Diageo CMO says brands need to go local in emerging markets
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Cannes: Strategies for emerging markets need to become more grass-roots and locally oriented, Diageo chief marketing officer Andy Fennell told an audience at the Cannes Lions Festival.
Fennell said emerging markets currently represent a third of the drinks giant’s business today but in three to four years they are expected to reach 50%.
He said that opportunities in markets such as China and Africa include several factors, such as the amount of people each year reaching legal drinking age, increasing wealth, more economically enabled women and advancing mobile technologies.
But to realise this growth it is essential that brands change the way they think about emerging markets, he warned. “These markets used to receive an adaptation of a brand concept created in Paris, New York or London, which used to be enough. But now they need to become the centre of our gravity so we can broaden our ideas.
“You need to go there, employ local people, and get local ideas.”
Fennell gave examples of activity in China and Africa. In Shanghai, a flagship outlet for Diageo brand Johnnie Walker called “House of Walker” was established this year. It offers exclusive purchases and ties its brand identity with the idea of progress and the Chinese appreciation of status symbols.
The brand has also worked with local celebrities such as film maker Jia Zhang Ke and video blogger Han Han.
Africa strategies have included an advertising campaign with Ethiopian Olympic marathon runner Haile Gebrselassie on the theme of “Keep Walking” to inspire consumers to reach their goals.
In Kenya, fellow Diageo brand Guinness has produced a branded football TV game show which incorporates an on pack lottery prize draw.
Johnnie Walker Red Label has also recently been made available in 200mL bottles in South Africa to acknowledge that many people can’t afford a full size bottle but still aspire to the brand.
Fennell added that another big challenge lay in measuring the effectiveness of brand activity: “How do you put a price on engagement? We need to find more accurate and contemporary ways to see if an activity works rather than wait to see if a product sells more.”
Read an interview Marketing Week did with Andy Fennell here
Readers' comments (2)
Neil Hopkins | Tue, 21 Jun 2011 9:43 am
Completely agree with this - brands should ensure that they integrate and interact with the local environment across all touch points (physical, social, cognitive) in order to gain traction.
A model I've been espousing for a while now is the Community Network Marketing model (http://bit.ly/CNMModel). This would enable the brands to gain the most leverage in the local community by providing action to meet the direct needs of that community. Would love feedback on those thoughts.
It also must be remembered that people don't always see themselves in terms of their geography. They identify with the community in which they live and the subdivisions of the community in a geographic area.
A one-size-fits-all approach is definitely no longer the way forward.
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Rick Pullan | Tue, 21 Jun 2011 6:20 pm
Reassuring that the larger global brands believe this. To be honest, ‘think global’ (brand image/equity), ‘act local’ (be relevant to the target consumer of the geographical catchment culture) has been around for a long time. Local community marketing is also an established concept. It all just takes more effort and time to implement, which is why marketing stuff is often imported from or imposed by the mother country. Local implementation should obviously reflect brand values that are often transportable across countries because that’s what creates the aspiration, emulation, adulation, must-own ethos in the first place. And with social media now a key element of the marketing mix, people in completely disparate local communities may be interested in a brand hub, it just depends how big or revered the brand is e.g. Nike, VO5. Local marketing of global brand essence has been a challenge for decades. Indeed ‘local area / community marketing’ of national brand identity is an increasing challenge in the UK for many large brands, because of massive cultural and ethnic profile differences across the regions, but that’s another story.
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