(Expansion) – In Latin America, the five brands most chosen by the consumer in 2020 were Coca-Cola, Colgate, Bimbo, Maggi and Lala. These brands play in different baskets (Food, Personal Care, Beverages, etc.), have different positions and compete for different moments of consumption.
Two disturbing questions arise from the above: By what metric is it that one brand is more or less chosen than another? What characterizes the most chosen brands?
As is common knowledge, there are many factors behind the success of a brand in the market. There is investment in communication, innovation, brand equity , distribution and execution, price-packaging offer, commercial strategy ( go to market ), logistics capabilities, competition itself, and of course, quality. of the product.
All the aforementioned factors are key to the success of a brand no matter what the circumstance; However, none of them is the determining factor to locate the most chosen brand; The criterion used is a very simple and practical one, but at the same time brilliant.
The variable is the combination between the number of shoppers of a brand and the frequency with which they buy it. This variable called Consumer Reach Points (CRP) escapes any subjective assessment, and even surpasses the strongest quantitative metrics such as absolute sales of a brand by providing a ranking from the consumer’s point of view: demand.
Under this metric, the most chosen brand is the one that obtains the highest number of CRPs as a result of multiplying the number of consumers by the frequency with which they buy the brand.
In 2020, despite being a special and atypical year in many ways, the main brands in the ranking maintained their leadership; In short, the big brands remained the most popular. Suffice it to say that, in Latin America, 43 of the top 50 grew in value averaging + 10.8% growth. How does this happen?
First, it is important to underline that, amid the uncertainty, confinements and health risks derived from COVID-19, the mass consumer industry benefited.
In fact, the pandemic reversed a multi-year trend of declining consumption partly because of the increased time we all spend at home, but also because of widespread support from governments, particularly for lower-income groups.
In addition, we are experiencing a transformation of the industry in terms of purchasing channels, such as the development of e-commerce , which attracted more than 67 million buyers to the channel. In terms of habits, the average number of trips made by households decreased by 8% and it was spending per trip that increased by 11.9%, driving the growth of the mass consumption basket.
Faced with this environment, the big brands did better. Brands with a high number of home buyers (more than 30 points) increased their number of CRPs by 40%; Since, despite product shortages and the rationale behind the purchase decision being modified, these brands capitalized on shopper spending thanks to their broad consumer base, which in turn is explained by brand awareness and equity , but even more so, for the muscle at the point of sale; strength that they managed to capitalize on thanks to their speed and ability to adapt and respond.
Curiously, we live a very particular scenario in 2020, where the rules of the game changed, but the protagonists were the same. This is something that we continue to experience in 2021, where the transition to the new normal will be prolonged, and although the future today is unknown, the final formula to win is the same as it was in the past: growing the consumer base.
Brands must guarantee that through their different levers they manage to build penetration. Any strategy that has this as its final objective will be pointing you in the right way. How to do it efficiently and sustainably will depend on each particular case.
Editor’s note: Juan Carlos Jouve is Director of Customer Service for Kantar Mexico’s Worldpanel Division. Follow him on. The opinions published in this column belong exclusively to the author.
