Emerging Trends in the Asian Grocery Market

With Asian grocery sales predicted to reach almost $4 trillion by 2023, we’re interested in finding out what trends are fueling this rapid growth.

Whether it’s using technology to streamline supply chains, unlocking the power of social media to influence shoppers, or adapting store designs to meet changing consumer behaviour, the Asian grocery market is finding new ways to boost sales.

Join us as we explore the top trends in the Asian grocery sector and learn how retailers are reimagining the way we shop to pull millions of customers through their doors.

What does the Asian grocery sector look like today?

Although brick and mortar supermarkets in the US and Europe are struggling to adapt to changing consumer habits, the global grocery market is going strong.

International grocery sales are predicted to reach $10 trillion over the next four years, and experts say Asia’s booming grocery sector will account for almost 50% of this growth.

China, India, Japan, Indonesia and South Korea dominate the Asian market, accounting for 83% of grocery sales and 80% of total Asian market growth.

Asia is home to some of the world’s fastest-growing economies, and the number of families with disposable incomes is on the rise. Today’s grocers are targeting these affluent populations with innovative marketing strategies and reimagined customers experiences to drive sales.

While the US currently sits on the top seat as the world’s leading grocery market, China is predicted to claim the first prize by 2022.

So, how can retailers learn from the Asian grocery market and jump on rising trends to maximise growth?

Put health & fresh produce first

As Asian populations become more affluent, educated, and influenced by government campaigns, modern consumers are increasingly aware of the health benefits of food. Whether it’s buying fresh produce or choosing packaged products with clear health labelling, Asian consumers will pay a premium for healthy food.

Many Asian retailers, including Hema and 7Fresh, are offering a range of health-focused products and adapting their marketing strategies to cater to health-conscious consumers. Nick Miles, Head of Asia-Pacific at grocery training specialist, IGD, explains how “fresh food and wellness ranges will feature more prominently in-store in the future as retailers respond to changing shopping habits.”

Chinese grocer, Hema, aims to enhance the shopping experience for health-focused customers via a mobile app.

Users can scan items in-store to access instant information about where a product comes from and what it contains. After its release in 2016, 11 million happy customers have signed up for the app, which accounts for 60% of Hema’s total sales.

Make food safer with blockchain

Many Asian retailers are leading the way with food safety with exciting developments in blockchain technologies.

Walmart China's traceability system uses state of the art blockchain and AI to track the movement of over 50% of all packaged fresh meat, 40% of packaged vegetables, and 12.5% seafood at each stage of the supply chain.

As customers are increasingly conscious of where their food comes from, investing in technologies which promote health and safety is a sure-fire way to build trust with customers and boost brand loyalty.

Partner with overseas providers

Asian consumers are prepared to look far and wide to get their hands on the products they want. Retailers are partnering with overseas suppliers, fellow retailers, and even technology companies to pull together resources and accelerate growth.

Partnerships are helping brick and mortar retailers to “blur the line” between online and offline retail channels.

In 2016, the Australian supermarket giant, Woolworths, partnered with Tmall Global, a Chinese B2C website, to offer Chinese consumers health-focused produce from overseas.

Ken Ma from Tmall Global explains how:

 “Health and product sourcing are very important to Chinese consumers, who are very discerning in their choice of products and are willing to source them from trusted providers in countries like Australia.”

Make shopping social

In an age of WeChat, Sina Weibo, and Tencent Video, Asian grocery retailers have more opportunities than ever to reach new customers and boost brand loyalty.

With 64% of Asia’s adult population regularly using mainstream social media networks, the fastest-growing retailers are those who have fully embraced the new era of social shopping.

Although Asia’s social media landscape is relatively different to European and US markets, the basic premise remains the same. Consumers are connected by an extensive network of information and digital content which retailers can use to influence their behaviour and build trust.

Whether it’s collecting customer insights from social media activity or analysing loyalty data from purpose-built apps, retailers can unlock the power of social shopping to deliver personalised and targeted promotions.

Nick Miles from IGD explains how “retailers and suppliers must truly understand the social media landscape and have a clear social media strategy to engage shoppers and stay relevant."

In 2017, Alibaba created an Augmented Reality app which added a taste of excitement to the regular customer experience.

Instead of building a run-of-the-mill app, Alibaba created an interactive game called Catch the Cat. The innovative app was similar in design to Pokemon Go — customers earned prizes and promotions as they made their way around a virtual supermarket store.

Integrating a shopping app with an interactive game is a unique approach to collecting customer insights while still offering value and positive engagement for customers.

Offer unrivalled convenience

US retailers typically create enormous megastores to offer customers ever product under the sun. But, unlike the US market, the Asian grocery landscape is dominated by thousands of hypermarkets. These smaller specialty stores tend to offer less selection, but provide customers with unrivalled convenience on their doorsteps.

Experts predict hypermarkets will be the fastest-growing sales channel in Asia over the next few years.

With Asia being home top 54% of the world’s urban population, retailers are downsizing larger stores to make way for a giant network of smaller hypermarkets.

The number of hypermarkets in Asia is expected to grow by almost 7% per year between now and 2022.

Increasingly, urban consumers are shopping little and often, which means they demand the products they want anywhere, anytime and anyhow.

Lead the charge With online sales

While e-commerce only accounted for 3% of all US grocery sales in 2019, the Asian grocery market has been quick to make the most of online retail channels.

A staggering 37% of Asia-Pacific consumers regularly use online grocery shopping to fill their fridges. Experts predict their online sales will double from $150 billion to a mind-boggling $334 billion by 2022.

CEO of Hippo Fresh, Hou Yi, explains how “technology means there is no reason why a customer can't have the same experience in-store as they do online.”

Hippo Fresh uses an omnichannel approach to offer customers a seamless transition between online shopping and in-store visits to promote online sales. Customers can switch between online and offline shopping and enjoy a consistent experience to put them in control of how they want to shop.

What can we learn from Asia’s success?

As Asia’s grocery industry continues to grow from strength to strength, retailers across the world should keep a keen eye on their latest innovations.

Whether you’re looking to invest in emerging technologies or adapting your marketing strategy, staying up-to-date with international markets and trends is a powerful way to get one step ahead of rivals and find that all-important edge.

Take your promotions to the next level

We believe in the power of customer data. Today’s technology allows retailers to understand their customers’ most intimate desires across a wide range of markets.

Unlock the power of customer insights and loyalty data to build meaningful promotions and drive customer engagement.

As promotional strategies and new markets emerge evolve, we’ve made it our mission to stay one step ahead of the game.

We provide our clients with the tools they need to deliver valuable products and offer effective promotions that will bring sky-high returns, wherever they’re located.