DOMESTIC consumption is the new revolution in Asia's economy. It has played and will continue to play an increasingly important role in the growth of Asian economies, which were generally export-dependent.
Asian economies have come a long way since savings and frugality were the mainstay of the day. Now that the economies have matured, the path to a balanced and sustainable growth lies in understanding the way people spend and the reason behind it because a sustained rise in private consumption is the ultimate engine of economic growth in Asia for the coming years.
When analysing the consumption equation, MasterCard found an important trend, that is, women are at the helm of it. Stretching across generations – from Silent Generation to Baby Boomers, Generation X to Generation Y – women are found to be the driving force of the consumer market.
From left: Shekila, Lim, Lai, Tan, Cheah-Foong and Yau at the MasterCard discussion. The rising discretionary spending power of women consumers will be a key driver of Asian consumer markets, and no business can afford to ignore them.
"Women are the buyers and key decision makers in the purchase of most consumer goods," Hedrick-Wong says.
"Therefore, no company can hope to be successful in Asia's consumer markets without a deep understanding of the woman consumers of Asia as they account for the rising share of consumer power as well as increasingly taking centre stage in deciding how, when and what to spend," he adds.
Recently, MasterCard organised an informal discussion with five successful women to understand how they perceive women consumers as the driving force of economic growth and the importance to empower them henceforth.
The session was moderated by MasterCard International Asia/Pacific vice-president of communications Georgette Tan. Participants Logica Malaysia Sdn Bhd managing director (Malaysia and Singapore) Shekila Ramalingam, Rampai Niaga Sdn Bhd managing director Datin Mina Cheah-Foong, Malaysia Deposit Insurance Corp general counsel Lim Yam Poh, Ireka Corp Bhd executive director Monica Lai and MasterCard Worldwide vice-president of member relations and marketing Yau Su Peng share their view.
On woman consumers...
MasterCard sees women very much as the driving force of the consumer market. It recognises that they are the ones making decisions and having the capacity to make things happen for themselves as well as their families.
Shekila: Women consumers are a rare breed. First, we must understand that women, unlike men, do not just shop for themselves but also for the whole family. Most women are equal or near equal contributor to their family funds. They make most buying decisions in the family because they are natural caregivers. They are also the ones who make decisions on savings.
Cheah-Foong: Generally, women make the purchasing decisions for their households, spanning across groceries, household stuff, clothes for children and holidays, etc. For instance, the owner of a credit card may not be a woman, but decisions on how to spend with the credit card most of the time are determined by a woman.
Lai: Women have assumed the responsibility of tending to the needs of their loved ones, besides their own. Increasingly, women take on the responsibility for buying larger items such as cars and properties.
For example, in my line of work, I have never been able to close a deal with a man without him saying "I must check with my wife first".
Yau: Women are better decision makers because they tend to judge the practicality of a product. A product has to meet her "predetermined criteria" before she is willing to spend her money on it. Women consumers have a "checklist" of sorts.
Lim: Women are very detailed beings. Take travel. Women are usually the ones who plan the details such as which hotel to stay and mode of transportation to take.
On women's spending habit ...
If women are driving the consumer market, it is imperative for businesses to understand their buying habits to target this important customer group.
Shekila: Women have a good eye, I think. They are cautious in what they buy. I am sure they do a lot of window shopping, but when it comes to actually purchasing an item, they think of value, not so much of cost.
As consumers, women live under a good deal of pressure. They have to find ways to feed their families on a limited budget. They search for a balance between affordability, nutrition and availability, countered with the personal preference of their families. And because women are key decision makers in consumption of a household, keeping them happy is important because women tend to talk about their experiences. You give excellent customer service to a woman, and you will gain 10 more new customers.
Brand loyalty programmes are an excellent avenue to reward a woman consumer.
Cheah-Foong: Women are natural word-of-mouth spreaders. They are also loyal to brands. Once they get attached to a certain brand, it can be difficult to detach the brand from their lives.
Lim: Women are brand-loyal customers. They can be using the same brand for years but, of course, there are certain things that they look for in the brand. The philosophy of a brand is what we believe in. Women are usually the ones who read and compare the product labels.
Yau: Family members are the priorities of a woman's life. Hence, women tend to read product labels to ensure they are getting the best for their family members as well as for themselves.
Lai: Depending on a woman's upbringing and financial background, she would be very willing to invest in expensive goods for its quality. Not all women would buy something for the sake of buying. On top of that, I agree that women are loyal brand customers.
On empowering women ...
According to the fourth annual MasterCard Worldwide Index of Women's Advancement 2008, Malaysia ranked third highest within the Asia-Pacific region with a score of 76.89, after the Philippines (86.82) and Hong Kong (77.37).
The Index measures the socioeconomic level of women in relation to men using four key indicators, that is, tertiary education, labour force, managerial position and above-median income.
Within the four indicators, Malaysia's score are: tertiary education (135.02), labour force (59.0), managerial position (65.91) and above-median income (47.62). (A score under 100 indicates gender inequality in favour of males, while a score above 100 indicates gender inequality in favour of females.)
The statistics show that for every 100 men who have tertiary education, there are 135 women with the same qualifications. But despite the fact that women are educated in Malaysia, their labour force participation is quite low as indicated by the statistics.
Shekila: Being educated does not level the playing fields. Any woman as per her male opponent must have the right skills for the job. On top of that, we need to create a society that accommodates women and their needs. In Australia, for example, women do not hesitate about entering the workforce because they have a proper support structure in place, such as childcare facilities and a flexi-hour work environment where women are allowed to work from home once or twice a week.
Lai: A single woman may find it less challenging to participate in the labour force, but once a woman gets married and have children, she may be asked to leave the working world, and sometimes it could just be a natural progression.
There is the tendency of a woman falling into a gender scenario once she is married. There is an expectation for her to perform the traditional role of a homemaker.
Cheah-Foong: A woman's work has to be valued, even if she is just a homemaker. Being paid to do work at home is not a privilege, it is a right. For a woman to be successful and financially independent, it is important to have a supportive family that encourages her to excel.
For example, in my case, when I was young, my parents have always instilled in me the importance of education and being financially independent even when married. But in some families, girls would never get this kind of encouragement.
No doubt, culturally, women have less status in most families and societies. Some women have to opt out from contributing to the economic and national developments even when they are highly educated, resulting in a "brain drain" of sorts.
Without a firm support structure in place for women in the workforce, Malaysia will not be able to see an increase of women participation in the labour force.
Lim: Malaysia has a pool of women talent who are smart and dependable. However, due to some constraints, some are not able to join the workforce. If we could fix this to encourage more women in the workforce, that would be great.
I believe childcare facilities are very important for working mothers and should be made available to them. It is also important to make such facilities affordable for working mothers from all walks of life. Childcare facilities are important because they give these women a sense of security, knowing that their children are under the care of responsible hands. This will enable them to concentrate on their work.
Yau: Besides the responsibilities at their workplaces, women have very demanding roles to play in their families, especially so if they are mothers. So, childcare facilities should be made accessible to them.
According to Harvard professor emeritus David Landes, a woman's role in society is one of the most important determinants of a country's economic development. His study finds that women must contribute fully to the economy and lead full social lives for a society to experience robust growth.
Women are the rising force that drives the economy. Hence, no business and government can afford to have policies that do not encourage the advancement and growth of this group of dynamic force.
MasterCard says women in the key markets of Asia Pacific total more than 1.3 billion to date. The number is expected to reach 1.5 billion in 2014.
