Today, most of the middle-class or working age population is those in Generation Y, or the Millennials, who are the target consumer for marketers around the world. This group of people has individual uniqueness, fresh perspectives and proficiency in digital technology. Being entirely different from previous generations, it is difficult to reach Gen Y with traditional marketing strategies, especially in ASEAN countries, where a very large number of the population are in this age group.
According to a research on ASEAN demographics by the research company Accenture, it is estimated that in 2020, ASEAN will have a total population of 680 million, or the third highest of the world after China and India, 40% of which are Gen Y. ASEAN’s consumption rate will also increase due to several factors, including higher income, which will change the status of around 60 million ASEAN people to consumers with middle to high purchasing power by 2020, at the initial purchasing power of 770 billion US dollars. This consumer group will demand more than basic products; they will buy luxury products, including gem and jewelry, for saving purpose. As a result, ASEAN will become a high-potential market. However, with awaiting challenges, it is not easy to find success in this market, and entrepreneurs should learn about ASEAN consumers for better understanding in their true demands.
Understanding the ASEAN Gen Y
Gen Y consumers are those who were born between 1980 and 2000, or at the age of 17 to 36 years old. They have increasingly higher potential in consumption and are now a large group of consumers, accounting for almost a third of ASEAN’s total population. According to the Hakuhodo Institute of Life and Living ASEAN, some differences can be found between the older group or those born in the 80’s, and the younger group or those born in the 90’s, in terms of lifestyles and career, use of digital technology, as well as consuming patterns. This is due to influences from social and economic events which occurred in different times of their lives.
The study found that the 80’s people are always looking for new opportunities in their lives. The 1997 Asian financial crisis might have left their parents unemployed when they were students, causing them to find some part-time jobs while studying. As a result, these people have flexible lives, and often find extra jobs to minimize their risk and maximize their opportunities.
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BamBam, a singer from the band GOT7
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On the other hand, the 90’s people are influenced by globalization and digital technology. Being individually unique, they are always looking for new opportunities to do what they want, with a support by information from the internet. They might want to build their own business based on their passions and interests.
The 80’s consider digital technology as a tool that makes their lives easier. Internet is a platform to show their identities and a space where they can express themselves freely through social media. As a result, they always post pictures or write status updates to present the best aspects of themselves as a way to gain acceptance from others.
In contrast, the 90’s grew up with digital technology. For them, the online world is therefore another form of reality. They love to share everything, including their daily activities, for others to see in real time. These are in the forms of images, video clips, emoticons and texts to express their identities and feelings.
As for consumption patterns, the 80’s people see shopping activity as a way to create their characters or present their images through their choice of products like IT products and fashion products. They often compare prices and look for online and offline information before making decisions and analyzing the pros and cons to get the best products from the best deals.
For the 90’s people, buying products is a way to create experience to be shared with others. They love to buy and try new products they are interested in, with some study of information from product reviews. After that, they will review the product and share it on social media; and if not satisfied with the product, they will resell it immediately.
Gen Y’s Jewelry Preferences
The consumption pattern of ASEAN Gen Y is different from that of the previous generations. In the old days, most people prefer buying yellow gold ornaments or jewelry for daily wear, but today Gen Y consumers rather buy jewelry for their weddings or other special occasions, or for wealth preservation. They think gold jewelry does not match with their clothing style and lifestyle. Apart from worrying about the safety of their lives and valuables, they are also influenced by rapidly changing fashion trends, and are inspired by the styles of celebrities who wear jewelry, including Asian stars from Korea and China. Being exposed to the media, such as television, billboards and social media network, Gen Y consumers are more open to the modern culture.
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Yang Mi, Chinese actress who is popular among the ASEANs
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Therefore, both male and female ASEAN Gen Y, in teenage and working age, pay attention to good dressing and having their own styles. They are interested in jewelry which can be mixed and matched with their clothes, and always catch up with new fashion trends. White metal jewelry is increasingly in popular. This includes white gold jewelry, silver jewelry with or without gemstones, enamel jewelry with charms or Murano beads in various colors, as well as imitation jewelry. Gen Y consumers especially look for distinctive designs which can reflect their identities, and need products that can be customized or made by order to make it different from others’. They also seek new value or experience from buying products. Their steadily growing income leads to higher purchasing power, and in turn, the willingness to pay a premium for products which suit their demand. Focusing on design and quality rather than prices, Gen Y makes jewelry buying decisions based on their own satisfaction.
However, since in some ASEAN markets, the income levels of this consumer group are not very high, those with rather low income still mainly consider versatility and prices. Jewelry should be wearable in various occasions, encompassing both special events and daily life. Therefore, jewelers should enter these markets by offering good quality products in reasonable prices.
Communicating with Gen Y
Growing up with different values and changes, especially in terms of technology, Gen Y has significant influence on brands and marketers. They have high purchasing power, are confident in making purchase decisions, and readily embrace new trends. They also consider spending money as self-reward. Therefore, they are more open to new brands compared to the previous generations, focus on functions and practical innovations rather than brands’ reputation, and emphasize the importance of product values which can express their identity or personal experience. Gen Y usually finds product information before buying and receives marketing materials from both online and offline channels. Regarding buying channels, the new generation increasingly buys products online in case of affordable silver or imitation jewelry, but for medium- to high-priced jewelry, they still buy from jewelry shops in shopping districts or department stores to make sure of product quality.
Therefore, brands and marketers need to understand the behavior of these consumers and find new ways to communicate with them. For the 80’s Gen Y, brands must act as a producer who builds the stage and creates inspirations for them to show their characters to the world, while for the 90’s Gen Y, brands must approach them with honesty and sincerity, acting as a partner who gives suggestions and support, and sometimes as a good listener.
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Graphture jewelry, a Thai brand targeting the new generation
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To win Gen Y’s heart, a marketing strategy should take account of customers’ demands and directly respond to them. This can be done by creating selling points for the product, presenting distinctive designs, or telling stories of special jewelry pieces with rare, naturally beautiful gemstones. Jewelers can also add contents on cultural beliefs which are similar among ASEAN countries, or offer jewelry which can be customized according to customers’ demand; for example, pieces which are designed by the customer or co-designed between the customer and the designer.
Gen Y’s favorite marketing campaigns are sales promotions, discounts or exclusive privileges. Brands need to communicate with them about promotions or privileges in a clear and direct way since they have little time and need fast communications. Releasing new collections in line with special occasions or new fashion trends is also important.
Moreover, jewelers can impress Gen Y customers by offering after-sales services, such as jewelry cleaning or fixing for existing customers. This is one of the main strategies to build customers’ trust, confidence and motivation to re-purchase. It might also increase the possibility that they recommend the brand’s services or products to their friends or acquaintances. As for new customers, the focus should be on giving information or advice on product quality, gemstone purchase and identification, and after-sales services. This should be communicated on social media for immediate response and growing awareness of the brand.
Gem and Jewelry Information Center
The Gem and Jewelry Institute of Thailand (Public Organization)
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