+2%

Recommendations

Info

MEXICO THOUGHT LEADERSHIP TOP 50 MOST VALUABLE LATIN AMERICAN BRANDS 2015 A KALEIDOSCOPE OF CHALLENGES AND OPPORTUNITIES In an environment of surprising significant growths and slowdowns, Mexico is one of the regional economies remaining somewhat constant. This is worth mentioning, since it has been achieved despite the fact that the Mexican economy has been shaken by oil production, oil prices, the United States growth, and the financial volatility of international markets. Although at first sight and from a macroeconomics perspective it might seem only weakly active, both Mexican society and government have been forced to make adjustments here and there so as to maintain the relative stability of LatAm’s second largest economy. RICARDO BARRUETA Managing Director Millward Brown, Mexico, Central America and the Caribbean Ricardo.Barrueta@millwardbrown.com A SLOWING ECONOMIC ENVIRONMENT The reality is clear: in the 2014-2015 period, Mexico has slowed down. On July 9th of the current year, the IMF reduced its estimated growth for Mexico from the already reduced 3% it had anticipated in April, to 2.4%. Among other things, this reduction was related to the weakness shown in the first months of 2015 by the economy of the United States, Mexico’s most important commercial partner. Although lower than expected, Mexico’s growth is headed up by manufacturing exports —largely the result of the two-digit increase, for the fifth consecutive year, in the automobile sector. However, local demand has not kept pace: private consumption is burdened by consumers’ low trust levels and scarce wage growth. Nonetheless, private investment has seemed to be more active in the past few months. Foreshadowing a longer-lasting drop in oil prices, the Mexican government announced a 2015 budget cut equivalent to 0.7% of the GDP and is planning an additional cut in public expenditure for 2016. The lower public expenditure will slow the pace of economic growth, despite the trust that disciplined tax practices will bring economic benefits. Growth has been lower than expected, and there has not been a strong connection between growth and the reduction of poverty. The latter might be the result of the circumstances prevailing in the labor market: in recent years, not enough employment opportunities have been created, nor have there been jobs paying adequate wages. In addition, the labor force has increased, due to demographic changes, balanced migration to the US, and more female participation in the workforce, all of which the Mexican economy has failed to absorb. There is a positive aspect, both government transfers, particularly in urban zones, and a lower dependency rate have contributed to the improvement of some poverty indexes in the country. REFORMS FOR GROWTH The Mexican government has made progress in its structural reforms agenda, specifically in the labor and education areas, competition laws, the financial sector, telecommunications and laws for the energy sector, all of which are aimed at increasing productivity, competitiveness and the potential growth of Mexico in the international arena. Today, the administration is devoted to the implementation of these reforms. Opening the energy sector to private investment is especially promising for promoting growth, for it is expected to lead to an increase in oil and gas production and to provide cheaper energy supplies to Mexican industry. Assessing the distributive impact of these reforms, the regulations associated with them, and their implementation will be important, but their nature endows them with strong potential to drive Mexico’s growth. Thus, an acceleration of economic activity is expected for 2017. On the one hand, it’s not anticipated that public expenditure will be reduced again; on the other, the gradual growth of US demand will support a continuous and strong performance of manufacturing exports. This is expected to result in a gradual recovery of private consumption and investment. ELECTIONS, CONSUMERS, AND BRANDS The first half of 2015 is a good example of the dynamism in the market during the period we’re evaluating. Midterm elections became the main character not only in the political, but also in the social scenario. The different political parties reflected — though by means of blaming one another, rather than presenting proposals — society’s concern about topics such as security, income, and corruption. Mexican consumers, who have an essentially short-term view, think in even more immediate terms thanks to the 24/7 messaging they’re receiving about overly-simple solutions to complex social issues. The ever-changing environment leads Mexican consumers to appreciate particularly three basic features: convenience, accessibility, and playfulness. In the face of change, Mexican society prefers brands’ prioritizing “making life easier and more bearable” over other engagement messages. The brands with the most marked growth in the last year definitely prove this. The cases of Oxxo and Tecate, the two Top Risers of the portfolio, are worth highlighting. Oxxo is and has been the epitome of accessibility and convenience in Mexico. With over 12 thousand stores and an opening pace of a new branch every eight hours, the brand is emerging as the largest retail chain in this region. The geographical expansion of Oxxo and the variety of products it offers have made it a widely known brand, capable of generating a meaningful difference that has led to exponential growth not only in terms of sales floor but also in the minds of consumers. The Tecate brand has managed to base its growth on a communication so powerful that it has transcended to an iconic status in the minds of Mexican consumers. Through creative campaigns with messages for “the Mexican macho”, Tecate has become a real cultural happening: a playful escape that has led its most recent campaign, featuring Sylvester Stallone, to become part of Mexico’s pop culture. Tecate has created differentiation, salience, and meaningfulness by presenting itself as a friend to consumers, an ally in their best moments. The learnings brought about by Oxxo, Tecate, and some other Mexican ranking champions are crystal clear: in an everchanging environment, Mexican consumers prefer brands that help them keep pace, acting as important buffers against uncertainty, and making them forget their difficulties. The secret is to become a close ally who invites others to think about the good times to come. 112 113
MEXICO THOUGHT LEADERSHIP TOP 50 MOST VALUABLE LATIN AMERICAN BRANDS 2015 EVOLVING PARADIGMS IN AN UNPREDICTABLE MARKET Mexico is in a time of economic uncertainty. There is no open talk of economic recession but GDP shows little growth and the dollar reached a historical high against the Mexican peso, whilst trust in government is at an all-time low. JORGE ALAGÓN Chief Client Solutions Officer LATAM Millward Brown Jorge.Alagón@millwardbrown.com At times like these, marketers tend to shift their focus from long-term strategy to short-term sales. Many will choose to meet revenue targets by lowering prices to maximize short-term sales while cutting investment in long-term brandbuilding activities. However, lessons from recent recessions provide powerful arguments for maintaining a longer-term view, even in the face of pressure to cut advertising in favor of promotions. Marketers who resist this pressure and use their budgets effectively and creatively will find that their brands emerge from the tough times in good competitive shape. Players that go in the opposite direction and engage in price wars may seemingly solve the immediate challenges but are damaging the brands’ equity and, ultimately, their revenue and profit. THE POWER OF ASSOCIATION While economic conditions are continually changing, successful brands have learned that despite the particular challenges of any given moment, the need to keep building strong associations between a brand and the consumers is permanent. Furthermore, because the volume of communications that the market generates is low due to the crises, it is the perfect time to invest. This approach seems counterintuitive but has been proven across the most varied recession scenarios, benefitting those who have understood it. Our analysis (see chart below) shows that the strongest brands – those in the BrandZ Global Top 100 – have outperformed both the S&P 500 and the MSCI World Index since recovery began in mid-2009. Clearly, brand strength needs to be nurtured and maintained through good times and bad. Doing so, the brand’s equity becomes both a shield when the crises arrive, minimizing the negative effects of the environment, and a boost to the market share of the brands once the crises has passed. Once the dust settles and the economy recovers its pace, the efforts made in the middle of the turmoil pay off. To make things more complicated, the Mexican consumer has changed too and will continue to do so. Technology has transformed how we interact with one another and with brands, and of course, the way we buy. DIGITAL INFLUENCE The power of social media has been demonstrated in Mexico. With an estimated 50 million Facebook users (roughly 70% of internet users, 40% of population) and close to 10 million Twitter accounts, it is not surprising to see new independent digital media outlets with a reach to rival traditional mass-media. Think of werevertumorro with 15 million Facebook followers, 10.3 million YouTube subscribers and 6.6 million Twitter followers; or El Pulso de la República with 1.2 million YouTube subscribers. The influential power of Aristegui Noticias (5.2 million followers in Facebook, 4.6 million in Twitter) created an outcry over president Enrique Peña Nieto’s $7 mansion, the “White House scandal”. These factors both influence and help to explain the all-time low approval score for the President´s performance, at 2.8 out of 10 (Survey conducted by Millward Brown through Google Consumer Surveys). Brands would do well to read the politicians’ current situation; people, either in their roles as citizens or consumers, now have a voice that is immediately heard. Traditionally, brands and politicians lived in a one-way communication cycle. Now, through social media, the everyman has the power to give instant feedback, which opens up new possibilities and brings new responsibilities for everyone. MOVING WITH THE MARKET Brand owners can no longer expect people to adapt to their business practices; marketers need to adapt to people’s new behavior and expectations, and even collaborate with their consumers or risk being swamped by new entrants and innovative business models. Consider Uber and how it has disrupted the transport industry in Mexico City. Uber is one of those rare businesses that truly think outside the box. They constantly surprise users and prospects alike with creative value propositions. For example, in response to taxi drivers’ demonstration against Uber, they gave two free rides up to $150 Mexican pesos (around USD$10). While Uber certainly sacrificed immediate profit with this initiative, through it they built strong associations with the brand, and even better, their app downloads soared, opening the door for a massive number of potential users. The whole event serves as a great example of both building long term equity for the brand, even at the cost of sacrificing short term sales, and of the creative use of social media, being available where it is most relevant for their target market. Uber doesn´t advertise in traditional media, but the free ride campaign resonated strongly without any media investment. The brand followed up this momentum with UberPet, UberCulinary and a joint promotion with Häagen-Dazs that surprised and delighted users, continuing to strengthen its equity. AMAZON FLOWS INTO MEXICO Surprisingly, only 20% of 51.2 million internet users make online purchases. This seems a huge opportunity for Strong brands generate superior shareholder returns BrandZ Strong Brands Portfolio vs. S&P 500 vs. MSCI World Index. April 2006 - April 2015 100% 0% -60% BrandZ Strong Brands Portfolio S&P 500 MSCI World Index Source: Millward Brown and BrandZ 102.6% 63% 30.3% Amazon, which has just landed in Mexico in a formal way. It already enjoys a strong positioning and has a significant base of clients that mainly use the US store. It will challenge mainstream retail businesses to fully embrace e-commerce as a vital strategy for growth, with excellent consumer experience and logistics. It will also nudge every business to deliver products faster, at lower prices, with one-to-one marketing and a user-friendly platform. We will see a shift from rigid structures of a product distributed in one channel by one company to an on-demand model where the consumer is in command, where the business no longer solely benefits itself but also benefits the consumer, evolving the relationship between brand and consumer from a merely transactional one to a partnership. The brand no longer wants just your money but genuinely wants to make your life easier. In this landscape, clever brands will no longer be company-centric, but client-centric, refocusing their essential views and acting accordingly. They will no longer limit themselves to sell features/ benefits but instead stand for something deeper that reflects the values of their consumers. So, what should brands in Mexico do in uncertain times like these? • Think and act long-term, maintaining marketing investment to outperform competitors. • Explore alternative channels of communication and of distribution, being mindful that they transmit both ways. Don’t ignore the feedback. • Be truthful to your brand’s purpose and improve people’s life through your product or service. 114 115
Page 2 and 3:
TOP 50 41 42 43 44 45 46 47 48 49 5
Page 4 and 5:
LATIN AMERICA WELCOME TOP 50 MOST V
Page 6 and 7: LATIN AMERICA THOUGHT LEADERSHIP TO
Page 8 and 9: LATIN AMERICA OVERVIEW TOP 50 MOST
Page 10 and 11: LATIN AMERICA KEY FINDINGS AND FUTU
Page 12 and 13: LATIN AMERICA TOP 50 MOST VALUABLE
Page 14 and 15: ARGENTINA THOUGHT LEADERSHIP TOP 50
Page 16 and 17: ARGENTINA KEY FACTS AND TOP 5 MOST
Page 18 and 19: ARGENTINA THOUGHT LEADERSHIP TOP 50
Page 20 and 21: BRAZIL TOP 50 MOST VALUABLE BRAZILI
Page 22 and 23: BRAZIL BRAND STORIES TOP 50 MOST VA
Page 28 and 29: BRAZIL THOUGHT LEADERSHIP TOP 50 MO
Page 34 and 35: CHILE KEY FACTS AND TOP 15 MOST VAL
Page 36 and 37: CHILE BRAND STORIES TOP 50 MOST VAL
Page 38 and 39: CHILE THOUGHT LEADERSHIP TOP 50 MOS
Page 40 and 41: CHILE THOUGHT LEADERSHIP TOP 50 MOS
Page 42 and 43: COLOMBIA KEY FACTS AND TOP 20 MOST
Page 44 and 45: COLOMBIA BRAND STORIES TOP 50 MOST
Page 46 and 47: COLOMBIA THOUGHT LEADERSHIP TOP 50
Page 48 and 49: COLOMBIA THOUGHT LEADERSHIP TOP 50
Page 50 and 51: MEXICO KEY FACTS AND TOP 30 MOST VA
Page 52 and 53: MEXICO BRAND STORIES TOP 50 MOST VA
Page 54 and 55: MEXICO BRAND STORIES TOP 50 MOST VA
Page 58 and 59: MEXICO THOUGHT LEADERSHIP TOP 50 MO
Page 64 and 65: PERU KEY FACTS AND TOP 12 MOST VALU
Page 66 and 67: PERU THOUGHT LEADERSHIP TOP 50 MOST
Page 72 and 73: RESOURCES BRANDZ VALUATION METHODOL
Page 74: RESOURCES BRANDZ PUBLICATIONS TOP 5
Page 77 and 78: RESOURCES CONTRIBUTORS TOP 50 MOST
Page 83: Powered by www.brandz.com
show all

+2%

Create successful ePaper yourself

Delete template?

Save as template?