An international presence allows brands not only to broaden their footprint into fast-growing markets, but also protect against the impact of an economic slowdown at home - Graham Staplehurst explores the results of new Kantar research into the brands that have succeeded and those that have not. Research from BrandZ shows that the ability to capitalise on the strengths of the country of origin plays a major part in a successful export strategy.
Of course, the world has fundamentally changed since this research was carried out. What ‘business as usual’ will look like in a post Covid-19 world is far from clear – but those brands that have invested in building their presence overseas will be in a better position to recover once the crisis is over.
This is because there’s a strong link between being highly exportable, the value of a brand, and its ability to weather a storm.
Brands that have a strong presence overseas grow their value faster than others. For example, in 2019 the Italian brands that generated half or more of their financial value in international markets increased their brand value by 20 percent year-on-year, while those with less than 50 percent overseas exposure remained flat. BrandZ research also shows that brands with the most meaningfully different consumer perceptions bounce back more quickly from a torrid time: strong brands recovered nine times faster following the financial crisis of 2008.
Excelling at export
BrandZ research has determined the 10 countries with the brands that have the greatest ‘overseas exposure’ – the portion of their financial value that’s earned in international markets. These 10 include Germany, Italy, France, the UK and the US.
There is a clear correlation between being highly exportable and the ability to effectively leverage provenance – an association with a particular place or country. This accounts for about three percent of the average brand’s equity, and will be much higher for those that actively trade upon their origin story.
Almost two-thirds of the value of Germany’s 50 most valuable brands comes from overseas exposure. Car brands in particular reflect what’s respected about German industry – quality, precision manufacturing, design, craftsmanship and reliability – famously exemplified by Audi’s ‘Vorsprung durch Technik’ strapline. Engineering and technology brand Bosch too has long emphasised its German heritage to signpost its high standards of quality, and justify its premium pricing.
The most valuable French brands are very strong in equity overseas, in particular the country’s stable of iconic luxury and premium brands in the fashion, alcohol and personal care categories. These remain true to their French roots, exuding the prestige, style credentials and refinement associated with ‘Brand France’ itself.
Italy’s luxury fashion brands emphasise style, sexy playfulness and a sense of fun to make themselves desirable across the globe. This chimes well with the image international audiences associate with the country. A huge 91 percent of the exposure of the seven luxury names among Italy’s 30 most valuable brands was generated overseas.
Italian car marques also make themselves fantastically exportable by using distinct attributes of ‘Brand Italy’. Ferrari stands for boldness, passion, exclusivity, energy and power, whereas Fiat reflects the more approachable, friendly face of the Italian motor industry.
The UK is an outstanding performer overseas. British goods have strong pulling power, with fashion, pharmaceuticals and food ranking third in the world for global preference in the Best Countries global study, undertaken by VMLY&R’s BAV Group, and cars, cosmetics and technology not far behind.
British Airways has always played on its origins. In 2019 it marked its 100th anniversary with the ‘The BA 100’, a celebration of 100 people who have helped make Britain “the creative, open-minded, pioneering and welcoming place it is today”. It also partnered with Marmite on limited-edition Centenary Marmite.
In the US, Coca Cola, McDonald’s, Levi’s and Harley Davidson have for many years exploited the aspirational ‘American Dream’, the ideal of wealth and opportunity, cemented themselves firmly in the hearts of millions of non-Americans.
Built not born
Provenance can be long-established – Belgium’s brewing expertise is welcomed by beer drinkers around the world, for example – but it can also evolve.
In recent years the perception of China has shifted from one of a place that produces cheap replicas to a country that’s developing ground-breaking new technology. BrandZ research carried out in collaboration with Google revealed growing acceptance of Chinese brands among overseas consumers. Of the 10 brands with the greatest overseas presence, six are in the technology category, compared with only three just a year previously.
Analysis of some of the most successful exporters in these high performing countries indicates there are a number of things they’re all getting right.
They make provenance part of the brand story. This means recognising and tapping into the strengths and attributes that make their country of origin unique and appealing in the eyes of the world, and understanding the commonalities they share. These are then clearly communicated through the brand story and assets. Brands must also be mindful of their country’s weaknesses – real or perceived – and shield themselves from those. This is particularly important in the wake of the Covid-19 pandemic.
Mini is one brand that has taken full advantage of provenance, balancing tradition with modernity to represent a distinct aspect of Britishness, particularly London and the swinging sixties. Minis are exported to over 110 countries.
Provenance should also be expressed through culturally relevant brand experiences. French luxury brands excel at this. Saint Laurent’s Rive Droite stores in Paris and LA aim to curate and cultivate a larger Saint Laurent world through books, music, and assorted curios. Auchan’s pilot Lifestores in Juaxing, Turin and Luxembourg include experiences such as French cooking lessons and wine tasting.
Know where you can win. To accelerate overseas expansion, brands need to identify the markets that will be most receptive, and determine the scale of demand. It’s important that a country has a positive reputation within the target market, in the category or sector the brand plays in. This then needs to be fully leveraged.
Brands must also understand the variations in attitudes, values and needs in overseas markets, and adapt messages, products and communications accordingly.
They build awareness, then build power. The strongest global brands have the greatest Brand Power in the eyes of consumers. Power is generated by a combination of difference from the competition, salience, and meaningfulness (fulfilling people’s needs in a relevant way).
Brands first need to be known if they’re going to be part of people’s lives, however. This is something the fastest growing Chinese brands – which include PC maker Lenovo, robotics company UBTECH, the telecoms and smartphone giants Huawei and ZTE, and smartphone maker Xiaomi – must prioritise. Their growth now depends on the ability to build on rising positive perceptions to increase awareness.
How people around the world feel about other countries is of huge significance, because consumers tend to apply this to the products and services that come from there. Capturing and capitalising on the essence of what makes a country appealing or iconic overseas is a winning formula for taking full advantage of the international opportunities available. It will also have a role to play in brand-building in a post-pandemic world; not only for brands, but in some cases for the countries they originate from, too.
Exporting won’t be a part of every brand’s strategy, but those with a goal to rebuild or cultivate overseas markets can learn from the performance of the names that have succeeded in the past. There is always a crisis of one sort or another around the corner. Businesses that continue to focus on building strong brands will not only improve their export success, but can also make themselves more resilient to the impact of whatever comes their way.