贝恩 -2024亚太消费品市场研究 Resilience Amid Disruption - How Some Asia-Pacific Incumbents Are Outmaneuvering Insurgents

ResilienceAmidDisruption:HowSome

Asia-PacificIncumbentsAre

OutmaneuveringInsurgents

Analysisof23consumerproductgoodscategoriesacross11Asia-Pacificmarketsrevealsanuancedreality.

ByJichulKang,GeraldTan,WeiweiXing,andDavidZehner

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Authorsandacknowledgments

JichulKangisapartnerwholeadsBain&Company’sConsumerProductspracticeinSouthKoreaandisbasedinSeoul.Youcancontacthimbyemailatjichul.kang@.

GeraldTanisapartnerwithBain&Company’sConsumerProductspracticebasedinSingapore.Youcancontacthimbyemailatgerald.tan@.

WeiweiXingisapartnerwithBain&Company’sConsumerProductspracticebasedinHongKong.Youcancontactherbyemailatweiwei.xing@.

DavidZehnerisaseniorpartnerwholeadsBain&Company’sConsumerProductspracticeinthe

Asia-PacificregionandisbasedinSydney.Youcancontacthimbyemailatdavid.zehner@.

Theauthorsextendgratitudetoallwhocontributed,includingBrunoLannes,CharlotteApps,RaviSwarup,NinaKaspar,PraptiSahni,ZaraLightowler,MiyaWang,YifeiGao,andRanqiLiufromBain.

Copyright©2024Bain&Company,Inc.Allrightsreserved.

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ResilienceAmidDisruption:HowSomeAsia-PacificIncumbentsAreOutmaneuveringInsurgents

AtaGlance

Ouranalysisof23consumerproductgoodscategoriesin11Asia-Pacificmarketsfrom2018to2022showsthatwhileinsurgentshavemadesignificantinroads,manyincumbentshavemain-tainedorevenincreasedtheirmarketshare.

Nosinglecategoryormarketfactorexplainsthesuccessorfailureofincumbentbrands.Channeldynamicsseemtobemoreinfluentialthancategorycharacteristics.Butwhatmattersmostishowincumbentsmanagetheircategoriesandbrands.

Successfulincumbentsblendtheirinherentstrengthswithinsurgentstrategies,leveragingscalewhileembracingagilityandinnovation.

TheriseandreinventionofestablishedAsia-PacificCPGbrandsamidinsurgentthreats

Wehaveallheardthenarrative—insurgentbrandsareontherisewhilelargeincumbentbrandsfaceanincreasinglygloomyfutureduetofallingbarrierstoentryandthrivinginnovation.However,

Baindataanalysisacross23consumerproductgoods(CPG)categoriesin11Asia-Pacificmarketsfrom2018to2022revealsamorenuancedreality.

Whileinsurgentbrandshavemadeinroadsincapturingmarketsharefromestablishedbrands,thistrendisnotall-encompassing.Despitethegenuinethreatposedbytheseemergingbrands,manyestablishedbrandscontinuetoachievesuccess.Withstrategiesspecificallytailoredtotheirstrengthsandmarketdynamics,incumbentscanthriveevenamidthegrowingpresenceofinsurgents.

Westudied253categoryandmarketcombinationsinAsia-Pacificoverfiveyears.Wefoundthatwhilelargeincumbentbrandslostin112cases(definedaslosingmorethan1percentagepointofmarket

shareinaggregate),incumbentsheldsteadyin72casesandwon(gainedmorethan1percentage

pointofmarketshareinaggregate)in69cases.TherewasnosinglecategorywhereincumbentslostshareacrosseveryAsia-Pacificmarket,norasinglemarketwheretheylostshareacrossallcategories(seeFigure1).So,whileinsurgentshavegainedgroundinmoresituationsthanincumbentshave

gained,theresultsshowsignificantvariationdependingonthespecificmarketandcategory.

2

Bottledwater

Carbonates

Drinkingmilkproducts

Energydrinks

Non-alcoholicbeverage

Juice

ResilienceAmidDisruption:HowSomeAsia-PacificIncumbentsAreOutmaneuveringInsurgents

Figure1:It’struethatinsurgentsaresucceeding—buttherearemanyexceptions,andincumbentwinnersabound

MalaysiaPhilippinesJapanIndiaChinaVietnamIndonesiaAustraliaSingaporeThailandSouth

Korea

Alcoholic

beverage

Beer

Spirits

Wine

Beautyand

personalcare

Bathand

shower

Color

cosmetics

Fragrances

Haircare

Oralcare

Skincare

Food

Confectionery

Edibleoils

Mealsand

soups

Milkformula

Petfood

Savory

snacks

Sweet

biscuits

Homecare

Laundrycare

Nappies/

diapers/pants

Win(incumbentsaggregatesharegain>1pp)Stable(sharechangewithin±1pp)Lose(sharelose>1pp)

Notes:pp=percentagepoints;Incumbentbrandsaredefinedastop10brandsintermsof2018marketshareineverycategoryxcountry,excludingbrandsthatnolongerexistin2022;MarketshareintermsoftotalvalueRSPforalcoholicbeveragesandretail/off-tradeRSPforothercategories

Sources:Euromonitor;Bainanalysis

3

30%

78%

2%

60

%18%%22%7%11%

InthePhilippines,largeincumbentslostin7of23categories

Channeldynamicsseemtobemoreinfluentialthancategorycharacteristics

Ouranalysisof11Asia-Pacificmarketsshowsavariedcompetitionpatternbetweenincumbentsandinsurgents(seeFigure2).Notably,SouthKorea,Singapore,andChinaemergeasthemostfavorableenvironmentsfornewentrants.Thistrendcouldbelinkedtotheirthrivinge-commercesectorandwell-establishednetworksofthird-partysuppliers,makingtheseregionsparticularlyconduciveforinsurgentgrowth.

SouthKorea,forexample,standsoutasoneoftheleadersintheAsia-Pacificregionfore-commercedevelopment.Thecountrywitnessedanimpressivee-commercesalespenetrationofapproximately34%in2022.Thismarketisalsodistinguishedbyitsrobustinfrastructureofthird-partysuppliers,towhichsmallbrandscanoutsourceelementsoftheirvaluechain.Suchanecosystemsignificantlyreducesthebarrierstoentryfornewbusinesses,intensifyingthecompetitivepressureonestablishedcompanies.Thisheightenedcompetitionisreflectedinlargeincumbentslosinggroundin16ofthe23monitoredcategories.

Incontrast,Malaysia,thePhilippines,andIndiaarethemostfavorablemarketsforincumbents.

Thistrendcanbeattributedtothedominanceoftraditionaltrade,especiallyinthePhilippinesandIndia,andtherelativelylowpenetrationofe-commerce.Thecomplexchanneldynamicsinthesemarketscreateachallengingenvironmentfornewentrants.

Figure2:SouthKorea,Singapore,andChinawerethemostinsurgent-friendlymarkets;Malaysia,thePhilippines,andIndiawerethemostincumbent-friendly

Incumbentbrands'performancein23trackedcategories,bycountry(2018–22)

Totalnumberofcategories:2323232323232323232323

100%

80

60

InS.Korea,largeincumbentslostin16of23categories

40

20

0

2022retaile-commercesalespenetration¹

Weightedaverage

traditionaltradepercentageof23categories2

Malaysia

5%

Philippines

2%

India

7%

Australia

9%

53%

Japan

9%

2%

China

2

SingaporeSouthKorea

Thailand

5%

Vietnam

3%

26

7%

13%

34%

Indonesia

%

46

Win(incumbentsaggregatesharegain>1pp)Stable(sharechangewithin±1pp)Lose(sharelose>1pp)Countrieswithleadinge-commerce/traditionaltradepenetration

Notes:1)E-commercepenetrationforChinaispublishedbytheNationalBureauofStatisticsandincludestheonlineretailsalesofgoods,butdoesnotincludetheonlineretailsalesofnon-physicalgoods(i.e.,services).2)Weightedaveragetraditionaltradepenetrationof23categoriesbasedonEuromonitordata,excludingcategoriesxcountrycombinationswithnoavailabledatafortraditionaltradepenetration

Sources:NationalBureauofStatisticsofChina;KoreanStatisticalInformationService;JapanMinistryofEconomy,Trade,andIndustry;eMarketer;Euromonitor;Bainanalysis

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ResilienceAmidDisruption:HowSomeAsia-PacificIncumbentsAreOutmaneuveringInsurgents

Forinstance,traditionaltradeaccountsforapproximately53%oftheretailvalueacrossthe23

categoriesanalyzedinthePhilippines.Thissignificantshareunderscorestheimportanceofrobustroute-to-market(RTM)capabilityforbrandsaimingtosucceedinthemarket.Suchalandscape

presentsaformidablebarriertoentryfornewcompetitors.Thisisreflectedinthefactthatlarge,

establishedincumbentsonlylostin7ofthe23categories,indicatingtheircontinueddominanceinamarketwheretraditionalchannelsstillplayapivotalrole.

Category-by-category,ouranalysisrevealedaspectrumofoutcomes.Overall,thebeautyandpersonalcaresectoremergedasthemostreceptivetoinsurgentbrands,instarkcontrasttoothersectors,

includingalcoholicandnon-alcoholicbeverages,food,andhomecare.Withinthebeautyandperson-alcarecategory,haircareandskincarewereparticularlyinsurgent-friendly,withestablished

brandslosingtheirmarketsharein8and9ofthe11markets,respectively.Ontheoppositeend,theconfectionerycategoryprovedtobethestrongholdforincumbentbrands,asincumbentsonlylostin1ofthe11marketswithinthiscategory(seeFigure3).

Figure3:Haircareandskincarewerethemostinsurgent-friendlycategories;confectionerywasthemostincumbent-friendly

Incumbentbrands'performancein11trackedcountries,bycategory(2018–22)

Totalnumberofmarkets:100%

80

60

40

20

0

1111111111111111111111111111111111111111111111

InSkincare,largeincumbents

lostin9of11markets

InConfectionery,large

incumbentslostin1of

11markets

Wine

Spirits

Fra-

grances

Color

cosmetics

Skin

care

Milk

formula

Edible

oils

Savory

snacks

Nappies/

diapers/

pants

Bottled

water

Energy

drinks

Drinking

milk

products

Oralcare

Sweetbiscuits

Carbo-nates

Beer

Confec-tionery

Haircare

Petfood

Bathandshower

Laundrycare

Juice

Meals

andsoups

AlcoholicBeautyandpersonalcareFoodHomeNon-alcoholic

beveragecarebeverage

Win(incumbentsaggregatesharegain>1pp)Stable(sharechangewithin±1pp)Lose(sharelose>1pp)

Sources:Euromonitor;Bainanalysis

5

In9outof23categories,incumbentbrandsin

aggregategainedshare

1+ppfrom2018to2022

In4

in

gained

1+

2018

In3outof4categories,foreign

incumbentbrands

outgrew

localones

ResilienceAmidDisruption:HowSomeAsia-PacificIncumbentsAreOutmaneuveringInsurgents

Delvingintotheperformanceoflargeincumbentsbasedontheirorigins,threedistinctpatternsemerge(seeFigure4).InmostAsia-Pacificcountries,suchasAustralia,Singapore,andVietnam,foreignincumbentbrands(i.e.,incumbentbrandsownedbyoverseas-headquarteredcompanies)continuetoleadinmarketshareacrossthemajorityofthe23trackedcategoriesanddemonstrategreaterresiliencebyoutgrowingtheirlocalpeersinmostwinningcategories.

However,inIndia,thePhilippines,andIndonesia,whileforeignincumbentsalsoleadinmarketshareacrossmostcategories,itisthelocalincumbentsthatexhibitastrongerabilitytogainshareinthewinningcategories.Forinstance,foreignbrandsinIndonesialed15outofthe23trackedcategoriesin2022.Nonetheless,localincumbentshaveshownhighergrowthinfiveofthesevenincumbent-winningcategories,includingwine,juice,andsweetbiscuits,from2018to2022.Thesuccessoftheselocalbrandscanbeattributedtotheirextensivedistributionnetworksinruralareasandlower-tiercities,wheretheyeffectivelyleveragetraditionaltradechannels.

InSouthKoreaandJapan,localbrandshavetraditionallydominatedthemarket.However,foreignbrandshaverecentlybeguntoleadgrowthinsomeincumbent-winningcategories,suchascarbonatesinJapanandfragranceanddiapersinSouthKorea.

Figure4:LocalincumbentbrandsshowedstrongergrowingmomentuminIndia,thePhilippines,andIndonesia;foreignbrandsstillleadmostofthetrackedcategories

Foreignincumbentssolidifyingwinner’sposition

InSingapore,Vietnam,Malaysia,Australia,Thailand,andChina,foreignincumbents

leadinmarketshareacrossthemajorityofcategoriesandareconsolidatingdominance.

Example:Vietnam

Market

dominator

In21outof23categories,foreignincumbentsheldhighersharethanlocalsin2018.

Growth

leaderin

winning

categories

239

Inall9categoriesthatincumbents

won,foreign

incumbentbrands

outgrewlocalones1

Allcategories

Incumbent

winningcategories

Localincumbentscatchinguponforeignincumbents

InIndia,Indonesia,andthePhilippines,foreignincumbentsleadinmarketshareacrossthemajorityofcategories,while

localsarecatchingup.

Example:Indonesia

In15outof23categories,foreignincumbentsheldhighersharethanlocalsin2018.

237

Incumbent

Allcategories

winningcategories

Foreignincumbentscatchinguponlocalincumbents

InSouthKoreaandJapan,localincumbentsleadinmarketshareacrossmostcategories,whileforeignincumbentsaregrowingfaster.

Example:SouthKorea

In6outof23categories,foreignincumbentsheldhighersharethanlocalsin2018.

234

categories,

incumbentbrands

aggregate

share

ppfrom

to2022

Incumbent

winningcategories

Allcategories

WinStableLoseForeignbrandsLocalbrands

Note:1)Theaggregatesharegainforforeignincumbentbrandswashigherthanthatforlocalincumbentbrands;Localbrandsaredefinedasbrandsownedbythecompaniesinthelocalmarket;foreignbrandsareclassifiedasbrandsownedbycompaniesheadquarteredoutsideofthelocalcountry,includingotherAsia-Pacificcountriesandotherregions

Sources:Euromonitor;Lit.search;Bainanalysis

6

Covid-19experiencewasalsonuanced

AnothercommonnarrativeisthattheCovid-19pandemicenabledincumbentbrandstoregain

tractionasconsumerssoughtoutwell-knownbrandsduringtimesofuncertainty.Atthesametime,largermanufacturerswerebetterequippedtonavigatesupplychaindisruptions.Again,ourstudyshowedamixedimpactamongtheAsia-Pacificcountries.DuringtheyearofpeakCovid-19restric-tions,incumbentbrandsexperiencedincreasedsuccessin7ofthe11countriesweanalyzed.IndiaandChinasawthemostsubstantialgains,whereincumbentsgainedineightandfiveadditional

categories,respectively,comparedtothepreviousyear.Ontheotherhand,incountrieslikeMalaysia,Singapore,Vietnam,andAustralia,therewereeithernosignificantchangesorincumbentslostinmorecategoriesduringthepeakperiodsofCovid-19restrictions.Insummary,incumbentsgainedtractionduringCovid-19insomemarkets,butnotinothers.

Insurgentshavemomentuminmanysituations,butourdatashowresilientincumbentbrandscanholdsteadyorgainshareacrossawiderangeofmarketsandcategoriesinAsia-Pacific.Whilemarket,categorycharacteristics,andmacrosituationsdocontributetoincumbents’successtosomeextent,whatmattersmostishowtheymanagetheircategoriesandbrands.

Whatwelearnedfromlargeincumbentwinners

Intoday’seraofswiftdisruption,establishedplayerscanfinditchallengingtomatchtheagilityofemergingcompetitors.Ourresearchrevealsthatsuccessfulincumbentcompaniesareadeptat

incorporatingthemosteffectivestrategiesfrominsurgentcompetitorswhileleveragingtheirinherentstrengths.Theyhaveharnessedtheirscaletotheiradvantage.Theyhaveskillfullynavigatedtypicalpitfalls,suchascomplexityandinertia,whichoftenbesetlargeorganizations.Additionally,they

haveshownacapacityforinnovation,investment,andexecutionthatwouldmakeeventhemostambitiousinsurgentsproud.ThesuccessofAsia-Pacificincumbentbrandscanbeexpressedinafour-partframework(seeFigure5):

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ResilienceAmidDisruption:HowSomeAsia-PacificIncumbentsAreOutmaneuveringInsurgents

Figure5:Incumbentwinnersadaptthebestoftheinsurgentplaybookwhilemaximizingtheirincumbentadvantages

1

Wheretoplay

ConsumerinsightsPortfoliostrategy

Learnfrominsurgentplaybook

Maximizeincumbentadvantages

Consumerneeds

first;noopportunitytoosmall

Respondtounmetconsumerneedsor

emergingtrends,eveniftheinitial

incrementalvalueofopportunityappears

modestorpotentiallydilutive

Accumulatedin-depthconsumerandmarket

knowledge

Extensiveconsumerandmarket

insightsenabledbysystematicstudies,tracking,andmonitoring

2

Howtowin

Memorability

Proposition

Availability

Agilityin

innovations

Rapidinnovationcycle,enabledby

operationalimprovementsand

ecosystempartnerships

it-rowith

profitability

EstablishdistinctiveheroSKU(s)first

beforebuildingabrand

Adoptinnovativemarketingmodels,

embracingevolvingdigitaltrends,e.g.,

contentmarketing,socialcommerce,etc.

Establishedknow-howininnovations

Richknow-howandassets,includingpatents,talents,processes

Long-termtop-linegrowthfocused

Fastscaling

through

omnichannelreach

Leverage

footprints

themoat,

achieving

establishedomnichannel

andrichknow-howinRTMas

enablingrapidscaleand

cost-effectiveness

HeroSKUfirst

Globalreach

Replicaterepeatablemodelsfrom/toglobalmarkets

Evolvingmarketingmodels

M&Apowerhouse

Abilitytostrategicallyleveragemerger

andacquisitionsasameansto

acceleraterevenueorprofitabilitygrowth

3

Operating

model

Founder’s

mentality

Fosteraculturecharacterizedbyan

extraordinarysenseofinsurgency,a

frontlineobsession,andanownermindset

Limitedsiloes,allowingforfast

communicationanddecisions

Stablereturns

Diversifiedportfoliosandriskmanage-

mentstabilizereturnsandincrease

“stayingpower”;abilitytofreeup

resourcestoinvestinhigh-priority

projects(brands,innovations,

businesses,etc.)

Integrated,

cross-functional

Talent

attractiveness

Abilitytoattracttoptalentsenabledbystrongreputationandmaturetalent

developmentsystem

4)DesignDecideDeliverDigitalize

1.Wheretoplay:Theseincumbentsestablishanin-depthunderstandingoflocalconsumerstoidentifygrowingdemandanddriveportfoliogrowthwithinandbeyondthecurrentmarket.

2.Howtowin:Theyfosterarepeatablegrowthmodelbybuildingstrongbrandmemorability,establishingabest-servedbrandproposition,andoptimizingavailability.

3.Howtooperate:Successfulincumbentsdevelopdifferentiatedcapabilitiesthatcreatesustain-ablecompetitiveadvantages.

4.Howtolocalize(forforeignbrands):Successfulforeignincumbentsproactivelylocalizecorecapabilities,enablingthemtocompetelikelocalplayers.

Wheretoplay

Successfulincumbentscapitalizeontheextensiveconsumerandmarketinsightsgainedfromyearsofoperationtoidentifyemergingmarketopportunities.Theyareattunedtothemarket,searchingforunmetconsumerneeds,andareoftenwillingtoinnovatebasedonemergingtrends,evenwhen

thesenewprospectsinitiallyseemminorcomparedtotheirexistingbusiness.Othersuccessfulincumbentsadoptsolutionsthatinsurgentsaretryingtoscale—solutionsthatresonatewith

consumers—andusetheirscaleadvantagetobuilddistributionandbrandawarenessandachievecost-effectivenessquickly.

8

By-health,aleadingChinesevitaminanddietarysupplement(VDS)brand,exemplifiesthisstrategy.Inrecentyears,By-healthhasbeenproactiveinidentifyingandrespondingtoemergingconsumer

trends.Ithasstrategicallyenteredburgeoningnichesub-segments,suchaseyehealth,liverprotec-tion,andbeautyandweightmanagement,positioningitselfasoneoftheearlymoversintheseareas.

Thebrandhasforgedpartnershipswithprestigiousinstitutionsforadvancedresearchanddevelop-ment,leveragingitsstatureasamajorplayertobuildacompetitiveedgethroughaccumulated

expertise.By-healthhasalsodramaticallyaccelerateditsinnovationprocess,achievingapaceonparwithinsurgentbrands.ThisagileapproachhasbeeninstrumentalinBy-health’sascenttothetoppositioninChina’sVDSmarket,supplantingthepreviousmarketleader.Asaresultofthesestrategies,By-healthhasachievedaCAGRof15%–20%from2018to2022.

Similarexamplescanbeobservedamongsuccessfulincumbentsintheregion.Baixiang,aleadingnoodlebrandinChina,hastransformeditsapproachtoinnovationbybecomingconsumer-centric.Embracinga“testandlearn”philosophy,thebrandhasadaptedtoemergingconsumertrendsandscaledbyleveragingitsestablishedchannels,leadingtothesuccessfullaunchofseveralhealth-

focusedpremiumproducts.Meanwhile,GreatNorthern,theleadingAustralianbeerbrandownedbyCarlton&UnitedBreweries,canattributeitssuccesstoitsdeliberatepositioning,whichtargeteditscompetitor’sstrongholdintermsofoccasions(outdoorlifestyle),taste(lightprofile),andgeography

(Queensland).Likewise,aleadingfoodbrandinIndia,TataSampann,hasachievedanapproximately20%CAGRinthepastfiveyearsbyaddressingconsumerneedsforhigh-quality,healthy,andnutri-tiousstaplefoods.ItwasoneofthefirstmoversintothebrandedpulsesmarketinIndia,gradually

expandingintocategoriessuchasspices,poha,anddryfruits.

Byleveragingtheirunparalleledconsumerinsightstoexpandmethodicallyintohigh-potentialniches,someincumbentwinnershavefueledtremendousgrowth.Theirstrategicplaybookcouldprovideamodelforotherincumbentslookingtoplaytotheirstrengths.

Howtowin

WinningincumbentbrandsintheAsia-Pacificmarketshavecraftedarepeatablegrowthmodelbybuildingstrongbrandmemorability,establishingawell-definedbrandproposition,andoptimizingavailabilityacrosstheirmarkets.

Ourresearchrevealsthatincumbentwinnersadoptedstrategiesinspiredbytheirinsurgentcom-petitors.Thesestrategiesincludefocusingonlong-termtop-linegrowth,prioritizinga“hero”

SKUapproach,andemployingamarketingstrategythatfollowstheevolvingmarketlandscape.Simultaneously,theseincumbentsleveragetheirstrengths,includingfast-scalingcapabilitiesandanestablishedomnichannelpresence.Theyeffectivelycombineinsurgentbrands’learningswiththeirestablishedmarketadvantages,suchasglobalreachandM&Acapabilities.

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ResilienceAmidDisruption:HowSomeAsia-PacificIncumbentsAreOutmaneuveringInsurgents

PucukHarum,Indonesia’stopready-to-drink(RTD)teabrand,exemplifiesthis.Itleveragesthe

distributionnetworkofitsparentcompany,Mayora,toachievethehighestnumericaldistributionintheRTDteamarket.Thebrandconsistentlyinvestedabovetheaverageinadvertisingforyears,focusingonitsheroproduct—theregular350mlPucukHarumJasmine.Thisstrategicfocushashelpeditcaptureanapproximately30%shareoftheRTDteacategorywiththissingleSKU.

Inexpansion,certainincumbentvictorsenhancetheirglobalpresencebyadoptingglobalbest

practicesforinternationalmarkets.Forinstance,SamyangFoodsachieveda20%CAGRinoverseasrevenueoverthepastfiveyears.ThissuccessstemsfromreplicatingaglobalexpansionmodelinitiallydevelopedandproveneffectiveinChinaandthenappliedtootherinternationalmarkets.Addition-ally,thebrandhasleveragedsocialmediaastheprimarytouchpointtosustaina“viral”effectand

maintainactiveengagementwithconsumers.

Finally,theresourcesandcapabilitiesofincumbentstoengageinM&Aprovidethemwithagrowthadvantage.Forexample,AmorePacificrecentlyacquiredCOSRX,aninsurgentcosmeticbrand.ThisacquisitioncontributessignificantoperatingprofittoAmorePacific’sbottomline.FormoreM&A

studies,pleaseread“OverseasAmbition:Asia-PacificConsumerProductsCompaniesUseM&AtoAccelerateGrowth.”

Howtooperate

Insurgentsarecharacterizedbytheiragility,integratedorganization,andcreativehouseculture.

Ouranalysissuggeststhatsuccessfulincumbentcompaniesandbrandsincreasinglyembrace

thisfounder’smentality,whichcanbedefinedbythreedistincttraits:anextraordinarysenseof

insurgency,afrontlineobsession,andanowner’smindset.Meanwhile,manyincumbentwinners

transformedtheirorganizationsintomoreintegratedandcross-functionalentitiesthatreducecom-plexityandactdecisivelytoovercomeanddismantlebureaucracy,therebyallowingthemtocompetemoreeffectivelyinadynamicmarket.

Meanwhile,incumbentwinnersleveragetheirdiversifiedportfoliosandrobustriskmanagement

capabilitiestomaintainfinancialresilienceamidmarketfluctuations.Theyactivelymanagetheircoststructure,redirectingfinancialresourceswhennecessarytorevitalizegrowth.Forexample,SouthKoreanfoodandbeveragecompanyNongshimconductedascaledcosttransformationprogramin

recentyears,nearlydoublingitsEBIT.Thisstrategyprovidedthenecessaryresourcestoinvestin

high-priorityprojects.Moreover,theestablishedstability,reputablestanding,andwell-developedtalentsystemsofincumbentwinnersmakethemappealingtoprofessionals.Prospectiveemployeesseelargeincumbentsasabletoprovidesecureandprogressivecareerpaths.Thisgivestheman

edgeinthefiercecompetitionfortalent.

10

Howtolocalizeforforeignbrands

Ourresearchhighlightsthatlocalizationplaysacrucialroleinthesuccessofforeigncompaniesin

theAsia-Pacificregion.AprimeexampleofthiscanbeseeninChina.Successfulforeignincumbentsinthisintensemarketgainacompetitiveedgebyemployinga“4Dapproach”:

•DesignforChinabyrigorouslytailoringproductsforChineseconsume