Latino's love talking about what makes them unique. Every country in the region feels "different" and special, and most of the time for very good reasons!
However often we forget that of all continents, we are probably the one with most things in common: only two languages, a culture that is more emotional than rational, more social than individualistic and highly creative. Our love for music, food, family and entertainment are very common realities in our region. Best proof of our unique identity is that while in the China BrandZ™ ranking, banks and insurance are the biggest contributors to brand value, in Latin America, beer, food and personal care brands is the most valuable category, followed by retail.
Many of the most salient Latin American brands have been successful precisely because they have managed to represent and engage with those motivations at a local level. The connection is so strong that in many cases after an acquisition, global companies like SABMiller and AmBev kept local brands like Aguila, Crystal, Quilmes and others as their main brand strategy in the country. And this has worked nicely. According to a study from Kantar World panel (Brand Footprint 2014), Global Brands grew 0.7% and Local Brands grew 1.3% - nearly double the growth rate. And brands are a very hot topic in LatAm right now. According to Group M, forecasted ad spend growth in Latin America is going to be highest in the world for both 2014 and 2015.
Now the question is: how can local brands continue to GROW in the near future? How can they expand their market and their influence beyond their category or country?
We believe there is a massive opportunity for growth of many of the LatAm Brands when they start looking at the whole region as their playground.
A smaller group of brands such as Falabella, Lan, Claro, Itaú, Bancolombia, Natura and Avianca have been working for years now to become true regional LatAm Brands. Many others have the aspiration to do so. What is the opportunity if we look at LatAm as a whole?:
- We would be the fourth largest economy in the world, only behind USA, China and Japan
- We would be the 3rd most populated market with close to 600 million people
So the key challenge for some LatAm Brands, including many of those listed in the BrandZ™ Top 50 Most Valuable Latin American Brands 2014, is how to transcend their local success and build propositions that connect with the wider Latin America region. This is not an easy task, with many questions that are related both to strategy (how are these brands meaningful and different?) as well as execution (the efficiency of the advertising to generate saliency for the brand?).
As Nigel Hollis mentions in his book "The Global Brand", there are 3 layers of building meaning for a brand: cultural meaning, social meaning and individual meaning. When looking at cultural meaning "the interaction between a brand and a culture is most obvious when the brand taps into local culture directly".
This is no different to what most global brands are facing. The advantage for many Latin American brands is that they understand better what brings us together and deal more tactfully with the differences, or do they? The challenge is on.