U.S. products rank high among Latin Americans
Latin American consumers seem highly pre-sold on key categories of American products. Consumers of the region’s major markets gave U.S. products consistently high marks for quality and price in a segmentation study, the MDI COMPASS, conducted by Market Development, Inc., a San Diego research firm.
A total of 2,000 adults in Argentina, Brazil, Chile and Mexico were asked their perception of the quality and price of automobiles, breakfast cereal, beer, casual clothing, toys, large appliances, wine and electronic equipment (TVs, VCRs) from the United States, Japan, the European Economic Union (EU) and their own countries.
COMPASS results clearly reveal Latin American consumers’ high levels of receptivity to American products. Introduction of new U.S. brands to the region’s marketplace can benefit from the positive equity American brands already enjoy. In ranking best overall quality/lowest price, American products were perceived to be the best or next best in seven of the eight categories. American toys, casual clothing and major appliances were rated the best among Latin consumers. COMPASS respondents considered American major appliances (refrigerators, washing machines, etc.) as offering the best price/value in their markets. In fact, those polled thought U.S. appliances were less costly than those made domestically. Japanese-made appliances, though regarded as above average in quality, were perceived as somewhat expensive. EU-made appliances got the most unfavorable quality/price rating, ranking significantly lower in quality than even domestic appliances.
Casual clothing, which includes jeans and athletic footwear, was another category in which American goods were highly esteemed. The perception of the quality of domestic casual clothing was also high. The EU and Japan were a distant third and fourth, respectively, with the casual clothing products of both offering less favorable price/value than their U.S. and domestic counterparts.
Overall, the quality of Japanese-made cars was only slightly more highly regarded than U.S. makes. Respondents did note the comparatively lower cost of American cars. Autos manufactured in the EU are perceived as expensive and of lower quality.
As might be expected, Japan’s TVs and VCRs are perceived as the better price/value option. U.S. brand units were regarded as being of higher quality and lower price generally than Japanese made products. Domestic units were deemed to be moderately priced, but ranked third in quality. Products carrying U.S. brand names were generally perceived to be expensive and of inferior quality.
While U.S.-made ready-to-eat cereals garnered top-quality laurels among those polled, they were perceived as more expensive than domestic-made cereals, which were rated well above average in quality. Perceptions of the category were highly consistent across the region, regardless of age, gender or socioeconomic status of the respondents.
Not only are U.S. ready-to-eat cereals the highest rated, but domestic ready-to-eat cereals, the only real threat, lag well behind. Chile provides the sharpest distinction, where the mean quality rating for U.S. cereals is almost 40 percent higher than ratings for the domestic alternative.
To a large degree, this is due to the perception of the category itself. Traditionally, cold ready-to-eat breakfast cereal has been perceived as an American breakfast. It follows logically, that if one is to consume an "American breakfast," then U.S. brands offer the more "genuine" product, despite the fact that many ready-to-eat cereals have been reformulated to accommodate local tastes.
Mexican usage of ready-to-eat breakfast cereals - which have been traditionally positioned as a day-long snack for the entire family - is more than 20 percentage points higher than in the other countries. Chilean breakfast taste preferences tend to follow a more European tradition. Rather than having cold, pre-packaged ready-to-eat cereals their breakfast usually consists of rolls, croissants and coffee. Chile distinguishes itself by consuming less, not more of some of the products, namely, pre-packaged cheese and ready-to-eat breakfast cereals.
As world-class wine-producers, Argentines and Chileans perceive their wines as the highest in quality, while Mexicans and Brazilians put European wines at the top of their list. Only in Mexico’s perception do U.S. wines approximate the perceived quality of the others.
While European wines were judged to be of the highest quality, they were seen as somewhat expensive. Domestic wines were thought to be the least costly and of good quality. American wines ranked third in quality and price. As is the case with beer, the Japanese product is poorly marketed, poorly known and not perceived as being either of high quality or affordable.
The overall poor image attributed to U.S. wines in Latin America obeys the same dynamic as Japanese beer. Since domestic and European wines have a long-established distribution, and more recently a marketing presence in Latin America, they at least have evolved top of mind awareness, while U.S. wines have not.
Latin American consumers strongly favored their domestic beers for quality and overall price/value. In the two largest markets, Brazil and Mexico, respondents allocated the second place in beerbrewing quality - after their domestic product - to the United States.
There is across-the-board consistency in allocating the second place for quality to the U.S. product. Not only is U.S. beer perceived as being second in quality only to the domestic brands, but it consistently edges out European beers, usually seen as more expensive.
Because national beer brands haven’t been marketed extensively outside of their own domestic markets, an enormous opportunity exists for a globalized beer brand that would meet the product standard commonly demanded across the region.
Almost half of all Latin American consumers consider the "Made in the U.S." label a symbol of higher quality. When asked about their perception of quality of U.S.-made goods vis-a-vis domestic products, COMPASS respondents revealed a strong disposition favorable to American products.
While American products seem to enjoy geater equity among Chileans and Brazilians, their share of mind is divided with products from other countries in Argentina and Mexico. Data also revealed slightly higher opinion in favor of the U.S.-label among Latin males over females (54 percent vs. 45 percent) and younger and older over middle aged (30-44) consumers.
A more favorable opinion towards U.S.-made goods was found among more upscale males. Emerging middle-class Latin females reported slightly lower levels of preference for American products.
Television progamming produced in the U.S. enjoys an enviable position in Latin America. Latin American consumers across the board, give American programs high ratings in quality. Mexicans consider U.S. programming superior to their own, while elsewhere, domestic programs surpass American programming by only a small margin. Europe and Japan figure very slightly in the area of television programming, being consistently ranked below domestic and U.S.-produced television.
One-third of households using cellular phones
Almost one-third (32.3 percent) of American households now have cellular telephones in their home or car, according to a recent nationwide survey by Decision Analyst, Inc., Arlington, Texas.
The survey of 9,400 households found that personal cellular phones are used most widely by those 45 to 54 years old (39.2 percent of respondents). Cellular phones are used least often by those 55 and older (22.2 percent of respondents).
Cellular phones are most widely used by those earning $40,000 or more (45.9 percent of respondents). Likewise, cellular phones are used most commonly by those with postgraduate degrees (41.5 percent of respondents).
Some interesting geographical differences exist. Personal cellular telephones are found most widely in the South (35.3 percent of residents) and least often in the Northeast (29.3 percent of residents).
"The high penetration of higher income households by cellular phones suggests that the cellular market will continue to grow rapidly. With a third of all individuals using cellular phones, the potential exists to reduce crime (because of widespread and quicker calls to police). Similarly, overall economic efficiency is theoretically improved because business can be conducted anywhere at anytime with no delays," says Jerry W. Thomas, president/CEO of Decision Analyst, Inc.
“The higher useage levels of cellular phones in the South is probably the result of aggressive marketing by mobile phone companies in that region,” Says Thomas.
The national survey of cellular telephone usage has a margin of error of +/-1 percent.
Many Americans concerned about FDA drug approval delay
The lengthy Food and Drag Administration approval process fornew medications, which has long frustrated doctors, patients and pharmaceutical companies, is now a significant concern of the general public, according to findings from IssueTrack/USA, an ongoing study by Audits & Surveys Worldwide, New York.
After interviewing a national sample of randomly selected adults, 18 years of age or older, ASW noted that a clear majority of Americans are now aware of the health risks associated with keeping potentially useful drugs offthe market while the regulatory agency reviews their safety and effectiveness.
"Extended FDA drag approval procedures often prevent U.S. citizens from reaping the benefits of medical research long after these advances are used in other parts of the world," says Barry M. Feinberg, senior vice president and director of ASW’s Public Affairs Division. "While this has long disturbed many doctors and patients, it was difficult to bring this issue into focus for the vast majority of people who were not (or did not know they were) affected by bureaucratic delay. The AIDS epidemic changed all that. Although AIDS is now found throughout every sector of the population, it poses a far greater threat to the gay community, which has mobilized and used its political and financial resources to bring about a greater awareness of this problem, which affects virtually every U. S. citizen."
More than haft (56 percent) of U.S. adults are aware of the health and safety risks associated with the time it takes the Food and Drag Administration to approve new drugs and one-third of all Americans are personally concerned and urgently want action (34 percent) taken to speed up the process.
Surfing the Net not yet a global activity
Is the Intemet truly the international phenomenon it was intended to be? A new 18-country study of adult consumers’ awareness and use of personal computers and the Internet reveals that few consumers around the globe have ventured into cyberspace.
The study was conducted by Response Analysis Corporation and its partners in the International Research InstituteS (IriS), a network of independent marketing research companies in North America, Europe, Australia and Asia.
"Businesses hoping to market their goods and services internationally through the World Wide Web must understand that, despite the potential, Internet use is only in the early stages of adoption," says Jim Fouss, CEO of Response Analysis, Princeton, N.J. "But the potential for future adoption of this new medium as an effective marketing tool for businesses holds great promise," adds Fouss, who is 1996-97 president of the IriS network.
Among the highlights of the study:
The workplace represents the greatest opportunities for growth of Internet and World Wide Web usage. Sweden and Finland lead in workplace access, with more than one-tenth of adults using the Internet for business communications and information, followed by the United States (9 percent) and Australia (8 percent). But in France, Greece, Italy, Cyprus, Portugal and Spain, 2 percent or fewer adults use the Internet at work.
Currently, only very small proportions of consumers are using the Internet at home. Household Internet access is highest in the United States and Canada (8 percent each) and lowest in Spain and Portugal (less than 1 percent). Worldwide, hands-on experience with the Internet at home is the privilege of only a small percentage of adults - mainly upper-income males under age 55.
In all countries but Sweden, fewer than half of households that have the current potential to use the Internet actually do. However, the prevalence of personal computers with modems - indicating the potential use and growth of the Internet at home - is highest in the United States and Canada, where about one-fifth of households are capable of Internet access. In Australia, Mexico, Finland, the Netherlands, Sweden and Switzerland, about one-tenth of households have Internet capability, while other countries trail far behind.
While most consumers lack the equipment to use the Internet, they do know it exists. At least three-quarters of adults in Sweden, the U.S., Canada, the Netherlands, Australia, Finland and Great Britain, are familiar with the Internet and World Wide Web. Even in Cyprus, ranked lowest in awareness, four in 10 adults have heard of the Net.
est opportunities for growth of Internet and World Wide Web usage. In Sweden (12 percent) and Finland (11 percent) more than one in 10 consumers are using the Internet in their offices for communications and information purposes. Workplace access to the Internet is next highest in the United States (9 percent) and Australia (8 percent). It is lowest in France and Cyprus (1 percent each).
While household usage of the Internet translates into millions of users - about 25 million adults in the 18 countries surveyed - only very small proportions of consumers are using the Internet at home. Household Internet access is highest in the United States and Canada (8 percent each). It is lowest in Portugal and Spain (less than 1 percent).
Familiarity with the Internet and the World Wide Web - which indicates the potential for future use -
varies greatly. Awareness is highest in Sweden (91 percent) and lowest in Cyprus (39 percent). In every country surveyed, men were more familiar with the Internet than women, adults under age 55 were more aware than their older counterparts, and higher-income consumers were more likely than low-income consumers to have heard of the Internet.
The prevalence of personal computers with modems predicts the potential use and growth of the Internet for home use. About one-fifth of households in the United States (19 percent) and Canada (18 percent) have a personal computer with modem, followed by Australia (12 percent), Finland (10 percent), and Sweden, Mexico and the Netherlands (each 9 percent). Other countries in Northern and Southern Europe lag far behind in terms of current capability for Internet usage.
Except for Sweden, fewer than half of households that have the potential to use the Internet are actually using it. The lowest ratio is in Mexico, where only one-fifth of households capable of accessing the Internet are doing so. IriS members conducted interviews with 15,835 adults age 18 or older in late 1995 and early 1996. The survey results represent more than 500 million consumers in the U.S., Canada, Australia, Mexico, Sweden, the Netherlands, Finland, Great Britain, Switzerland, France, Belgium, Germany, Turkey, Greece, Portugal, Italy, Spain and Cyprus.
Are you ready for the Internet PC?
As reported in Intelligram, a publication of IntelliQuest, Austin, Texas, the technology industry is abuzz with the upcoming Internet PC, Network PC, information appliance, or whatever you want to call it. Widely covered in the trade press, stories about the Internet PC are hitting the mainstream media as well.
Depending on who you ask, this device will or won’t connect to your TV, but it will be priced so low and make it so easy to get on the Internet, that everyone will have one (or more) in their home and office. Gone will be the days of power hungry operating systems and applications; you will just download a series of the most up-to-date applets for the specific task at hand, on a pay-as-you-go basis. New multitudes will join the ranks of the wired.
Or will they? According to the baseline wave of IntelliQuest’s Worldwide Internet On-line Tracking Service (WWITS), 10 percent of the U.S. population over the age of 16 have heard of a dedicated device for the sole purpose of accessing the Internet. But the people who know about this device are already Internet and on-line service users. Twenty-nine percent of current users report that they have heard of such devices, compared to 6 percent of non-users.
Of those that have heard of this device 29 percent, or about 4.9 million people, would consider purchasing it. They envision this product as a home access device and usually as an addition to their current computer. Almost all (96 percent) of those that would consider purchasing this product would use it at home, compared to 26 percent who see using it at work. Seventy percent would be purchasing this device as an additional system, as opposed to a replacement for a computer or as the first system acquired.
This data from WWITS illustrates two points for technology marketers to consider. First, industry interest in a product or service does not always translate into widespread public awareness. Most technology product launches don’t make the morning news. Second, the public’s image of a product or service can vary widely from the view a company is trying to portray. Fully understanding the awareness and the perceptions of a new product before it is launched can make the move to market that much easier. For more information visit the company’s Web site at http://intelliquest.com.