shopper trends: the changing face of Australia

The latest census found that slightly more than half of Australia’s residents today have two Australian-born parents and more than one in four Australian residents were born overseas.

This shift in the population make-up also means a shift in shopping habits, preference, behaviours and expectations, as well as influence and purchasing power towards ethnic-Australian consumers.

Ultimately, a different approach is required for manufacturers and retailers to be successful in this evolving market.

So, how can brands deliver for Australia's changing population? What are the opportunities for FMCGs and retailers? 

The shift.

According to the 2016 census, net migration has accounted for over 50 percent of Australia’s population growth since 2006, with 28 percent of Australians now born overseas.

The increase in overseas-born Australians is predicted to continue with the biggest growth coming from Asia (overtaking Europe in terms of population share as of 2015). NSW alone is home to about half of all of Australia’s 500,000 Chinese-born ­residents. 

According to Nielsen:

"...in the next five years, ethnic-Australians’ spend will grow at a faster rate than their Australian-born counterparts, accounting for over $4.4 billion in incremental revenue. This will result in the ethnic-Australian shopper contributing a total of $18.7 billion (or 28 percent) of the total FMCG retail channel."

The changing retail landscape.

1. Food.

European preferences are generally catered to more so than Asian foods in major supermarkets.

This is partly because many SKUs are driven by Australian demand, such as consumers looking for unprocessed foods, with healthier alternatives such as wholegrain foods.

However, there are more similarities than we think. Both European and Asian-born consumers are looking for healthy ingredients, although perhaps just slightly different types.

Changes have been made in an effort to better connect with international consumers, with sections of supermarket aisles now dedicated to food from various cultures such as the introduction of fresh sushi counters. But more could be done.

Food trends are moving towards fresh Asian ingredients, vegetables and treats, such as dumplings and dim sum. Asian-fusion restaurant cuisine is also becoming increasingly popular in Australia, suggesting that Australian and European-born consumers would respond well to an increased Asian food selection in supermarkets.

2. Liquor.

Culture has a big impact on attitudes towards alcohol. There are obvious and clear differences between Australian cultural attitudes and Asian cultural attitudes and tastes.

According to market research and consulting agency Koji:

"From sweeter drinks to lower ABV products, to exotic Asian flavours such as coconut, our liquor industry will need to be able to evolve beyond the expectations of ‘European’ tastes to take advantage of the changing shopper landscape."

3. Luxury retail.

Wealthy Asian consumers, particularly the Chinese, have a reputation for shopping luxury brands.

Global management consultancy firm Bain recently stated that Chinese consumers account for 32 percent of luxury retail sales worldwide. In the Australian market, Chinese shoppers are estimated to be responsible for at least two-thirds of sales.

According to Jennifer Spark from Ready Set Go China, a Sydney based digital marketing agency, luxury brands in Australia are now maximising this opportunity by working with wealthy Chinese micro-influencers who can influence shopping behaviours.

Concierge and customer service staff at bigger city stores in Australia are often Mandarin speakers in order to better connect with this group of consumers.

Dior stores in Melbourne have also introduced a rate card which compares the prices of their popular products in Australia with China, to show the savings.