ASEAN’s resilient performance during the past decade has allowed many of its local companies to expand rapidly throughout the region and beyond, creating numerous multi-ASEAN corporations. The power, reach and influence of these companies have increased dramatically (see my blog on this topic here). These multi-ASEAN corporations have developed strong marketing campaigns in recent years, with the region now home to many multibillion-dollar brand names, some of which surpass famous Western names in value (see graphic below, based on figures from Brand Finance).
Although these companies are not mature enough to worry Western markets yet, the rise of multi-ASEAN corporations is going to lead to an increased battle for resources – both natural and human – heightened competition for several fast-growing segments and reduction of prices alongside faster innovation in ASEAN.
Multinational corporations need to invest in creating and communicating their unique dominance and mastery over technologies and competencies to build the kind of market confidence that smaller-scale regional competitors will not be able to replicate. Keep in mind that ASEAN markets have a large and fast-growing middle- to upper-middle segment whose loyalty can be earned through the early establishment of brand familiarity before regional competitors begin to enter the space. Emerging-market multinational corporations, such as multi-ASEAN corporations, are born into a new, highly globalized and integrated world where internationalization will happen much faster than multinational corporations have experienced in the past, making these companies a much greater and more immediate threat. Leading multinational corporations should not only closely monitor the rise of these firms but should also explore potential partnership in order to penetrate deeper into the emerging markets of Southeast Asia. (FSG’s clients can find the in-depth analysis on this topic here.)
ASEAN’s Seven Crucial (Less Talked About) Facts
This update is the sixth of a seven-part series of quick insights that I will be publishing over the next few weeks on the ASEAN region (see full list here). These have been selected carefully based on FSG’s numerous interactions with regional executives; I will discuss the topics which have proven to have high importance for senior executives of Western multinational corporations and ones with a lack of coverage in the business spheres. Final update (next week): “ASEAN Will Not Come Close To Achieving True Economic Union by 2016.”