Today its all about global branding and marketing, right?
Well actually no, according to Graham Mckay, CEO of SAB Miller. He explains how SAB firmly believe in local marketing in an article in Brand Finance's new journal. And I tend to agree with him. Many of the best examples of marketing come from local initiatives, including campaigns that go on to be global, such as Doves' Evolution viral video.
I've been lucky enough to see this approach in action at SAB first hand, having worked with the company on projects around the world over the last 17 years.
Let's look at some of the key points Graham makes about SAB Miller's local marketing, which has delivered an impressive and consistent set of results, as I posted on here. Profits increased from from $764million in 1999 to $3.4 billion in 2009.
The first interesting point is just how local beer remains. Beer brands consumed outside their country of origin account for only 5% of global beer volume. In other words, 95% of beer is local. Global brands like Corona and Heineken have global shares in the low single digits. And this picture has not changed much in the last 10 years.
This is all the more suprising given that the beer industry has gone through an dramatic period of consolidation over this period. The big four players (SAB Miller plus Heineken, Carlsberg and AB Inbev) account for c.50% of global beer volumes and c.75% of the profit pool.
So, if beer companies are now global, why is the beer marketing still so local? The economics of making and distributing beer around the world are prohibitive, as it is a bulky and perishable product. But Graham suggests this is a secondary reason.
Emotional and cultural connection
Graham suggests the key reason for local marketing is to do with beer being "an emotional construct". And more specifically, one that taps into local cultural meaning. Whilst many beer adverts work with similar human motivations such as friendship and achievement, the best ones express these values in a way which really resonates locally. Graham says: "Local sensitivity and local intimacy are critical to understanding the un-articulated, intuitive relationship that people have with their beer."
And getting this level of local nuance requires in-depth insight.
Let's look at a couple of examples of SAB brands in action.
Tyskie - Poland
This was the first project I worked on with SAB, back in the mid 90's. At the time Tyskie was a regional brand and one with a pretty poor reputation outside its home region, which was famous for coal mines and nuclear power stations (bang went the provenance story). Tyskie is now the leading brand in Poland, and one of SAB's biggest and most successful brands.
The growth came from tapping into a desire amongst Poles to believe that they can be a great country, after many years of hardship. The brand vision work led to a creative brief with the key idea of "David vs. Goliath": dramatising the fact that Tyskie was a proud Polish beer that could take on the world.
A series of entertaining commercials showed drinkers in countries famous for great beer, such as Ireland and the Czech Republic, thinking they were drinking a local brew only to find it was in fact Tyskie. From Poland?! If you're on the blog you can click below to watch one of the ads.
In addition, the packaging was upgraded and a press campaign was used to promote the international quality medals the brand had won.
A full case study on Tyskie in our Brand Vision book, here.
Castle Lager- South Africa
The second example in Graham's article is for Castle Lager from South Africa. This brand played in the leading role for SAB in South Africa during the soccer world cup in 2010. The brand tapped into a characteristic that unites the "Rainbow Nation" of different languages, cultures and political affiliations: pride in South African's reputation for hospitality and open-ness.
Advertising portrayed a collection of soccer fans from all races preparing a traditional "brai" barbecue from the backs of their cars and vans. Importantly, this was complemented with an activation programe to help set up similar Castle Lager-lubricated brais in key locations where fans were watching the world cup.
In conclusion, SAB Miller show the power of local marketing. As a company they share best practice in marketing and other business practices like manufacturing and finance. But then, as Graham concludes, they "Use the best of what we know globally to enhance our offering and delivering locally".