, in Southeast Asia, Hypermarkets are strongest in Thailand with 90% of urban shoppers using them regularly, there has also been significant development in Malaysia where nearly 40% of shoppers spend most in this format.

In many of these countries, the traditional grocery store has been in slow decline as it has faced increased competition.  In Korea, the traditional channel posted a closure rate of 5% per year, accounting for more than 50,000 store closures over the course of the decade.  Although the hypermarket is making huge gains in Malaysia, most shoppers (over 70%) still visit traditional grocery stores two to three times a week. Asian shoppers now have a wide portfolio of alternative shopping channels to meet different shopping needs and occasions including both traditional and modern stores.

Any visitor to Asia will notice the surge of small format stores, both convenience stores and mini-marts, with some intersections boasting two or more such stores on the corner.  Convenience stores such as 7-Eleven, Familymart and Circle K have continued to grow strongly throughout the region, with shoppers attracted by their convenient location and food service offer.

Indonesia has seen explosive growth in mini-markets, small modern grocery stores, with local chains leading this change.  With just 2,000 such stores at the start of the decade, the nation now boasts more than 11,500, and this channel’s now accounts for more than 17% of grocery sales.

Tapping the Potential of Private Label
In North America and Europe, private label goods have experienced strong growth, especially during the recession.  What’s more, consumers in those regions say that they expect to continue buying private label goods even after the recession is over.   The story is very different in Asia.  The private label concept has yet to make a significant dent in sales, and only in Hong Kong do they have above 5% share of sales.  Retailers across the region have been investing in the development of Private Labels but still have a lot of work to do to convince shoppers of the quality and value of these products compared to leading brands.

What’s Ahead
The changes shaping the retail scene in Asia Pacific go beyond store size and format.  Nielsen has identified a number of trends that will affect retailers and manufacturers in the next decade, including:

• The growing role of the male shopper – Tradition still leads the way in most countries in the region, but an increasing number of men are becoming involved in grocery shopping.  Only in India and Indonesia do housewives dominate, and Korea and Vietnam also still strongly adhere to traditional roles.  Across the region, 22% of the “main” grocery shoppers for households are now male, up from 14% a decade ago.

While there are signs of change in Korea, likely driven by the development of Hypermarkets, only 11% of men claim to be the main shopper for their families.  In Vietnam, the percentage is likely to stay low for a while as long as the traditional Wet Market channel continues to dominate packaged grocery sales.

• Hypermarket growth stalls as multi-format strategy gains – Smaller formats that offer shoppers a more convenient way to “top-up” shopping have gained in popularity, many being opened by the leading hypermarket chains themselves.
• Shopping outside the store – Shopping done via the TV or Internet is gaining traction in Asia Pacific, with Korea leading the online shopping sector.   Koreans have embraced this “format,” with 4% of shoppers saying they use the Internet for the majority of their grocery shopping and 71% saying they use it regularly to purchase groceries and personal care items.  An additional 30% say they use TV shopping.

These and other trends are discussed in the 2010 APAC shopper trends report.

• Download the Asia Pacific Social Media Trends webinar and related materials.

The survey found that three of the seven biggest global online brands are social media sites – Facebook, Wikipedia and YouTube. Close to three quarters of the world’s Internet population (74%) have now visited a social networking/blogging site, and Internet users are spending an average of almost six hours per month on social media sites.

Social media is having an increasing impact on consumers’ purchasing decisions – in Asia Pacific, online product reviews are the third most trusted source of information when making purchase decisions, behind family and friends. This is particularly so for purchases of consumer electronics, cosmetics and cars – products where consumers are most likely to base their purchase decisions on online product reviews. But not ever country shares the same way.

REPORT HIGHLIGHTS

Blogging… it’s Big in Japan

• Japanese Internet users are the most avid bloggers globally, posting more than one million blogs per month, significantly more than any other country in the region.
• Japan’s adoption of Twitter continues to grow, with unique visitor numbers increasing in the last year from less than 200,000 to more than 10 million.
• Sixteen percent of Japanese Internet users now use Twitter, which compares to 10 percent in the U.S.

Grass roots celebrities attract China’s social networkers

• Bulletin board systems underpin popular social media behavior in China – more than 80 percent of social media content is bulletin board systems.
• Social media games are used as a stimuli to drive new users and gain reach with existing users, while content sharing behaviors are more popular among the more experienced users. Virtual product placement within social networking site games is becoming one of the most profitable methods of revenue for social networking sites.
• ‘Grass roots’ celebrity tracking dominates online conversations in China, with social media celebrities such as Sister Phoenix and Mr. Yuan outperforming real life celebrities in popularity.
• Chinese Internet users are the most likely in Asia Pacific to post a negative online product review, and are the only consumers in the region more likely to share negative reviews than positive reviews – 62% of Chinese Internet users say they are more likely to share a negative review compared to 41 percent globally.

Facebook threatens Orkut’s share in India

• Although 70 percent of social media users in India identify Orkut as their preferred social media site, Facebook is gaining market share with 50 percent of social media users claiming to use Facebook most often, compared to 38 percent for Orkut, with the most common reasons for switching include friends moving sites, preferring the look and feel of the site, and offering more features.
• Twitter has enjoyed exponential growth in popularity in India, with more than half of Twitter users (57%) having signed up in the past year. Close to one third of India’s social media users (32%) use microblogging sites such as Twitter at least once a day.
• Online product reviews are increasing their influence on purchases in India, particularly for consumer electronics – 55 percent of Indians that read online product reviews have purchased products based on feedback. Consumer durables/electronics are the most common products purchased based on reviews (64% of purchases).

Koreans a-buzz about social media

• By population, Korea is one of the most social media engaged countries in the world, with the country’s leading social media site, Naver, attracting 95 percent of the Korean Internet population every month.
• While penetration of social media amongst Korea’s Internet population is already strong, it continues to grow (Twitter alone saw 1900% growth in the year to May 2009) with much of this growth coming off the back of Korea’s June election and the adoption of mobile social networking.

Australians flock to online forums

• Australia leads the world in social media engagement, with the highest global average for time spent per month engaging with social media, averaging over seven hours per month
• In contrast to many countries, Australians look to communities of interest such as parenting or sports sites as a key channel for social media discussion – 62 percent of Australian Internet users visited a message board or forum in 2009.
• LinkedIn has seen one of the fastest growth trends amongst social media sites in Australia, with unique audience numbers increasing by 99 percent from July 2009 to May 2010

“The findings highlight, beyond a shadow of a doubt, that social media is here to stay and needs to be taken seriously by the broader business community, from the CMO to the CEO,” notes Megan Clarken, Managing Director of Nielsen’s online business in Asia Pacific. “With three quarters of the global Internet population now participating in some form of social media, businesses can no longer afford to simply observe the social media phenomenon, they need to embrace it.”

In the clearest sign yet that economic prospects are improving rapidly across the region, six of the ten most confident consumer markets globally are from Asia Pacific, with positive consumer confidence level increases in the Q1 2010 Nielsen Global Consumer Confidence Index.

Richard Basil-Jones, Managing Director, Nielsen Media Asia Pacific comments “The latest Nielsen findings are the sign that marketers, manufacturers and retailers have been eagerly waiting for, as consumers’ spending intentions are turning into actual spending reality. In Q1 2010 global consumer confidence rebounded to the highest level since Q3 2007, however the positive news for marketers in Asia Pacific is that consumers are already upbeat on how they will utilize their spare cash, including 41% on holidays / vacations, 35% new clothes, out of home entertainment 29% and new technology 30%.

These discretionary spending considerations showed significant growth over the same findings in Q1 2009 and this is not lost on most marketers who are now back in growth mode. This is translating into advertising activity rapidly returning to pre GFC levels; where we now see the second consecutive quarter of media advertising growth across all 12 markets in Asia Pacific (compared to the same period in 2009)”.

“Based on the most recent ad spending results, the outlook for main media advertising across the remainder of 2010 appears extremely positive in all 12 markets.

The challenge for marketers however, will be strengthening their brand awareness and positioning where visibility diminished during the downturn. Consumers are out there spending and intending to loosen up their purse strings, so the onus is now on marketers to ensure their products and services return to top of mind” Basil-Jones summarised.

Qtr 1 2010 compared to Qtr 1 2009

• Ad spending in main media* across the region lifted to US$31.16 billion, an overall increase of 18%
• For the first quarter since Q3 2008, all 12 markets across the region recorded strong to bullish ad spend growth.
• Signs of a strong advertising recovery with second consecutive quarter of growth for all 12 markets across the region.
• Double digit ad spend growth across 10 markets drove overall growth in Q1 2010; led by India, Indonesia, Hong Kong, Philippines, Malaysia and Taiwan.
• In a quarter of bullish revenue growth, China dominated with 69% share of all main media ad spending.

12 months to March 2010 & YOY

• Overall ad spending results showed a YOY increase of 15%, to US$132.38 billion.
• As the advertising recession faded, increases YOY were evident across 9 Asia Pacific markets, including double digit increases in 6 markets.
• Still absorbing the impact of advertising downturns of 2009, declines YOY were recorded across 2 markets – Australia and South Korea.
• Television was the main driver of growth (+16%), Newspapers (+14%) and Magazines increased by 4% YOY.

“While these results are encouraging, consumers in most parts of the world remain cautious about spending their money, and are increasingly moving to value channels.  At the same time, retailers are selling more on promotion.  It’s likely these trends will continue until economic recovery has solidly taken root,” said James Russo, Vice President, Global Consumer Insight at The Nielsen Company.

Nielsen Economic Current Key Indicators
Country	Trend	Aug-09	Sep-09
Brazil		1	1
Canada		2	2
China		2	2
France		3	2
Germany		3	4
Hong Kong		2	2
India		1	1
Italy		3	3
Spain		3	3
Taiwan		3	1
United Kingdom		2	2
United States		3	3
Source: The Nielsen Company 1=Very Strong Growth >/= +5%; 2 = Growth between +1 and +4%; 3 =Neutral Between -1 and +1%; 4 =Negative between -1 and -4%; 5 = Very Negative

Country by Country Highlights

• U.S. – Consumers continue to be skittish about the recovery and their willingness to spend money.  Store brands, value channels and buying on promotion all showed growth as manufacturers continued to step up incentives and deals.
• Canada – Volume and value sales grew in September 2009, with strong growth in the number of retailers selling on promotion.  Unit sales rebounded as price increases stabilized at 2 percent.
• France – Volume and values sales showed some growth, but with confidence dropping in the September survey, French shoppers actually reduced their shopping frequency.
• Germany – Volume sales remained neutral, while value sales recorded a small decline.  Germans continue to watch their Euros as their confidence in the economy has dipped.
• U.K. – Volume sales improved, and premium brands returned to growth.  Consumers were taking advantage of the strong promotions on offer, shopping more frequently and spending more per trip – despite slightly decreased consumer confidence.
• Italy – Italian consumers cut back the frequency of their shopping trips, but spent more per trip, taking advantage of retailer promotions and switching to store brands.  Volume was up, but value sales were down.
• Spain – Spaniards remained neutral in their spending habits, but did start shopping more frequently for the first time in nine months.
• Brazil – All indicators show that Brazil has returned to levels prior to the global economic crisis.  Volume and value sales were up, and shoppers were feeling confident: shopping frequency and spend per trip both increased.
• India – Volume and value sales indicators each posted better than 5 percent growth, and Indians are feeling very optimistic about the economy and finances.
• China – While retail sales were relatively flat, growth is now apparent in modern trade outlets, which may be the first sign of fast moving consumer goods sales recovery.
• Taiwan – Volume and value sales increased solidly for the first time in nine months.
• Hong Kong – Increased consumer confidence has driven growth of volume and value sales.

The Buzz
In an analysis of blog buzz in seven countries, Nielsen found that online discussions about the global recession have leveled off as consumers have accepted the “new normal.” At the same time, however, mentions of recovery have not gained traction, and actually declined in the most recent week reviewed.

“It seems as if people are accepting the new reality of an ever present recession, which through our analysis of online buzz illustrates that despite a dip in recession discussions in the spring, that they have now leveled off but not subsided completed. Perhaps it is not on the front burner for all consumers as it was in 2008 thru mid 2009, but definitely still on the back burner where it continues to impact consumer decisions,” concluded Russo.

• Download the Nielsen Economic Current.

While this growth is impressive, seven countries still recorded declines in ad spending in the second quarter of 2009, including South Korea (-17%) and Taiwan (-16%).

“Although declines in advertising activity were still evident across free to air TV, newspapers and magazines in a number of markets, there were clear signs of a reversal of contracting activity.    In the more dynamic markets of China and India, both of which saw sharp cutbacks in advertising activity in the first quarter, advertising bounced back strongly with double digit growth over the same quarter in 2008,” said Richard Basil-Jones, Managing Director, Asia Pacific at Nielsen.  “Positive economic signs across the region suggest that the recovery to pre-financial crisis advertising activity may occur earlier than industry observers had forecast at the beginning of the year.”

On a year-to-year basis, ad spend was up 9 percent, reaching an estimated $112 billion (US).  Television was the only main media to record growth (10%), while newspapers and magazines showed modest declines (-1% and -3%, respectively).

Value has become a main focus for Asian shoppers, partly driven by the economic situation and partly as a result of increased retailer activity focused around price and promotions. According to Nielsen’s Asia Pacific Retail and Shopper Trends 2009 Report, more than 70 percent of shoppers claim to have become more price sensitive compared to last year. The effect: shoppers are more inclined to buy only what they need, spending their money on essentials rather than on treats or what they now consider ‘nice-to-haves’. They’re also consciously trying to cut down on the quantity purchased and are actively seeking out products on promotion.

Over the course of 2008 in Asia, grocery markets continued to show volume growth, led by India (+9%), China (+9%) and Vietnam (+18%), with only Taiwan (-7%) experiencing a decline in sales. Value sales increased by double figures in many markets on the back of high inflation for key food categories. But with inflation falling in all markets, we have seen value growth drop sharply in 2009, although overall volume growth in many markets has held up reasonably well with shoppers not cutting back significantly on grocery categories.

Traditional trade continues to lose share

As expected, the traditional counter service trade continued to lose share in Asia, with overall share of trade dropping another percentage point to 47 percent in 2008. At the same time, the absolute number of traditional grocery stores in the region grew by one percent to over 12.3 million stores. In most developed countries, traditional store numbers fell by five percentage points or more. In Korea, where traditional store numbers dropped by nine percentage points, the share of trade decreased from 15.9 to 13.9 percent, while in Taiwan the traditional trade now accounts for just over six percent of sales, having lost 1.5 percent share in the last 12 months.

The retail landscape looks very different in Southeast and South Asia, however, where traditional store numbers actually grew year on year, and even though share of total grocery sales continues to decline slowly, the majority of shoppers in all markets continue to shop at this trade channel. The traditional channel continues to meets shoppers’ needs for everyday convenience, personal service and affordability – being able to buy the smallest sizes and quantities.

Growth of small modern trade outlets

Globally, many large retailers such as Wal-Mart, Tesco and Carrefour have embraced a multi-format strategy that includes the development of smaller neighborhood stores. Similar growth in small modern trade outlets is also being seen across Asia, with mini-markets/small supermarket store numbers increasing by 17 percent in 2008 to over 100,000 stores.

Indonesia has led the way over the last 10 years and in 2008 more than 1,500 new stores opened, taking the total to over 10,500. These stores now account for more than 16 percent of total packaged grocery sales. Shoppers in Indonesia are continuing to embrace the convenient location, relatively good service and acceptably low prices offered at mini-markets.

Retailers in China are also investing in this store format, with store numbers growing by 22 percent in 2008 to more than 70,000 stores, accounting for more than three-quarters of all modern self-service outlets.

In South Korea we are also seeing the leading Hypermarket operators expanding into small supermarket formats, or ‘Super Supermarkets’ as they are known in South Korea. Samsung Tesco is now operating over 150 SSM Homeplus Express stores and E-mart is planning to open 30 or 40 small, 300 square meter E-Mart Everyday stores. The expansion of these large chains into the small store arena has led to concerns regarding competition with small store owners, and the South Korean government is considering introducing a bill to regulate the opening of small supermarkets.

In the U.S., consumers remain skittish.  Shifts to private label brands continued at a strong pace, as they have for the last eight months, while consumers are shopping less frequently and spending less per trip.  Canadians, on the other hand, are spending more per trip, and are taking advantage of retail promotions.  Unlike in the U.S., private label brands are struggling to gain share as national brands step up promotional activity.

In Europe, the French remain relatively unchanged in their shopping.  Value channels continued to see growth and more retailers were selling on promotion, leading to a modest increase in the amount spent per trip.  Germans showed very little change in the number of shopping trips they took, nor did they increase or decrease how much they spent.  Unit sales increased, however.  In the UK, sales volume improved slightly from the previous month, while budget store brands’ growth slowed as consumers began returning to premium brands.  British shoppers were also spending slightly more per trip.  Italians continued to move to store brands and value channels, although they were reducing their shopping frequency.  Spaniards, who have been among the most optimistic, have not seen that reflected in spending.

Brazilians showed an 8 point surge in optimism, and this translated into more frequent shopping trips and higher sales, in both volume and value terms.  Hong Kong and China both showed growth in sales, but Taiwan showed declines, and optimism there was among the lowest in Asia.  Indian consumers’ confidence was high, and volume and value sales both increased by more than 5 percent.

“While things are starting to look up, it’s clear that Americans and Western Europeans aren’t quite convinced that recovery has taken hold and remain cautious when it comes to shopping.  The labor market is clearly affecting this behavior.  It comes as little surprise that Brazil, India and China – countries that have generally been less affected by the global recession – are among the first to see renewed consumer confidence and sales growth,” said James Russo, Vice President, Global Consumer Insights at The Nielsen Company.

The Buzz

While the idea of recovery hasn’t opened up global consumers’ wallets quite yet, it has started to infiltrate their discussions on the Web.  In June, 71 percent of survey respondents thought that their countries were in recession, an improvement from the 77 percent who thought the same in April.  Additionally, 26 percent believed that their country will be out of a recession in the next twelve months, up three points from April.  Global recession buzz has declined 27 percent since March.  In July, however recessionary buzz perked up, primarily in Western Europe.

“We are likely to see an overall downward trend in recession discussions, but it will be choppy until consumers really feel as if they are experiencing the recovery,” said Russo.

Download the latest Nielsen Economic Current.

“Even under current financial pressures, the Nielsen China Outbound Travel Monitor shows that the Chinese travel market continues to boom and is likely to grow further.  The interest lies not only among the experienced traveler, but also among novice travelers.  This should serve as a boost of confidence to the travel industry,” said Dr. Grace Pan, Head of Travel and Leisure Research with Nielsen China.

Short haul trips, such as those to Hong Kong (the most mentioned place to visit), Macau or Taiwan, were the most popular, with more than 60 percent of travelers intending to visit those destinations.  Thanks to a recent agreement that allows Mainland Chinese to travel to Taiwan in groups, Taiwan showed the greatest increase in interest.  In 2007, just three percent of respondents said they planned to visit Taiwan.

“Historic ties with Taiwan – a destination that has not been an option for many years – make it a destination of much interest to Mainland Chinese, and we expect to see tremendous growth potential for travel to Taiwan in the years to come,” said Dr. Pan.

Top Planned Destination Countries

* Note: multiple answers allowed