Local brands fight for market share
ONE area where the Philippines is lagging behind is in the locally branded products sold by retailers. Based on the advertising list furnished by a friend, foreigners dominate not only the retail outlet brands, but also product brands.
Foreign brands are coming so fast and in such big numbers that malls and other shopping centers in the country now look more like global, rather than domestic, retail shops. In the past, goods made in other countries were available only in duty-free shops, as well as in Subic in Zambales province, Cartimar in Pasay City and the barter markets of Zamboanga City. Today the most popular perfume, clothing and shoe brands are displayed alongside homemade or imitation scents and Marikina City-crafted shoes and leather apparel.
In the coffee category, local brands are putting up a good fight against their foreign competitors. So far, however, multinational firms, particularly those that have been producing coffee longer than Philippine ones, enjoy a dominant position.
Nescafé, produced by the local unit of the Swiss food conglomerate, has been a Filipino household name in the instant and 3-in-1 categories. Kopiko, the newcomer from Indonesia that is sometimes mistaken for a local brand, is becoming increasingly popular because of its innovations, like its cappuccino and brown-coffee variants.
Among local brands, the most popular are Blend 45 and Great Taste of Universal Robina Corp.; Café Puro of Commonwealth Foods; and Jimm’s Coffee, which boasts of having more than the traditional coffee, cream and sugar in its sachets. Coffee shops are also dominated by foreign brands, led by Starbucks, Seattle’s Best and The Coffee Bean.
In the toothpaste category, the list contains only four local brands—Hapee of Lamoiyan Corp., Unique of ACS Manufacturing Corp., Beam of Alfredo Yao’s Zest-O Corp. and Herbaflo Herbal—that are just starting to compete with the much older Colgate of Colgate-Palmolive Philippines (there was a time in my childhood when toothpaste meant Colgate), Close Up of Unilever and five other, lesser-known foreign brands.
ACS also manufactures Pride detergent, which is becoming popular among washing-machine users. Two other local detergent brands—Champion and Calla of Peerless Products—are confronting Procter & Gamble’s (P&G) Tide and Ariel, and Unilever’s Bonux, Breeze and Surf.
Local brands dominate the toilet and organic-soap category in terms of number, but not necessarily the market, which is ruled by Unilever’s Dove and P&G’s Olay, Camay and Safeguard. Local television audiences constantly see the commercials of these products, from the early-morning shows and the afternoon and prime-time telenovelas to the nightly news programs. Less frequent, if any, are the shorter TV ads of local soap brands, like ACS’s Shield and Philusa Corp.’s Ever Bilena and Mestiza.
The situation in the jeans category is similar, which has more local brands, but very few popular ones, market-wise: Bench and Freego. In terms of popularity—and probably market share—they are no match to the more expensive Levi’s, Wrangler, Calvin Klein or DKNY.
In the ready-to-wear, or RTW, category, Bench and Human enjoy a good following. However, the market is also flooded with foreign brands, which are sold at their exclusive boutiques, like Marks & Spencer, Mossimo and Giordano.
For local brands, the competition is going to be really tough, considering the pervasive colonial mentality of many Filipinos that imported products are better. But this could be changing; there are many successful examples.
Again, I go back to Jollibee, which is a fine example of a Filipino product that has been able to compete with foreign brands and is now, in fact, doing the opposite: positioning itself as a global brand. The Jollibee model should be replicated in many other areas.
In retailing, some companies are able to compete, although they are having a hard time. A good example is Penshoppe, the flagship fashion brand of Cebu-based Golden ABC Inc. Penshoppe started in the Visayas and Mindanao in 1986. It opened its first boutique in SM City North Edsa in 1991. Today Penshoppe has more than 300 stores in strategic areas and has stared expanding overseas, starting with Dubai in the United Arab Emirates.
I once met with executives of Peerless Products, who said Champion had gained a significant market share. Published reports said the local brand now accounts for 20 percent of the domestic detergent market.
To be concluded next Tuesday
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