Asian economies with its many countries, cultures, business practices and customer segments are much more complex than other any other region in the world, and these markets still demonstrate branding infancy. The mindset, the complexity of business structures, the diversity of demographic composition and the huge geographic extant requires certain unique brand strategy steps.
1. Create a strong differentiation: In many of the still developing countries, Western brands are still looked up to as people in these countries aspire to own the global brands. With many local companies striving to create similar products at lower prices, the Western brands would do good to create a strong differentiation by leveraging their brand equity. Similarly, local brands that aspire to make it big must tap into the unique cultural associations and local myths to weave the brand into the societal fiber.
2. Establish a strong distribution network: Emerging economies of South East Asia are very vast countries and distribution in these countries holds the key to success in many industry sectors. With an increased migration of consumer from the rural side into main stream economy, success in these rural areas will prove critical. Moreover, unlike the developed markets, distribution is not organized and centralized in these countries. Regional and fragmented distribution channels replace national channels.
Establishing strong distribution network is of paramount importance. Some major brands such as P&G and Unilever have benefited from such a focus in India.
3. Glocalize: As emerging economies mature gradually, they start developing a strong sense of individual consumption identity. This is evident from the increasing demand for products which are localized to suit the local preferences. Global brands must retain their brand identity at the strategic level but localize the tactical implementation such as the communication, product offerings etc. This combination of global brands with local products will allow the global companies to weave their brands into the fabric of the local society and make the brand a part of the community.
For example, given the religious beliefs of Indians, cow is not treated as a source of meat, but rather an object of worship. Understanding such sentiment, McDonald's have eliminated their beef items and have introduced India specific menu items that appeal to the Indian palate.
4. Leverage cross-border synergies: In spite of the many differences between the many South East Asian countries, companies can leverage the scale of operations and supply chain across borders to optimize profitability. The relatively lower cost of production offers companies a fine platform to serve the entire region. By standardizing the major part of the product and fine tuning the final offering to suit the local tastes, companies can minimize cost and gain scale.
5. Recognize and respond to the unique regional markets: Emerging markets are mosaics of cultures and rich heritage. Each country has a unique pattern of consumption. Companies should be careful not to generalize across them as a homogenous region by ignoring the glaring regional and national uniqueness. As each country is fast evolving and integrating with the global economy, none of these challenges and market situations are static. Businesses should develop the flexibility to quickly react to the changes in the market and adapt their strategies to successfully compete and survive.
For example, British India is a major successful apparel brand from Malaysia. However, given India's troubled past with the British occupation, British Raj does not bring out positive emotions to the Indian customers, and the brand stayed out of India.
6. Collaborate and co-create: Many global and regional companies entering new markets have collaborated and leveraged the resources of the local companies. The combination of strong brand equity, financial prowess and the business acumen of the global brands and the local networks, established distribution channels and the strong knowledge of local customers of the local companies would offer a winning scenario.
For example, Costa Coffee is one of the leading coffee brands from the UK. But when it entered the Chinese market, it successfully collaborated with the Yueda Group, to leverage the local partners' knowledge of the market and customers.
7. Leverage the unique local cultures: Companies that plan to build brands in the different South East Asian economies must leverage the unique local culture to relate to the customers. Every market has a very strong history and heritage that has for long influenced the local cultures and practices of both companies and consumers. Companies should tap into these specific details and incorporate them in their brand personalities and identities so that customers can be offered an authentic experience.
For example, the Malaysian government brand campaign "Malaysia, Truly Asia" attempts to capture the unique culture, practices and experiences of the country. This offers an excellent example of how companies building brands in the Asian markets can leverage the local cultural assets.
