Grow richer and deeper, and not bigger

As we become more and more globalised in our outlook towards life, the more we seem to embrace aspects that remind us of our roots and heritage. The cultural richness of global cities is driven by the need of communities to establish a part of their home in their adopted city. Traditions, cuisines, folklore and customs coagulate and create a vivid melting pot. Going beyond cities, nations around the world are increasingly realising their existence in the world and are trying to communicate their uniqueness to the whole world. Nation branding (or even city branding) is an established branding discipline, which if effectively utilised, can have a strong impact on a nation’s economy.

The key challenge for organisations in today’s world is how to build truly global brands from scratch. We have enough local and regional powerhouses, but there are very few global brands that have emerged in the last decade. We do need to take into account the fact that brands like Google, Apple, Uber, Airbnb and Under Armour have been able to hasten the process of globalisation immensely. But it is also important to keep in mind the fact that the level of disruption these brands have created in the way we live our lives is difficult to emulate.

We need to change our focus back to the task of building global brands, who are necessarily not ‘game changers’, but do have strong and differentiated positioning and do bring different propositions to the table. Hundreds of such aspiring brands come to life everyday (as outcomes of expensive innovation programmes) and hundreds die everyday (because they can’t even cross the first hurdle of becoming a success in their home markets).

If success after birth is such a painful objective to achieve, it is quite evident that to be a success over your lifecycle can be hundreds of time more painful. Consumers are now more demanding, more informed, more conscientious and more discerning. In addition to that (which is an offshoot of being discerning) is the emerging consumer attitude of ‘not accepting to be treated second best’. Linking these behavioural traits with the thoughts at the beginning easily leads to scenarios wherein global brand building will get severely impeded by powerful forces.

Building a global brand in today’s fragmented marketplaces requires a strong understanding of trends that capture ‘how we live’, ‘what we value’ and ‘how we make choices’. These three fundamental factors encapsulate the impact of an ever-changing world on our lives.

  • How we live –  The biggest brand building opportunities lie in identifying tensions in our day-to-day lives and the daily activities we engage in. Every successful brand need not create a new category, need not identify a need that never existed and need not show us what we have been missing. With all our inherent complexities and cultural differences, there are some needs that we have in common. The success of Uber exemplifies how strong global brands can be built by effectively solving a day-to-day problem. Global brand building needs to have the vision around how a local brand can be grown to address a global problem
  • What we value – The rising consciousness towards the health of our bodies and to the fact that we are not alone in terms of existence on this planet has led to the emergence of new strategic differentiators. Health & wellness, sustainability and ethics are the new global brand positioning platforms to adopt. All consumers over the world, with varying degrees of difference, will happily latch on to these positioning. The key factors driving success here is integrity and honesty about these platforms
  • How we make choices – Our choices are becoming more fleeting, more experimental, more collective (less individualistic) and more impatient. Building a global brand requires a strong understanding of the dynamics of choice making in different markets. If a brand can address a globally relevant decision-making problem, then it has huge potential to become a global brand. Unilever and P&G customise their global brands’ offer (via innovation) to satisfy needs that have local variances in choice making. Choice making dynamics not only differ by countries, but also within market segments and price tiers

Effectively addressing these three questions in the brand offer is the first step towards establishing global relevance. If the brand provides a tangible solution to an existing problem then it immediately has wide appeal. The success of fintech as a domain is based on identifying effective solutions for existing problems (e.g. exorbitant bank fees on foreign exchange transfers) that have global relevance. Brands from traditional categories need to start thinking along similar lines of creative disruption if they want to achieve their global ambitions. Launching brands that address tangential problems or problems that do not exist are expensive exercises in failure.

The complexities and richness of culture, combined with more knowledge and experience, make the global consumer a ‘tough nut to crack’. Starbucks has struggled to establish itself in Europe, where discerning coffee lovers have rejected the concept of an American brand trying to teach them how to drink coffee. On the contrary, the brand is a huge success in Asia, where consumers do want to be taught by Starbucks on how to imbibe a coffee culture into their lives. Consequently, some consumers would want to be pampered and some would straightaway reject you. Building a global brand requires effective engagement with both such types of consumers.

The complexities of culture is a strong force, which inhibits even regional growth and expansion plans (let alone global). There are not many regional brand powerhouses in Asia, Europe, Africa and Latin America. We either have local market leaders or legacy global brands that have been in existence for more than 100 years.

Organisations do need to realise one thing – the pace at which you can expand globally can be faster if you have the resources and the answers in place, but there is no guarantee that having a faster pace will improve the changes of success. To build a global brand, organisations need to invest equal (if not more) amounts of time and money in understanding global consumer trends (cultural, social, geopolitical, behavioural and demographic) as they do on R&D and innovation programmes.

As proliferation increases across market segments, the size of the pie available becomes smaller and smaller. Global brands need to be able to get a large chunk of the pie, but should constantly look at evolving based on how society is shifting. If we think of the seismic shifts expected in the next five years, global brand building success will increasingly hinge on an organisation’s ability to identify growth opportunities that can be tapped into using differentiated positioning and a compelling and relevant offer.

 

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