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shopper trends: the changing ethnic face of Australia

The latest census found that only 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 a 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? Read on to find out...

The shift

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

The increase in ethnic-Australians is predicted to continue with the biggest growth coming from Asia (overtaking Europe in terms of population share as of 2015).

NSW is home to about half of all of Australia’s 500,000 Chinese-born ­residents. Looking at Sydney, in Hurstville 40% of people are Chinese and in Parramatta 35% of the population are South Asian.

According to Nielsen:

" 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%) of the total FMCG retail channel."


Asian-born Australians

There are some notable differences in shopping behaviours and preferences...

  • High demand for health and beauty products. This is demonstrated by the daigou effect’ (check out our blog HERE to find out how to leverage the Chinese daigou shopper trend)

  • Linked to the previous point around daigou shoppers, they are also willing to spend more on big brands that they trust

  • A desire to have their needs properly understood and catered for means they will choose a retailer based on the availability of international products


The changing retail landscape



European foods are generally catered to much better than Asian foods in the major supermarkets.

This is partly because many trends align with Australian demand, such as consumers becoming more environmentally conscious and 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 - 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 and the introduction of fresh sushi counters, for example. 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.

Ad News recently noted how Aldi built its profile in Australia by tapping into multicultural markets, stating:

"There are also several specialist grocery stores like the sensational” Korean grocery store 'Komart' taking away customers from the likes of Coles and Woolies."



Culture has a big impact on attitudes towards alcohol. In liquor, manufacturers and retailers operating in Australia need to understand and be relevant to this growing part of the market.

According to 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."


Luxury retail

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% 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 (Ready Set Go China - Sydney based digital marketing agency), luxury brands in Australia are now maximising this opportunity by working with wealthy Chinese micro-influencers within the community who can influence their friends’ shopping behaviours.

Concierge and customer service staff at bigger city stores in Australia are often now 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.


Opportunities to connect


Introduce more product variety, information and promotions

Focus should come away from mostly catering for European cultures, with more investment in the categories which Asian consumers are shopping for.
Product promotions can be useful to engage with price sensitive shoppers, as well as providing the opportunity for big families to buy in bulk easily.
The preference for more information on pack applies to changes in both Australian-born and international consumers' preferences today.

Show commitment

Commit longer term than just during cultural holidays such as Chinese New Year. These sporadic promotions aren't enough to change behaviour and store preference.
Masheila Pillay (Dentsu Mitchell's multicultural director), recently stated: 

“That needs to change because grocery buyers are there all of the time... What is needed for these major supermarket chains is that sometimes its just a matter of putting a little bit more investment to reach a completely new market. Using similar creative but having more tailored approach to certain audiences.”


Personalise and tailor content

Connect with Asian-born consumers by leveraging trusted sources of information such as health influencers (e.g. Blackmores using tennis star Li Na as an ambassador) or by targeting older consumers (because grandparents are influential in family decisions).

“A lot of marketers assume younger audiences [from ethnic communities] can understand English so there’s no need to be targeted. But within certain communities [particularly Asian], grandparents have a huge influence over family decisions.”


Tap into daigou shoppers

Target the Australian market using local Asians as influencers to introduce Australian brands.

Lou Petrolo (multicultural marketing expert and managing partner at Etcom) advises: 

“...the brands that are clever will tap into this. However, the danger with a grey market is if they become too big, it takes over and controls your brand. Take a measured structured approach to this.”


The bottom line

The traditions, behaviours, beliefs, wants and needs of an increasingly multicultural Australia provide an opportunity to explore new flavours, ingredients and products.

Businesses that make a conscious effort to connect with ethnic-Australians have a real opportunity to benefit due to the increased spending power of these 'new Australians', with future immigration only amplifying this growth.
The shift also benefits Australian consumers who get to experience more diversity and options, conveniently aligning with the current trend to be more creative with cooking and food choices.
Australian kids are already eating sushi in their lunch boxes (I only got cheese sandwiches back in the day - how unfair!) and Asian salads, Japanese-influenced poke bowls, matcha/herbal teas and Yum Cha restaurants are everywhere.
So, where is the next opportunity and how will your brand get the move right?

Over to you 

PLAY specialises in consumer research for FMCG, retail and lifestyle brands, so if you are looking to get a better understanding of the changing Australian population and market - we're here to help.

Get in touch on 02 8097 0200 or email any time.

And as always, if you've got any research or consumer insight questions you'd like to chat about - we're happy to share our veteran advice!

Talking of insights, grab a free copy of our guide to getting your hands on actionable insights here.

Download: Cheat's Guide to Actionable Insights


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