Multinationals should not turn their backs on emerging market consumers. Some rebalancing toward developed markets makes sense in the near term as their relative strength improves, but it must not come entirely at the expense of investment in emerging markets.
In 1990, 57% of Southeast Asia was in poverty and access to daily necessities one could afford was not to be taken for granted. Today, so much has changed that a new niche at the high end of the affordability spectrum has emerged to fan the aspirations of consumers – premiumization.
The slowing pace of Chinese economic growth underscores the country’s need to transition from an investment- and export-led growth model to one powered by consumption. But how long will that transition take? The answer is crucial to companies looking to ride what will eventually be the next extraordinary surge in consumer spending in China.