Letters From the Booming Markets of Mexico, Indonesia, South Korea, Turkey

Four Global Players Report From the World's Hot Spots

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With many of the old-world economies in various states of turmoil, it's no wonder that marketers and investors are looking for the next big thing. The BRIC countries (Brazil, Russia, India and China) certainly haven't lost their economic luster, but the spotlight is increasingly turning to the MIST markets of Mexico, Indonesia, South Korea and Turkey.

Each country is forecast to be among the top 15 in annual real growth in GDP between now and 2050, according to PwC, with strong growth in per-capita GDP. In the nearer term, Indonesia breaks into ZenithOptimedia's list of the top 20 global ad markets this year and by 2013 will overtake Mexico, which like South Korea, is already among the top 20. Turkey is climbing closer to a projected 24th in 2013. Indonesia's size will make it one of the fastest growing ad markets adding $2.5 billion to the worldwide ad economy.

A youth segment in Mexico that has received much media attention is the so-called NiNis (Ni estudian, Ni trabajan or Don't work, Don't study). Their existence is thought to demonstrate a lack of opportunity and general apathy among youngsters in Mexico.

Alvaro Carvajal
Alvaro Carvajal

A Mexican psychologist we interviewed as part of our global "Truth About Youth" study highlighted the lack of contemporary heroes for a generation of young Mexicans and linked this to their strong emergent interest in retro music, fashion and design as young people seek idols and meaning in the past. Interestingly, when asked in our survey for the famous person they most admired, No. 1 answer was Gandhi.

Our global research indicates, however, that there is hope on the horizon. One of the motivations which young people over-indexed on vs. all the other markets is a motivation we've called "Gauntlet" (the need to challenge oneself). They spoke passionately about the need to establish goals and strive for something bigger and better.

There is a big opportunity for brands in Mexico to embody this "Gauntlet" mentality. In the focus groups, young people expressed their admiration for brands such as Nike (Just do it) and Gatorade (Go further), which operate in this emotional space. This generation of Mexican consumers need to look beyond seeking solace in the past, and find courage to look to the future.

Alvaro Carvajal, strategic innovation director, McCann Worldgroup Mexico

For Indonesians, the PC isn't a computer, it's a smartphone. While computer penetration is only 10%, mobile-phone penetration is fast approaching 60%, and 80% of all new phones are now internet-enabled.

Stephen Mangham
Stephen Mangham
The must-have device is the BlackBerry, which, thanks to smart marketing -- it works with Leo Burnett and BBDO in the region -- keen pricing and its messenger function, has taken the market by storm. Its biggest threat are not iPhones, which have barely made a dent here, but "Chinaberries," popular clones sold at half the price on the gray market. Even the BlackBerry Facebook site has nearly 1 million fans.

Today Indonesia has the second-biggest Facebook population in the world (39 million users and counting). It's arguably the most Twitter-addicted nation in the world -- nowhere else has a higher percentage of internet users tweeting. Indonesians generate 15% of all tweets globally on a daily basis.

Twitter has become a powerful tool for exposure and debate, as some politicians and celebrities have found to their chagrin. Last November the Information Minister was filmed shaking hands with Michelle Obama during the U.S. president's state visit to Jakarta. When he denied doing so (claiming never to shake hands with any female not his relative), Twitter was bombarded with sarcasm and parodies.

TV remains the prime mass medium, but online ad spending growth has gone into hyperdrive. It is forecast to grow 200% in 2011, more than 8% of total ad spending, and social media is taking 80% of the pie.

Some marketers have found that creating a conversation is the best way to inject fresh interest in their brands. Unilever tea brand Sarawangi did so with a campaign by Ogilvy urging women to rethink relationships with their husbands, and use tea as a means of sharing, not serving.

Just over a decade ago Indonesia was on the brink of collapse. Today the economy is booming, with growth primarily fueled by domestic demand, and 85 million young people aged between 15 and 29 who are hugely excited by new technology. Economists see the country as one of the eight markets which will drive global growth.

Stephen Mangham, group CEO, Ogilvy Indonesia

Business in South Korea is booming.

The luxury market has been steadily growing 12% each year on average since 2006. McKinsey & Co. recently revealed that Koreans are spending more on luxury brands than the Japanese, typically the world's biggest spenders in this category.

Buz Sawyer
Buz Sawyer

But South Korea is a world divided, where affordability is keeping pace with high-end luxury. It has become a battlefield for global mass-market brands, known as SPA (specialty retailer of private-label apparel) or "fast fashion." Revenue of the big three SPA brands, Uniqlo, Zara and H&M, has increased by two to four times for the past three years.

On the entertainment front, reality-competition shows, similar to "American Idol," have exploded on the scene in South Korea -- so much so, in fact, that many of the major network and cable stations have introduced their own versions.

When not shopping or watching TV, nearly 4 million Koreans are tweeting, thanks to the launch of the microblogging site in the Korean market in January, along with Twitter Android and iPhone applications. Just over half of South Koreans are active on some kind of social-networking service, and recently, the number of monthly visitors to Facebook exceeded those to local networking service Cyworld for the first time. In a country of approximately 49 million people, nearly 34% visit Facebook each month. The use of "smart" devices, especially as they relate to social networking and e-commerce, is expected to rise in record numbers this year.

Who knows what the future holds for this underdog. But Asia's fourth-largest economy is quickly outpacing its more profitable neighbors to the East and the West, especially in areas of luxury spending and social media, and may soon become third or even second in no time.

Buz Sawyer, president-CEO, Cheil in the Americas

Now ranked the eighth-largest by IMF, Turkey is expected to become the seventh-largest economy in Europe by 2015, overtaking the Netherlands. The positive effects of the economic growth can be traced in the consumer-research findings.

Mehmet Cem Topçuoğlu
Mehmet Cem Topçuoğlu

Consumer confidence in Turkey has been in record highs during the first half of 2011, never going below 90. These happy consumers prefer to spend their time in shopping malls and buying the latest technology products. The number of malls in Turkey is rising exponentially and is expected to reach 400 by the year 2015. Synovate's "New Generation Youth Research" shows that malls are the No. 1 spot among youth for shopping. Their favorite brands are Nokia in phones, Adidas and Nike in sports apparel and Avon in cosmetics.

Internet usage is increasing steadily, rising from 27% to 46% in the last four years. The Turks are now the fourth-biggest population on Facebook, with more than 30 million users.

Only 15% of Turks say "technology is beyond me" (vs. 24% globally) and a whopping 45% believe that it needs to be mastered in order to stay up-to-date in life. The sales numbers in flat TVs, smartphones and notebooks prove that . GfK Turkey's retail and technology research shows that in the first half of 2011, the flat-TV market has grown 58% and the mobile-computer market has grown 41% year-over-year. Smartphones' share within the mobile market is increasing and has reached 27% as of June 2011, which is two points higher than the global average.

Ali Levent Orhun, partner in GfK Turkey, said technology and electronics are among the topics that the Turks are most interested in. In fact, it's up there in the top three "The Most-talked About Issues" alongside more serious subjects such as religion and politics. But while Turkish consumers have rather modern consumption habits, they still keep their cultural values. According to GfK's Turkey Report 2009, "authenticity" and "honesty" are the two most important values in Turkish society.

Mehmet Cem Topçuoğlu, President-CEO, TBWA Istanbul

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