Nearly 90 Percent of Asian Women Surveyed Buy Clothing and Accessories Online While 63 Percent of Respondents Browse Online Shops Daily
Vipshop Holdings Limited (NYSE: VIPS, vip.com), the largest online discount retailer for brands both in China and globally, as well as the No.1 female-oriented vertical e-commerce retailer in China, has initiated and partnered with The Economist Intelligence Unit of the Economist Group on a survey regarding the growing buying power of female consumers in Asia.
The report, titled "On the rise and online: Female consumers in Asia" was released today, and it surveyed 5,500 women across major urban areas in Greater China, India, Japan, South Korea and Singapore, as well as consumer analysts, major retailers and brand owners. The study found that women are driving the growth of online shopping in the region, with many preferring online to offline. Among survey respondents, 63 percent browse the Internet at least once a day for products and services, with nearly 30 percent doing so twice or more per day. Slightly fewer than 80 percent of women regionally buy groceries online, 83 percent for cosmetics and the figure rises to nearly 90 percent for clothing and accessories.
Asia's rapidly growing consumer markets are the great hope of many companies across the world. In 2015, retail sales in Asia are forecast to grow by an average 4.6 percent on a volume basis, to US$7.6trn. This compares with 2.5 percent in North America and 0.8 percent in Europe, according to Economist Intelligence Unit forecasts. "Women are a unique and important driving force in the Asian market. And at Vipshop, over 80 percent of the accumulative 90 million members are females, who contribute to 90 percent of our sales. The partnership with the EIU allowed us the opportunity to learn more about consumer shopping habits and to further expand upon its leadership position in China's online retail market. Based on the survey results, we are confident in our ability to address the growing and diversified user demands for quality products and services. We also hope this survey can provide some insights to brands that wish to further reach female Asian consumers," said Eric Shen, Chairman and CEO of Vipshop.
Perhaps most troubling for retailers focused on the brick-and-mortar business, nearly half -- 49 percent -- of women polled agreed or strongly agreed that they preferred the experience of shopping online to doing so in stores. The figure was as high as 69 percent in mainland China. Notable outliers include Hong Kong, Singapore and especially Japan, where only 18 percent of women said they preferred online shopping to shopping in stores -- the lowest rate in the region. This no doubt reflects the highly developed retail markets in these places.
Moreover, youth lead the way to the future. Among the youngest (18-29) demographic surveyed, 53 percent prefer shopping online and 58 percent shop online with their smartphones at home, versus 38 percent of 40-49 year olds.
Additional key findings from the report:
Women in Asia's major cities are increasingly empowered. Region-wide, 43 percent of the women responding to the survey were in managerial, executive or professional services jobs. Of those, eight percent described themselves as sole breadwinners and 41 percent said they were joint breadwinners, while 83 percent contribute to household income. The trend is particularly notable in mainland China, where 62 percent described themselves as joint breadwinners, and 91 percent contribute to household income.
Women are showing increasing independence in handling their finances. Just over two-thirds reported having their own bank accounts (this ranged from 76 percent in mainland China, to a low of 47 percent in Macau), and 48 percent held their own credit cards.
Most women are in charge of budgeting decisions on cosmetics (81 percent), clothing and accessories (73 percent), groceries (67 percent) and maternity and children's products (57 percent), and they are at least co-decision makers in most other product categories like electronics and travel services. In Macau, Singapore and India, women reported having a comparatively smaller role in household budgeting decisions, but were still the clear authorities in areas like clothes and cosmetics.
At least on the Internet, many Asian women do not seem to be living up to the stereotype of selfless, family-focused individuals. Over 62 percent of women are buying for themselves most of the time when shopping online; in mainland China that rate rises to 74 percent, and to 77 percent among 18-29 year olds. Women do, however, engage in guilt shopping; 41 percent said they would buy something for their partner, children or family when they feel they have bought too much for themselves. That figure rises to 67 percent among women in mainland China.
Brick and mortar retailers need to improve their operations, notably on inventory management and customer service. Women have a variety of reasons to prefer online shopping. Most point to cost (62 percent) and time (60 percent) savings, but they also feel that online retailers can be relied upon to have the products they want to buy (59 percent) and they appreciate the range of choice online shopping offers (56 percent). Across the region, nearly half (48 percent) say they feel pressured and stressed in traditional shops, and 27 percent feel store staff talk down to them because they are women.
When choosing an online retailer, women say price (83 percent) is important or very important, but so are quality (83 percent), genuine products (82 percent) and convenience (77 percent). Notably the rise in women's purchasing power and online shopping are together reshaping retail, many of the trends emerging are nothing new. Women still place an immense amount of value on the advice of friends and family. A good name counts for more than just about anything.
The online shopping craze offers opportunities in cross-border trade for brands and retailers, but brands and retailers need to work on logistics. Regionally 36 percent of women agreed or strongly agreed that they shop online specifically to get products from overseas, and 41 percent said they bought products from abroad because they were better than those produced domestically. This perceived quality gap was especially pronounced in Macau and mainland China, where 53 percent and 63 percent of women respectively saw products from abroad as superior.
Getting the messaging right will be tricky. Given their rising economic power, one might reasonably expect women to be more attracted to messaging that appeals to their rising independence. The reality is more complicated. While messages that address them as independent, intelligent consumers were found to be appealing to 56 percent of women, nearly the same percentage (54 percent) said they found messages addressing them as wives, mothers or girlfriends to be attractive. Successful messaging will no doubt be that which somehow manages to marry the two.
The future of online shopping looks mobile, and impulsive. Mobility in online shopping also means women are increasingly shopping anywhere and everywhere, and online retailers will need to have a strong mobile interface. The percentage who prefer shopping online climbed to 53 percent among the youngest (18-29) demographic surveyed (compared to 49 percent overall). In this age range, 58 percent of women shop online with their smartphones at home, versus 38 percent of 40-49 year olds. While overall some 43 percent reported spending more money online than they do in physical shops, again the rates among those 18-29 were even higher (56 percent). This may be connected to the typical lack of youthful restraint; over half of women 18-29 agreed that they were more likely to buy impulsively online. Asian women enjoy online window-shopping, which is regarded as an important social activity by them. Sixty-three percent reported they will go online window-shopping, no matter whether they will purchase the products; Fifty-nine percent said they would on online window-shopping even though they will not afford the products. Also, 45 percent said they will purchase "impulsively" when online window-shopping, and 33 percent admitted themselves "spend too much online."
Laurel West, editor of the report, said, "Women are controlling spending in a variety of categories where you would expect them to, such as clothing and accessories, cosmetics and groceries. But they also have an increasing influence in bigger ticket items such as electronics. Many brands are realising this and making efforts to better understand what is important to female consumers."
Since its foundation in 2008, Vipshop has been focusing on "online discount retail" model, well-known for the features of "selected brands and genuine products" with "discounted prices" for "flash sales." According to the EIU report, Asian women regard "quality (83 percent), price (83 percent) and genuine products (82 percent) as the top three factors when they choose online retailers. Obviously, Vipshop's business model of "online discount retailing for branded and genuine products" naturally matches with women's demands and criteria for online shopping.
The EIU report also reveals that women have dominant online spending control in the buying of clothing and accessories, cosmetics, maternity and children's products, and home goods, which coincidently proves the rightness of Vipshop's she-economy strategies that it conducted one year ago. Since then, Vipshop has expanded its categories from apparel and accessories to cosmetics, maternity and children's products, as well as home goods to leverage the increasing power of the she-economy.
With forecasts of the growing trend of female consumers' mobile shopping habits in 2009, Vipshop launched its mobile APP and continuously kept optimizing the mobile interface ever since. In July 2014, Vipshop founded its first overseas R&D center in the Silicon Valley, USA to focus on big data research and application, and providing a personalized landing page and customized services for women to enhance their online shopping experience. Moreover, Vipshop initiated "8 pm sales activities specialized for mobile purchase" this year, which is tailor-made for those women who are fond of mobile shopping in bed at night. This activity specifically relates to the EIU report, which found that 30 percent of the Asian women surveyed said they would shop online in bed at night due to the convenience and popularity of mobile shopping.
Fully understanding women's comprehensive roles and shopping demands both as independent career women and good wives/mothers/daughters, Vipshop provides the goods of 12,000 brands for women and their families. And in September of this year, Vipshop launched its "Global Sales" business to enrich the online shopping offerings to women.
Tony Feng, Vice President of Vipshop, said at the survey launch press conference, "At Vipshop, we are continually pushing ourselves to deliver the best products and services in the best format, and this study is born from these efforts aimed at the rapidly growing women's market. It showcases our determination to go further in focusing our resources on better understanding and creating bigger innovations and deploying them at scale in areas where we want to win."
