BRICing it? The significance of brand building in the BRICs
While the BRIC countries might present some risks for marketers, the potential profits are worth it, according to the latest research from Global TGI.
In many ways it’s wrong to refer to the BRIC markets - Brazil, Russia, India and China - as ‘developing’ markets.
As well as being seen as future cornerstones of the world economy, they are significant markets today in their own right.
For example, credit/debit card uptake; the growth in ownership of these ‘flexible friends’ arises from a need to manage money and greater levels of financial sophistication.
Ownership levels have risen dramatically with plenty of opportunity for greater growth. For example, in Russia, there has been a rise of 450% in the last ten years, in India 171%, China 115% and Brazil 84% growth.
However, in the US and Britain there has been very little growth in a category which is already heavily saturated in those markets.
Across many other categories the same picture can be seen, one of rapid growth yet still much further potential.
When considered along with the sheer size of their consumer markets, there is little surprise that many marketers are paying close attention to the BRICs.
The cost of failure could be high though, and a sound understanding of consumers in the four markets is essential for success.
However, there is some good news for marketers in the views that BRIC consumers already have about brands in general.
When persuaded about a brand’s merits, they will stay loyal - over 70% of BRIC consumers agree that once they find a brand they like, they tend to stick to it.
This is considerably higher than US consumers (40%) and Western European counterparts (61%).
This suggests that if a brand gets it right in the BRICs, there is potential for long-term success.
Furthermore, BRIC consumers already appreciate the value of brands, with a high proportion agreeing that it’s worth paying more for quality goods.
To help marketers start to understand these markets, there are also some fundamental values which are held not only among the BRIC countries, but also in the US and Western Europe.
These key universal values are skewed towards conservatism rather than adventurousness, and to collectivism rather than individualism.
A large number of people in all the markets (BRICs, US and Western Europe) consider themselves to be very good at managing their money ranging from 69% in India to 46% in the US.
The conservative approach is also apparent in the agreement to attitude statements relating to having a practical outlook on life, to time being more important than money, and to the importance of lasting relationships.
For marketers to successfully tap into local cultures for their communication, any of these values could be drawn upon safely.
Although with regards to the marketing and promotion of international brands, it will not generally be possible to apply a ‘one size fits all’ strategy to each of these markets.
Historically, globalisation has been led by western brands, and the movement has depended upon the spread of western values.
But if globalisation is to spread more deeply in the BRICs, marketers must deal with the limits of these western values.
Those who wish to develop in these markets have to devise product and marketing strategies to cover the four markets, each with very different cultures and value sets.
Category flooding (putting multiple brands into the same sector at different price points) is one strategy that has proved successful for some brands.
Another is localizing the offer (adapting the global brand to fit local tastes); again this has also proved successful for a number of brands.
Designing a brand strategy to meet the demands of each of the BRICs is an extremely difficult task, all the more so when the considerations of marketing to western audiences also have to be applied.
Having comparable market information is absolutely critical to gaining a true appreciation of each market in terms of their cultural, consumer, economic and ethnic backgrounds.
Although it does appear that the challenges for marketers are enormous, so too are the potential profits
These findings are from Global TGI’s 2011 edition of ‘Brand Building in the BRICs’ - a free copy of the booklet can be downloaded at www.globaltgi.com
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