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Industry trends

In 2022, Southeast Asia accounted for 19% of household care sales in the Asia-Pacific region, second only to China. It's a vibrant region with significant growth potential.

Southeast Asia is home to high-growth economies such as Indonesia, the Philippines, and Vietnam. According to data from Euromonitor International, it is projected that these economies will outpace China in terms of growth during the forecast period. By 2022, the household care industry in the region is expected to grow by 7%, reaching sales of $9.6 billion.

By the end of the forecast period in 2027, the retail market value of household care in Southeast Asia is expected to reach $12.5 billion, with laundry care being the largest contributor. Three trends expected to support this performance are format evolution, e-commerce potential, and innovation centered around sustainability.

Format Evolution in Laundry Care:

Cross-category forms of household care are continuously evolving. With increased consumer awareness and purchasing power, people are leaning towards more sophisticated forms. Specifically, in the case of laundry care, although powdered detergents have been the established form in the region, consumer preferences are changing as more people opt for liquid detergents. Factors supporting this shift include convenience in use and storage, offering a wider retail supply at more affordable prices, heightened consumer awareness, and increased disposable income levels.

In addition to liquid detergents, the presence of detergent pods is expanding in the region. The chart below shows that Singapore and Malaysia are expected to contribute significantly to this form in the coming years. In Singapore, it's the most dynamic category in laundry care, supported by innovations in product releases, promotional offers on e-commerce platforms, and consumer desire for convenience. In Malaysia, brand diversity underpins its performance, and viral TikTok trends also help boost its popularity among urban consumers.

While most consumers are transitioning from powdered to liquid detergents, some niche markets are shifting towards detergent pods. This means that the right product strategy and price segmentation are crucial for brands to capture these growth areas.

The Importance of E-commerce and Digital Engagement:

The Asia-Pacific region presents significant opportunities for e-commerce. In Southeast Asia, platforms like Lazada have seen a surge in demand for household care products like laundry detergents.

One significant trend in the region is the shift towards digitalization. E-commerce players are leveraging social media and messaging platforms to drive sales. For instance, in the Southeast Asian market, Shopee has been actively promoting discounts for household care brands on Facebook. In addition to social media, Lazada in Malaysia is using WhatsApp to promote a range of products to consumers. Manufacturers are actively promoting promotions or sales activities through their social media pages and providing links to their online stores. Digital engagement allows household care brands to build a community around their products, increasing brand awareness and fostering brand loyalty.

One form of digital engagement is live streaming, which is becoming a popular method on e-commerce platforms in the Asia-Pacific region.

Packaging and Formula Sustainability:

Consumers are increasingly seeking more sustainable packaging choices and environmentally friendly formulas.

Regarding packaging, refill stations are one approach that brands are deploying in the region. In Indonesia, Qyos by Algramo is testing vending machines in Jakarta. Leading household care company Wings Corp partnered with Qyos in 2021 to sell its So Klin laundry detergent brand through the latter's vending machines. Local and global players in Thailand, Singapore, and Malaysia have also taken similar initiatives.

Apart from packaging, product formulas are another area where household care companies are introducing more environmentally friendly alternatives. For example, Unilever Vietnam has applied the "Carbon Rainbow" model to its product development, which is a four-tier model categorizing carbon capture from various sources. It's the first unit of Unilever in Asia to use bio-based alkyl polyglucoside (APG) surfactants in Sunlight Gentle products. Other brands like Omo, Vim, and Comfort are also introducing formula-based innovations.

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