In Asia, the rules of the consumer products game are dynamic, requiring responsive offerings and services. As in North America and Europe, Asian consumers are changing their shopping behavior. But, Asian markets are also changing structurally—driven by consolidation and regulation. Each consumer products company needs to remain relevant to both mature and emerging markets by embracing multiple imperatives in multiple markets. Five global trends, plus two
This companion paper to the IBM Institute for Business Value executive brief, "Consumer products 2010: Executing to lead in a world of extremes," assesses the impact of five global trends on the disparate marketplaces of Asia, concentrating on four key regions: Japan, India, China and ASEAN (Association of Southeast Asian Nations): - Consumer value drivers fragment — Pronounced demographic shifts are creating microsegments with greater demand complexity
- Gatekeepers become more guarded — Enabled by technology and regulation, consumers are exerting more control over business interactions
- Information exposes all — Accessibility of information is empowering consumers
- Industries reshape into flexible value networks — Alliances among companies are on the rise
- Megaretailers break the boundaries — Global expansion is rapidly crossing geographies, channel formats and product/service categories.
Two additional trends will significantly impact consumer products companies in Asia: an ongoing urban and rural divide, and market restructuring. Asian marketplace trends
Vast demographic and social differences exist throughout Asia, creating fragmented consumer values. But, it is the urban and rural divide that will have even greater impact. Though migration to urban centers is rising, Asia’s largely rural population means that limited education and lack of infrastructure will continue to inhibit development. Ultimately, this will result in a polarized market, with one end of the spectrum serving customers who want low-cost, basic goods and the opposite end targeting those who will pay premiums for specialized, highly-valued products. The fragmented marketplace is illustrated by four scenarios (see Figure 1). Asian consumer markets will slowly gravitate toward the "world of extremes"—with timing determined by the rate of urbanization, government investment in infrastructure and regulations on foreign investments and trade. Today, emerging markets in some parts of China are already close to the world of extremes; other parts of Asia, such as Vietnam, will still be “behind the walls” in 2010. Imperatives for the new Asia
Facing these challenges, the optimal path forward will vary. In mature Asian markets, the four global imperatives apply: deliver insight-driven innovation, sell more through superior service, build "fit-for-purpose" supply chains and focus on differentiators. But, an emerging environment also presents the challenges of infrastructure, regulation and consumer diversity. Asia’s markedly different conditions require strategic modifications: - Enable innovation through localized consumer insight
- Drive strong customer management competencies
- Build "fit for purpose" supply chain networks
- Increase organizational agility to adapt to different markets.
Ultimately, the way to succeed in the Asian world of extremes is threefold: focus on what really matters, develop a clear change agenda and go deep to mobilize the organization. 
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