Thaifex 2019: What you need to know about brand disruption in Southeast Asia
Brand disruption 101
Successful products always start with the consumer. Every product must fulfill a need or want. Needs and wants can be created, like the iPhone by Apple Inc. when it was first brought to the market. Needs and wants can also be identified and answered, as in how numerous reduced-sugar beverage variants are appearing in the market in Southeast Asia because of the negative sentiment towards sugar consumption in the region.
If you want to make consumers purchase your product, they must first know about it. Are consumers aware of your brand? Are they even aware of the category? In developed countries, the latter is hardly an issue, but in developing countries like Indonesia, Vietnam and Thailand, and for products such as Greek yoghurt or non-dairy ice cream, consumer education is extremely important.
Next, consider affordability. Businesses need to think about the share of wallet in terms of daily propensity to spend, as consumers likely have an intrinsic budget to spend on consumer goods in its entirety. Product distribution is another factor that businesses need to consider. Even if the product is affordable to consumers, they cannot buy what they cannot find.
Lastly, successful products must have some type of value over their competitors. In an interconnected world where consumers are overloaded with information daily, it becomes difficult to stand out amidst a sea of brands. It is even more important than before to have the whole product concept together – from ingredients to packaging to execution to brand value. Consumers need to believe in what they are consuming, be it based on country-of-origin of ingredients or product quality.
Brand disruption case study: Salted egg
One example of brand disruption in Southeast Asia would be the salted-egg flavour trend. This trend was initially pioneered by brands such as The Golden Duck and Irvins Salted Egg – products that were twice as or even three times more expensive than the average savoury snack available. Yet, they grew from nothing to become the new-age model of success for savoury snack start-ups, redefining the way consumers think and feel about savoury snack consumption and about value for money.
Part of the reason why consumers were so drawn to these brands was because of their nature of exclusivity. These brands were first sold via their own retail outlets, through pop-up stores or the like. This, combined with the perception of high-quality ingredients and perhaps a portable, presentable, taste of Singapore, allowed for these two brands to reach heights of unprecedented popularity for premium savoury snacks in Southeast Asia.
These snacks were especially favoured by tourists, but also by locals who had the propensity to spend on these snacks and were perhaps desiring to spend more given rising affluence levels. The need for premium savoury snacks was therefore created and curated.
This exclusivity strategy also helped to simplify product distribution. Singapore is a small country and putting these outlets in strategic areas frequented by tourists and young working professionals helped to form queues and enhance the perception of product demand.
With authenticity and the need to stand out from the crowd in mind, word of mouth emerged as the most effective form of communication between brands and consumers. This created hype, which in turn generated demand, continuing word-of-mouth recommendation.
The result? A change in the perception of what savoury snacks should be like – a market where unpackaged snacks, packaged food giants and premium snacks can co-exist together.
The key to brand disruption is essentially to review and to reinvent – even if you are initially successful, your product must always be answering a type of need. If it is not, can you reinvent yourself in time to stay relevant? Judging by The Golden Duck Co’s strategy of modern trade and diverse, unique flavours and Irvins Salted Egg’s strategy of expanding its product portfolio to all things salted egg, it is safe to say that neither brand is resting on its laurels.