Healthy competition: how and why Ukrainian business is able to outcompete international brands in Ukraine
Over the past few years, the more and more global international brands are entering Ukraine, and they are entering all areas. I told you quite often and about how much we were influenced by the release of Apple Pay and Google Pay, and described it from all possible sides. But, besides the fintech sphere we as consumers also received quite a lot. Uber, H&M, Miniso, Taxify, IKEA soon, and the discussed release of Glovo and Uber Eats — it’s not a complete list of what makes Ukraine (at least, the capital for sure) much more understandable for a foreigner.
It would be logical to think the emergence of a major international service with its automation, salary budget, advertising and general hype makes it the leader in any field in which domestic brands were present. As in, this is how things dome in our globalized world. But no, not all Ukrainian business agrees to step aside. Some of them are ready to roll up his sleeves, stick his teeth and fight for customers. And there are cases when the winner is precisely native, not a conditional “Varyag”. How so?
In their own land
It sounds like a slogan of the Ukrainian historical film, but the essence displays correctly. «Locals» are well aware of all the subtleties of doing business in Ukraine: arranging supplies, working with contractors, recruiting and especially controlling the performance of executors, and, of course, the specifics of legislation and government institutions. Better than invited leaders from abroad, or even hired Ukrainians who are obliged to follow a clear internal procedure and general standards of transnational corporate culture.
The most vivid example here is the Uklon vs Uber case. At the moment of Uber’s release there was, of course, a bombshell: tens of thousands of downloads, full media coverage, opinion leaders attention etc. But one set of drivers (which, by the way, often continued to work with Uklon) already caused difficulties. Even more problems arose when the famous Uber price algorithm began to play into the hands of drivers, and users raised a wave of negativity due to permanently high tariffs.
Deeper customer understanding
Aspect, smoothly flowing from previous theses. It’s not enough to know the peculiarities of regulation and behavior in the Ukrainian business. You need to understand how your customer thinks in micro-level.
Weaknesses were manifested in small, but sometimes crucial decision making points. For example, in crisis situations, Ukrainian user wants to solve the problem in ASAP mode and by phone. Uklon has strengthened its call center, while Uber is more focused on automatic forms. This also includes penalties for the cancellation of the trip. There is no fast and lively feedback — there is a high drop percent in applications and sometimes negative posts in social networks.
International brands sometimes underestimate the number of customers in Ukraine. A vivid example is the excess of all possible forecasts for the number of Apple Pay activations. Companies are guided by the data of international big data analysts, for whom Ukraine is only a «part of CIS region» with all typical conclusions. In fact, it turns out that our audience is large, involved, attentive to details and requires a serious approach. But at the same time, this approach should take into account the very peculiarities of the CIS countries that shape some consumer habits.
Less internal expenses
Ukrainian companies initially spend less on payroll. They hire and cultivate talented in-house specialists, and don’t usually contract agencies with inflated price tags for their services. They don’t spend on all advertising in a row, because they already know that, for example, banner blindness has long been developed on bigboards, but advertising on Facebook is much cheaper and allows you to see real conversions. Limited budgets make it necessary to use them as efficiently as possible.
Availability of the best marketing tools
The second decade of the XXI century is coming to an end, and over the past 5 years it’s much more easier to create a nice, modern and fashionable promo with no astronomical budgets. The overall quality of design solutions in Ukraine, the prices of digital advertising are optimized and the number of specialists on it is constantly growing. As a result — when you have a desire and budget, you can do something great. This includes competent digital-strategy, as well as non-standard image promo, in which Ukrainian business, knowing the sensitive points of its customers, shoots much better than beautiful, but sterile «varyag» promo.
A big international brand is undoubtedly a challenge from which customer is the winner. After all, Ukrainian brands began to work on themselves: upgrade applications, work on the quality of service, slightly dumping, in order to kill the tariffs/prices of “new” competitors. This is a war of attrition, in which Ukrainian delivery services, taxi and financial technologies show their ability to quickly restructure: first to survive, and then for the victory.