Ogilvy POV | Fiona Gordon, Group Chairman, Ogilvy & Mather Singapore
With its small stature and big ambitions, Singapore celebrates SG50 with one of the strongest country brands in the world and punches well above its weight in Asia’s marketing scene. As the epicenter of globalization in Asia it is a comfortable home to the regional HQs of our industry’s bellwether brands. High levels of disposable income, education, digital connectivity and access mean Singaporeans can enjoy most any brand firsthand, making it imperative that brands live up to their values, and keep up with the tech-savvy, gadget loving citizens who consume content on the go.
Beyond catering to the island’s love of gadgets, brands that make real effort to speak directly to Singaporeans have the best chance to reach the top of the market’s ranks.
With its small stature and big ambitions, Singapore punches well above its weight in terms of impact on the marketing communications industry in Asia. As the country celebrates its 50th anniversary (SG50) in 2015, it does so as one of the strongest country brands in the world, having become a futuristic and multicultural global city and one of the world’s major commercial centers in record time.
But have we considered that perhaps Singapore’s greatest achievement lies in having evolved from being a city at the crossroads of trade to a city at the crossroads of thought? A marketplace where ideas meet and grow.
While its enviably strong country brand sets the standard for branding excellence in the marketplace, its role as the epicenter of globalization in Asia has attracted bellwether brands such as Unilever and P&G to establish their Asia-Pacific headquarters here to hone and define their strategies for Asia and beyond. Without the crutch of a large domestic consumer market, brand work done in Singapore must work harder in order to work regionally, or even increasingly globally. The market’s small size means you don’t have the luxury of resting on your domestic laurels.
The consumer is not a moron
David Ogilvy famously said this and truer words couldn’t be said of the savvy consumers of the Little Red Dot, as Singapore is affectionately known. While few in number, Singaporeans are a highly sophisticated demographic that have the rare combination of high levels of disposable income, education, digital connectivity and access that allows them to own or experience most any brand firsthand. In a place where most consumers are either using your brand or know someone that does, living up to your brand values, or brand integrity, becomes more important than ever.
The savvy, affluent, well-connected nature of Singaporean consumers has other implications. In a crowded, highly competitive market brands must go beyond the obvious to have an impact and break through the clutter. With the highest smartphone penetration rate in the world at 85 per cent, Singaporeans have constant access to content on the go, exemplified by the fact that this is one of the few places on Earth where Wi-Fi really does work on the subway. This means brands must continuously consider how to capture the attention of their target, with what message, where and when as they are constantly on the move. The other challenge is keeping up with Singapore’s tech-savvy consumers whose media and digital habits can be ahead of the curve, especially when it comes to new apps and social media usage.
We love our gadgets
It is perhaps no surprise then that consumer electronics brands dominate the top spots of the Singapore brand ranking – with Samsung, Apple and Sony leading the charge. Also noteworthy is the fact that of the top 20 brands in Singapore, 12 are Asian, half of them in the consumer electronics category. Their dominance in the ranking is partly due to them being top-of-mind because Singaporeans use so many consumer-electronics products on a day-to-day basis. But we can’t ignore the fact that their prevalence is also driven by their global image as much as their local efforts. The other similarity among them is their creation of seamless customer journeys from product design, to in-store experience to post-sales service. This consistency in branding and messaging across the customer journey is something all brands in Singapore would be wise to work on.
Local players make their mark
Flying the flag for local companies in the ranking are three Singaporean brands that have cracked the competition to make lasting impressions on the market’s demanding consumers. Supermarket chain NTUC Fairprice and sports drink maker 100 Plus held steady in their positions. Meanwhile multimedia and ICT brand Singtel made a major leap from #32 in 2014 to #13 in 2015, following the January launch of its customer-centric brand transformation, the first revamp for the brand in 16 years. Part of Singtel’s success came down to tapping into local behavior, insight and culture.
With SG50 dominating the nation’s calendar this year this is a trend that we increasingly see as brands make greater efforts to speak directly to Singaporean consumers. It will be interesting to see in next year’s report whether SG50 celebrations and tributes moved the needle for brands, and how they change and embrace the future as we move beyond the Jubilee year.
Nelson Market Analysis
Food and clothing brands could face tough times ahead in Singapore. Shrinking household size has knock on effects for several brand sectors.
Singapore started off 2014 with a strong first quarter, clocking up 4.6 per cent year-on-year economic growth. However, momentum slipped in following quarters and 2014 ended with GDP growth of just 2.9 per cent. The start of 2015 was also modest; first quarter growth only hit 2.1 per cent year-on-year; the same rate as the previous quarter.
A fall in output for the transport engineering, electronics and precision engineering clusters has crimped Singapore’s manufacturing sector. Conversely, construction and services have shown relatively better performance with private sector construction activities, wholesale and retail trade and business services driving the pick-up.
The country’s soft economic outlook reflects in Singaporeans’ relatively muted confidence in the economy, job prospects and their personal finances. According to Nielsen’s first-quarter Global Consumer Confidence Index, which is based on consumers’ perceptions of job prospects, the local economy and the state of their personal finances, the nation posted an index score of 100 (the Asia Pacific average was 107 and the global average was 97), which is unchanged quarter-on-quarter and up one point year-on-year, with job security and the economic outlook as key consumer concerns. A score above or below the baseline of 100 indicates the degree of optimism or pessimism.
Singapore’s consumer prices dipped 0.3 per cent year-on-year in March 2015, mainly on lower transport, housing and utility costs, while food prices nudged up 2.3 per cent over the same period. Singaporeans remain cautious with their budgets – overall spending intentions across many categories remain similar compared to the previous year and more consumers are channeling spare cash into savings and retirement funds.
All of this combines for a cautious mindset in the country, which has led value and pricing to take on a greater role in purchasing decisions. Many Singaporeans’ have taken steps to reduce household expenses (59 per cent), particularly spending on apparel and out-of-home entertainment. Price sensitivity has also extended to grocery purchases, with many consumers switching to cheaper grocery brands or cheaper store formats.
Other demographic factors impacting Singapore’s consumer landscape are the country’s ageing population and shrinking household sizes. More than one in 10 Singaporeans is over the age of 64, and this figure could climb to about 24 per cent by 2030, creating opportunities in categories such as adult diapers, nutritional supplements, diabetic foods, medical insurance and leisure travel. Meanwhile, declining fertility rates have shrunk the average household size from 3.7 to 3.4 at last count, which prompts demand for smaller pack sizes and on-the-go meal options, and has a knock on effect of reducing the overall basket for home-prepared meals.
Internet penetration is high (81 per cent of Singaporeans have internet access), and increasing connectivity and device ownership has fueled a boom in ecommerce and m-commerce. To date categories such as travel, fashion and beauty, and entertainment are key growth drivers in online purchases. Food and grocery sales online are still low, and retailers will need to boost platform investments in order to build confidence and drive greater traction.
Below are the top performing brands in Singapore. Click on the image to learn more:
Welcome to the region’s most comprehensive research on consumer brand perception, presented by Campaign Asia-Pacific and based on an exclusive survey conducted by Nielsen. Discover the biggest brand battles with our interactive charts, track the rise and fall of specific brands over the last 12 years, drill down into 13 specific APAC markets and read about the factors that drive brand performance.
Click here to read the report on Singapore.