Young growth markets are on the move. Income is rising, the retail trade is organizing itself, young entrepreneurs and skilled workers are demonstrating status and success. There are millions of new customers for virtually every product category. On the other hand, thousands of new brands are wooing for the attention of consumers. The battle for the “share of voice”, i.e. the percentage of target group contacts of a brand, is fiercely fought. Under these conditions, it is extremely difficult to build a brand and win customers to try the product for the first time. Therefore, opportunities for experience and activities must be cleverly developed in order to enter into a dialogue with potential customers and to change their consumer behavior. The challenge is to win consumers over to products and brands with which they are not yet familiar and in which they may not initially be interested. This is described in detail in our new Springer publication “Successful brand development in the major emerging markets” (written in German) by Dr. Niklas Schaffmeister (Managing Partner Globeone) and Florian Haller (CEO Serviceplan Group).
The basic idea of “Experiential Marketing” is that this approach is not primarily about selling something, but about showing how a brand can enrich the customer’s life. Generally speaking, it is a kind of customer-centered marketing activity in the form of staged, experience-oriented events and points of contact, through which a multi-sensual and emotional connection to the target group is established. Experience marketing has long been known in the developed markets of industrial nations. But the concept has a unique significance for emerging markets. This is not only true for premium markets, but for practically every market segment.
From fashion shows to adventure centers: how to address target groups
There are many different examples of how to enable the consumer to get to know and love a previously unknown product through unique experiences:
- Brand experience centers (for example the BMW and MINI experience center at the EXPO in Shanghai)
- A fashion show or an exclusive kick-off event (for example a Fendi fashion show at the Great Wall)
- An exhibition in a shopping mall (where, for example, models who show a lot of skin pose in Calvin Klein jeans and ask customers to take photos)
- Public test drives under supervision (e.g. a driver academy at the Land Rover Off-Road Experience Center)
- Product tests in supermarkets (for example, an event with French wines in a Carrefour shopping center)
- An advertising campaign in a well-known restaurant or nightclub (for example, advertising for Budweiser, in which hostesses in brand uniforms are involved)
- Showrooms that allow people to experience the product directly (for example, designer furniture shops that allow customers to try out a bed or even sleep in the middle of the showroom)
- Museums or brand academies (for example, a Mercedes-Benz museum)
- Customer conferences, events and exhibitions that signal “strong leadership” and enable direct interaction with strategically relevant customer groups
- Technology Days, which usually take place in the local branch or factory of an important customer in order to familiarize the engineers and management of the customer with the manufacturer’s latest solutions.
Example from cosmetics: how to modify consumer behavior
However, modifying behavior is sometimes easier said than done, as the example of L’Oréal shows. The world’s largest cosmetics company had to contend with fierce headwinds in Brazil. Customers traditionally buy skin cream and mascara from representatives at the front door. This type of distribution has a long tradition in Brazil. Around 2.5 million women earn their living through direct sales. But L’Oréal depends on quality shops to sell its products. To be successful in Brazil, L’Oréal must therefore encourage Brazilians to change their consumer behavior and buy beauty products on a larger scale from organized retailers.
This change has already begun. In recent years, pharmacies and drugstores have succeeded in gaining market share from direct sales. The growing demand is triggered by higher incomes and the growing middle class in the very young population. People under the age of 25 are among the main consumers of cosmetics. In order to make more sensory-emotional experiences possible and attract more customers, the cosmetics group introduced the concept of “personal beauty advisors” in the country’s department stores. These consultants bring customers into direct contact with L’Oréal products and offer them a personalized customer experience. A similar concept has also been implemented in pharmacies.
In emerging markets around the world, retail is usually not yet highly organized. The challenge for international brands is to introduce their products to potential customer groups in the face of rapidly increasing competition and to show them how the brand can enrich their lives. In a fiercely competitive market, experience marketing can be the decisive advantage over the competition.