By Daniel Hunter
When Scotland was days away from leaving the United Kingdom, plenty of questions were raised about the consequences for 'Brand Britain'. But new research suggests that 'Brand Britain' is hugely influential for businesses exporting their products.
According to research commissioned by Barclays Corporate Banking, products featuring British branding command a considerably higher premium when sold abroad than those with national branding.
It even suggests that people in emerging markets are 64% more likely to purchase a product carrying the Union Jack flag.
The research combined ONS export data with a survey of 7,610 individuals in eight key export markets (France, Ireland, Germany, the USA, Brazil, South Africa, China and Qatar) designed to examine the premium they are willing to pay for different goods labelled as Made in Britain/England/Scotland/Wales.
The findings show that English, Scottish and Welsh branding does not carry the same weight as British branded products. The only exception was Scottish alcohol, which is more influential than 'British' alcohol, particularly in the US and Ireland.
There is a stronger preference for British branded products in new and emerging markets than in developed markets. Across all product categories, the ‘willingness to pay’ gap between developed, and new and emerging markets is 4.5%.
Thirty-one percent of customers in new and emerging markets have knowingly paid a premium for products from Great Britain. The same figure for developed economies is just 14%.
The label 'Made in Britain' triggers a willingness to pay up to 7% more among customers in new and emerging markets than for products without a declared country of origin.
At least 50% of respondents in all countries perceived the quality of British goods to be “good” or “very good”. Scottish, English and Welsh products were also perceived positively, but often not to the same extent.
Rebecca McNeil, Head of Business Lending at Barclays Corporate Banking, said:
“While British businesses are currently reliant on the EU and the USA for the majority of their exports, they are well placed to expand into new and emerging markets. The report shows that the biggest premiums for British branded goods will be paid in these markets, not the developed markets. These new and emerging markets are also growing at a faster rate than the established trading partners, meaning growth opportunities and premium pricing are aligned.
“We understand that these new markets can be more challenging to enter but for those that persevere, there are opportunities for a greater return. Rather than focusing on seemingly saturated developed markets, exporters should seriously consider looking further afield as there are bigger premiums to be had when products are marketed as Made in Britain.”
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