Techlash or Techlove? - Connecting beyond the Crisis Hong Kong Deep Dive
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Foreword Welcome to our latest edition of the Digital Society Index study. Started in 2018, this is a multi-year research our network run to track how people over the world are responding to the digitisation of economies and industries. It explores themes such as trust, infrastructure, personal data and skills. Today, in the midst of a global pandemic that is disrupting almost all facets of how we live and work, this research sheds new light on how we are using technology differently and what this could mean for brands in the longer term. Our survey ran between March to April 2020, analysing the view of 32,000 people across 22 markets. A total of 1,017 people in Hong Kong were surveyed. This market deep dive is built on the key findings from Hong Kong. The global research paper covers all surveyed markets - download. This study serves as a reference point for how well we are in realising a balanced, sustainable growth from the digital economy and how people are adopting technology to their lives. It is intended to stimulate debate and action, framing our future in a digital economy that works for all. Best Regards, Pauline Chu CEO, Dentsu Aegis Network Hong Kong 2. Techlash or Techlove? Connecting beyond the Crisis – Hong Kong Deep Dive
Hong Kong Deep Dive The COVID-19 crisis is calling us to re-evaluate our relationship with digital technologies as we embark upon a mass social experiment to live online. Consumption of digital media has rocketed in recent months, sparked by a desire to use technology to satisfy the fundamental human needs of staying healthy, staying connected, and creating joys in life. We connect to transact more We connect to experience more People are using technology to People are using technology to facilitate daily life: expand life experiences • 84% Do shopping online • 73% Listen to music via a streaming service • 81% Use an app to do banking or manage money • 66% Watch TV via a streaming service • 59% Use an app to take a taxi • 61% Play computer game or e- sports • 51% Use voice-assisted technologies • Use educational apps, join online courses and webinars etc. to learn new skills and knowledge We connect to care more Could the COVID-19 crisis lead us to People are using technology to a more positive personal improve their sense of well- relationship with digital being: technologies? Or will the techlash • Use social media, discussion return with a vengeance? Is there an forums etc. to feel more opportunity for brands to reset and engaged with friends, family, rethink how they use technology to and the world around them build better relationships with consumers? This study sheds light • Use health apps and wearable on how digital technologies are fitness devices to look after reshaping societies and human their health needs. • Plan to use technology to aid physical health prediction • Plan to use technology to measure health on a daily basis 3. Techlash or Techlove? Connecting beyond the Crisis – Hong Kong Deep Dive
Life goes online Fast forward to today, COVID-19 is accelerating digital adoption as life goes Hong Kong has been leading the digital online, without much of a choice. This transformation, being recognised as the pandemic has led to new consumer third most advanced city in the APAC behaviours and responses. We are now far region1. We made it to the top 10 more likely to engage with more digital digital elites according to the IMD products and services than we did before, World Digital Competitiveness Ranking with e-commerce topping the list (see 2019, moving up from 11th to 8th Figure 1). place2. Our residents are increasingly tech-savvy and welcome technology to play a bigger role in their lives3. However, the relationship between Figure 1: Likelihood of taking the people and technology vary depending following actions compared to last year on the subject. Despite advanced digital infrastructure and governance, there are certain digital spaces Hong 84% Kongers just do not want to get into. Do my shopping online According to FIS 2019 Retail Global Payment Report, only 4% of overall 81% retail spending was done online4. The Use an app to do my banking or biggest concern was around payment manage my money security, which had led to little appetite for e-commerce.5 73% Listen to music via a streaming service 66% Watch TV via a streaming service 59% Use an app to take a taxi Source: Dentsu Aegis Network Digital Society Index Survey 2020 1 The Asian Digital Transformation Index 2018 2 IMD World Digital Competitiveness Ranking 2019 3 Google Smarter Digital City 3.0 4 FIS 2019 Retail Global Payments Report 5 SCMP 2018 4. Techlash or Techlove? Connecting beyond the Crisis – Hong Kong Deep Dive
Our study suggests Hong Kongers are far more accepting and willing to manage their day-to-day transactions with digital technology. We are 17% more likely to shop online compared to the global average and 24% more likely compared to the APAC markets surveyed (see Figure 2). This is a huge step forward as we were previously hesitant to shop and pay online due to security concerns. Figure 2: Hong Kong compared with global and APAC in terms of the likelihood of engaging in digital activities in the next 12 months 17% Do my shopping online 24% 9% Use an app to do my banking or manage my money 14% 17% Use an app to take a taxi 7% 1% Listen to music via a streaming service 1% -4% Watch TV via a streaming service -13% Difference in % compared to the global avg Difference in % compared to the APAC avg *Global averages of all 22 markets surveyed, APAC averages of 6 markets surveyed Source: Dentsu Aegis Network Digital Society Index Survey 2020 A recent Ipsos study on the impact of COVID-19 on Hong Kong consumers confirms a similar digital shift. According to their research, 48% of Hong Kong adults declared spending more time browsing on online shopping platforms and 36% declared they have purchased more groceries online or used more mobile payments.6 This trend is also true across our surveyed age groups (see Figure 3). Figure 3: The likelihood of engaging in digital activities compared to last year Hong Kong Age Breakdown 86 88 85 85 85 84 78 80 78 75 Do my shopping online (% likely) Use an app to do my banking or manage my money (% likely) Age 18-24 Age 25-34 Age 35-44 Age 45-54 Age 55-65 Source: Dentsu Aegis Network Digital Society Index Survey 2020 6 The Hong Kong Consumer & COVID-19 Study by Ipsos 5. Techlash or Techlove? Connecting beyond the Crisis – Hong Kong Deep Dive
As outlined in the beginning, in times of crisis, Technology is not killing our people are understandably focusing on how relationships after all technology can deliver their needs to transact, to care and to experience. The ability to feel more engaged with friends, family and the Within a context of increased online world around them is ranked as the No. 1 consumption and improved confidence impact from their use of technology, in the in the digital space, personal use of context of social isolation and distancing. 94% technology is seen as overwhelmingly of the survey sample did not see any positive in terms of its specific impacts relationships (with other people) deteriorate on well-being. Out of a list of potential from their use of technology and 97% have not impacts, with an even number of both experienced bullying online. These results positive and negative outcomes, the top indicate a positive role technology can play in five choices in Hong Kong are (see keeping us connected in ways we desire. Figure 4). Some priorities vary by age. For example, those aged 18-24 prioritise using technology to learn new skills, to relax or gain new experiences and pleasure. They also cited that increased use of Figure 4: Top 5 commonly cited technology resulted in physical issues (see impacts of personal tech use on health Figure 5). & well-being Figure 5: in what ways is personal use of tech 1 I feel more engaged with friends and impacting sense of well-being family and the world around me Hong Kong Age Breakdown 2 Using technology enables me to I suffer from 32% relax or experience pleasure physical health 23% issues 23% 3 I’m learning new skills/new 20% knowledge (e.g. using educational 16% apps, joining online courses and webinars, etc.) I’m learning 40% new skills/new 28% 4 I suffer from physical health issues knowledge 21% (e.g. repetitive strain injuries, eyesight 17% problems, bad posture, etc.) 21% 5 I’m monitoring and looking after my health (e.g. checking health apps Using technology 37% enables me and using wearable fitness to relax/or 30% experience 22% devices) pleasure 24% 24% Source: Dentsu Aegis Network Digital Society Index survey 2020 Age 18-24 Age 25-34 Age 35-44 Age 45-54 Age 55-65 Source: Dentsu Aegis Network Digital Society Index survey 2020 6. Techlash or Techlove? Connecting beyond the Crisis – Hong Kong Deep Dive
Well-being or Wealth-being? Looking beyond technology usage, there is a broad spectrum of factors that can potentially impact our sense of health and well-being (see Figure 6). Understandably, physical health ranked at the top. Figure 6: Key factors driving people’s sense of health & well-being – Hong Kong Which, if any, of the following do you think is the most important to your sense of well-being? (% ranking in top 3) Physical Health 78% Wealth and financial stability 62% Relationships with your friends and family 57% Mental Health 41% Personal development/self-fulfilment 30% Quality of the natural environment 13% Feeling included or part of a community 10% New experiences 8% Source: Dentsu Aegis Network Digital Society Index Survey 2020 The second most important driver of health and well-being is wealth and financial stability, sitting at 62%, followed by relationships with family and friends (57%). It is the highest amongst the 22 markets surveyed (see Figure 7). Figure 7: Wealth and Financial stability cited as the most important factor driving people’s sense of health & Wellbeing - Global 62% 58% 57% 57% Global 54% 53% 49% 46% ave 44% 44% 43% 40% 39% 38% 38% 38% 37% 36% 32% 31% 31% 30% 29% HK HU ME JP SA SG RU CN NZ AT DE IT ES OZ US FIN UK PL DK FR NO BR Source: Dentsu Aegis Network Digital Society Index Survey 2020 This reflects how concern is shifting from the initial health impacts of the virus to its economic impacts. Cigna COVID-19 Global Impact Study has revealed a similar discovery. People are worried about insufficient funds for retirement, pressure from mortgages and other expenses such as education costs.7 7 Cigna: Hong Kongers suffering poor health and wellbeing during COVID-19 7. Techlash or Techlove? Connecting beyond the Crisis – Hong Kong Deep Dive
Techlash or Techlove? Our network has been studying the impact of digital technologies on society for the last three years and our evidence shows some consistent pattern of concern around the world - 57% of people today believe the pace of technology change is too fast, a level that has been consistent since 2018 (see Figure 8). Figure 8: % agreeing that the pace of tech change is too fast (2018 – 2020) 57% 57% 57% 2018 2019 2020 Source: Dentsu Aegis Network Digital Society Index Survey 2018 – 2020 In Hong Kong, this is felt more acutely, sitting at 73%, 13% ahead of the APAC average and 16% ahead of the global average (see Figure 9). Figure 9: % agreeing the pace of tech change is too fast (2020) 73% 60% 57% HK APAC Global *Global averages of all 22 markets surveyed, APAC averages of 6 markets surveyed Source: Dentsu Aegis Network Digital Society Index Survey 2020 8. Techlash or Techlove? Connecting beyond the Crisis – Hong Kong Deep Dive
Despite this concern, Hong Kongers seem Figure 11: % not agreeing I will take to be enjoying the benefits of periods of rest from using technology technological advancement. More than (e.g. computers, smartphones) half (55%) of them are feeling optimistic Hong Kong Age Breakdown that digital technology will help solve the world’s most pressing challenges. 75% of them do not see the need to take periods 82% 80% of rest from using technology, while other avg 75% surveyed markets in the APAC region felt 73% stronger about this need (see Figure 10). 66% 68% This also aligns with a finding that only 10% of our survey sample cited that the use of technology is causing them mental stress. Figure 10: % not agreeing I will take periods of rest from using technology (e.g. computers, smartphones) 80% 75% Age: Age: Age: Age: Age: 18-24 25-34 35-44 45-54 55-65 Source: Dentsu Aegis Network Digital Society Index Survey 2020 avg 52% avg 51% We have also noticed people in Hong Kong aged 25 to 44 are 22% more likely to take periods of rest from using 43% technology than people aged 45 to 65 38% (see Figure 11). 35% 35% HK CN SG JP AUS NZ Markets APAC Avg Global Avg *Global averages of all 22 markets surveyed, APAC averages of 6 markets surveyed Source: Dentsu Aegis Network Digital Society Index Survey 2020 9. Techlash or Techlove? Connecting beyond the Crisis – Hong Kong Deep Dive
Figure 12: % likely to use technology to Figure 14: % agreeing digital predict what will happen to my physical technologies have made society more health in the future unequal between rich and poor 62% 61% 55% 49% 49% 51% 44% 42% 46% HK APAC Global HK CN SG JP AUS NZ *Global averages of all 22 markets surveyed, APAC averages of 6 markets surveyed Source: Dentsu Aegis Network Digital Society Index Survey 2020 Source: Dentsu Aegis Network Digital Society Index Survey 2020 Close to half of the people surveyed As Hong Kongers are welcoming across the APAC region believe that technology to play a bigger role in their digital technologies are worsening the lives, more than half (55%) of the people inequality gap between rich and poor. surveyed plan to use technology to This sentiment is felt less in Hong Kong measure health aspects on a daily basis. (42%), the lowest percentage in the In particular, around 62% will use region (see Figure 14). technology for physical health prediction (see Figure 12). Yet, Hong Kongers have less confidence in emerging technology creating career In terms of digital marketing, Hong opportunities for them in the next 5 to 10 Kongers feel less disturbed when being years, with less than a third (32%) of shown personalised ads online people surveyed believing this (see Figure (33%) - lower than the APAC and the 15). China, on the other hand, is much global average. (see figure 13). more optimistic (69%). Figure 13: % who find it intrusive when Figure 15: % agreeing emerging digital being shown personalised ads online technologies will create career 49% opportunities in the next 5 to 10 years 44% 69% avg 41% 40% 41% avg 40% 33% 32% 40% 32% 32% 30% 24% HK CN SG JP AUS NZ HK CN SG JP AUS NZ Markets APAC Avg Global Avg Source: Dentsu Aegis Network Digital Society Index Survey 2020 *Global averages of all 22 markets surveyed APAC averages of 6 markets surveyed Source: Dentsu Aegis Network Digital Society Index Survey 2020 9 .10. . Techlash or Techlove? Connecting beyond the Crisis – Hong Kong Deep Dive
Recommendations 1. No matter which sector you are in, brands are now expected to play an integral role in helping people to transact, to care, and to experience. The rapid change of Hong Kong New Business Model consumer mindsets and behaviours New Revenue Streams caused by the pandemic can be threatening to some businesses, but Though Hong Kongers find that technology also creates a lot of new opportunities changes too fast, the fact that they keep for others. up with the pace indicates that they understand the value of technological acceleration. Brands should look closely at their existing consumer journey to identify new business opportunities. Simply adding value isn’t enough, these new opportunities should remove the pain points (big or small) brought about by COVID-19, through the use of technology. Not only will this help differentiate your brand, but it can also transform your business and grow new revenue streams while other brands remain stuck. Solve The Problem - Be Available and Be Helpful Foodpanda, one of Hong Kong's top food delivery platforms has officially launched their on-demand grocery delivery service (Pandamart) right as the COVID-19 outbreak began.8 Collaborating with around 1,000 shops and selling over 14,000 items, aimed to redefine the way Hong Kongers shop for groceries”. Delivering anything at any time to customers, Pandamart filled a growing need of both their current and new customers for greater convenience and variety beyond food. 8 Foodpanda launches 15-minute grocery-delivery service 11. Techlash or Techlove? Connecting beyond the Crisis – Hong Kong Deep Dive
Challenging the Convention – Be Agile, Be Flexible and Be On-Demand As more people in Hong Kong go online to learn, after thousands of tuition centres closed due to social distancing, new forms of learning have accelerated. Instead of a set fee for a set class location and time, new instant learning virtual platforms like Snapask are offering flexible hours and pay- per-use. Students can now access different teachers, submitting a photo of their question online for instant response anytime, anywhere. On top of this, by leveraging AI and big data to provide personalised learning solutions, it improves both the students’ and tutors’ productivity (efficiency and effectiveness) and thus stabilises tutors’ incomes and increase career opportunities for fresh graduates and tutors. During the past few months, usage of Snapask and the number of questions asked on its platform spiked by 40%.9 A Win-Win Strategy – Begin by Focusing on Doing Good For the Ones in Need Every year, international companies launch their management trainee programmes in Hong Kong to hunt for the best of the best. Despite the pandemic and the ensuing economic uncertainty, 63% 10 of employers in Hong Kong are proceeding with their plans to hire for critical roles. Yet, campus recruitments have been postponed. A local start-up, OnGrad, accelerated their transformation into HR x education technology by launching Hong Kong’s first AI-driven career learning community to help employers and graduates through this challenging time. Leveraging emerging technology such as AI to optimise user profile evaluation processes and removing unconscious biases, users are offered recommendations for employer-provided courses, internship programmes, and volunteering opportunities to better acquire requisite knowledge, skills, and experience. This community has successfully attracted 10% of Hong Kong university graduates in a year and has gained support from key employers like Deloitte and Microsoft.11 9 Technode Global May 2020 10 Covid-19: employer pulse survey, Randstad Hong 11 Kong HKTDC 08 June 2020 12. Techlash or Techlove? Connecting beyond the Crisis – Hong Kong Deep Dive
2. Brand Commerce - Closing the Gap Between Inspiration and Commerce With Personalisation Points of communications for brand Home" video hub which included a 12- inspiration are opportunities to convert. part workout series led by top fitness There is no time to wait or waste for coaches.12 It aimed to encourage Hong both consumers and brands. Kongers to sustain a healthy lifestyle by Personalisation and staying relevant staying active even at home and to contextually is more crucial than ever. create family bonding moments. Brands should leverage technologies to Another example is fitness app Bravera, help consumers to manage their well- which rewarded users by converting their being and wealth with inspiration. As walking and running data into points that Hong Kongers are less disturbed by could be redeemed for gifts.13 personalised online ads, brands should Ultimately, customers were motivated take this opportunity to collect and rewarded for their effort in achieving customer data to better understand a healthier lifestyle. their consumers, and better target and personalise products and services to build relationships in a timely manner. Wealth after Health Inspirations That Address Their Top Hong Kong ranks No. 1 in the APAC Concern – Holistic Well-being region when it comes to worries about wealth and financial stability. There are Knowing that physical (78%), wealth concerns over financial freedom in (62%), relationship (57%) and mental retirement as well as pressure from (41%) needs are considered as the most mortgage and education payments, rent, important to one’s sense of well-being, etc. Many financial institutions (not brands should consider how their image limited to J.P. Morgan14, Standard and products can inspire consumers and Chartered Bank15, HSBC16) offer online help them to achieve their needs the education tools, investment tips, and moment they arise. insights to guide consumers through the pandemic’s economic impact. A majority Stay Fit. Stay T.O.M (Top Of Mind) of these are delivered through live webinars, online videos, and social ManulifeMOVE launched the "Move at media. 12 Manulife Website 13 Bravera Website 14 J.P. Morgan Website 15 Standard Chartered Bank Website 16 HSBC Website 13. Techlash or Techlove? Connecting beyond the Crisis – Hong Kong Deep Dive
Stay Joyful. Stay T.O.M 37% of people in Hong Kong agree that using technology enables them to relax or experience pleasure. In addition to the increased usage of music and video streaming services, 61% of Hong Kongers are likely to play games online in the next 12 months. While the popular Animal Crossing game achieved significant success in helping Hong Kongers stay entertained at home, it has Hone Kong Landmark mall launched its also created huge opportunities for new online shopping concierge that cross-brand collaboration. Following enables "members only" to browse and Santosa’s virtual wedding, Sunkist has purchase using the mobile app.17 The live created a California citrus grove chat function, via WhatsApp, allowed simulation for the Animal Crossing customers to directly communicate with community with scavenger hunts and in-store sales assistants as well as place secret prizes to brighten up their day.17 an order and pay online. 3. Members Before Customers In addition to the launch of the free enhanced protection and "Non-Face-to- Face purchasing" arrangement, AIA launched a COVID-19 alert service on their AIA Connect mobile app for all Understanding the importance of registered app users (both AIA and non- consumer data to personalise brand AIA customers).19 Utilising geo-fencing experiences and ultimately drive sales, technology and the Office of the more brands are accepting members Government Chief Information Officers’ even without purchases. This enables API data and GPS, users would brands to collect consumer data so that immediately receive alerts from the app they can immediately craft once they were within 200 meters of communications and bespoke services to buildings with probable or confirmed achieve a great first impression. cases. 17 Sunkist Brings California Sunshine to the Virtual World of Animal Crossing 18 Landmark mall releases live-chat concierge service through its mobile app 19 AIA Website 14. Techlash or Techlove? Connecting beyond the Crisis – Hong Kong Deep Dive
4.Contactless and Cashless End-to-End Experience Businesses, even the ones with purchases that are highly reliant on product trials, are accelerating towards contactless end-to-end digital experiences since 84% of people are likely to do shopping online and 81% are likely to use apps to do banking and manage money. While many beauty brands are all busy building and expanding their e-commerce presence, Sephora is already providing virtual try-on right on their product page.20 Tesla not only was the first to introduce online ordering, they also introduced the Home Test Drive Experience during the pandemic to provide consumers with a safer test- drive environment (without visiting the showroom) and more convenience.21 Hong Kongers are agile and fast-paced. There is a strong need for brands to accelerate their transformation with a strong consumer-centric mindset and technology that taps into numerous business opportunities that this pandemic has created. 20 Sephora Website 21 Tesla Website 15. Techlash or Techlove? Connecting beyond the Crisis – Hong Kong Deep Dive
6. The Hong Kong Consumer & COVID-19 Study, Ipsos https://www.ipsos.com/en-hk/press- release-new-ipsos-study-impact- covid-19-hong-kong-consumers 7. Cigna: Hong Kongers suffering poor References health and wellbeing during COVID-19 https://www.marketing- interactive.com/cigna-hongkongers- have-lowest-health-and-well-being- during-covid-19 1. The Asian Digital Transformation Index 2018 8. Foodpanda launches 15-minute http://connectedfuture.economist.com/ grocery-delivery service wp-content/uploads/2018/12/ADTI- https://insideretail.asia/2020/02/19/ whitepaper.pdf foodpanda-launches-15-minute- grocery-delivery-service/ 2. IMD World Digital Competitiveness Ranking 9. Battle mode for digital https://www.imd.org/wcc/world- entertainment and education players, competitiveness-center-rankings/world- Technode Global May 2020 digital-competitiveness-rankings-2019/ https://technode.global/2020/05/05/ digital-playground-for-digital- 3. Google Smarter Digital City 3.0, entertainment-and-education- Google summary/ https://services.google.com/fh/files/ misc/google_smarter_digital_city_3_ 10. Covid-19: employer pulse survey, whitepaper.pdf Randstad Hong Kong https://www.randstad.com.hk/ 4. FIS 2019 Retail Global Payments workforce-insights/workforce- Report, FIS trends/63-are-still-hiring-talent- https://www.fisglobal.com/flavors-of- despite-anticipated-impact-of- fast covid-19/ 5. Hong Kongers are the world’s most 11. Navigating Covid-19: A Human reluctant online shoppers, but try Resources Enabler, HKTDC 08 June stopping the Chinese, SCMP 2020 https://www.scmp.com/business/china- https://hkmb.hktdc.com/en/ business/article/3033093/hongkongers- NDQ5NTQwODA5/hktdc-research/ are-worlds-most-reluctant-online- Navigating-Covid-19-Human- shoppers-try Resources-Enablers 16. Techlash or Techlove? Connecting beyond the Crisis – Hong Kong Deep Dive
References 12. Manulife Website https://www.manulifemove.hk/en/campaign/ move-at-home/index.html 13. Bravera Website https://www.bravera.fit/ 14. J.P Morgan Website https://am.jpmorgan.com/hk/en/asset- management/per/insights/investment-ideas/ coronavirus-asia-views/ 15. Standard Chartered Bank Website https://www.sc.com/en/trade-beyond-borders/ covid-19-nothing-else-matters/ 16. HSBC Website https://www.business.hsbc.com.hk/en-gb/ covid-19 17.Sunkist Brings California Sunshine to the Virtual World of Animal Crossing http://asiatoday.com/pressrelease/sunkist- brings-california-sunshine-virtual-world-animal- crossing 18. Landmark mall releases live-chat concierge service through its mobile app https://www.marketing-interactive.com/ landmark-mall-releases-live-chat-concierge- service-through-its-mobile-app 19.AIA Website https://www.aia.com.hk/en/about-aia/media- centre/press-releases/2020/aia-press- release-20200318.html 20. Sephora Website https://www.sephora.hk/pages/virtual-artist 21.Tesla Website https://www.tesla.com/en_HK/event/edm-all- home-td 17. Techlash or Techlove? Connecting beyond the Crisis
For more information on this report please contact: Joyce Zhang Associate Director, Marketing and Communications Joyce.zhang@dentsuaegis.com About Dentsu Aegis Network Part of Dentsu Inc., Dentsu Aegis Network is made up of ten global network brands—Carat, Dentsu, dentsu X, iProspect, Isobar, mcgarrybowen, Merkle, MKTG, Posterscope and Vizeum and supported by its specialist/multimarket brands. Dentsu Aegis Network is Innovating the Way Brands Are Built for its clients through its best-in-class expertise and capabilities in media, digital and creative communications services. Offering a distinctive and innovative range of products and services, Dentsu Aegis Network is headquartered in London and operates in 145 countries worldwide with more than 47,000 dedicated specialists. www.dentsuaegisnetwork.com
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