The Data Digest: Metropolitan Chinese And Metropolitan Indian Customers Lead The Demand For Business Transformation

Anjali Lai

Consumers in Asia Pacific are in the midst of a digital transformation. Within the past decade, online penetration in China grew from 8% to 54%, while mobile internet access grew more than sevenfold. Today, the rate of customer evolution is gaining speed, as consumers are increasingly willing to experiment with new products, rely on devices, demand seamless digital experiences, consume large volumes of information, and are committed to seeking out the best experiences for themselves.

Forrester’s Empowered Customer Segmentation measures these key shifts in customer behaviors and attitudes and anticipates how consumers both respond to digital innovation and demand it. An analysis of our Consumer Technographics® data for Asia Pacific shows that the most rapidly evolving customers dominate in metropolitan China and metropolitan India:

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48% Of Retail Sales In Asia Pacific By 2020 Will Be Impacted By Web

Satish Meena

Only 13% of total retail sales in Asia Pacific (Australia, China, India, Japan, and South Korea) were made online in 2015, but the impact of the web on offline retail sales is much bigger. Our recently published Forrester Data Web-Influenced Retail Sales Forecast, 2015 To 2020 (Asia Pacific) shows the influence of the web on offline retail sales and how its impact varies by country and category. Some of the key findings of the forecast are as follows:

  • The web impacted more than a third of total retail sales in 2015 and will impact 48% by 2020. Smartphones are becoming consumers’ most widely used mobile device, and consumers are using them to find information about a product irrespective of their location. They use them to research products, even when they are shopping in physical stores; to compare prices with online retailers; to check specifications; and to read user reviews. This behavior is making the web a more powerful medium — one that retailers can no longer ignore. We expect web-influenced retail sales in Asia Pacific to reach $2.1 trillion in 2020, up from $1.2 trillion in 2015.
  • South Korea leads in web-impacted sales . . . High penetration rates for the internet, smartphones, online retail, social media, online payment options, and messaging platforms are powering the web’s impact on retail sales in South Korea. Similar factors mean that Japan, China, and Australia closely follow South Korea in terms of web-impacted sales.
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The Data Digest: Upping The Emotional Ante Down Under

Anjali Lai

Emotions are at the basis of how customers perceive experiences – and why they choose to stay loyal to certain brands. But, not all emotions are equal: Different emotions lead to unique behavioral outcomes depending on context, emotional intensity, and even industry.

For example, in our latest study, my colleague Tom McCann and I measured the emotional impact of CX among banks and retailers in Australia. We discovered that feeling valued is one of the most powerful emotions driving loyalty toward a bank: Australian customers who feel that their bank puts them first are willing to pay a premium for the bank’s experience and are more forgiving when something goes wrong. However, among retail customers, valued is good – but happy is better. Australian retailers that leave customers in a cheery mood are more likely to retain their shoppers and turn their customers into advocates.

And what makes Australian shoppers happy? Forrester’s Consumer Technographics® survey data shows that details in the experience go a long way. For instance, customers are pleased with perceptibly low prices or special deals, stocked inventory, and pleasant customer service reps.

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Privacy & Personalization: two globally important initiatives, one tremendous opportunity

Fatemeh Khatibloo

I'm just back from two weeks in Hong Kong, where I'd been invited to give a keynote at the 10th anniversary conference of the Business Information Industry Association. Since I was there, I took the time to meet with some fantastic Forrester clients in industries ranging from travel to insurance to retail to consulting. In nearly every discussion, whether I was speaking to a BT or a marketing exec, we eventually got to the topic of the "privacy-personalization paradox."

This is an issue I've explored extensively, and have written about before. It's a challenge that marketers in the US dabble with when they're considering investments in tools like retail beacons and cross-device identity resolution. But it was enlightening to hear about the challenges that firms in APAC face: antiquated privacy laws, a dearth of third-party consumer data, and even the incredible difficulty of compiling a single customer view across their own first party data. Interestingly, though, the solution in both markets is similar: preference management

I've just published a report about enterprise preference management, which Forrester defines as:

The business practice of systematically collecting, managing, and utilizing explicit customer preferences — about frequency, channel, content, interests, and intent — in outbound communications.

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OpenStack Pushes Local Stories In Tokyo

Paul Miller

I was in Tokyo last week, for the latest OpenStack Summit. Over 5,000 people joined me from around the world, to discuss this open source cloud project's latest - Liberty - release, to lay the groundwork for next year's Mitaka release, and to highlight stories of successful adoption.

Tokyo's Hamarikyu Gardens combine old with new (Source: Paul Miller)

And, unlike many events, this wasn't a hermetically sealed bubble of blandly anodyne mid-Atlantic content, served up to the same globe-trotting audience in characterless rooms that could so easily have been in London, Frankfurt, or Chicago. Instead, we heard from local implementers of OpenStack like Fujitsu, Yahoo! Japan, and - from just across the water - SK Telecom and Huawei. 

In keynotes, case studies, and deep-dive technical sessions, attendees learned what worked, debated where to go next, and considered the project's complicated relationship to containers, software-defined networks, the giants of the public cloud, and more.

My colleague, Lauren Nelson, and I have just published a Quick Take to capture some of our immediate impressions from the event. As our report discusses, the Foundation is making some good progress but there are a number of clear challenges that must still be addressed. How well do you think the Foundation is addressing the challenges we discuss?

Brands In China Have High CX Aspirations But Most Fail To Deliver

Ryan Hart

With recent drops in global stock markets and all eyes on China’s economy, the timing of the China CX Index report couldn’t be more serendipitous. While customer experience (CX) most likely doesn't have a direct impact on all this sudden share volatility, our research shows that there is a strong correlation between CX and revenue growth.

Forrester’s Business Technographics™ data shows that CX improvement is a growing priority for companies in China: 70% of tech and business decision-makers indicated that improving the experience of their customers was a high or critical priority for 2015 and 2016. However, CX Index scores reveal that these aspirations have yet to manifest themselves in actions and — more importantly — results.

Evolved from the inaugural assessment we completed last year, The China Customer Experience Index, 2015 now includes loyalty elements to the mix to gauge how well brands in China are at delivering quality customer experiences that create and sustain customer loyalty. This year, we examined 60 brands across five industries in China: banking, insurance, retail, eCommerce, and mobile device manufacturing.

At a high level, the results of 9,000 customer surveys in China revealed that:

  • No brands stand out as especially good or bad. The good news: No brands ended up in the very poor category. The bad news: none achieved excellent scores either. The vast majority of brands (80%) rated as just OK; 5% landed in the poor category, and 15% qualified as good.
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Big Billion Day Exposes The Opportunities And Weaknesses Of eCommerce In India

Satish Meena

October 6, 2014 — “Big Billion Day” — was marketed by Flipkart extensively, both online and offline. The founders of Flipkart, Sachin and Binny Bansal, sent a personalized email to registered users announcing the date and mentioning their emotional connection with the number 610 (the number of the apartment from which they launched Flipkart in 2007). October 6 falls in the festive season of Diwali, a period that accounts for 40% of the total sales of key brands in India. Online and offline retailers are competing for a major share of sales during this year’s Diwali.

2014 was a year of massive eCommerce investment in India. Flipkart raised $1 billion; Amazon announced it would invest $2 billion in its Indian subsidiary; and Snapdeal raised $234 million from private equity firms and an undisclosed additional sum from private investors. These three players are spending approximately 2 billion rupees ($33 million) this season on marketing — and a lot more on improving last-mile delivery and adding fulfillment centers to get a bigger piece of the sales pie.

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Customer Experience In Asia Pacific: More Advanced Than You Might Suspect

Harley Manning

For the past two weeks, I’ve been on the other side of the planet, spending a few days each in four very different cities: Sydney, Singapore, Beijing, and Shanghai. While Sydney was much like I remembered it — an exotic version of San Francisco but with better weather — the Singapore skyline had changed drastically and now appears to be a science-fiction version of the seaport I remembered. (If you think I’m kidding, just do a search on “Marina Bay Sands Hotel.”)

In contrast to Sydney and Singapore, I hadn’t been to either Beijing or Shanghai before. I was blown away by how vibrant those cities are and how much prosperity is on display: If the Chinese economy is truly slowing down, you wouldn’t know it from all the luxury cars on the road.

Despite all the diversity I saw on my trip, for me, there was one constant across all four cities: the high level of interest in customer experience.

In Sydney, I gave talks about customer experience to three different groups of 20 to 40 people each. Even though the attendees came from very diverse companies — like insurers, quick-serve restaurants, technology vendors, and giant professional services firms — all three groups asked questions that showed this wasn’t their first CX rodeo. 

I also gave a speech to the digital team at a major bank, and as a bonus, I got to see the company’s chief experience officer give a talk. Frankly, there are a lot of US and European banks that could learn from that large, enthusiastic, clued-in group.

My time in Singapore started out with a customer experience ecosystem mapping workshop for around 35 people. This was also a diverse group, with varying levels of customer experience expertise, even among attendees from the same company. They all picked up on the concepts, though, and generated an impressive amount of insight. 

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Understanding Gamification in APAC

Forrester's global analysts have written some great pieces on gamification. In general terms, this research is is just as applicable to the SE Asian markets. However, there are some specific differences within the region that should also be considered. The most important thing to remember is that, while the general principles of gamification definitely hold true within the region, there are still some specific differences that should also be taken into account.
First and foremost, we definitely see the same problems in APAC where a lack of clarity on the desired behaviour encourages game play - for games sake. This is probably the worst outcome of all for gamification initiatives, regardless of where they're deployed. If there's no clear desired behaviour change identified, there's absolutely no valid reason to introduce gamification. The real challenge though is ensuring that the right strategy is selected to achieve the right objectives.
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Understanding The Changing Needs Of Online Consumers In China, India And Japan

Reineke Reitsma

Historically, consumers in Asia Pacific have done far more activities on their mobile phones than in other regions. With the increasing availability of affordable smartphones in the region, mobile phones are now the No. 1 device for consuming media for many consumers in Asia Pacific. Similarly, activities like playing games (such as word games and puzzle games), listening to music (both streaming and non-streaming), and using social media are increasingly done via mobile phones, and activity levels are now approaching those of PCs.

In recent months, Forrester’s Data Insights team has been analyzing our Technographics® data for the Asia Pacific version of our annual global series, “Understanding The Changing Needs Of Online Consumers.” For the past seven years, Forrester has been tracking consumers’ online and offline behavior in Asia Pacific. In 2012, we surveyed 16,616 Asia Pacific consumers across two surveys to find out about their use of the Internet for media, entertainment, shopping, communication, and social computing.

Some other highlights of our analyses include:

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