Affluent Singaporeans' spending on luxury items surges

Booming economy prompts significant jumps of ownership in designer clothing, jewellery, luxury watches and air travel.

Synovate, one of the world’s largest market research firms, on Thursday released its 2010 PAX survey findings, revealing that affluent consumers across Asia Pacific have impressive spending power in good times and bad.

Steve Garton, Executive Director of Media at Synovate, said that the continuous data from the flagship Synovate PAX survey paints a comprehensive picture of affluent Asians, according to a Synovate report.

“We’ve been studying Asia’s elites over the past 14 years, examining their habits and attitudes, their values – and the sheer power of their spending. Last year was a tough year in terms of the economy, yet still people spent on goods of desire. This year we have a much healthier economy and elite consumers are maintaining their spending.

“These affluent people are continuously seeking out new products and the latest items and are very much the early adopters of high ticket items. They are the backbone spenders in many such product categories across the region,” he said.

In its 14th year, Synovate PAX is the region’s most comprehensive study of elite adults, tracking media and digital consumption, prosperity, and influence across 11 markets from Hong Kong, Singapore, Korea, Taiwan, Thailand, Malaysia, India, Indonesia, the Philippines, Japan to Australia.

Technology takes you to the top
Affluent Asian consumers have a love for gadgets, especially the latest and greatest models. The survey showed significant rises in ownership of high definition televisions (HDTV, up from 19.5% across the region to 28%), laptops or notebooks (rising from 48% to 51.8%) - and especially smartphones (up from 10.4% to 15.8% across the region).

Garton said: “In fact, you could almost call it the ‘Year of the Smartphone’, as their appeal mobilised purchasing across the region. This wave of acquisition peaked in Taiwan, where it jumped from 15.5% ownership to 27.7% in one year.

“Singaporeans continued to buy a mountain of mobiles (23.1% own them now, up from 14.7% last year), keeping them in the lead ahead of Hong Kong, where smartphone ownership doubled, from 11% to 22.4%.

“While some of this can be attributed to a socially-driven desire to have function-packed, elegant items, we also found that nearly half of elite Asians (46.7%), and especially those in Top Management (58.3%), see technology as a key to their success,” he said.

Alongside the smartphone boom, Singapore is one of the leading Asian markets for allthings- techno, with seven in ten owning a laptop or notebook, two-thirds have a digital still camera and 40.3% have a HDTV.

Singapore spends up
The 2010 results show the rise of the Singaporean big spender. The survey is conducted year-round and Synovate spoke with 1,709 affluent Singaporeans to get the 2010 results.

Garton said: “Singaporean elites have steadily increased their spending, year-on-year, even through last year’s downturn. Now, with an extremely healthy local economy, there are quite significant leaps in some categories too. Many of these are technology-related, but in a more surprising move, Singaporeans are embracing luxury in droves.

“In past years, we have noticed that affluent Singaporeans were more practical in what they purchased. But that seems to be changing. There are some significant jumps of ownership in designer clothing, jewellery, luxury watches and so on. More than half of elite Singaporeans now own a luxury item of some description,” he said.

Some of the biggest year-on-year changes in items owned by affluent Singaporeans were:

• For the second year in a row, ownership of laptop computers increased by 11%, from 61.2% to 72.2%. Affluent Singaporeans now own more laptops than elites in any other market.
• High-tech TVs are in strong demand, with 66.5% owning a plasma or LCD screen TV and 40.3% now have an HDTV (up from 31.8% last year).
• There has been a significant leap in ownership of private property that is lived in, from 26.1% last year to 34.1% in 2010.
• Over a third of affluent Singaporeans own a luxury watch of US$500 value or more, 23.7% own designer clothes and leather goods valued at US$500 or more and 36.9% own jewellery of that value.
• There was a big jump in car ownership across Singapore’s elite in the past 12 months, from 67.1% to 76.5%.

Singapore takes off as top market for air travel
The Synovate PAX 2010 survey shows that elite Singaporeans are taking to the skies in large numbers.
Garton cites an impressive GDP rebound and business confidence figures as the reason why so many affluent Singaporeans are in the air.

“Singapore topped this year’s survey in both leisure and business trips taken. In a period of prosperity, 10% of affluent Singaporeans have travelled five times or more for business in a 12 month period, and 27.2% have travelled at least once for business.

“But holidays have not been ignored. Topping the region, six in ten elite Singaporeans have taken a leisure trip over the past year,” he said.

The importance of multiple media marketing
“Elite Asians are spending. They are early adopters and lead the charge in many product and service categories. Intelligence exists on segments within the elite. All this is great news for marketers, but only if they can reach the right people with their messages.

“That’s where the PAX survey shows the power of regional media – cable and satellite TV, print and the internet. Indeed, a combination of these media is probably the most effective way to tap into the sophisticated, internationally-minded affluent Asian,” Garton said.

The 2010 Synovate PAX results (Q3’09 to Q2’10) show that affluent elites who own or intend to buy high-end products are spending an increasing amount of time on the internet, watching TV, and reading print compared to the previous period (Q3'08 to Q2'09).

“Affluent people who consume regional media are buying more high-end items than those who do not. Brands can reach a poised-to-spend, sophisticated audience through regional media channels,” Garton said.