Though no Indian brands feature in Sri Lanka’s first Top 20 brands list unveiled by Interbrand, the fusion of global trade, global communications and global culture has never been brought closer home. The pinnacle of this fusion is the power of global branding, and Indian companies need to build on this asset, say executives.
“Brands can be really powerful accelerators for business growth,” says Michael Rocha, Global Director, Brand Valuation, Interbrand. They tend to provide a beacon of positivity and can help transform not just consumers but even economies, he adds.
The Maithripala Sirisena government’s arrival in Sri Lanka was the tipping point for global brand consultancy Interbrand Group to unveil Sri Lanka’s first ever Best Sri Lankan Brands Awards. Recognising the 20 top Sri Lankan brands selected through their globally accepted evaluation model, the consultancy found many Indian brands popular in Sri Lanka. Despite this, no Indian brand figured in the Top 20.
Though many of the top brands listed in Interbrand’s Best Indian Brands 2017 list have a significant presence in Sri Lanka, such as Tata, Mahindra, and retail brands such as Nalli Silks and Madura Garments (which includes Louis Philippe, Allen Solly and Peter England), many more need to devise plans and make huge investments to expand their businesses in the island, the executive said.
Better poised for growth
“There was a lot of pent-up demand in Sri Lanka. Lot of recent growth had bypassed Sri Lanka because of three decades of civil war,” said Rocha. “As the new government came in and demonstrated stability, completing one full year, they began to look out for global learnings to accelerate their growth,” he said.
Interbrand’s inaugural edition of Best Sri Lankan Brands is modelled on Interbrand’s prestigious annual Best Global Brands report, the definitive guide to the world’s 100 most valuable brands.
“Through data, we benchmarked the Sri Lankan market against Best Global Brands and Best India Brands, and inferred that branding within Sri Lanka is largely under-leveraged. We see a growth opportunity in the region,” Ashish Mishra, Managing Director, Interbrand India, told Catalyst .
An opportunity that could well be the tour de force for several Indian brands. The consultancy found many Indian brands wooing Sri Lankan consumers.
“Financial services, automotive and diversified brands tend to dominate our inaugural Best Sri Lankan Brands study, and are well placed to succeed in an economy with significant pent-up demand,” said Mishra, adding: “Encouragingly, we see the Sri Lankan market looking to evolve from being serviced by distributors of global brands to accepting brands from Sri Lanka as well as India. This is a sign of growing confidence in its own as well as the region’s ability and it augurs well for our self-sufficiency and aspirations.”
Commenting on the regulations and risk of the sectors that play a key role in emerging markets, Mishra said the automotive sector finds the most favour. “That’s evident in the local Sri Lankan brand DIMO doing well as a leading distributor of brands like Mercedes among many more. It also explains Indian auto sector brands like Tata, Bajaj, Mahindra and Ashok Leyland as being popular in Sri Lanka. Tata, Lanka Leyland and Bajaj are as omnipresent in Sri Lanka as they are in India,” said Mishra.
Commenting on the popularity of Indian brands in Sri Lanka, Mishra said, “It is interesting to note that the Indian brands finding favour in Sri Lanka are all brands with proclaimed global brand aspirations.”
Growing the economy as a whole via both consumption and income generation is what is needed for Sri Lankan brands as well as for brands from India, in driving growth in their segments, he added.
He said the reasons for the popularity of Indian brands “are also related to the comparable choice drivers across the two markets including value prominence. The logistical ease, cultural resonance and social hot buttons find consonance between the markets and bolster acceptance.”
Mishra added that the “Sri Lanka market thus serves as yet another key zone for Indian brands, while serving as a level one global market for Indian brands.”
Incidentally, in Interbrand’s 2017 Best Global Brands rankings, Samsung (at No. 6) and Toyota (at No. 7) were the only two Asian brands in the top 10 names, with a brand value of $56,249 million and $50,219 million, respectively.
Terming brands as powerful assets, Rocha said, “Just like a factory, like its people, like any organisation, brands are powerful business assets with logos and have to be managed systematically and carefully all the time, just like any other asset.”
Part of the discussions for Sri Lanka’s top brands started in January last year, said Rocha, where an economic forum with Sri Lanka’s leaders, investor George Soros and a policy unit at the Harvard University debated the need for sound money, competitiveness and broad-based growth in the country.
Rocha added the “stability witnessed in Sri Lanka today has really turbo-charged the growth of many Indian brands.” Despite this, much more needs to be done for Indian brands to shine on the global stage.