Southeast Asia poised to add over 50 million consumers by 2030, but flat FMCG growth and cautious spending pose challenges for brands

• Seven in 10 shoppers who trade up in some categories also trade down in others, challenging brands to deliver both value and meaningful differentiation
• Local, regional and insurgent brands are gaining share as traditional trade faces pressure from minimarkets, e-commerce, social commerce and hard-discount formats
• Only one in five surveyed FMCG executives say their companies are well prepared to address the challenges ahead, with macroeconomic uncertainty, trade-down and rising input costs among their leading concerns

SINGAPORE, November 5, 2026-Southeast Asia remains a compelling long-term consumer growth story, with over 50 million additional consumers expected to enter the region's consuming class by 2030. Yet, the region's near-term reality is becoming more demanding: weak household spending, choosier shoppers and accelerating retail disruption are reshaping the fast-moving consumer goods (FMCG) landscape, according to the latest Bain & Company and NielsenIQ (NYSE: NIQ) report, Southeast Asia: Still the growth story, or the story we tell ourselves?.

Covering SEA-6 (Indonesia, Malaysia, the Philippines, Singapore, Thailand and Vietnam), the report highlights the need for brands to adapt to more selective shoppers, intensifying competition and evolving consumer journeys.

Economic growth remains resilient, but consumer spending lags

Southeast Asia's GDP is projected to expand by 5.1% in 2026 and average 4.7% annually from 2028 to 2035[1]. SEA-6 will add over 50 million people to its consuming class by 2030, trailing only India and China globally, with Indonesia alone accounting for roughly half that growth.

That resilience has not translated into stronger FMCG consumption. FMCG value growth across SEA-6 markets has remained flat between 2023 and H1 2026, dragged by weak sales volumes even as prices kept rising. Economic growth is increasingly being driven by exports and investment, while slower real wage growth and high household debt are constraining disposable income. Around 30% of consumers surveyed across Indonesia, Singapore and Thailand said they were worse off financially than a year earlier, contributing to a more cautious approach to everyday spending.

"Growth in Southeast Asia is not disappearing- it is becoming harder to capture," said Praneeth Yendamuri, partner and head of Asia-Pacific Consumer Products practice at Bain & Company. "Consumer products companies can no longer rely on broad-based consumption growth or traditional definitions of premium and value. Today's shopper is willing to pay more for products that genuinely improve their lives while seeking savings elsewhere. Businesses will need to make sharper choices about where to play, design products around real consumer willingness to pay, and build the speed to respond as needs, channels and competitors change."

Two baskets, one shopper: Value becomes increasingly personal

SEA consumers are reallocating spending across categories, trading up where performance, health, safety or family benefits matter and trading down where products are viewed as more functional or interchangeable. Seven in 10 consumers who traded up in at least one category also traded down in another.

Beauty and baby care products are among the "good for me/my family" categories seeing greater premiumization, while household products remain more value-oriented. Overall, 58% of consumers are open to paying a premium for compelling reasons, such as trusted quality, proven effectiveness, or meaningfully better performance. Half of SEA shoppers stated they would switch brands on the spot if their usual option were not available, but loyalty still holds in "good for me/my family categories".

Local challengers and insurgents accelerate share shifts; retail challenges FMCG margins

Local and regional players are moving fastest to capture market share. They now account for more than half of FMCG market value across SEA-6, taking share from multinationals in nearly every category except alcohol and baby care, largely through hyper-localizing products, pricing accessibly, building strong distribution and digital-first marketing.

The path to purchase is fragmenting just as quickly. Traditional trade remains the region's largest FMCG channel, but its share is being pressured by convenience stores, minimarkets and e-commerce. Hard discounters, consolidating wholesalers and growing retail media networks further erode FMCG margins. The report also highlights that 65% of FMCG executives surveyed see B2B wholesale and discounters as a challenge, but only a third are confident in their ability to respond.

"The data points to a region where the shopper is no longer loyal to a single channel, and brands can't afford to be either," said Craig Houliston, Executive Director, Regional Consulting & Insights at NIQ. "With discounters, minimarkets and online platforms all competing for the same wallet, brands need to be present, priced and positioned in the right places. As shoppers increasingly turn to AI to help decide what to buy, that precision must extend to where discovery begins."

Discovery has left the shelf as consumers turn to AI

Consumer discovery is shifting quickly. Approximately 80% of Southeast Asian consumers already use AI somewhere in their shopping journey, to compare products, get recommendations or find deals. TikTok Shop's share of regional e-commerce market doubled from 17% in 2024 to 34% in 2025, fueled by creator-led content and livestream shopping. As these channels multiply, brands risk losing visibility at the exact moments that shape a purchase. Companies must reimagine the consumer journey to reclaim the touchpoints shaping discovery, conversion and repurchase across emerging channels, from digital media and quick commerce to large language models and agentic commerce. Bain's analysis suggests a revenue gap of about 15% could open over the next five years between consumer products businesses that reimagine retail and those that do not.

Against this backdrop, FMCG executives are clear-eyed about the scale of the challenge. Macroeconomic uncertainty, consumers trading down or out of categories, tariff and input-cost volatility, and the growth of e-commerce and social commerce rank among their top concerns. Yet only one in five say their organizations are well prepared to respond.

"Winning brands will be the ones that reignite real connection with consumers, turn what they already do well into a genuine competitive advantage, and rebuild how they reach shoppers across channels," Praneeth Yendamuri said. "That takes the speed of a challenger and the capabilities of a scale player, and above all, the adaptability to keep adjusting as the ground keeps moving."

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About the report

Southeast Asia: Still the growth story, or the story we tell ourselves?, by Bain & Company and NIQ, examines consumer trends and the FMCG landscape across Indonesia, Malaysia, the Philippines, Singapore, Thailand and Vietnam (SEA-6).

The report draws on NIQ Retail Measurement data and NIQ Consumer Panel data through June 2026, NIQ Consumer Outlook through July 2026, the 2026 Bain Southeast Asia Consumer Survey of 975 respondents, the 2026 Bain SEA CXO Survey of 29 FMCG executives, and secondary research.

FMCG data covers the categories and markets available in the underlying NIQ datasets. Singapore includes online sales, while other markets primarily reflect offline FMCG data.

¹World Bank; IMF; OECD; UNCTAD; UNSD; WTO; Euromonitor; Trading Economics; literature search