News

The Philippines: Asia’s next top market?

Contact Denise Jaschke for more information.

Article: written by Ric Stockfis Ink MD of APAC

With some 7,000 islands and more than 103 million people, the Philippines is nothing if not diverse and full of surprises. Yet all too often the country is reduced to simple stereotypes by the outside world. Even the long-running “It’s More Fun in the Philippines” campaign, which painted a compelling picture of tropical beaches and the laid back life, barely scratched the surface of this dynamic nation. As a consequence, the Philippines has traditionally been overlooked by brands, agencies and marketers – despite its huge and rapidly growing potential. That may now be changing: a 2016 MAGNA advertising report declared the Philippines the global market with the fastest growing ad spend (up 17% year-on-year). It’s no wonder why:

The number of middle class households in the Philippines is set to grow by more than 40% by 2030, to reach 8.4 million. This puts the Philippines among the top 10 countries with the fastest projected rates of middle class expansion between now and 2030, with median incomes and purchasing power also projected to rise in a big way over the same period. 

A recent survey by Visa found that Filipinos are among the most well-travelled of all Asia-Pacific nations, with only Australians, Kiwis and Indians visiting more countries on average. According to the survey, this is proof that “Filipinos [have joined an] emerging global travelling class”.

And the Philippines is quickly growing in popularity as a destination for the rest of the world, with 6.5 million visitors expected in 2017, up from 4.2 million just five years ago.

All of this is music to our ears. When we launched Smile magazine for Cebu Pacific in 2006, we heard a lot of the clichés – this isn’t a high-spending market; Filipinos are not big travellers; many of the international passengers are overseas workers – but how wrong those doubters were! In 2016 Cebu Pacific flew more than 19 million passengers and Smile is now one of the most successful titles in Ink’s entire portfolio. By building the magazine around the brand – ignoring the received wisdom and instead embracing the true adventurous spirit of Filipinos – we’ve created a world-class magazine, with budget-busting revenues. (Anyone who thinks print advertising has had its day should take a look at the December 2016 issue of Smile, which ran to 240 pages with no less than 100 pages of advertising. That’s the power of inflight at Ink!)

Smile Cebu Pacific Air

It’s proven so successful that when Philippine Airlines (PAL) was looking for someone to reinvent their beloved title Mabuhay last year, they appointed Ink. The new-look Mabuhay, now approaching its first anniversary, has been a hit from the start – and a key element of the airline’s strategy to become a five-star airline by 2020 (industry analysts CAPA awarded PAL “Airline Turnaround of the Year” in 2016). The most recent issue – aside from gorgeous feature stories on urban farming in Sydney and traditional Japanese freediving – carries advertising from Volkswagen, Asics, Coca-Cola, Panasonic and Hyatt, among many other high-profile brands. These are ads directly targeting the high-spending, 13 million yearly passengers that fly PAL.

Philippine Airlines

That this is an extremely desirable audience shouldn’t come as a surprise. Last year, a Nielsen study declared that Filipino consumers are the most optimistic in the world. Among the indicators of confidence: a 10% rise in immediate-spending intentions; with three-in-10 Filipino respondents planning to spend spare cash on holidays and vacations, home improvements/decorations, new clothes and new technology. Backing this up, a 2017 survey by Deloitte found that 89% of Filipino millennials believe the country's economic situation will improve (almost double the global average) and, when it comes to personal finances, 84% of Filipino millennials expect to be financially better off than their parents (compared to just 26% in the rest of the world). Given that millennials make up a third of the population and half of the workforce in the Philippines, those are figures worth paying attention to.

Philippines Asias Next Top Market

Yet even now, many marketers continue to overlook the Philippines in their planning and instead are seduced – or should that be distracted? – by the lure of Chinese riches, despite language barriers and the difficulties of doing business there. (That MAGNA report points out that the incremental dollar contribution from ad spend in China is still nearly three times the combined sum of the incremental dollars coming from the four fastest-growing other APAC markets.)The Philippines, by contrast, is a huge, English-speaking market, eager to spend and hungry to travel. Where better to target that amazing market than in the pages of Smile and Mabuhay, which between them reach more than 2.6 million passengers each and every month?

Contact Denise Jaschke for more information about getting your brand in front of this incredible audience.

 

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