The most influential Megatrends set to shape the world through 2030, identified by Euromonitor International, help businesses better anticipate market developments and lead change for their industries.Learn More
Welcome to the latest edition of the Euromonitor International consumer comment bulletin tracking new consumer trends in emerging markets. Understanding the fast-moving trends shaping consumer attitudes and behaviour in these difficult-to-research markets is key to successfully capturing the hearts of these prized consumers. This bulletin spotlights consumer trends in BRIC countries and other emerging nations every two months.
Unlike most other European countries, the internet is dominated by local players in Russia. Yandex, which recently floated on the stock market with great success, is dominant in search, with Google accounting for no more than a third of the market, according to data published by GP Bullhound, a UK- based, technology-focused investment bank. Similarly, vKontakte accounts for over 70% of the social network market, with Facebook’s share at less than a fifth. Overall, six of the top ten sites in Russia (including all of the top three) are domestic, compared with four in Germany and just one in the UK.
However, Russia’s low (if increasing) penetration of credit cards and widespread reliance on cash poses challenges for e-commerce. Cash payment terminals are widely used, and cash-on-delivery remains a popular payment option. According to Euromonitor International data, e-commerce was worth US$6.5 billion in Russia during 2010, up from US$1.7 billion in 2005.
A small, but growing, number of often affluent Chinese are choosing to abandon meat for religious, environmental or health reasons. A spate of food scandals is thought to be the reason behind many of these conversions. While hard data is difficult to come by, international vegetarian groups reporting a surge in interest from China. According to the USA-based People for the Ethical Treatment of Animals, its website now receives more traffic from China than anywhere else.
The most visible evidence of this trend is an explosion of vegan and vegetarian restaurants in some of the country’s larger cities, particularly Beijing. A decade ago you, there were no more than a handful of restaurants in the capital, but there are now more than 100. According to Wang Rui, the proprietor of Good Mother’s Vegan Restaurant, which opened in central Beijing earlier this year, just a few years ago most vegetarians came to the practice through Buddhism. However, this connection with religion has steadily been eroded. She says that her friends and customers are increasingly giving up meat for other reasons, such as food safety. In spite of the growth in the number of vegetarians in China, mainstream opinion still considers meat to be essential to a healthy diet.
Cinépolis, a family-owned firm based in Michoacán, Mexico, is the fourth-largest cinema chain in the world. Dominant in the Mexican market, it also has a presence in eight other Latin American countries. It has prospered by replacing old, fleapit cinemas with modern multiplexes, and it is now looking to bring this formula to India.
Cinema is hugely popular in India: According to Euromonitor International data, Indians made an average of 3.7 trips to the cinema during 2010, compared with 2.9 in the UK, 1.9 in Italy and 4.6 in the USA. Non-English-language films account for 90% of takings, by far the highest proportion in the world. However, many of its cinemas are in a dilapidated state and in dire need of renovation.
Over the past 18 months Cinépolis has opened three multiplexes in India, introducing such gimmicks as 3D to some regions. It is due to open a further 43 screens during 2011, followed by almost 100 the following year. Its plans include 14- and 15-screen “megaplexes” in Mumbai and Pune, respectively, which will be India’s largest. The company hopes to have 500 screens in India by 2016, which could make it the largest player in a fragmented market.
Oxi, a highly addictive and hallucinogenic blend of cocaine paste, gasoline, kerosene and quicklime is wreaking havoc across Brazil’s Amazon region. It is said to be twice as powerful as crack cocaine but costs just a fifth of the price.
According to Alvaro Mendes, an outreach worker from the city of Rio Branco who works for the state of Acre’s Harm Reduction Association, the NGO that first detected the drug: “The majority of first-time users become addicted on their first contact with the drug. Most of them go seven to 10 days without sleeping, without eating. They start to go into a process of degeneration. After months of use … they go into a state where they look like zombies, wandering … in search of pleasure.”
Regular use often leads to death within a year: “The difference between cocaine and oxi is like the difference between drinking beer and pure alcohol,” commented an unnamed federal police operative working close to the Peruvian border.
The average height of very poor women in some emerging markets in Africa has shrunk over recent decades, a study conducted during 2009 and 2010 by researchers at Harvard University has found. Height is a strong indicator of childhood nutrition, disease and poverty, and the study found that average height had declined among women in 14 African countries and had stagnated in many more.
Those behind the study maintain that this implies that poor African women born during the last two decades are actually worse off than their mothers or even their grandmothers: “It’s a sobering picture. It tells you the world is not getting to be a better place for women of lower socioeconomic status. For them, it’s getting worse,” said S. V. Subramanian, a professor at the Harvard School of Public Health and the study’s lead researcher.
The Nigerian film industry (popularly known as Nollywood) is huge, second only to India’s Bollywood in terms of the volume of its output. On average, 31 films are released each week. Most of these tend to be low-budget affairs that are shot in a few weeks and released directly to VCD (video compact disc), a precursor to DVD that remains popular in much of Africa.
Nollywood films are now hugely popular throughout English-speaking Africa, from Ghana to Uganda and South Africa. According to Teco Benson, a prominent Nigerian director, “We are beginning to commandeer the information flow to go from the global south to the global north. Only in Nigeria can Africans tell their own stories to audiences around the world.”
As in much of the rest of the world, food prices in Azerbaijan have skyrocketed during the first half of 2011. According to official figures, overall prices rose by 2.2% in February alone, with the price of sugar and potatoes increasing by 9.5% and 12.5%, respectively. However, non-government sources claim that the actual increases have been much larger. Azerbaijanis have long shopped in neighbouring Georgia, but after the Iranian government moved in February to lift restrictions on the amount of agricultural products that could be taken out of the country, Azerbaijanis have been flocking to their southern neighbour to buy food, leading to lengthy queues at the border.
According to one elderly woman queuing at the border: “Why shouldn’t I go to Iran? We buy everything we need there – meat, butter. These products are very expensive in our country. We cannot afford to buy these things here on our tiny pensions.” Another claimed “If they close the Iranian border, we will die. People will kill each other.”
Thais are passionate about food, with traditional varieties of fermented fish particularly popular in rural areas of the northeast of the country. Described by one aficionado as “tasting like heaven but smelling like hell,” the raw fish contain parasites that can accumulate in the liver and lead to a deadly cancer. Known as bile duct cancer, it is relatively uncommon in most of the world but accounts for most of the 70 liver cancer deaths a day in Thailand, according to Dr. Banchob Sripa, the head of the tropical disease research laboratory at Khon Kaen University in the north of the country: “It’s the most deadly and persistent cancer in the region,” he says.
Nutcharin Yanarangsri, a volunteer at a government health clinic in the nearby village of Lawa, spends her days walking from house to house telling locals to “Say no to raw fish!” She says, “We tell them, ‘If you really want to eat it, you’d better boil it or cook it.’ But they tell me, ‘Eating it raw is so delicious. I can’t stop. I love it!”’
A study sponsored by the Slovak department of the European Commission and carried out by the Association of Slovak Consumers during 2010 has found that food products of the same brand exhibit significant differences in quality between Eastern and Western Europe, depending on the market they are intended for.
For example, in the case of Coca-Cola, the difference lies in the type of sugar used: German and Czech consumers get a product made from beet sugar, while Slovaks have corn sugar in their drinks. The reason for this is usually cost: Slovaks have less purchasing power, so manufacturers tend to use cheaper ingredients and charge them lower prices than in wealthier neighbouring countries.
The report sparked significant online debate in Slovakia: According to one blogger, “It is mainly about the customer… If the customer does not care about contents, weight, origin and cares only about the price, then the producer will meet his wishes. It’s a huge difference between a typical Austrian and a typical Slovak customer. How many Slovak customers are looking at the country of origin?” Another writes “My parents grumble that smoked meat is not the same quality it used to be, but the only thing they care about is the price. With contents or taste, they deal only when it is impossible to eat it.” However, a third claims “I do this [check the country of origin] and others do it as well. And I do not think that Austrian customers pay more attention to these things than the Slovak ones.”
In the Belarusian capital of Minsk, the dominant topic of conversation these days is prices: the price of imported goods – those that are still available – is doubling or even tripling on an almost weekly basis. Multiple exchange rates are in operation: Recently, the interbank rate stood at around BYR7,500/US$, while bureaux de change businesses were still required to sell dollars for BYR4,500. Naturally, the result of this was that they barely had any dollars to sell.
In scenes reminiscent of the Soviet era, many Belarusians are closing their bank accounts, stocking up on non-perishables, and joining long, snaking queues outside these bureaux de change to get their hands on hard currency. Those waiting in line keep a notebook detailing their names and place in the queue, returning occasionally to check that everything is in order. Others loiter around Minsk’s central railway station in the hope that naive foreigners will trade in their hard currency for favourable rates on arrival.
In spite of the fact that they have long derided them as a symbol of capitalist decadence, in May, the Cuban government gave preliminary approval for four large luxury golf resorts on the island. These will be the first in an expected wave of more than a dozen that the government anticipates will lure affluent tourists to a country hungry for hard currency. The plans also include residences that foreigners will be permitted to buy, a rare occurrence in a country where private property has been all-but abolished in a concerted push for social equality.
According to Chris Nicholas, managing director of Canadian developer Standing Feather Indian, which plans to break ground on a golf development in September this year: “Cuba saw the normal sun and salsa beach offerings and knew it was not going to be sustainable. They needed more facets of tourism to offer and decided golf was an excellent way to go.”
Ralph Lauren polo shirts have become a fashion staple among the country’s disaffected youth. This trend emerged during summer 2010 with the capture of mafia leader Edgar Valdez Villarreal, aka La Barbie, who was paraded before the press wearing a green Ralph Lauren polo shirt. Several months later, Jose Jorge Balderas Garza, known as El JJ, was detained wearing the same shirt in blue.
These shirts sell for about US$150, but counterfeit versions are doing a roaring trade at around a tenth of that price: “The kids want to look like the bad guys,” said Maria del Carmen Martinez, a street vendor in Mexico City. According to Oscar Galicia, a research psychologist from the Iberoamericana University in Mexico City: “There is an aspirational crisis in Mexico. Young people have lost faith in legal means for social advancement and see the ‘narcos’ as figures of respect.”
He added the traffickers copied the style from the Mexican elite, who began wearing these shirts several years ago. He maintains that urban-based criminals now see themselves as part of that elite and have largely abandoned their old image of loud open neck shirts, crocodile skin boots, and ostentatious gold chains.