With brands such as Toshiba and Carrefour citing Singapore’s lack of long-term growth potential as a reason for their exits, many brands are still eager to set up shop in the Lion City and it is not necessarily for growth strictly in terms of revenue.
Speaking at a press conference at Bangkok’s Queen Sirikit National Convention Center, Thapana Sirivadhanabhakdi, CEO of Thai Beverages, said: “Compared with the rest of the region, Singapore is not necessarily a growth market. But Singapore is more of an image market where brands can be projected. It is one of the major cities in ASEAN, and a very strategic image market.”
Ronnie Teo, head of global marketing (Beer) -ThaiBev explained that for ThaiBev’s Chang Classic brand. Singapore provides an image market for the brand to catapult itself in the region. Teo said Singapore’s first-world economy status in ASEAN makes it a strategic hub for regional and international travellers as well as for global brands.
The Red Dot’s high connectivity enables the accelerated transmissions of information and trends. Since consumers in Singapore are more plugged into global trends, consumers around the region naturally look to Singapore to understand the latest trends. “For Chang, having a good presence in a global city like Singapore will provide strong external validation for continued growth in ASEAN,” Teo said.
Lawrence Chong, CEO of Consulus also agreed it is critical for brands to establish in an image market like Singapore. For a brand like Chang Classic, the path to becoming a global brand necessitates an association with a “global city of influence”.
“It is not a coincidence that many Asian brands do consider Singapore as a logical platform to launch their global branding initiatives,” Chong said.
What exactly is an image market?
Chong explains the four factors that determine such a market.
Identity and creative diversity – other global cities of influence such as London, New York and Hong Kong boast diversity in identity and expressions which makes it easier for brands to want to be associated with such a city.
Power convergence – More than just a renowned financial centre, global and regional intergovernmental bodies such as WIPO, APEC have offices in Singapore. This convergence strengthens Singapore’s place as a city of influence.
Connectivity – Singapore’s world-class airport and sea port provides global accessibility.
City branding – Its brand of governance and innovative city management in terms of urban planning and water management has received a lot of interests.
Some other examples of image markets are Paris, London, NY, Tokyo.
“Each has inherent associations that any brand deciding to house themselves from these locations will benefit. Singapore is moving into this type of company. But the difference with Singapore is that this ‘image’ had been achieved in double quick time versus the above group. This has been through absolute focus – there is no happy accident about any of this – due mainly to the vision of its late Minister Mentor Lee Kuan Yew,” Charlie Cookson, senior strategist of Landor, said.
Such markets are essential to the success of image-led brands where brand activation and image among younger audiences are vital to their brand goals.
According to Graham Hitchmough, CEO of Brand Union South & Southeast Asia, it’s important for such brands to venture into Singapore as it would allow them to extend their existing strategies or to innovate in a meaningful and controlled way without having to adapt or distort the core brand values.
“Singapore provides brands with the opportunity to reflect the halo of that image market onto other countries that may view Singapore as a representation of more globalised, cosmopolitan values,” he added.
Moreover, Singapore’s organised and open marketing infrastructure make it comparatively easy for marketers to try new things and push brand activation in a controlled and measurable way.
“Emotionally, Singapore has a reputation for being advanced and sophisticated. This also makes it easier for Western companies to be innovative in the way they deploy their marketing strategies here, minimising the need for expensive adaptation of global strategies,” Hitchmough said.
However, he cautioned against over-reliance on the possible impact of Singapore as an image market. He cited examples of other ASEAN markets such as Indonesia, Thailand and Malaysia increasingly looking globally for inspiration, but are at the same time, also looking inward to their own sources of inspiration, innovation and image leadership.
“These markets have always had strong image and design sensibilities and are now combining that successfully with a new, connected entrepreneurialism,” Hitchmough said.
The inherent risk then for Singapore as an image market is that it becomes a homogenous reflection of Western tastes, rather than continuing to develop its own unique image and culture.
“Ultimately, more than just ordered systems and structures, it is the authenticity of the brand experience that will shine through and attract the new, more demanding, more connected regional consumers,” he said.
The main thing about having presence in an image market is that it shows you are a brand with the agility to adapt and exist in markets different to your own, said Cookson.
“It means you ‘get’ the region you are entering. It means you can compete on the global stage.”