Localism – Consumer Behavior Case Study
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According to a GlobalData survey, at least one in 10 consumers globally claim to have a preference for smaller brands over multinationals. The localism consumer behavior report examines the trend and how industry players can tap into it.
During times of COVID-19, younger consumers are especially driven towards purchasing familiar brands as they are perceived to be more trustworthy.
What types of products do consumers typically purchase?
International still dominates consumer preference but local brands show notable demand. Many consumers globally, show preference to small/independent brands over foreign/multinational brands.
At least one in 10 consumers globally claimed to have preference for smaller brands over multinational, especially in beauty and fashion. This reflects the impact of the localism trend on product choices, where a notable proportion of consumers question the authenticity of product origin and sustainability benefits. In response to this trend driven by comfort & uncertainty and sustainability & ethics, international brands have been introducing products with more local influences. In effect, this shows a great opportunity for brands to build consumer trust and tailor more closely to their preferences and lifestyle.
What was the consumer behavior during the COVID-19 period?
At the peak of the pandemic in 2020, locally sourced ingredients became more important to half of consumers globally. During COVID-19, the demand for local products and services has spiked across all generation groups. The report offers insights into consumer behavior during COVID -19 across various generations including Gen Z, Gen Y, Gen X, boomers, and silent generation.
Consumer behavior localism trend , by generation
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What are the key factors driving the localism trend in 2021?
Familiarity and concern for environment are key drivers for localism. Some of the key factors driving the localism trend are discussed below.
Local familiarity
Consumers gravitate towards products/ingredients that they know and trust due to its local routes.
Sustainability
Consumers show interest in brands with sustainable benefits e.g. low carbon footprint, which opens an opportunity for local brands to grow due to shorter transportation distances during production.
Authenticity
Consumers question lack of transparency from international brands and show concern toward product origin
Product safety
Since COVID-19 consumers have shown concern toward product safety and traceability, which has led many to put more trust in local products.
Support for local community
Consumers globally continue to be encouraged by their government bodies to support the community through local initiatives.
Personalization
Consumers globally continue to gravitate towards local brands, as they closely tailor to their lifestyle and personality compared to international/foreign brands.
What are the key strategies adopted by brands to target local communities?
Cadbury, Din Tara Ta, and Nivea are some of the major brands adapting formulation and packaging to target local communities.
Cadbury, Dairy Milk Pan Jeer, India
This vegetarian product claims to have a combination of milk chocolate, betel leaf and spiced fig. In India, paan is a very local and regular mouth freshener and combining it with the well-known Cadbury Dairy Milk chocolate could intrigue local shoppers and attract those shoppers looking to experiment within the category.
Din Tara Ta, yogurt drink, Romania
According to the brand, this yogurt drink is made with 100% Romanian milk. In terms of formulation strategy, the local product closely aligns with this trend, as local offerings produced closer to home are perceived to be more trustworthy as compared to international or imported products. This would especially appeal to ingredient-conscious shoppers seeking local ingredients in distinct products.
Nivea, hijab cooling body serum, Indonesia
This halal-certified body serum is said to be formulated with vitamin C and cooling menthol and targets women who wear hijabs.
What are the key takeaways for industry players to consider in the localism trend?
Industry players must develop more transparent product/service solutions through a more local supply chain to ensure consumer trust. This would especially be effective if the brand adopts high traceability standards at a local level. They must create products that are familiar to consumers through recognizable local influences through targeting specific cultures or using local ingredients. They can also utilize local channels to regain trust from consumers who have become skeptical of international or foreign brands, especially during the COVID-19 period and support small/independent businesses through donations and partnerships, as consumers show concern for the local community as well as the environment.
Report scope
Mega trends | Sustainability & Ethics, Health and Wellness, Sensory & Indulgence, Smart & Connected, Comfort & Uncertainty, Individualism & Expression, Easy & Affordable, and Evolving Landscapes (Demographics) |
Brands adopting localism trend | Cadbury, Din Tara Ta, and Nivea |
Scope
- Develop more transparent product/service solutions through a more local supply chain to ensure consumer trust.
- Partner with local suppliers to co-create products that align closely with the personality and lifestyle of local consumers.
- Support small/independent businesses through donations and partnerships.
Reasons to Buy
- Understand the relevant consumer trends and attitudes that drive and support innovation success so you can tap into what is really impacting the industry.
- Gain a broader appreciation of the fast-moving consumer goods industry by gaining insights from both within and outside of your sector.
- Access valuable strategic take-outs to help direct future decision-making and inform new product development.
Din Tara Ta
Nivea
Danone
EU Commission
McDonald's
McCain
Table of Contents
Frequently asked questions
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What were the key factors driving the localism trend in 2021?
The key factors driving the localism trend were local familiarity, sustainability, authenticity, product safety, support for local community, and personalization.
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What are the key product categories purchased by consumers?
The key product categories bought by consumers are clothing and footwear, tobacco and smoking alternative products, products for pets, baby care and childcare products, household care and laundry, healthcare, hygiene, and toiletry, beauty and grooming products, non-alcoholic drinks, alcoholic drinks, bakery, cereals, and morning goods, prepared meals, chocolate, confectionery and desserts, savory snacks, and dairy products.
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What are the key product types purchased by consumers within the categories?
Consumers purchase products made by small/independent brands, foreign/global multinational brands, products made by private label, and artisans/handmade products.
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What are the key consumer generations discussed in the case study?
The key consumer generations discussed in the case study are Gen Z, Gen Y, Gen X, boomers, and silent generation.
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