SHANGHAI - With the global economy possibly back on track, worldwide market research firm Synovate's global Chief Executive Officer Robert Philpott has drawn up a map detailing levels of spending power across the world, along with an array of emerging markets that are challenging traditional ones.
"When headlines were dominated by how bad it was in certain markets in Europe, there were other markets out there doing very well," said Philpott.
Included in the latter were China, South Korea, Australia, Brazil, Colombia and Mexico, as well as several countries in East and West Africa.
"The economic downturn caused lots of consumers to re-evaluate what brands they would choose," he said.
"A classic example would be in North America, where everybody was driving big trucks made by Ford or General Motors (GM) up until the beginning of 2009. Last year, we saw big inroads made by small South Korean cars, especially in the oil-alternative fuel vehicle market place.
"The development altered consumers' behavior significantly. Not only did it bring a new range of South Korean manufacturers into the market, but also caused pain for Ford and GM."
Philpott said consumers are never going to stop buying, even during the toughest times. Consumer spending only fell 2 percentage points when news of the failure of Lehman Brothers broke and the credit market freeze started in 2008.
Consumers simply became more conscientious about what they were buying during and after the economic downturn. Philpott said the increasing market share of Brazilian and Mexican products squeezed out some local US brands.
"They recognized their opportunities and created the perfect storm for them to be competitive. I see brands from the emerging markets such as Brazil and Mexico becoming mainstream brands in America, and local brands becoming boutique products for selective buyers only," he said.
At the same time, the spending power of Americans shouldn't be overrated.
Lael Brainard, the US Treasury under secretary for international affairs, told the New York Times that US President Barack Obama believed the global recovery would be enhanced by greater balance.
"For too long, the American consumer was the engine of growth for the entire global economy," she said. "That pattern of growth, we have seen, was unsustainable."
The International Monetary Fund estimates that the US will have a current account deficit of 3.2 percent of gross domestic product this year, and China a current account surplus of 4.7 percent.
Synovate, the US-based research company, also sees China as the future influencer as its clients flock there.
"I think I'm the first CEO in the market research industry to see his base needing to shift to China," said Philpott. "We now expect our China business to help influence what we do around the rest of the world and that's really because the manufacturers here are now looking at exports in the same way they are looking at imports."
