The constant changes we’ve witnessed since the onset of the pandemic have forced brands worldwide, including in Asia Pacific, to step back from well-formulated marketing strategies and adapt to immediate priorities.
Despite the unknowns, several key trends impact the current state of consumer behavior. Kenneth Pao, Executive Managing Director at Criteo Asia Pacific outlines six of these trends, how they will affect the advertising industry, and how brands can better shape their 2021 marketing strategies in light of this.
1. Ecommerce continues to skyrocket in 2021.
While ecommerce was already crucial for brands pre-COVID-19, the pandemic caused a major shift in consumer behavior, resulting in an influx of online shoppers. According to Criteo’s Singles’ Day 2020 data, we saw record spikes in online sales and traffic across Southeast Asia. Malaysia and Thailand saw the highest increase in indexed sales of 600% and 305% respectively, while Singapore generated a 248% increase.
This shift is driven from both existing online shoppers buying more, and new online shoppers who have been pushed out of their “in-store comfort zone” due to necessity. According to our recent “Peak to Recovery” Survey where we spoke to over 13,500 consumers worldwide, 53% of respondents discovered at least one form of online shopping during the peak of COVID-19 and want to continue.
This presents massive growth opportunities for brands to expand their existing audiences on digital channels. Leveraging marketing tools such as retail media advertising and social retargeting ads to engage the most relevant consumers across the entire shopper funnel and convert sales will be the key focus.
2. Digital advertising spend jumps as marketers plan to invest more online.
According to Criteo’s latest State of Digital Advertising 2021: Marketing Budgets & Priorities in a New World, 38% of marketers saw increased website sales and bookings since the onset of the pandemic, resulting in accelerated digitization of their business processes.
As such, we have seen how the impact of COVID-19 has necessitated changes to marketing strategies. In fact, seven in 10 marketers in APAC say that the share of digital marketing spend at their company has increased due to COVID-19.
The survey also reported that marketing spend will continue to be driven across digital channels, with marketers planning to spend more on paid display and retargeting (50%), social media (58%), search marketing (56%) and content marketing (54%) within the next six to 12 months. Apart from increasing spend across these digital marketing channels, brands will also need to ramp up on their efforts to engage consumers on the app front.
Here is why: according to Criteo’s recent Global Apps Survey, we see a pivot toward app sales, with the share of app sales at 75% for retailers with a shopping app. Southeast Asia is one of the regions with the highest app shares globally. 55% of shoppers in APAC downloaded at least one shopping app (retail, food, or grocery/alcohol) during the peak of the pandemic.
The relationship between mobile users and apps has fundamentally changed, and this will continue even in recovery stages as consumers have experienced the benefits of using apps. As such, in-app advertising will need to be considered within brands’ plans in 2021.
3. Over-the-Top (OTT) and Connected TV (CTV) will become key marketing channels.
Like the rise of ecommerce, the popularity of over-the-top (OTT) and connected TV (CTV) devices has been trending upward in recent years, with the pandemic accelerating this growth. It is thus essential that brands engage consumers on these devices through advertising.
According to eMarketer1, all APAC countries saw exponential growth in digital video viewers in 2020, and that momentum will continue through to 2024. Findings by Nielsen2 revealed that the amount of time spent with CTV devices rose with people quarantining at home, showing an 81% increase year over year, which amounts to nearly four billion hours of CTV use per week.
The bottom line for brands: consumers are migrating to OTT and CTV — and it is key that advertising meets them there. More people using CTV and OTT devices means more hours of content watched on those platforms and a captive audience that would be open and receptive to relevant ads.
4. Brand safety continues to be vital.
In 2020, we saw many advertisers take a stand against platforms that failed to manage the spread of misinformation and hate speech, and become more intentional with where they invest their advertising dollars.
The ongoing pandemic also brings brand safety to the forefront. Since the renaming of the virus to “COVID-19”, the blocking of words such as, “COVID” and “COVID-19”, has been on the rise3 in APAC. Despite this, brands remain cognizant that some digital ads still fall through the cracks and end up being misplaced.
This year, we expect that brands will leverage solutions that can help them better control ad placements to safeguard their brand’s image and stay true to their brand values. At Criteo, we are working with brands to strengthen their brand safety capabilities, including our recent integration of Oracle Data Cloud to help marketers achieve this goal, while maintaining brand scalability and performance.
5. In-store shopping will become more digital.
While ecommerce trends took center stage in 2020, in-store shopping remains a priority for consumers, and thus will continue to be a focus for brands.
Despite an increase in online shopping frequency by consumers, seven in 104 still reported a preference for purchasing grocery items in person, whilst around half (47%) opted for home delivery, and 17% relied on curbside pick-up.
We expect to see consumers in Asia alternate between online and offline5 mediums throughout their shopping journey. What this means: Brands need to bolster their omnichannel presence and ensure that experiences across online and offline are seamless.
What will change about the in-store shopping experience, beyond increased sanitation, is that it will be optimized for consumers to spend less time inside with features such as digital transactions, “buy online, pick up in store”, and cashier-less checkouts.
6. Industry collaboration towards new identity solutions will kick into overdrive.
One of the key initiatives for the industry is the development and adoption of a future-proofed solution for online identity that does not rely on third-party cookies.
In 2021, we expect to see more advertising players come together to develop a future-proofed solution for online identity that does not rely on third-party cookies. What is unique about this endeavor is that it affects the entire industry – advertisers, publishers, ad tech partners and consumers. As such, everyone is invested.
Recently, Criteo collaborated with The Trade Desk to stand behind unified solutions which advertisers and publishers have started testing, and we look forward to pursuing more meaningful collaborations across the ecosystem to push this forward.
As we look toward a new beginning in 2021, the key to leveraging these trends would be to keep strategies nimble and staying open to adapting to the unexpected.
Brands in our region have been able to demonstrate great resilience through a tumultuous 2020. I am confident that they will be able to stay strong and carve out new paths to success regardless of what 2021 brings.
Need help making your brand stand out in 2021? Get in touch with us.
- Insider Intelligence. 2020. Digital Video Consumption Is Spiking in Asia-Pacific. [ONLINE] Available at: https://www.emarketer.com/content/digital-video-consumption-spiking-asia-pacific. [Accessed 13 January 2021].
- 2020. Connected TV usage remains above pre-covid-19 levels as traditional tv viewing normalizes. [ONLINE] Available at: https://www.nielsen.com/us/en/insights/article/2020/connected-tv-usage-remains-above-pre-covid-19-levels-as-traditional-tv-viewing-normalizes/. [Accessed 13 January 2021].
- Marketing Interactive. 2020. Publishers and agencies in Asia tackle brand safety amidst COVID-19. [ONLINE] Available at: https://www.marketing-interactive.com/publishers-and-agencies-in-asia-go-on-the-offensive-to-tackle-brand-safety-amidst-covid-19. [Accessed 13 January 2021].
- Tech Trade Asia. 2020. Online shopping increased during COVID-19 lockdowns in APAC. [ONLINE] Available at: https://www.techtradeasia.com/2020/07/adobe-online-shopping-increased-during.html?view=classic. [Accessed 13 January 2021].
- Retail Asia. 2020. Omnichannel retailing set to take off in Asia. [ONLINE] Available at: https://retailasia.net/e-commerce/in-focus/omnichannel-retailing-set-take-off-in-asia. [Accessed 13 January 2021].