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Nielsen: Nearly 75% Of Global Consumers List Brand Origin As Key Purchase Driver

National pride among the factors that influence consumers' willingness to buy local versus global products

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News provided by

Nielsen

Apr 26, 2016, 01:39 ET

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NEW YORK, April 26, 2016 /PRNewswire/ -- Nearly 75% of global respondents, on average, say a brand's country of origin is as important as or more important than nine other purchasing drivers, including selection/choice, price, function and quality, according to findings from the Nielsen Global Brand-Origin Survey released today. The new research examined whether consumers prefer goods produced by global/multinational brands (defined as those that operate in many markets) or by local players (those operating only in a single market—the respondent's home country), based on responses from more than 30,000 online respondents in 61 countries spanning 40 categories.

Respondents in Asia-Pacific and Africa/Middle East are likelier to say that origin is more important than the other selection factors (33% and 32% on average, respectively). European, North American and Latin American respondents, in contrast, are likelier to say brand origin is less important than the other selection factors (35%, 32% and 31% on average, respectively).  

"One of the more surprising findings from the survey is that country of origin is as important as—or even more important than—other purchasing criteria such as price and quality," said Patrick Dodd, group president, Nielsen Growth Markets. "In a crowded retail environment, brand origin can be an important differentiator between brands, but sentiment varies by category and by country, and leveraging a powerful brand presence needs to be managed carefully regardless of whether it is global or local. Ultimately, the brands that deliver on a strong value proposition and connect personally to consumers' needs will have the advantage in any given market."

THE WHY BEHIND THE BUY

Why do global consumers choose local brands over global brands or vice versa? When asked to select the top three decision factors for choosing a global brand and for choosing a local brand, respondents offered similar response patterns across all regions—emphasizing the factors that typically are top rated in consumer surveys. Globally, better price/value is the top-selected reason for choosing global (42%) and local (43%) brands. Positive experience with the brand (32% for global brands, 28% for local), safer ingredients and processing (31%, 28%), better product benefits (31%, 25%) and a sale or promotion on the brand (26%, 24%) also are among the top-selected reasons for selecting a product.

National pride is the only selection factor for which there is a notable difference between local and global brands, which is unsurprising, given that one would not buy a global product for reasons of national pride, unless it was a global product widely recognized as 'American,' such as Marlboro, or 'Japanese,' such as Toyota. Logically, this is a more important reason for buying local products than global ones. One-fifth of global respondents (21%) say national pride is the most important reason they buy local products, with sentiment highest in Africa/Middle East (25%), Asia-Pacific (24%) and Latin America (21%) and lower in Europe (16%) and North America (10%).

LOCAL BRANDS HAVE ADVANTAGE IN FOOD AND BEVERAGE CATEGORIES

For fresh foods, local brands are, not surprisingly, the clear preference. The majority of global respondents who have purchased the category say they prefer local brands to global ones for vegetables (68% vs. 11%), meat (66% vs. 13%), fruit (64% vs. 12%), seafood (57% vs. 18%) and yogurt (52% vs. 22%). The preference for local brands holds for nearly every fresh category in every region. Local brands also are preferred for beverage categories where spoilage is a concern or flavor preferences differ by region. Respondents in every region prefer local brands for juice, water and milk. Among those who purchase carbonated soft drinks, global brands are preferred in every region except Europe, where the largest percentage say brand origin is not important to them.

For packaged foods and snacks, local taste preferences dominate. Local brands are preferred to global brands for ice cream (44% vs. 27%, respectively), cookies/biscuits (40% vs. 28%), crisps/crackers (40% vs. 28%), breakfast cereal (44% vs. 29%), instant noodles (47% vs. 24%) and canned vegetables (53% vs. 20%).

GLOBAL BRANDS ARE PERCEIVED AS QUALITY FOR BABY CARE CATEGORIES

When it comes to baby care, global brands are clearly preferred for diapers in every region except Asia-Pacific, where preferences for local and global brands are evenly split. However, for food and formula, preferences are split largely along developed- and emerging-market lines. Global food and formula brands are preferred in Asia-Pacific and Latin America, while local brands are preferred in Europe and North America. The strongest preference for global brand baby food and formula comes, unsurprisingly, from respondents in China and Hong Kong, where in recent years product-quality issues for local baby food and formula have made headlines. In Africa/Middle East, global brands are just slightly preferred for formula, but local brands are more preferred for baby food.

"For many categories, a global brand name is an indicator of quality, safety and trustworthiness in emerging markets," said Dodd. "In North America and Europe, the baby-care product industry is highly regulated, and consumers may automatically expect that the baby foods they buy are safe and nutritious. For these consumers, local brands carry an assurance of quality."

CONSUMERS LOVE GLOBAL BRANDS FOR PERSONAL CARE AND BEAUTY

For personal-care and beauty products, global brands are the clear favorite around the world. Global brands are preferred to local for razors, shampoo and conditioner, cosmetics and deodorant in every region. Global brands are also preferred for toothpaste, hand and body soap, and hand and body lotions in four of five regions (Asia-Pacific is the exception). In Europe, the largest percentage of respondents say brand origin isn't important for several categories, including razors, toothpaste and hand and body soaps and lotions.

"Global brands are able to leverage their scale and expertise, research and development capabilities, and strong brand equity to provide high-quality and innovative personal-care products to local markets around the world," said Dodd. "In addition, in some markets, the number of local brands is limited for nonedible categories, so consumers naturally gravitate to offerings from global brands because they are widely available."

ABOUT THE NIELSEN GLOBAL SURVEY

The Nielsen Global Homecare Survey was conducted Aug. 10 - Sep. 4, 2015 and polled more than 30,000 online consumers in 61 countries throughout Asia-Pacific, Europe, Latin America, the Middle East/Africa and North America. The sample includes Internet users who agreed to participate in this survey and has quotas based on age and sex for each country. It is weighted to be representative of Internet consumers by country. Because the sample is based on those who agreed to participate, no estimates of theoretical sampling error can be calculated. However, a probability sample of equivalent size would have a margin of error of ±0.9% at the global level. This Nielsen survey is based only on the behavior of respondents with online access. Internet penetration rates vary by country. Nielsen uses a minimum reporting standard of 60% Internet penetration or an online population of 10 million for survey inclusion.

ABOUT NIELSEN

Nielsen Holdings plc (NYSE: NLSN) is a global performance management company that provides a comprehensive understanding of what consumers Watch and Buy. Nielsen's Watch segment provides media and advertising clients with Total Audience measurement services across all devices where content—video, audio and text—is consumed. The Buy segment offers consumer packaged goods manufacturers and retailers the industry's only global view of retail performance measurement. By integrating information from its Watch and Buy segments and other data sources, Nielsen provides its clients with both world-class measurement as well as analytics that help improve performance. Nielsen, an S&P 500 company, has operations in over 100 countries that cover more than 90% of the world's population. For more information, visit www.nielsen.com.

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