Brazil Now

LOCAL MATTERS

BRAZIL

LOCAL MATTERS

LOCAL MATTERS

4 BRAZIL NOW . LOCAL MATTERS

Increasingly our connected world feels

smaller, familiar and more similar.

However, this can be an illusion. What

people do, think and feel within their own

environment and culture can be vastly

different, often in surprising ways.

We help our clients build relationships that

really matter to people, wherever they are.

We recognize that digital technology is

transforming the way we all experience and

interact with brands, allowing people to

experience different things in different places.

We explore beyond individual desires and

needs, to understand cultural context and the

power of social influence and uncover what

really matters locally. We watch what people

do and delve deeper into what they feel and

think. Only then can we build the most vivid

picture of what matters to people.

With all eyes on Brazil in anticipation of the

2014 World Cup and 2016 Olympics, there

is no better time than now for brands to be

breaking into the market. Brazil Now explores

what matters to Brazilians in a defining

moment for the country.

5

WHAT WE SEE Brazil is an emerging power, with millions of new middle

class consumers. The growth extends right across the

country, beyond its famous two cities of São Paulo and Rio

de Janeiro, resulting in tremendous opportunity for brands

willing to expand. There is also a new, growing, rich class

in the country, driving a further appetite for luxury among

this already fashion-forward society.

Their young population is also

shaping the way people think about

consumption in Brazil. They have

access to more information and are

demanding more - higher quality

service, better products and fair prices,

while retaining their strong sense of

nationality. The resulting cultural

fusion is a natural offshoot of this.


With a sexy, party-loving reputation,

Brazilians have become global

broadcasters of their happiness and

life through a strong presence on

social media, and the Internet is further

driving leisure and consumption

among these digital pioneers.

The 2014 World Cup and the 2016

Olympic Games will increase the

exposure of the cool, happy Brazil.

7

AN EMERGING POWERBrazil is a land full of new opportunities to be

discovered. It is the fifth largest country in the

world, with a territory larger than Australia’s

and almost three times the size of India. With

the seventh biggest economy, it is a country

rich in commodity and human resources, now

poised to creatively leapfrog.

Inequality and poverty are perhaps a couple

of the biggest threats after the Global

Financial Crisis. Brazil has been working hard

to combat these challenges and develop its

economy, while bringing millions of people

out of poverty and into a New Middle Class of

consumers - a group with more people than

the entire population of the United Kingdom.

These new consumers are willing to buy

clothes, electronics, cars and even luxury

goods so they can improve their standards

of life. Companies are already focusing on

this new market with brands such as Nestlé

and PepsiCo having created products that

are adapted to the taste of the Class C, the

New Middle Class, with sub-brands that offer

cheaper products. Global airlines have started

to offer plane tickets to be paid in several

instalments on credit cards as part of the

market tradition in Brazil, where the Class C

usually pay for everything in instalments.

Creative Commons. Author: Gisele Lobato


2009 2014 2016

Total Brazil

population 2014

Total UK

population 2014

A rapid increase in socioeconomic inclusion creates opportunities for brands that focus on the needs of a new class looking for a better standard of life. This is important for brands that can demonstrate a social mission and commitment to helping consumers thrive.

So what?

94.9 mi

121 mi

160 mi

RISE OF C CLASS

Number of Brazilians in the New

Middle Class: Growth from 2009 to

today and its projection for 2016

1. Source: www.ipea.gov.br 9

Cre

ati

ve C

omm

ons.

A

uth

or: D

ougla

s F.

Hen

rique


GROWTH ACROSS THE COUNTRYCopacabana and the Christ in Rio de Janeiro

are symbols of Brazil to the world, but

the country has gone through a national

transformation, with growth of cities and

development of markets in all of its regions.

Brazil is increasingly urban, with population

over one million in 16 of its cities, and more

than two-thirds of the country live out of the

famous cities of Rio de Janeiro and São Paulo.

These people living in five disparate regions

want to have access to goods and want to be

recognised as Brazilians with their own local

culture. The national growth in consumption

and the market of luxury goods has been

spreading in different

parts of the country.

In the Northeast of

Brazil, which used to

be associated with poverty and backwardness,

consumption accounted for more than US$

100 billion in 2013, 14% more than the year

before2. More than 20 new shopping centres

will be inaugurated in the region until 20183.

Important metropolitan regions such as Belo

Horizonte, Brasília, Curitiba and Recife have

become focus of investment in the market of

luxury goods, with brands like Tiffany & Co.,

Prada and Diesel opening stores there.

USD100Total Northeast consuption 2013

billion

2, 3. Source: Ibope

11

THE APPETITE FOR LUXURY

At the same time, there is a new, growing,

rich class in the country. About 27 million

people have become part of the highest social

classes in Brazil in the past 5 years - that’s

more than the population of Australia.

Brazil has the 12th most millionaires in the

world, a group of 194,000 people that is

expected to continue in accelerated growth,

with another 46 new millionaires per day. The

list of the Richest Brazilians by Forbes Brasil

counts 124 billionaires with combined wealth

of US$243 billion.

The increase in number of wealthy Brazilians

brings a new impulse to luxury consumption,

which is close to US$10 billion a year. Luxury

brands such as Tiffany & Co., Prada, Bugatti,

Bentley, Lamborghini, Louis Vuitton, Hermès,

Missoni and Christian Louboutin have recently

opened stores in Brazil. Today, Ferrari sells

an average of 45 sports cars worth over US$

600,000 in the country every year.

One of the main symbols of this is the

growing aircraft market. São Paulo has the

largest city helicopter fleet in the world -

larger than New York and Tokyo - with 411

aircraft registered and an average of 2,200

flights per day.

Creative Commons. Author: o-Porto Bay Hotels & Resorts


The development of new markets in different Brazilian cities offers opportunities for global brands willing to expand. In particular, there is a growing appetite for luxury goods amongst the increasing number of wealthy Brazilians.

So what?

2,200

46new millionairesper day in 20144

Brazil expects

124billionaires5

Brazilians count

flights per day

FLYING HIGH

MILLIONS AND BILLIONS

São Paulo is the city with the world’s largest helicopter fleet

4. WealthInsight / Revista Veja 5. Forbes 13

DEMANDING MOREBrazil is a young country preparing itself for

the future. With an average age of 30.7 years,

51% of the population is under 30 years old.

Brazil’s younger generation is becoming more

educated, and more connected, with greater

material and service needs. The rise of the

new Millennial generation is changing the

way people think about consumption, with

increased conscious decisions.

Brazilians are tired of paying more than other

countries for the same products, and that is

one reason why price comparison websites

are especially popular in the country. Global

brands are becoming increasingly popular

when they offer good products for prices

lower than the national average. This could be

seen in 2014, when fashion retailer Forever

21 opened its first store in Brazil with prices

lower than average and sold in 24 days what

it planned to sell over three months6.

6. www.exame.abril.com.br


YOUNG BRAZIL

CONSCIOUS CONSUMPTION

$URREAL

30.7

51%

81%

53%

years old7

of Brazilians are under 30 years old8

of young Brazilians believe that spending wisely is more important than earning a lot of money9

more than in the US10

The newest iPhone in Brazil cost

Brazilian average age

7, 9. JWT - Meet the BRIC millennials 8. World FactBook Brazil 10. The Economist

15

Creative Commons. Author: Vinicius Pinheiro


CULTURAL FUSION

Brazilians are also demanding higher

quality products - from both global and

national brands - resulting in a cultural

fusion. However, more than eight out of

ten Brazilians still trust local brands over

international ones speaking to the pride in

Brazilian-ness.

The strong sense of nationality exists

everywhere, and Brazilian pride in their

country and their multicultural heritage

can be seen in their online presence and in

the colours of the national flag all over the

country. Local is so important that there

are examples of brands like McDonald’s

who have created a meal with rice, beans

and burgers to adapt its menu to the local

taste in Brazil, where rice and beans are the

staple meal of the country.

As Brazil raises its profile on the

world stage, Millennials in the country

acknowledge that there is work to be done

at home before their country can become

a world leader. There is a lot of pride in

Brazil, and nine out of ten Brazilians say it

is time to make a mark on the world.

The large, highly connected Millennial population in Brazil is demanding quality and fair prices. Brands need to customize their products to cater to local needs, while also keeping in mind Brazilian sensibilities and pride. Maintaining competitive pricing is critical, while tapping into the increase in cultural fusion is a real opportunity in this environment.

So what?

17

BROADCASTING HAPPINESS


The highly interpersonal culture of Brazil,

which stresses social connections, is the

key reason it has been called the ‘social

media capital of the universe’. Brazilians

love technology and spend on average 32.5

hours per month online, only 3.7 hours

less than the Americans and 41% more than

the Chinese12. Digital means are great for

showcasing their pride and status to each

other and the world.

About eight out of ten young Brazilians are

on Facebook, which has more than 65 million

users in the country spending 535 minutes on

the social network every month13.

With their strong presence on social media,

Brazilians have become global broadcasters

of the life in the country.

Carnival, football, beaches and bikinis are

all global symbols of happiness and the

‘cool lifestyle’ in the country, and millions

of tourists travel to Rio de Janeiro and other

cities searching for that happiness. Important

global events such as the World Cup and the

2016 Olympic Games, along with non-stop

growth in the use of the internet, all have

the power to increase the exposure of the

Brazilian cool, happy lifestyle.

Place of Brazil in a survey

over happiness on Instagram11

HAPPY NATION

#1

11. Jetpac City Guides / Huffington Post 12. Brazilian Media survey 2014 - Observatório da imprensa 13. ComScore/Wall Street journal 19

HAPPY BRAZIL

‘Felicidade’ (happiness) and ‘Beleza’ (beauty)

are both seen as positive social expressions,

and Brazil owns this space socially

Happiness is part of Brazil’s social equity and

beauty is not far behind-both are attractive

spheres for brands to position themselves

across channels

Top 3 countries against the theme

“happiness” on Twitter (March to June 2014)14

MofaIronica @JoshDevineDrums Happiness is here in Brazil, please come back soon. We love you xo xo

morolandmorolan The Way to Happiness in Brazil http://t.co/CWH43y5zs1

RT @Aline_Chaienne @iamsrk Be happy without reason is the truest form of happiness #Brazil#Fan #LoveYou http://t.co/IKOY0hKRAa

BRAZIL OTHER

72.4%

USA

7.2% 6.5%

14. www.sysomos.com


TWEETING ABOUT THE WORLD CUP AND OLYMPICS

Brazil’s status as a global player will continue to grow

during and after the World Cup and then into the build

up for 2016 Olympics

Brazil government #rio2016 officials says the Olympics will meet prep deadlines and will be held without disorder

#48daystogo till the 2014 FIFA world cup Brazil!!!!!!!!!!!!!!!!!!!!! Let’s go show the world football Brasil!

10JKR@vivab 16 days and counting! the squad is ready and so am I! Brazil!!!

21

young Brazilians are

on Facebook15

8 out of

10

Brazilians accessed the

mobile Internet in 201316

67mi

of Brazilians will be using

the internet by 201717

59.5%

15. ComScore/Wall Street journal 16. Forbes 17. eMarketer, PR Newswire


DIGITAL PIONEERS

Brazilian consumers have also shown an

unusual willingness to make purchases online

using credit cards. More than 40 million

Brazilians are already searching for products,

information and shopping online - leading

product categories are household appliances

and fashion items. Global companies on the

web, like Amazon and Netflix, have created

personalised websites to offer products to the

Brazilian market.

With more than half of the population online,

Brazil casts itself as a defender of Internet

freedom with the 2014 implementation of the

Marco Civil, the national Internet bill of rights.

The law enshrines access to the Web and

the principle of net neutrality, ensuring that

Brazilian internet users enjoy online privacy

and freedom of expression.

The strong adaption of digital media is a huge opportunity for brands. Brazilians love to broadcast stories and become influential brand advocates through their social media activities. There is also a big opportunity for brands to offer online marketplaces – particularly for those who provide access to global brands and competitive offers. The 2014 World Cup and the 2016 Olympics amplify opportunities for global brands looking to make their entry.

So what?

23

A rapid increase in socioeconomic inclusion creates opportunities for

brands that focus on the needs of a new class looking for a better

standard of life.

The development of new markets in different Brazilian cities offers

opportunities for global brands willing to expand.

The increase in number of wealthy Brazilians brings a growing appetite

for luxury goods.

The large, highly connected Millennial population in Brazil is demanding

quality and fair prices. Brands need to customize their products to cater to

local needs, while also keeping in mind Brazilian sensibilities and pride.

Brazilians love to broadcast stories and become influential brand advocates

through their social media activities.

There is a big opportunity for brands to offer online marketplaces – access

to global brands at competitive offers.

The 2014 World Cup and the 2016 Olympics amplify opportunities for

global brands looking to make their entry.

SO WHAT MATTERS FOR BRANDS?


Find out more »To learn more about Brazil Now, please get in touch:

Offices contacts

BOSTON » [email protected]

CAPE TOWN » [email protected]

CHICAGO » [email protected]

JOHANNESBURG » [email protected]

LONDON » [email protected]

LOS ANGELES » [email protected]

MELBOURNE » [email protected]

MUMBAI » [email protected]

NEW YORK » [email protected]

SALT LAKE CITY » [email protected]

SEATTLE » [email protected]

SHANGHAI » [email protected]

SINGAPORE » [email protected]

SYDNEY » [email protected]

TOKYO » [email protected]

www.hallandpartners.com

/hallandpartners

/hallandpartners/hallandpartners

/hallandpartners

/hall-&-partners


BRAZIL


Documents

Brazil Now