New Report: Impact of Inflation on APAC Consumers
In the past year, following the pandemic, many markets have experienced high rates of inflation, which have in turn, created a cost-of-living crisis for millions of consumers around the world. APAC is no exception. Deepened by global political crises such as the Russian invasion of Ukraine, groceries, fuel, and energy are the sectors most mentioned in our daily news bulletins in Europe, but what is the impact on consumers in APAC?
In this context, Rakuten Insight has surveyed approximately 129,000 panellists from its proprietary panels in APAC to discover how the cost-of-living crisis has impacted them, their attitudes towards spending and their purchasing habits.
- ○ 32% of consumers feel significantly impacted by inflation, with a further 47% feeling a need for caution in their household spending.
- ○ The fortunate 16% feel no impact, whereas more dishearteningly, 6% feel unable to cope with inflation.
- ○ Only 4% of consumers have not noticed any change in habits. 62% are checking prices, and 45% are cutting back on unnecessary spending.
- ○ Actions taken to cope include cutting back on leisure activities (59%), buying cheaper groceries (53%), and shopping at discount stores (48%)
- ○ Groceries (75%) are the most impacted goods and services. Compared to Europe, where the impact of the invasion of Ukraine is lower, but still, inflation in Fuel (54%) and Utility Bills (45%) are impacting consumers.
- ○ And the extent of the cost-of-living crisis is highlighted by ‘basic necessities’ (food, clothing, healthcare etc.) being the highest ranked on the most impacted aspect of basic household expenditure at 73%.
China’s low inflation – a unique situation
However, a closer look at the data shows one exception in the APAC market – China. As many markets around the world cope with high inflation, China has the opposite problem. Low inflation. Similar to post-Bubble Japan, Chinese consumers, uncertain about the future, are saving their money rather than spending it. In addition, the size of the country and the wealth of available natural resources has led to China heading in a different direction. The huge internal market means China is protected from global inflation caused by large infrastructural projects or price increases in raw materials such as Iron and Ore, where China are more price-setters.
From our survey, the impact of inflation and the cost-of-living crisis on consumers across APAC is clear. Unless you are one of the lucky 15% who felt they had not been impacted at all or one of the many Chinese consumers hoarding their savings, you are likely to be cutting back, searching out deals and exercising caution in your household spending. Hopefully, the cost-of-living crisis improves globally throughout the remainder of 2023.
Download the full report here!
Related articles: The rising cost of living in Asia & the US, Watch Chat Read Shop 2023, Impact of Inflation on US Consumers,
For more infographics, updates and our original survey reports, follow us on LinkedIn or subscribe to our newsletter at the bottom of the page.