Brands must adopt fresher techniques in order to keep up with the BRIC juggernaut

25 October 2013

Dan Hawker

Dan Hawker

Former Head of Tobacco, Wholesale & Retail

One look at the global map tells its own story: British products are increasingly in demand globally.

Whether its luxury clothes from London, Scotch Whiskey from Edinburgh or the latest vehicle from one of the country’s resurgent automotives, the Made in Britain label carries considerable gravitas. In the developing nations, the rise of the middle class has been one of the most significant production drivers of the 21st century.

The BRIC nations (Brazil, Russia, India and China) are markets with good growth-aiding export opportunities for manufacturers. It is estimated that by 2050, these four nations will make up the top four largest global economies. The total value of UK goods and services exports will increase by 8.5% a year over the next 10 years, according to ITEM, with the total value of UK goods and services into the BRIC countries to increase by 11.7% a year to 2020. With their populations also growing significantly by the decade, it makes for good locations to establish a presence.

Here’s what marketing individuals of consumer products companies can look for when approaching these markets and solidifying their brand:

The emerging middle classes

The powerhouses of foreign economies have increasing capacity for consumer products in growing middle classes of the BRIC nations.

A recent McKinsey report estimates that by 2020, there are expected to be more than 1 billion new consumers spending between $10 and $100 per day from these four countries alone. According to another study by auditors EY, while cash strapped consumers in the UK continue to feel the impact of tax increases, austerity measures and depressed wage rises, strong economic growth in the BRIC economies will see the average household income rise by 14% a year to 2020.

Improved living standards and the growth of the middle classes will also deliver a significant increase in consumer demand for electrical goods and high tech products - traditional strongholds for UK exporters.

But capturing the loyalty of the local markets is one barrier. Beverage giants Coca-Cola and Pepsi have found resistance to their products in China when up against domestic competitor Master Kong. The latter being established since 1991 along with domestic customer loyalty – even as globalisation increases – are still significant factors.

An evolving market needs fresh techniques

The evolved market of the BRIC countries presents a significant opportunity for consumer goods businesses operating in mature markets with limited opportunities for growth. One example is in healthcare, a UK sector continuously being squeezed financially. Investments in healthcare infrastructure within BRIC countries are expected to play a significant role in the future growth of the patient monitoring devices market, as medical facilities aspire to achieve Western standards of care.

To develop further in the BRICs, brands also need to understand how well accepted the western values that have underpinned the globalization trend to date are. Refining CRM is also a vital part of the process, given western companies’ shift from mass marketing BRIC countries to a focus on customer relationship management.

Acquiring customer and prospect data on a more personal level, as opposed to simply purchasing it, will give companies a competitive advantage. But there are other marketing considerations.

A one-size fits all approach doesn’t work

While marketing spend towards BRIC nations has increased significantly in the last five years, success can remain hard to come by. The all-encompassing advent of social media has reached a level for encouraging strong marketing initiatives, coinciding with increased literacy rates in the four countries.

Although it varies across industries, social media marketing's broad focus is on developing products targeted at specific consumer groups, launching new product offerings and monitoring brand image sentiments.

As more 3G/4G and LTE networks become part of the wireless network in these countries, smartphone adoption will be as high as other developed nations by as soon as 2018. YouTube is also an effective channel for localising marketing. Luxury automotive McLaren hopes to use content revenues sold against branded content to help further fund its marketing efforts in the BRIC economies. It aims to translate such content into local languages, rather than rely on its existing English language versions.

A digital view of the world, giving instant access to millions while having the added flexibility of language options, has levelled the playing field. Now is the time to follow McLaren’s proactive lead and race ahead.

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