The Geo-demographics
To understand the Geo-demographic factors of the Singaporean market, age, education level, household structure, population, and income distribution of its consumers should be analyzed. According to the current demographic studies, the population of Singapore is approximately 5.9 million. The native population is 3.84 million, whereas the immigrant population is 1.56 million (Wilson, 2011).
Globally, the nation is among the top ten countries with the highest percentage of millionaires. It is estimated that the ratio of millionaires to every household is one to six. Severe poverty is very rare in Singapore. Despite its economic success, the nation is considered to be one of the leading countries with the highest income disparities.
The measure of income inequality is calculated based on individual household earnings. The lowest income earner is paid $1000 or less per month. The top income earners are paid 10 to 20 times of this amount. After government taxation, Singapore has a Gini coefficient of around 0.478, which confirms that there is a huge market-income inequality.
The transfer of cash, social security, and income taxes has contributed to the increased income inequality in the Singaporean markets. The most discriminated part of the population in terms of employment is the elderly people, the youth, women, and the migrants.
This part of population is vulnerable to exploitation. They earn lower wages because the government policies do not specify the minimum wage rates. This low wage and an increased unemployment rate among representatives of this marginalised population have enhanced income inequality.
Many Singaporeans are educated. It is estimated that about 65% of the population are literate. The varying age and education of the population have led to varied needs and demands, thus marketers should monitor these factors closely.
Socio-economic characteristics of consumers
The decisions of consumers are influenced by several factors. Socioeconomic factors dictate what one chooses, purchases, as well as what products and services to consume. Social factors, which include friends, role models, living standards, and reference groups, influence the buyer’s decisions.
The Singaporean living standards have been improved, and this has changed their income expenditures from consumer to branded luxury products and services (Pacek, 2012). Unlike before, the number of Singaporean consumers travelling abroad during the holidays has increased.
Over the last few decades, the Singaporean government has played a great role in education of its citizens, thus translating to well-paying jobs. This has led to improved living standards. Currently, a number of its citizens are able to afford decent housing and sophisticated products and services.
Psycho-behavioural characteristics
Psychological and behavioural factors influence the consumer purchasing decision in a number of ways. Purchasing can be done either individually or in a group. Factors such as family, friends, and society or peer groups have a great influence on the consumers of certain products. Motivation is one of the factors that psychologically influence Singaporean consumers.
There is a need for selective brands and prestige among the consumers in Singapore. This is fostered by the fact that most of the consumers in this country have toured many places around the world. This has tremendously changed the buying behaviours of the consumers in the country. Perception also plays an important role in the consumer buying behaviour.
Consumers in Singapore have different perceptions about products and services they consume. It is obvious that not all consumers have the same tastes and preferences. Therefore, marketers should study the psychological factors to promote their branded products. Notably, the Singaporean consumers are keen when choosing their brands and prestige. They are sophisticated buyers.
The western culture has distorted the beliefs and attitudes of consumers. This influence is predominant among the Singaporean youth consumers. They have embraced the western values and beliefs. This has influenced their buying behaviours. Equally, the Singaporean consumers prefer shopping on self-service supermarkets.
Consumption patterns of consumers
Due to improved living standards of the people of Singapore, the consumer expenditure has changed greatly over the last few decades. Research has shown that from around 1978, Singaporean households spend a great percentage of their income on consumable goods and services. A larger portion of this percentage is spent on communication and transportation services.
Actually, about two-thirds of the household expenditure are spent on buying and fuelling of cars. The health and education sectors in the last few years have risen by around 68%, thus improving the living standards of Singaporeans. They are increasingly spending only on luxury goods compared to consumer goods. This had a great influence on the market needs of the Singaporeans.
In the recent past, the western culture has interfered with their traditional values and believes influencing what they purchase and consume. The changes in the lifestyles have also changed the consumer patterns. The Singaporean consumers have become more selective in terms of both prestige and brand of the product.
The sophistication in purchasing has been enhanced by the increased education level and media exposure of the Singaporean consumers. This has consequently led to high income and high purchasing power of the population. Currently, more families in Singapore have embraced holidays and leisure abroad as part of their lifestyle.
Consumer savings
The influence of western and eastern cultures among the Singaporeans has created sophisticated purchasing behaviours and made a number of their consumers spend much of their income.
Consumers spend a large portion of their income on products such as fashion clothes, advanced gadgets, travels and leisure, skin and beauty related products. A lot of spending by consumers means that less money is available for savings. Only the educated and rich Singaporeans are able to save.
Major trends
Singapore population has encountered both social and economic changes. These have had great impacts on the markets. The female population has increased its literacy level and their percentage in the labour force. The government policies with respect to family planning have led to a total change in the age distribution structure of the population. This has led to diversified needs among people.
The marketers should analyze this trend since it has a great effect in the marketing field. Due to increased levels of education, the Singaporeans are able to secure well-paying jobs and attain a higher consumer purchasing power in their markets. This has actually led to a rise in their real income. The economy in Singapore has experienced great extent of urbanization.
People have moved to flats and stopped living in their sine-roofed residents. Currently, shopping malls are shifting to the estates from the CBDs. Similarly, there is a declined in private means of transport compared to the public means. Lastly, enhanced Singaporean living standards are progressively changing their income expenditures from consumer to branded luxury products and services.
References
Pacek, N. (2012). The Future of Business in Emerging Markets The success factors for market growth in the 21st century.. Singapore: Marshall Cavendish.
Wilson, P. (2011). Challenges for the Singapore economy after the global financial crisis. Singapore: World Scientific.