NEWS3 October 2014

‘Brand Britain’ commands a premium

News UK

UK — Overseas consumers will pay a premium for British-branded goods above English, Scottish or Welsh, according to new research.

When consumers in eight key export markets (France, Ireland, Germany, the US, Brazil, South Africa, China and Qatar) see the Union Flag on a product, their inclination to buy increases, according to the research commissioned by Barclays Corporate Banking. This is particularly true in emerging markets, where 64% of consumers said they would be more inclined to purchase a product carrying the British flag.

When goods are labelled as made in England, Scotland or Wales, they command “considerably lower premiums”, except for in the unique case of alcoholic beverages branded as ‘Made in Scotland’ in particular countries, including the US and Ireland.

Other findings included:

  • Across all product categories, the ‘willingness to pay’ (for British-branded products) gap between developed, and new and emerging markets is 4.5 percentage points
  • 31% 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

“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,” said Rebecca McNeil, head of business lending at Barclays Corporate Banking.

“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.”