PH among 3 most favorable APAC markets for established brands

WHILE emerging brands have made inroads capturing market share from established brands, Bain & Company’s latest analysis shows many established consumer product brands continue to achieve success.

The report studied established (also known as incumbent) consumer product brands’ market share in 23 product categories across 11 Asia-Pacific markets over a five-year period (2018 to 2022).

It revealed that among 253 category and market combinations Bain studied, large incumbent brands lost market share in 44 percent of cases against emerging or insurgent brands, held steady in 28 percent cases and won in 27 percent cases.

When looking at markets, Malaysia, the Philippines and India emerge as the top three most favorable markets for incumbents, while South Korea, Singapore and China had the most favorable environments for insurgents.

“The trend could be linked to the channel dynamics across markets. For example, the thriving ecommerce sector and well-established networks of third-party suppliers are making countries like South Korea particularly conducive for emerging consumer brands’ growth. On the other hand, the dominance of traditional trade and relatively low penetration of ecommerce make countries like the Philippines more favorable markets for established brands,” said Jichul Kang, head of Bain’s consumer products practice in South Korea.

From a category perspective, Bain’s analysis revealed that the beauty and personal care sector was the most receptive to insurgent brands overall, in stark contrast to other sectors, including alcoholic and nonalcoholic beverages, food and home care.

“Our study challenges the notion that insurgent brands universally disrupt incumbents. The successful incumbents thrived by blending their incumbent strengths and insurgent tactics, allowing them to counter threats and strengthen their market position effectively,” said Sydney-based David Zehner, head of Bain’s Asia-Pacific consumer products practice.