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LatAm Brasil The Secrets of Local Brand Value

The trend observed in recent years in Brazil is the growing value of consumer brands, which are now more predominant in the BrandZ Tp 50 Most Valuable Latin American Brands, displacing the traditional winners from the financial market, and Petrobrás, from the oil and gas industry.

Consumer brands add significant value, dodging fluctuations in the economic and financial setting, enforcing the power of brands as intangible assets, and taking on more significant positions.

In 2014, Skol is the most valuable brand in Brazil and the second in Latin America. It has the largest share in the beer market in Brazil, with a performance that has benefited greatly from the increase in the middle class’ purchasing power in recent years. One of the pillars of the brand’s success is its longstanding communication consistency, delivering a Meaningful and Different brand to consumers, which is essential to brand value. Skol’s communication efficiently combines the functional and emotional aspects that are vital to cement brand loyalty in this category.

Brand revitalization and differentiation come from ever-present innovation. Sponsoring music festivals to keep close to the young target – vital for the brand, is a constant in Skol’s activities. This year, the brand broke Heineken’s traditional partnership with Lollapalooza, and sponsored the event in Brazil.

This year, it launched Skol 360 to shield the brand against the action of cheaper brands that are competing for the large group of consumers from the emerging middle class. Vying for space in the consumer relationship, Skol has created the Barbecue Customer Service with tips to prepare barbecue, a traditional form of Brazilian get-togethers with friends and family.

Sadia is a Brazilian brand that has seen 24% growth in brand value in 2014, ranking sixth in the BrandZ ranking in Brazil and 26th in Latin America. An example of a successful post-acquisition strategy (Perdigão and Sadia, the two main Brazilian food companies, underwent a merger) the portfolio rationalization process considered the value of the Sadia brand among consumers. Perdigão showed good financial health but did not have the same performance as Sadia in consumers’ perception of brand value. The Sadia brand was built upon its “Brazilianness,” a family brand from the south (where regionalism is extremely ingrained), emphasizing a stronger bond with the Brazilian family.

In this category with low distinction among brands, Sadia has rescued and continued to spearhead innovation in the market, focusing its efforts on products with higher added value, living up to its brand history. “Frango Fácil” (Easy Chicken) is the latest big brand launch that brings convenience to consumers combined with quality, which is always associated with Sadia (in Portuguese Sadia means Healthy). Sadia’s consistent communication uses 'S as in Sadia’ as a tagline to their masterbrand advertising.

Sadia has faced, with great authority, the very strong competition in this category - notably Seara Food’s marketing investment, which brought Fátima Bernardes (a TV news anchor and talk show hostess) to add quality to Seara’s brand image.

Another player, the newest in the category, is Friboi, a JBS brand that has been making strong investment in its communications, with the goal of building a quality brand of meat.

Even in this competitive scenario, in categories with low differentiation, the strategy of Meaningful and Different brands offers potential for success. In the acquisition process, it’s crucial to also consider the value of each brand. Acquisitions that consider strategies primarily based on financial and business indicators could be a recipe for poor performance.

Aurora Yasuda

Knowledge Management Millward Brown Brazil