The importance of location in establishing a brand identity has been highlighted by the recent negotiations for the establishment of mutually recognized geographic indicators for products made in South Africa and the European Union. Businesses are finding success with branding initiatives that capitalize on this type of location based brand identity, thanks to growing consumer interest in the origins of products. However, brands are also increasingly expected to demonstrate an awareness of the unique characteristics of the locations in which they are being sold. Companies that have failed to brand themselves effectively for a particular market have tended to end up making expensive mistakes. A lack of local knowledge has proven particularly harmful for companies attempting to establish themselves in Africa, with even the largest multinational brands like Pepsi finding it difficult to adapt to the local markets.
Geographic Indicators and the SA-EU Trade Summit
Despite some initial disagreements over the ending of bilateral investment treaties, the 2013 SA-EU trade summit opened with the expectation of improvements in the trade relationship that was initiated with the free trade agreement in 2000. This agreement is set to be extended by an economic partnership agreement (EPA) that will allow more reciprocal trade between the parties, particularly in agricultural products. Optimism about the EPA was encouraged by an agreement between the parties regarding the use of geographic indicators, a form of copyright that both the EU and South Africa use to enable producers to claim exclusive rights to geographically derived product names. A large number of European products, particularly cheeses and wines, have been given GI status, which will now also be recognized in South Africa. In return, the three products that have so far achieved GI status in South Africa will gain the exclusive right to the use of their names in the EU. The products that will benefit from this status are Karoo lamb, honeybush tea and rooibos tea. Only products from the appropriate geographic region of South Africa will now be entitled to use these names either here or in the EU, so Rooibos tea will become the South African equivalent of Champagne.
Local Branding in Africa
The success of geographic indicators as a means of branding is indicative of a shift in the way consumers are thinking about products made in Africa. The South African products that have achieved GI status will be marketed both domestically and abroad using branded product names that are recognizable links to their country of origin. Changes in the way consumers think of African products are also influencing the branding of products that do not have GI status. Brands are now more likely to use their African roots as part of their brand identity, both at home and abroad. The branding of products as “Made in Africa” is becoming an important part of the marketing strategy for businesses based in countries like Senegal. If consumers continue to respond to geographically branded products, it is likely that South African origins will increasingly become a feature of branding strategies.
Brand Awareness in South Africa
Branding of products as made in South Africa may play a role in enabling businesses to reach markets abroad, particularly for products that will be protected by GI status. The domestic market, which is growing quickly due to the rapid expansion of the middle classes, may also be attracted by brands that are associated with South African origins, but this emerging class of consumers could be harder to reach than their counterparts in the EU. The new middle class consumer is very brand-aware, but also highly resistant and distrustful of marketing claims. Reaching these customers requires a new type of location-based branding in which local businesses may have the advantage over their multinational rivals. Being locally based will provide the advantage of an authentic connection to the community, along with an understanding of the area and its people. Making a personal connection between the brand and the consumer is becoming more important than a global brand name. Establishing this sort of direct connection with the customer involves finding ways of incorporating the brand into people’s lives. Branded merchandise can be a more effective means of achieving this than a traditional marketing campaign, since consumers are less resistant to brands that infiltrate homes and workplaces without an obvious agenda. Familiarizing potential customers with the brand in a non-threatening manner will be far more effective than a hard-sell approach.
Awareness of the brand is spread around the community through these branded items, but it is the use of brand ambassadors that is the truly innovative aspect of local marketing in South Africa. Ambassadors or zonal champions are members of the community who have been recruited as brand representatives to share their knowledge with the local people. Ambassadors provide a means for brands to reach out to their customers through simple word of mouth, presenting the brand in a way that is tailored to local needs, while also learning more about what consumers want. Brand ambassadors can reach the people who are most resistant to traditional modes of advertising, familiarizing them with the brand and making them feel more comfortable about purchasing it. Brands that are local by origin and through their investment in establishing links with the community can use their location to create the sort of brand that will appeal to the broadening middle class.
The Future of Location-Specific Branding
The geographic origins of South African products are likely to play an increasingly important role in branding these products for both the domestic and international markets. Products that are made in Africa are gaining more attention from consumers at home and abroad, but consumers are also searching for products that feel relevant to their own lives. Brands that can combine the interest in African products with the local knowledge required to attract South African consumers may find themselves at an advantage even against larger international rivals, particularly if they manage to incorporate innovative methods like the use of local brand ambassadors into their marketing strategies.