ASEAN’s and Malaysia Emerging Affluent: Understanding the Region’s Invisible Consumer Class

From left to right: Ananda.Swinburne, Strategy Planning Director of Hakuhodo Malaysia, Steven Yap, Head of Digital & Operations of Kingdom Digital, Leong Weng Kin, Chief Integration Officer of Hakuhodo Malaysia, Kiew Yen Nie, General Manager of Hakuhodo Malaysia, Devi Attamimi, Institute Director of HILL ASEAN, Ryusuke Oda, Chief Growth Officer of Hakuhodo International Malaysia, Yuko Ito, Managing Director of HILL ASEAN, Prompohn Supataravanich, Associate Director, Market Research & Strategy of Hill ASEAN.

Hakuhodo International Malaysia, in collaboration with the Institute of Life and Living ASEAN (HILL ASEAN) recently held its ASEAN SEI-KATSU-SHA FORUM 2023, sharing findings from this year’s research theme entitled “Emerging Affluent: Discovering the Invisible Class in ASEAN.” Coinciding with the 50th anniversary of Hakuhodo’s operations here in Malaysia, the forum saw members of the team revealing details on an unexplored segment between the elite and middle class in ASEAN referred to as the Emerging Affluent.

In the previous years, the HILL ASEAN team has provided valuable insight into key consumer demographics and driving behaviours including ASEAN’s GenZ’s in 2021 and the power of Fandoms in 2022. This year, HILL ASEAN conducted quantitative and qualitative research and interviews in Thailand, Singapore, Indonesia, Malaysia, Vietnam and the Philippines, along with a quantitative survey in Japan to shed light on the Emerging Affluent class of consumers – pooling data regarding their lifestyles, ambitions and consumer behaviour; along with the reasons why brands should be taking notice of them.

Ryusuke Oda, Chief Growth Officer of Hakuhodo International Malaysia at the ASEAN SEI-KATSU-SHA FORUM 2023.

“As we mark Hakuhodo’s 50th year of operation in Malaysia, we continue to strengthen our offerings as well as relationships with our many stakeholders. Findings from HILL ASEAN’s annual deep dive into new areas of research on what drives current consumer behaviour and lifestyles are one such offering, in line with the Hakuhodo Group’s core philosophy of Sei-katsu-sha Insight, which views people as individuals with diverse lives,” said Ryusuke Oda, Chief Growth Officer of Hakuhodo International Malaysia. “Through various growth-oriented initiatives – including our recent integration with Kingdom Digital – we remain committed to supporting brands with their marketing in ASEAN countries and providing vital intelligence to help marketers navigate a rapidly changing business environment.”

Meet the Emerging Affluent

“Emerging Affluent” is the term coined by HILL ASEAN to define the segment sandwiched between the wealthy (upper) class and the middle class. Commonly referred to as the “upper-middle class”, this research found that the majority of ASEAN Emerging Affluent individuals can be considered “self-made,” with over 60% coming from a middle-class socio-economic background.

As a result, they are logical, strategic and self-motivated to keep advancing – often driven by having been through financial hardship when they were growing up, resulting in a strong determination to avoid reliving such experiences.

The ASEAN Emerging Affluent are “Omni-mizers”: people who connect all aspects of their lives and use that foundation to propel their growth. They rely on that interconnectivity to become the best versions of themselves. As Omni-mizers, they develop a broad base of knowledge and support to ensure stability, and they take pride in long-term planning, choosing to pour their efforts into comprehensive asset building in order to achieve stable and sustainable lifestyles. This extends beyond financial assets such as real estate, savings and insurance, to include such things as education for their children and the development of skills and knowledge. It’s a strategy that expands their possibilities horizontally, rather than one-dimensional, vertical goals based solely on achieving an abundance of financial assets.

While they are highly self-reliant and action-oriented, they also demonstrate a belief in an “invisible power” (religious or supernatural power) for emotional support, as well as for keeping them humble and grounded. A notable aspect is that regardless of their wealth, they prefer to keep out of the spotlight and try to blend in with the rest of society which makes them difficult to distinguish from the broader middle class.

Devi Attamimi, Institute Director of HILL ASEAN at the ASEAN SEI-KATSU-SHA FORUM 2023.

“This segment is going to be an important economic powerhouse, driving the consumer market in ASEAN. We believe that the ASEAN Emerging Affluent serve as role models—or influencers—for the middle class, inspiring them to aim higher while also influencing their lifestyles, brand preferences and consumer behaviour,” said Devi Attamimi, Institute Director of HILL ASEAN. “In contrast to the idealized lifestyle of the wealthy that is often portrayed in mainstream media, attaining the ASEAN Emerging Affluent lifestyle through persistence and hard work is a realistic possibility for the middle class! Therefore, growing our understanding of this segment and targeting this consumer class above and beyond existing legacy marketing initiatives will provide the most efficient economic case for businesses seeking to capture and retain the broader middle-class market.”

Catering to These Omni-mizers

In today’s business environment strongly influenced by the seemingly opposing forces of content oversaturation and tech-driven tunnel visioning, reaching out to and maintaining a relationship with an increasingly fragmented market has never been more challenging. Therefore, companies and brands interesting in dedicating their efforts towards approaching the ASEAN Emerging Affluent should be guided by three keywords: Low-key, Love-tribution and Longevity.

Low-key represents observations on how the Emerging Affluent prefer to fly under the radar. They are willing to buy premium items, but they do so based on function and not because of the attention they get.

Love-tribution relates to how much reach this segment can have with their purchases and is a combination of the words “love” and “contribution.” They see purchases as conduits for expressing care for others. They want to share great convenience or experiences from their purchases or customer journeys with their loved ones, and brands should keep this in mind when designing for the ASEAN Emerging Affluent.

Finally, Longevity stands for the opportunities for brands to become life planners or consultants for ASEAN Emerging Affluent and their entire families. One of the things that motivates the ASEAN Emerging Affluent is a desire to make life easier for their family. Therefore, brands must do more than just sell them a product or service; they need to serve as trustworthy consultants who listen sympathetically and advise the Emerging Affluent on all aspects in their lives. Being seen as a means of eliminating their worries will increase customer value and loyalty for your brand.

HILL ASEAN will continue to support the marketing activities of companies in ASEAN through research into the perceptions and behaviour of ASEAN sei-katsu-sha. Findings of the full ASEAN SEI-KATSU-SHA STUDIES 2023, an explanation of the research content and hints for marketing going forward can be found at https://hillasean.com/assets/pdf/Forum_2023_en.pdf.

About the Malaysian Emerging Affluent
(created by Hakuhodo International Malaysia team)

Hakuhodo International Malaysia also presented a study focusing on the Malaysian Emerging affluent*.

Background:
The Malaysian Emerging Affluent grew up in low to middle-class households where uncertainty was rampant and because of this, they had no choice but to pursue education and career paths that were decided for them. Although they’ve now achieved affluence and lead lives better than their parents did in the past, the Malaysian Emerging Affluent is at a constant tug of war with themselves; Needing to constantly evolve and progress out of fear of back-peddling back into the low-middle class, once again.

Shopping behavior:
Meticulous Planning & Patience are quintessential aspects in their ‘Shopping Strategy’; They identify and create plans for when to make their purchases to make full use of seasonal promotions and discounts. They seek high quality brand and/or products and are not particular of a brand/product’s country of origin.

2 Uniqueness’s that make the Malaysian Emerging Affluent stand out compared to ASEAN Emerging affluent:
Among 6 ASEAN countries, we discovered that the The Malaysian Emerging Affluent has a significance in neutrality. This is possibly due to the vast multiculturism between different races and religions groups in Malaysia. Therefore, to ensure peace and unity across all, the Malaysian Emerging Affluent has learned to be neutral, accepting, and not to express extreme views towards different groups but rather, turn their focus inward and focus on self-improvement to be the best versions of themselves that they can be.

They have two unique ways of expressing this:

  1. Their Perseverance to Keep Improving

Out of fear that they’ll slip back into financial struggle, the Malaysian Emerging Affluent prioritises self-improvement to learn how to not only expand their wealth, but to maintain it. They also believe that perseverance is the key to unlocking “success”, which is not only defined by monetary status alone, rather, the ability to be solely independent and happy.

  1. Contribution = Luxury

The Malaysian Emerging Affluent is no stranger to hardships, they want to contribute to their families in ways that will allow children and future generations to pursue education and career paths that they are passionate about, while, also providing them with the fundamentals on how to achieve and sustain wealth. They also want to contribute to society: They are aware that not everyone is given the same opportunities in life. However, they want to mitigate the number of people that had to struggle as they did, in hopes that in one day they will become good roles models, themselves.

HILL ASEAN aptly labelled the Malaysian Emerging Affluent, “Thriving Uplifters”.
People who are humble in attitude and successful in mindset, they believe that there is always room to build strong foundation and grow into a “Role Models” who can pass on their legacy to the next generation.


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