globeone BRIC Branding Survey - Russia Edition

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© CopyrightThis document of globeone GmbH is intended exclusively for the client or addressee. It remains exclusive property of globeone GmbH until the rights of use are expressly transferred. Any revision, use, duplication or commercial distribution of this work is permitted only with written consent of globeone GmbH. This document is a discussion paper. It makes use of secondary information and hypotheses and is therefore for discussion only. It does not include any recommendations or binding statements.

BRIC Branding® Survey – Russia Edition

The Perception of German Brands in Russia – Strengths, Weaknesses and Opportunities

June 2012

2

• Executive Summary• About globeone• Survey Approach• Germany’s Image in Russia• Leading German Brands in Russia• Insights into Information Channels in Russia• Marketing and Communication Strategies for Russia• Contact

Agenda.

3

Key findings – Germany’s image in Russia

Source: globeone

COUNTRY-OF-ORIGIN IMAGE OF VERY HIGH IMPORTANCE IN RUSSIA90% of Russian consumers and B-to-B buyers consider the Country-of-Origin Image (COO-Image) to be of central importance in the purchase decision process.

EXTREMELY POSITIVE ATTITUDE TOWARDS GERMAN BRANDSAn overwhelming majority of Russians (88%) show positive attitude towards German brands. This is the highest figure compared to other BRIC countries that were surveyed.

GERMAN BRANDS LEADING IN ALMOST ALL DIMENSIONSGerman brands lead the ranking in 12 out of 15 categories of values associated with their performance. This perception is especially distinctive in such categories as excellent quality, high performance, good reliability and trustworthiness.

SHORTCOMINGS IN SOPHISTICATIONGerman brands show some shortcomings in “sophistication” as they are not perceived as being very fashionable or exciting, nor geared to local tastes. France and Japan outperform Germany in this category. Japan also scores slightly higher than Germany in terms of “innovativeness & high-tech”.

SOME BARRIERS TO ENTER THE RUSSIAN MASS MARKETMost German brands have a strong premium image and score high on the prestige scale. Therefore, many brands are also perceived as being expensive. Limited affordability of German products because of relatively low income level may pose barriers to German products gaining a significant share in the Russian market.

Germany’s image in Russia – Key findings (1/2)

4

Key findings – Leading German brands in Russia

Source: globeone

GERMANY IS BEST KNOWN FOR TRADITIONAL INDUSTRIESGerman brands are most famous for automobiles (94%), home appliances (86%) and pharmaceuticals (44%). 7 out of 12 brands that urban Russians remember spontaneously belong to the above-named sectors.

MERCEDES-BENZ, BMW AND AUDI ARE THE BEST KNOWN GERMAN BRANDS IN RUSSIAAn overwhelming majority of the Russian population is aware of numerous German brands. Brands of three German car manufacturers – Mercedes-Benz, BMW, and Audi – take the leading position with 99% aided awareness.

BMW IS THE BEST-LIKED GERMAN BRAND IN RUSSIAGerman automotive brands – BMW (95%), Mercedes-Benz (94%), and Volkswagen (92%) – enjoy the highest ranking on the positive attitude scale, followed by Audi (91%) and sportswear multinational Puma (91%).

NIVEA IS THE MOST FREQUENTLY PURCHASED/USED GERMAN BRAND IN RUSSIAThe most frequently purchased/used German brand in Russia is Nivea (68%) followed by Adidas (62%) and Braun (61%). Only 6 brands out of 45 represented in the survey enjoy 50% and over purchase/usage rate. There is potential for German brands to secure a larger market share in the Russian market.

INTERNET IS THE MOST POPULAR INFORMATION SOURCE TO LEARN ABOUT FOREIGN BRANDSThe Internet serves as a leading source for Russian consumers to find information about German brands being used by 29%. Other important sources include shopping centers (19%), TV (19%), and personal recommendations by family or friends (17%).

Germany’s image in Russia – Key findings (2/2)

5


Agenda.

6

Global network with strong focus on fast growth markets

Mumbai Office

Cologne Head Office

São Paulo Office

Singapore Office

Beijing Office

Shanghai Office

globeone is a business consultancy with a strong representation in the world’s fast growth markets

We offer specialized marketing strategy consulting & project management services to help drive clients’ success in the world’s key growth regions

About globeone (1/2)

Seoul Office

7

Marketing & communication strategy consulting to drive clients’ success in BRIC

Exec

ution

Stra

tegy

supp

ortConsumer & strategic

market insights1

Quantitative market research design (e.g.

market potential, segmentation)

Customer insight generation & market trend

studies

Competitor analysis & benchmarking

Qualitative market research (e.g. online user experience, focus groups)

2 Optimized positioning & planning

Brand architecture & brand portfolio strategies

Definition of goals and KPIs & related strategy

development

Brand and product (re-) positioning & value

proposition development

Business case & market entry program development

3 Support of 360° fulfillment

Employer brand development & program

implementation

Hands-on project management & creation of professional presentations

Creation of 360°integrated activity planning

Creation of briefings & steering of specialized

agencies (e.g. pitch support)

4 Brand performance & loyalty

Marketing spending effectiveness (e.g.

correlation of investment and sales)

Brand performance analysis & controlling (e.g.

brand monitor surveys)

CRM audit & CRM strategy development

Set-up of activities & programs to enhance

brand loyalty

Global Strategy + Local Adjustment = Success in BRIC

– Typical globeone project examples for major global clients (selection) –

About globeone (2/2)

8

• About globeone• Survey Approach• Germany’s Image in Russia• Leading German Brands in Russia• Insights into Information Channels in Russia• Marketing and Communication Strategies for Russia• Contact

Agenda.

9

Countries/Cities:

Brazil Russia India China

São Paulo Moscow Mumbai Shanghai

Rio de Janeiro St. Petersburg New Delhi Beijing

Porto Alegre Novosibirsk Bangalore Guangzhou

Recife Yekaterinburg Chennai Chengdu

Brasília Nizhny Novgorod Pune Wuhan

Objectives:• Identification of Country-of-origin Image (COO-Image) relevance in BRIC • Assessment of perception of German brands amongst urban citizens• Strengths & weaknesses of German brands and strategic implications

Method/Timing1: • Stock exchange (DAX/MDAX) listed companies, other major German brands • Computer-assisted telephone and face-to-face interviews: n ≈ 4,000• Field work conducted: 2011

Over 4,000 interviews in 20 of the most important BRIC cities to analyze the perception of German brands

Survey approach – Objectives and scope

Source: globeone

German brands

1) Representative survey based on research conducted by a certified market research agency in each country.

10

Cities:

Objectives:• Assessment of perception of German brands among Russian urban citizens• Analysis of Russia-specific strengths, weaknesses and opportunities• Guiding successful brand management in Russia

Method/Timing1: • Inclusion of major German brands • Computer-assisted telephone interviews: n = 1,000 for Russia• Selection of cities to achieve a good representation of urban Russia

For the Russia edition, 1,000 interviews were conducted in 5 key Russian cities

Survey approach – Objectives and scope

Source: globeone

Yekaterinburg

NovosibirskMoscow

St. Petersburg

Nizhny Novgorod

1) Representative survey based on research conducted by a certified market research agency in Russia. The city sample was selected in order to achieve a good representation in key Russian regions.

German brands

11

COO – Definition

“Country-of-origin is defined as the country where corporate headquarters of the company marketing the product or brand are located. This does not require local manufacturing.” 2

“Consumers and customers associate positive or negative attributes with a company, product or brand, if they know it originates from a certain country.“ 3

“Country-of-origin effect is one of the most analyzed phenomena in consumer behavior in international markets.“ 1

COO – High interesteST

Survey approach – Country-of-origin definition

Country-of-origin (COO) as a key factor for purchase decisions in Russia

Source: globeone

Sources: 1) Amine et al. (2005): Executive Insights: Exploring the Practical Effects of Country of Origin; 2) Daniels, J.D./Radebaugh, L.H., (2002): International Business ; 3) White, P.D./Cundiff, E.W. (1978): Assessing the quality of industrial products.

12

Survey approach – Country-of-origin in Russia

COO-Image – Important success factor in Russia

Urban consumers in the Russian market are particularly sensitive related to the COO-Image resulting from• Social mobility: Local consumers’ demand for prestigious

brands to highlight their social progress• Novelty: Lower availability and higher novelty of foreign

brands also boost their image• Limited trust: lower level of quality and marketing

competence of local brands in most emerging markets

Russia-specific relevance of a positive COO-Image

A positive COO-Image can:• Increase perceived quality and prestige of a brand • Promote consumers’ purchase intentions in favor of a brand

Potential for increasing brand performance depending on respective industry and product category

General relevance of a positive COO-Image– Perception of a brand’s corresponding country-of-origin –

Examples

!

Source: globeone

http://www.fahnenkontor24.de/javasc






13


Agenda.

14

COO-Image important for purchase decision – confirmed by 90% of Russian respondents

Germany’s image in Russia – Importance of COO-Image

Source: globeone

– Importance of COO-Image –

Sample size in Russia: 1,000. Q.: How important is the country-of-origin of a brand to you when you purchase a product or service?

Not at all important Not important Does not really matter Relatively important Very important0%

10%

20%

30%

40%

50%

60%

70%

0% 0%

10%

29%

61%

15

COO-Image is most important for RussiansC

Germany’s image in Russia – Importance of COO-Image

Source: globeone

Not important at all

Not important

Does not really matter

Very important

Relatively important

10%

20%

36%

29%

5%4%

31%

38%

19%

8%

1%

14%

47%

25%

13%

0%

0%

61%

29%

10%

Sample size per BRIC country: 1,023 (Brazil), 1,000 (Russia), 1,000 (India), 1,010 (China)Q.: How important is the country-of-origin of a brand to you when you purchase a product or service?

16

• Overwhelming majority have positive attitude towards German brands

• Only a miniscule fraction (1%) that does not like German brands

• Excellent opportunities for effective positioning utilizing country-of-origin potential

German image as an asset – 88% of the Russian urban population confirm positive image of German brands

Q.: Do you like German brands, products or services?

– General attitude towards German brands in Russia –

Source: globeone

Sample size in Russia: 1,000

88% associate positive image!

I do not like German brands

at all

I do not really like German

brands

I do not have a preference

I like German brands

I like German brands very

much

0%

10%

20%

30%

40%

50%

1% 0%

11%

43%45%

Germany’s image in Russia – General attitude towards German brands

17

Best results for positive perception of German brands in Russia compared to other BRIC countries

Germany’s image in Russia – General attitude towards German brands

Sample size per BRIC country: 1,023 (Brazil), 1,000 (Russia), 1,000 (India), 1,010 (China) Q.: Do you like German brands, products or services?

Source: globeone

42%

9%

38%

47%

5%

1%

22%

59%

13%

5%

1%

45%

43%

11%

0%

1%

16%

33%

7%

2%I do not like

German brands at all


brands




much

18

German brands enjoy consistently high reputation across all income classes

Germany’s image in Russia – Income-class-specific attitude towards German brands

Source: globeone

I do not like German

brands at all


brands




much

– Liking of German brands across social classes (according to gross monthly income) –

– Middle class – (€ 880-1,960; RUB 36,000-80,000)

– Upper middle class – (> € 1,960; > RUB 80,000)

– Emerging middle class – (€ 290-880; RUB 12,000-36,000)

1%

40%

14%

44%

84% associate positive image

17%

17%

67%


0%

1%

49%

5%

45%


0% 0%

0%

Q.: Do you like German brands, products or services? Exchange rate: 1 € = RUB 40.83 (June 2012)

19

German brands most strongly associated with quality, reliability and performance

Germany’s image in Russia – Perception of brand and product attributes (1/2)

Source: globeone

– Perception of brand and product attributes based on respective country of origin –

Excellent quality

Good reliability

High durability

High performance

Outstanding design

High prestige

Sophisticated0% 20% 40% 60% 80%

GermanyUSJapanChinaFranceRussia

Sample size in Russia: 1,000. Q.: We are interested in the important brand & product characteristics e.g. design, quality etc. Which countries are most strongly associated with these characteristics?

20

German brands not seen as fashionable or exciting, but they score high on trustworthiness and service

Germany’s image in Russia – Perception of brand and product attributes (2/2)

Source: globeone

– Perception of brand and product attributes based on respective country-of-origin –

Innovative & high-tech

Fashionable & exciting

Close to local customer needs

Good after-sales service

Good value for money

Trustworthy

Good corporate citizenship

Protecting environment & climate0% 20% 40% 60% 80%

GermanyUSJapanChinaFranceRussia

Sample size in Russia: 1,000. Q.: We are interested in the important brand & product characteristics e.g. design, quality etc. Which countries are most strongly associated with these characteristics?

21

German brands enjoy the best reputation in Russia based on 15 performance indicators

Germany’s image in Russia – Country-of-origin image strength index

Source: globeone

– Country-of-origin image strength index – (average scores of 15 relevant brand & product attribute dimensions)

Russia China France US Japan Germany0%

10%

20%

30%

40%

50%

60%

70%

10%13%

30%

38%

52%

64%


22

• German brands are mostly seen as relatively and very expensive reflecting their focus on the premium segment

• Large potential to target emerging middle class with more locally adjusted product portfolio and pricing strategies

– Price perception of German brands in Russia –

Source: globeone

1% 0%

26%

56%

17%

Very cheap Relatively cheap

Very expensive

Relatively expensive

Similar to other countries` brands

Germany’s image in Russia – Price perception

Q.: What do you think about German brands in terms of price? Sample size in Russia: 1,000

73% of interviewees in Russia consider German brands to be relatively or very expensive

23

• Such industries as automotive and home appliances lead the ranking

• Eco-friendly technologies are not yet strongly associated with Germany

• German brands are weakly associated with services

Source: globeone

Germany’s image in Russia – Top industries with German association

Q.: What categories do you think German brands are famous for? Sample size in Russia: 1,000

– Industries/product categories most commonly associated with German brands –

Services (insurance etc)

Detergents

Eco friendly technology

Football

Cosmetics / Perfume

Food

Clothing / Fashion

Machinery

Pharmaceuticals / Medicine

Home appliances

Automobile / Motorcycles

0% 20% 40% 60% 80% 100%

3%

8%

9%

14%

15%

19%

21%

39%

44%

86%

94%

Urban Russians associate Germany mostly with cars, home appliances, pharmaceuticals and machinery

24

Overwhelming majority of the Russian respondents showed high awareness of German brands

– Unaided awareness for German brands in India (top 11) –

Source: globeone

Can recall a German brand

Can't recall a German brand

0%

20%

40%

60%

80%

100%

93% 7%

Hugo Boss

Puma

Metro Cash & Carry

Nivea

Braun

Adidas

Bosch

Audi

Siemens

BMW

Volkswagen

Mercedes-Benz

0% 10% 20% 30% 40% 50% 60%

6%

6%

7%

13%

13%

16%

29%

37%

39%

42%

57%

58%

– Unaided awareness for German brands in Russia (top 12) –

Germany’s image in Russia – Unaided awareness

Q.: Which German brands do you know ? Please name as many as come to your mind spontaneously. Sample size in Russia: 1,000

25


Agenda.

26

• German car manufacturers lead the top 12 ranking

• Mercedes-Benz, BMW, and Audi (99%) are the best-known German brands

• Siemens (95%) is the only non-automotive brand on the top 5 list

• Metro Cash & Carry (74%) is the only B-to-B brand on the top 12 list

Source: globeone

Leading German brands – Aided awareness (1/2)

Q.: I will read you a list of German brands. Which brands do you know?

Top 12 – Car manufacturers are at the top of the best-known German brands ranking with 99% awareness

(987)

(994)

(993)

(970)

(964)

(960)

(916)

(880)

(744)

(743)

(799)

(717)

0% 20% 40% 60% 80% 100%

Mercedes-Benz

BMW

Audi

Volkswagen

Siemens

Bosch

Braun

Nivea

Adidas

Metro Cash & Carry

Puma

Hugo Boss

99%

99%

99%

97%

96%

96%

92%

88%

80%

74%

74%

72%

– Aided brand awareness in Russia (top 12) –


27

• Deutsche Bank (71%) is the leading financial services brand

• Auto parts manufacturer Continental shows high awareness of 63%

• MINI (48%) has a significantly lower awareness compared to other leading car brands

• Industry leader Thyssen Krupp holds the 30th place

Source: globeone

Leading German brands – Aided awareness (2/2)

Q.: I will read you a list of German brands. Which brands do you know?

Rank 13 - 30 – Service and car companies enjoy higher awareness than consumer goods

– Aided brand awareness in Russia (rank 13 to 30) –

(714) (707) (706)

(700) (680)

(642) (636)

(629) (593)

(581) (575)

(554) (543)

(512) (478)

(442) (423) (422)

0% 20% 40% 60% 80% 100%

71%Deutsche Bank

Thyssen KruppBecks

Boehringer-IngelheimMINI

Carl ZeissMAN

MieleAEGDHL

Deutsche TelekomContinental

SkodaPorsche

BayerGrundig

Lufthansa 71%71%

70%68%

64%

63%59%

58%58%

55%54%

51%48%

44%42%42%

64%Henkel


28

• BMW (95%), Mercedes-Benz (94%) and Volkswagen (92%) hit the top 3 list

• Hugo Boss (91%) is the only fashion clothing brand among the top 12

• Nivea (86%) is the only skin- and body care brand on the top 12 list

• METRO extremely well perceived in Russia with its Cash & Carry wholesale formats

Source: globeone

Leading German brands – Positive image (1/2)

Q.: Do you like this brand in general?

Top 12 – Automotive industry tops the ranking – BMW, Mercedes-Benz and Volkswagen as best liked brands

– Positive attitude towards German brands in Russia (top 12)¹ –

(943)

(938)

(891)

(896)

(674)

(649)

(669)

(696)

(829)

(758)

(585)

(805)

0% 20% 40% 60% 80% 100%

BMW

Mercedes-Benz

Volkswagen

Audi

Puma

Hugo Boss

Metro Cash & Carry

Adidas

Bosch

Nivea

Porsche

95%

94%

92%

91%

91%

91%

90%

87%

86%

86%

86%

84%Siemens

1 Based on number of interviewees who know the brand

29

• Bayer (83%) demonstrates the highest score on the positive image scale in the pharmaceuticals industry

• DHL (77%) is in the upper third part of the ranking

• DAX 30 listed SAP (69%) ranks last in the top 30 ranking

Source: globeone

Leading German brands – Positive image (2/2)

Q.: Do you like this brand in general?

Rank 13 - 30 – Bayer as best liked German pharmaceuticals brand

– Positive attitude towards German brands in Russia (rank 13 to 30)¹ –

(760) (580) (525)

(315) (523)

(323) (450)

(285) (235)

(412) (392) (368) (320) (447) (391) (236)

(289) (181)

0% 20% 40% 60% 80% 100%

Bayer 83%Henkel 83%Osram 82%Skoda 81%

Dr. Oetker 80%DHL 77%

Haribo 75%BASF 75%AEG 72%

MAN 72%Carl Zeiss 72%

Boehringer-Ingelheim 72%Continental 71%

Miele 71%

Paulaner 69%SAP 69%

Leica 70%

Braun 83%


30

• Deutsche Bank and Deutsche Telekom lead ranking due to adjective ‘Deutsche’ in the brand name

• 4 leading car brands are among top 7

• Bosch and Siemens, world’s largest electronics and engineering companies, are also on the top 12 list

• Volkswagen using its “Das Auto” slogan scores 96%

Source: globeone

Leading German brands – Recognition of German brand origin (1/2)

Q.: Do you think this brand is originally from Germany or not?

Top 12 – German brands showing high recognition of “German origin” with major car manufacturers in top 7

– Recognition of German brand origin in Russia (top 12)¹ –

(709)

(589)

(966)

(964)

(960)

(683)

(934)

(194)

(889)

(153)

(883)

(389)

99%

99%

97%

97%

97%

96%

97%

95%

93%

93%

92%

92%

Deutsche Bank

0% 20% 40% 60% 80% 100%

Deutsche Telekom

Mercedes-Benz

BMW

Audi

Lufthansa

Volkswagen

Zwilling

Bosch

Hansgrohe

Siemens

Thyssen Krupp


31

• German-sounding brands like Carl Zeiss and Henkel have a high recognition rate

• Competitors Becks (83%) and Paulaner (82%) enjoy high recognition scores

• LANXESS specialty chemicals group also demonstrates a high recognition rate of 84% despite its non-German-sounding name

Source: globeone

Leading German brands – Recognition of German brand origin (2/2)

Q.: Do you think this brand is originally from Germany or not?

Rank 13 - 30 – German-sounding brands scoring high on the origin recognition scale

– Recognition of German brand origin in Russia (rank 13 to 30)¹ –

(462) (625) (483)

(802) (274)

(695) (72)

(618) (549) (380)

(627) (486) (112)

(350) (340)

(712) (141)

(502)

90%89%89%

88%88%

87%87%

86%86%86%

84%84%84%

83%82%

81%81%

80%

Carl Zeiss

0% 20% 40% 60% 80% 100%

BayerMAN

BraunBASF

AdidasBertelsmann

Hugo BossHenkel

Boehringer IngelheimPuma

DHLLANXESS

BecksPaulaner

LindeContinental

Nivea


32

• Top 12 mainly consists of B-to-C brands led by Nivea (56%) and Adidas (62%)

• Adidas bought/ used by 62% of the interviewees outperforms its main competitor Puma (47%)

• Metro Cash & Carry enjoys a healthy 50% purchase rate among urban citizens

Source: globeone

Leading German brands – Purchase/usage (1/2)

Q.: Which German brands have you bought or which services have you used?

Top 12 – Leading brands with high purchase/usage rate with Nivea at the top of the ranking

– Purchase/usage of German brands in Russia (top 12) –

(676)

(619)

(605)

(542)

(529)

(503)

(471)

(466)

(404)

(336)

(282)

(266)

68%

62%

61%

54%

53%

47%

50%

Nivea

0% 20% 40% 60% 80% 100%

Adidas

Braun

Siemens

Bosch

Metro Cash & Carry

Puma

Hugo Boss

Henkel

Dr. Oetker

Becks

40%

34%

28%

27%

Bayer 47%


33

• Volkswagen (16%) scores highest among the German automobile producers on the purchase rate

• Lufthansa, German flagship carrier and one of the leading airlines in Europe, with currently 10% usage rate

Source: globeone

Leading German brands – Purchase/usage (2/2)

Q.: Which German brands have you bought or which services have you used?

Rank 13 - 30 – Many well-known German brands with significantly low market penetration level

– Purchase/usage of German brands in Russia (rank 13 to 30) –


25%25%25%

24%24%24%

19%19%

18%17%

16%16%

14%14%

13%

OsramContinental

PaulanerBoehringer-Ingelheim

GrundigHaribo

LufthansaCarl Zeiss

BASFMiele

DHLVolkswagen

AudiZwilling

AEG

HansgroheMercedes-Benz

(251)(247)(247)(240)(235)(235)

(191)(189)

(181)(173)(158)(155)

(143)(139)

(126)

(87)(82)

SAP (89)

0% 20% 40% 60% 80% 100%

9%9%8%

34


Agenda.

35

Internet as the most popular information source to learn about foreign brands

Insights into information channels – Key sources (1/2)

0% 10% 20% 30%

Shopping center / Store

Internet1

TV

Family / Friends

Events / Tradeshows

Radio

29%

19%

17%

7%

5%

5%

19%

Newspapers / Magazines

– Information sources to find out/ learn more about foreign brands in Russia–

Source: globeone

Sample size in Russia: 1,000. 1 Category Internet includes Internet search engines, social media and corporate website research. Q.: How do you generally find out/learn more about foreign brands?

36

Within digital communication, internet search engines and corporate websites are most relevant

Insights into information channels – Key sources (2/2)

– Information sources to find out/ learn more about foreign brands in Russia–

0% 10% 20% 30%

Internet search engines

TV

Shopping center / Store

Family / Friends

Events / Tradeshows

Radio

Social media

19%

5%

5%

5%

19%

Newspapers / Magazines

Corporate website

21%

17%

3%

7%

Q.: How do you generally find out/learn more about foreign brands? Sample size in Russia: 1,000

Source: globeone

37


Agenda.

38

Strategies for Russia – Leveraging maximum brand potential to grow sales (1/3)

Success in Russia requires dedicated action and a clear strategic roadmap (→ ‘one world strategy’1)

Strategic implications for corporations:

Illustrative1:1 transfer of ‘developed market’ strategies is rarely successful

Almost continental complexity of Russia as key challenge for annual strategy development and alignment of local organizations

Fact-based adjustments regarding strategic focus, relevant target groups and brand strategy necessary

Different levels of brand performance require a differentiated approach

1 A ‘one world strategy’ is a strategy that considers the BRIC countries and specific consumer/customer needs in BRIC at the very center of corporate strategy.

- Brand performance analysis -

Improving business performance in Russia through effective communication strategies

Source: globeone

39


Corporation with low brand awareness and thus low general brand performance across all major dimensions in Russia

- Key challenges -• Lack of fact-based ‘one-world-strategy’ for Russia• Inability to bridge gap between HQ and country

marketing / COM teams• Unclear definition of market-driven strategy and

local target groups and needs • Ineffective activation strategy & media investment

to communicate above ‘perception threshold’• Ineffective utilization of media vehicles /

insufficient media investment

25%

50%

75%

100%

0%

Corporation with high awareness but weak image as compared to Industry benchmarks in Russia

25%

50%

75%

100%

0%

Awareness Image Recognition Purchase Loyalty


- Key challenges -• Under-utilization of local customer insights and

thus no ‘quick wins’• Absence of a relevant positioning adjusted to local

target group expectation (esp. prestige appeal)• Shortcomings in locally relevant storytelling• Low differentiation from key competitors/ local

hero brands in Russia• Lack of effective creative execution and media

strategy

- Brand performance in Russia -

Illustrative

Illustrative

Awareness challenge1- Brand performance in Russia -

Image challenge2

Selected strategies for Russia – Awareness & image challenges

Source: globeone

40

German roots of

the brand(s) not properly recognized in Russian target groups

- Key challenges -• Missing link to German origin of a brand • Advertising, PR, event or online activities lacking

proactive communication of German brand heritage and thus no realization of image transfer and additional price premium potential

• Lack of story telling related to brand origin & history though one of few competitive advantages that cannot be easily imitated

• No successful use of ‘educational approach’

Brand enjoys good reputation but purchase behavior and loyalty remain below Industry benchmarks in Russia

- Key challenges -• Lack of strategy addressing middle income groups

as well (e.g. brand-stretching in order to appeal to more price sensitive target customers)

• Limited number of local distribution points• Lack of implementing sequential expansion

strategies in line with regional development• Under-utilization of global CRM basics and related

systems in the local market• Lack of effective activation at POS & in social media

German origin challenge3

Activation & loyalty challenge4

Illustrative

25%

50%

75%

100%

0%

25%

50%

75%

100%

0%


Selected strategies for Russia – German origin & activation challenge

Source: globeone





Illustrative

41

• About globeone• Survey Approach• Germany’s Image in Russia• Leading German Brands in Russia• Insights into Information Channels in Russia• Marketing and Communication Strategies for Russia• Contact

Agenda.

42

Global offices.

globeone

Cologne Head Office

Kranhaus Süd

Im Zollhafen 24

50678 Köln

Germany

Shanghai Office

16F Feidiao Internat. Bldg.

1065 Zhao Jia Bang Road

200030 Shanghai

People's Republic of China

Mumbai Office

B 806, Sagar Tech Plaza

Sakinaka Junction

Andheri Kurla Link Road

Andheri (East)

Mumbai 400072

India

São Paulo Office Singapore OfficeBeijing Office

Office 39, Room 509A

No. 4 Gong Ti Bei Lu

Chaoyang District

100027 Beijing

P.R. China

Av. Cidade Jardim, 400

20th floor – room 08

01454-000 São Paulo

Brazil

10 Collyer Quay, 40-53

Ocean Financial Centre

Singapore 049135

Singapore

Email:

[email protected]

Phone +91 (0) 22 6770 3718 (ext. 11)

Fax +91 (0) 22 6645 9842

Email:

[email protected]

Phone +55 (0)11 3818 0837

Fax +55 (0)11 3818 0899

Email:

[email protected]

Phone +65 6808 6050

Fax +65 6622 5999

Email:

[email protected]

Phone +86 (0)10 6593 5451

Phone +86 135 0129 8737

Fax +86 (0)10 6593 5463

Email:

[email protected]

Phone +86 (0)21 5158 1688 (ext. 1352)

Fax +86 (0)21 5158 1686

Email:

[email protected]

Phone +49 (0)221 788068-0

Fax +49 (0)221 788068-29

www.globe-one.com

Seoul Office

5F Seoul Design Works

B/D, 683-133

Hannam-dong,

Yongsna-gu,

Seoul, Korea, 140-892

Email:

[email protected]

Phone +65 6808 6050

Fax +65 6622 5999

Thank you!

© CopyrightThis document of globeone GmbH is intended exclusively for the client or addressee. It remains exclusive property of globeone GmbH until the rights of use are expressly transferred. Any revision, use, duplication or commercial distribution of this work is permitted only with written consent of globeone GmbH. This document is a discussion paper. It makes use of secondary information and hypotheses and is therefore for discussion only. It does not include any recommendations or binding statements.

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