Over the last year, 62% of FMCG sales in Asia were with local brands. Customers in Asia typically perceive local brands to be more trustworthy, have fresher products and offer better prices than global competitors. In the UK, we’ve found Cornish ice cream buyers require a different set of flavours (clotted cream is a must!) and many prefer to choose a local supplier. As we emerge from the pandemic, this preference for buying local could be even stronger. A recent YouGov poll found that 64% of consumers want to support local businesses going forward.
But all is not lost for global businesses. Investments, partnerships and developing knowledge of local markets can all help multinational companies increase their foothold in locally-focused markets.
Small, local or regional companies are often well attuned to needs in their specific markets. These brands can usually pivot more easily to align to local developments – accepting the Bristol Pound, featuring artwork from local artists, naming products after local features or events and placing product in new local retailers.
Partnership with or acquisition of brands to fill a niche could be one effective way for global brands to act more local. P&G has been acquiring smaller brands that consumers consider to be more sustainable, natural, and authentic for many years. In 2012, Britvic and AG Barr, maker of Irn-Bru, were looking into an (eventually abandoned) merger, which would have given Britvic strong credibility in the Scottish market.
During the pandemic, many global brands have worked effectively with hyperlocal businesses to fulfil last mile delivery. Deepening these partnerships could provide revenue support for struggling local businesses, and local information and know-how to multi-nationals.
Carefully executed localised marketing campaigns, based on knowledge of local markets can help global brands appeal to local pride and sensibilities to drive sales. Nike’s ‘Nothing Beats a Londoner’ campaign, resulted in 93% more searches for Nike in London, and 54% more searches across the UK. Tiger Beer collaborated with the Singapore Tourist Board to launch 20 different beers customised to each neighbourhood in the region.
A more ambitious option could be to develop a new brand. To reach a certain market, a new brand could tailor its messaging to appeal to the target audience. Deep understanding of the target market and local needs would help with brand success.
Knowing the potential impact of these campaigns would help you plan their scale and value. Research into target markets is essential in assessing both their attractiveness and their specific needs. Detailed primary research, surveys and competitor analysis are all good starting points to this end.
In order to ‘think local’, there are a number of questions you can ask yourselves:
- Do we understand the specific needs of our local or regional markets?
- Are there any partners we could work with to enter certain markets?
- Which local businesses are the most attractive acquisition targets?
- What should we be focussing on within branding, messaging, and engagement strategies at a local level?
For help with how to approach these questions, speak to White Space Strategy today.