What You Need to Know Before Starting Your Market Research in Asia
In today’s intensely competitive and highly complex business world, no organisation can hope to get far without recognising the importance of market research.
In this four-part blog series, we’ll cover all that there is to know about performing market research in the Asian business context—from traditional sources of information to the latest technologies that can elevate the process and yield more informed decision-making.
What is Market Research?
Market research is an integral part of building an effective business strategy as it equips an organisation with important insights into future market activity, the evolving needs of its customers, and the movements of competitors. Armed with the right market data, business development teams can assess the dynamics at play within a market and make well-informed judgements about its long-term outlook; analyse consumer trends and tap into new markets; and scan the horizon for potential threats.
Market research allows a firm to take a more proactive stance in identifying and responding to potential challenges and opportunities.
In Asia, where the business landscape is shaped by large, diverse populations and complex geopolitics, the benefits of effective market research can be especially crucial to succeed in the local market.
Why You Need to Perform Market Research in Asia
A Look into the Current Asian Business Landscape
For an organisation to thrive in Asia, its decision-makers must familiarise themselves with the local markets and develop a deep understanding of the ways in which they are impacted by local and global events.
The Covid-19 pandemic is one of the most significant events to hit the Asian economy in recent years. Measures aimed at curbing the spread of the virus, including lockdowns, social distancing guidelines, and travel restrictions, have disrupted manufacturing operations and dampened consumer demand across several industries in the region. The International Monetary Fund predicted that developing and emerging economies in Asia would contract by 0.8 percent in 2020, following a decade of robust growth (7 percent per year on average).
However, things are looking up. The Asian Development Bank forecasts a strong recovery for markets in the region, with economic activity projected to grow 6.8 percent in 2021. This coming economic upturn will open up a host of new opportunities for businesses operating in Asia. That being said, firms must be able to closely monitor new developments and market trends in the region if they are to be in a position to take advantage of these opportunities.
In 2021, market researchers in Asia will need to take into account the following three topics:
1. The US-China Trade War
In 2021, Asian markets will continue to be profoundly impacted by the deterioration of trade ties between the United States and China in recent years. The tit-for-tat tariff war between the two economic powerhouses has weighed on the global economy, but some Asian economies have benefitted from the US moving supply chains out of China. It is too early to say whether US-China trade tensions will ease under the Biden administration, but the economic fallout of the trade war will likely be felt across Asia for the foreseeable future.
2. The post-pandemic reopening of markets
The roll-out of vaccination programs across Asia and the easing of pandemic-related restrictions on market activity have fuelled optimism about the region’s economic outlook. At the beginning of 2021, currencies and stock markets in emerging Asian economies were boosted by hopes that Covid-19 vaccines will bolster economic recovery. However, uncertainties over how long it will take to return to “business as usual” have been exacerbated by the emergence of new strains of the virus.
3. The substantial presence of state-owned and family-owned companies
State-owned enterprises play a significant role in many Asian economies, especially in the infrastructure, banking, and financial services sectors. Likewise, family-owned companies are key drivers of economic growth in the region, some of which are among the largest companies in the world, including Samsung Electronics in South Korea and Reliance Industries in India.
If you are a business leader or someone involved in formulating business growth strategies in Asia, you will likely already have some understanding of the above topics. However, it is important to keep monitoring the news for any developments that may impact your target market.
One of the best things about Asia from a market research perspective is the fact that there is a vast amount of information available on the region’s demographics, geopolitics, economic systems, and industrial structures. Organisations that are adept at gathering and interpreting this information are able to gain valuable insights into market trends and conditions and thereby manage risks and leverage opportunities more effectively.
On the other hand, the sheer volume of available information can be a problem for market researchers. It can be difficult to isolate the information that is most relevant to your organisation’s needs. Moreover, it can take a lot of time to determine which information is reliable and which is not.
Market research in Asia is further complicated by the fact that the region is home to a multitude of languages and dialects, as well as the fact that the political systems of some Asian countries are not as transparent as their Western counterparts.
The key to conducting effective research into Asian markets is to gather up-to-date, accurate information such as news stories and market reports from a wide range of reliable sources and leverage artificial intelligence (AI) technologies to sort the information and draw out powerful insights.
Conducting market research in Asia can be a daunting task given the region’s unparalleled cultural, political, economic, and linguistic diversity. The region’s markets, some of which are among the fastest-growing and most dynamic in the world, host a dizzying number of organisations of varying types and sizes. As if the region’s complexity wasn’t enough of a challenge, market research is further hampered by governmental opacity in some territories.
In the next article, we’ll discuss the types and sources of information, as well as some organisation tips, that are most useful in developing a comprehensive and value-packed Asian market research.