Across all age groups, 43.7pc cited employment or search for employment as the key reason for moving between states/regions to more urban areas. This population movement has a high correlation with economic development in the form of industrial zones and special economic zones, which remains geographically concentrated.

Moreover, the fast paced reforms and incoming foreign investments have led to better employment opportunities, faster growth and higher spending power especially for the Optimists (see Table below) and Aspirants who have embraced change and economic development.

Rise in consumerism driven by higher spending power

Currently, only 24pc of the Myanmar population earns more $120 per month as bulk of the population (>60pc) continues to be employed in the unindustrialised agriculture sector. However, this share is expected to increase to 48pc by 2022 driven by rising employment opportunities in the services and manufacturing sectors.

The Connected generation are characterised as ‘voracious consumers’ and with higher affinity for foreign brands and products, are expected to drive consumer spending going forward. There is also a slow but steady transformation of purchasing processes and decision making, especially across the urban areas driven by a rise in modern trade outlets.

Burmese consumers are expected to eat out more frequently with the rapid growth of foreign food franchises established in Tier 1 cities. Local modern retail operators such as City Mart, Capital and Gamone Pwint, have increased presence of 24-hour convenience stores, whereas Supermarket and Hypermarkets are seen not just in Tier 1 cities but also in Tier 2 and 3 cities of Pathein, Taunggyi and Mawlamyine.

The next stage of consumerism: Myanmar’s digital economy

Myanmar’s mobile infrastructure and connectivity, though notably slower than other neighboring countries, are witnessing rising development after the country embarked on the liberalisation of the telecom industry in 2013. As of January 2017, smartphone penetration reached 78pc driven not just by the Optimists who remain most tech savvy, but even the older Contemplative generation.

Given the larger size of Myanmar’s rural population, the bulk of smartphone penetration growth will be driven by increasing adoption in the rural areas. The attractive price levels of Chinese brands and Samsung handsets are widely popular in Myanmar with Huawei dominating the market followed by Samsung, Xiaomi, Oppo and Vivo.

As smartphone penetration continues to accelerate, the Optimists and Connected generation groups will be crucial for driving the next phase of the digital adoption in Myanmar, such as e-commerce and mobile banking. While Myanmar’s e-commerce industry is at a nascent stage, 85pc of visitor traffic comes from smart phones, with customers appreciating the convenience of shopping on the go.

Drivers and key enablers for Myanmar’s economic growth

It is important to understand the impact of the rapid pace of development on consumers in Myanmar, not just on a regional or urban versus rural perspective, but even through the defining political and economic events. For that fact, companies and foreign investors interested in this market will need to consider several factors to achieve sustainable, long term success in this market such as:

Rising consumerism to drive local manufacturing

Consumer firms such as Unilever, Henkel and Nestle, automotive firms such as Nissan and Suzuki have all established local facilities to better cater to the local demand.

Technological leaps to boost SME innovation

With Myanmar leapfrogging straight to smartphones, a range of tech start ups have emerged to cater to basic needs of the people especially in the financial, healthcare and educational sectors.

Customer education is key

While customers are impatient to catch up, highlighting the value of your products and services remains key with consumers being more value conscious than price conscious. Targeted customer engagement strategies will be more impactful in a segregated complex market such as Myanmar.

Offline and online integration

While social media remains the predominant mode of engagement, effectively integrating online and offline marketing through a “customer oriented” approach rather than a “product oriented” strategy will be key.

Solidiance is a corporate strategy consulting firm with a focus on Asia. It advises CEOs on make-or-break deals and new business models. It has 12 offices across Asia, from Dubai to Shanghai.

Source: https://www.mmtimes.com/news/riding-wave-consumerism-myanmar.html