Possessing 74 percent of total FMCG spend and growing their sales by double that of their global competitors, local brands proved dominant in Asian markets in 2015, according to Kantar Worldpanel's Annual FMCG Brand Footprint study.
Marcy Kou, CEO of Kantar Worldpanel Asia, said the research company has witnessed a shift in Asia’s competitive FMCG landscape over the last few years. "Although FMCG growth across all world markets has cooled, local brands in Asia have gained ground over global brands and are growing at a much faster pace,” she said.
Asia's brands were particularly strong in the food-and-beverage categories locally, where brand choices were dominated by local players in terms of both the number of brands available and the number of times they were chosen.
In China, local brands comprised 75 percent of shopper decisions, followed by Indonesia with 61 percent and India with 57 percent.
For more on brand equity in Asia, see our
Asia's Top 1000 Brands report, including rankings
for APAC as a whole and 13 individual markets.
Alison Martin, director at Kantar Worldpanel, explains that “in large emerging markets such as China, India and Indonesia, many consumers see local brands as not only familiar but also more affordable and widely available”.
The three best performing local brands of 2015 were Chinese natives: Yili, Mengniu and Bright.
India’s household and personal care brand Clinic Plus remained Asia’s most chosen brand, and is the number one brand in Asia, according to the study.
Coca-Cola remains the global market leader for beverages, reaching 46 percent of the world’s population. In Asia, non-local Nescafé remains the top chosen beverage brand.
Indonesia’s Indomie rose to become the top food brand in Asia for 2015.
For comparison, in Campaign's consumer preference-based Asia's Top 1000 Brands study, Indomie ranks 32nd in the food category, and landed at 257th overall this year (down slightly from last year but a huge improvement over its 910 ranking in 2010). Asian brands in the top 10 under the food category include Lotte at second, behind category leader Nestlé and followed by Japan’s Meiji and Nissin at third and 10th place, respectively.
Half of Asia’s top 10 brands, according to Campaign's study, are local brands, including first place Samsung, Sony at 3rd, Panasonic at 5th, LG at 7th and Canon at 8th, implying a preference for local brands in Asia not only for FMCG markets, but also in electronics markets.
Emerging markets, or emerged?
The Kantar study states that emerging markets accounted for 82 percent of FMCG growth in 2015, with star performers including China and India.
FMCG value share in emerging markets has increased from 44 percent to 48 percent in just two years. On this trajectory, the study predicts emerging markets will account for more than half of sales by 2017.
Globally, 2015 saw FMCG brands grow by a total of 4.7 percent in value. Almost half (47 percent) of brands grew in the ranking, and three quarters of these attracted more households and grew penetration. However, food-and-beverage volumes declined globally by 0.6 percent. Home care and personal care, with volumes up 0.6 and 0.3 percent, respectively, continued to grow.
Consumers paid more for fewer goods in 2015, with the value of FMCG sales increasing by 4 percent while volumes declined by 0.4 percent. The United States, Latin America and Asia showed to be the regions driving this trend.
The Kantar study states that as convenience and ease of access is always top of the list when it comes to choosing a store, the key opportunity area for multinationals is e-commerce, the fastest growing channel. E-commerce FMCG sales continue to grow strongly, up by 15 percent globally in 2015. South Korea still leads the way, buying 13.7 percent of their groceries online. E-commerce is projected to command a global 9 percent share of FMCG sales by 2025.