How brands can align themselves with local sentiment

Over the last two years it seems we have become almost immune to political upheaval and ‘populist’ shocks. Election results across Europe and the Americas have left assumptions about society and the economy that held true for much of the last 30 years in question.

What appears to be driving these trends is a sense of insecurity in the face of automation, globalisation and changing demographics. Although it is easy to exaggerate this sense of dislocation - the global public tell us we need modern technology and to take risks - half (50%) of respondents across 23 countries told Ipsos they agreed they would ‘like my country to be the way it used to be’, while 80% said traditions were an important part of society.

If voters’ political tastes are in flux to this extent, then it should be no surprise that consumer choices are too. Brands are adapting their own positioning in response to this sense of nostalgia. No drinker of alcohol for example can have failed to notice the fashion among beers and gins to define themselves as ‘craft’ or ‘small batch’, terms with obvious connotations of local workmanship. Indeed, when polled in 2017 almost half of UK respondents (45%) told us they associated craft beer with small manufacturers, while a third (32%) saw it as made in small batches. A quarter (23%) linked craft beer with traditional recipes, and a fifth (21%) connected it with local ingredients. Meanwhile, coffee drinkers have seen a similar shift in ‘third wave coffee’, that emphasises high quality coffee, and prizes the artisanal aspect of the product.

While partly driven by a desire to emulate the past, some of this swing towards small scale producers – or producers who portray themselves as such – is also driven by low trust in large corporates. Only a minority in the UK in the Autumn of 2018 (45%) told us they trusted large companies to treat customers fairly, while just 30% said big companies had society’s best interests at heart. And when brands that portray themselves as local and independent are found to be tied to major corporations, major reputational damage can result. 

Until recently such episodes were commonplace - in 2013, Harris and Hoole, a coffee chain that positioned themselves as artisanal and independent, suffered a customer backlash once it became known the company was 49% owned by Tesco. Two years later, Camden Town brewery were delisted by indie darlings Brewdog, after the former brewery was taken over by brewing giant AB InBev. Also in 2015, Meantime Brewery was forced to defend itself against similar accusations of selling out their values after being bought out by SABMiller. While partnership with major brewers may offer benefits to the upstarts in terms of greater investment and distribution, and larger brands can benefit from the artisanal aura given off by the smaller players, the reputational pitfalls are clear.

So where does this leave any major brand looking to position itself as local?

Clearly the risks of such a strategy need to be weighed against the opportunities, and stakeholder research can help you to understand the local competitive contexts.

In each market, research can investigate the reputational benefits local brands enjoy over global competitors, or vice versa, and identify what it is about local brands that is appealing to target audiences. Is it that local operations promise more sustainable means of packaging, transportation and production? Is it more about providing jobs and a healthy local economy? Or is it a desire to give something back to local communities and show action on the ground? 

While a simpler strategy, the appeal of one-size-fits-all global mega-brands may be limited.  The way forward may be more meaningful local engagements in key markets, localising a brand’s positioning and initiatives so that it resonates better with local stakeholders.  In the long term, the best way for a global company to unlock its brand equity may be to understand how to become that bit more local.