Choosing or Settling for Local?
The BDS Movement has seen consumer spending on local brands surge, but will they be able to sustain it for the long term?
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A Shining Moment for Pakistani Brands?
Sahar, a resident of Karachi, used to frequent McDonald’s with her family. However, in the wake of the Gaza conflict and the global call to boycott brands perceived to support Israel, she switched to local alternatives. Now, instead of McDonald’s, she takes her family to local eateries like California Pizza. “It’s the least we can do to support the Palestinian people,” she says. Her story reflects a broader shift in consumer behaviour across Pakistan.
The Boycott, Divestment, and Sanctions (BDS) movement, initiated in 2005, “works to end international support for Israel’s oppression of Palestinians and pressure Israel to comply with international law.” In doing so, it encourages consumers worldwide to avoid buying products from multinational companies believed to have ties to Israel. The movement has gained significant traction globally.
In Pakistan, the recent conflict in Gaza has intensified support for the BDS movement. This has led to a significant decline in sales for multinational giants like McDonald’s, Pepsi, Coke, KFC, and Nestlé since October 2023. Similar trends have been seen globally; KFC has closed 108 branches in Malaysia and McDonald’s has reported a seven-billion-dollar loss in Middle East revenues.
In Pakistan too, multinational brands have seen a significant downturn. Executives acknowledge lower revenues but often attribute this to broader economic challenges rather than solely to the boycott. Nevertheless, market observations and declining foot traffic in multinational brand outlets indicate a clear impact of the boycott movement.
According to Pulse Consultant, over 65% of surveyed Pakistanis agreed to boycott brands linked to the BDS movement, with 84% actively participating by April 2024, up from 68% in December 2023.
The data indicates a growing commitment to the boycott among Pakistani consumers, driven by solidarity with Palestine and resentment towards Western complicity in Israeli aggression.
Many Pakistani consumers share Sahar’s sentiments. Another consumer, Usman from Lahore, switched from buying international soft drinks to local brands like Gourmet Cola. “It’s a small sacrifice to support a just cause,” he says. These personal stories underscore a broader national trend of shifting consumer preferences.
As a result, there has been a surge in demand for local alternatives, particularly in categories like soft drinks, juices, dairy products, and packaged goods. Local brands such as Cola Next and Candyland are experiencing increased sales, and some previously struggling local brands are seeing a revival.
In fact, local brands such as Cola Next have seen a remarkable surge in demand. “Everybody is asking for Cola Next. They are not saying, give me any Pakistani drink; they are saying, we want Cola Next,” says Alamgir Janjua, GM Marketing, Mezan Group. This heightened demand has led to supply issues, prompting the company to guide customers to locations where their products are available.
Speaking about his company, Ehtisham Khan, COO, CandyLand Pakistan, says, “We serve two markets; confectionery and chocolates. Demand for chocolate has increased due to growing public support for local brands. However, the confectionery market has not experienced a similar rise in demand, as it is already dominated by local brands and international brands have struggled to gain a foothold.” The surge in support for local brands has not gone unnoticed by other Pakistani businesses.
There are, however, concerns about the sustainability of this trend. As the intensity of the interest in the conflict wanes, there is uncertainty about whether Pakistani consumers will revert to their previous purchasing patterns. Dr Adil Nakhoda, an economist and associate professor at the Institute of Business Administration (IBA), in an interview with Dawn, highlighted the fact that the boycott could potentially impede economic activity and diminish demand for goods. He pointed out that many local products lack quality due to inadequate certification and standards. Moreover, multinational chains also source products locally, thereby impacting domestic industries. Nakhoda warned that without a comprehensive understanding of the supply chain and better quality control for local products, the long-term impact of boycotts might be limited.
Indeed, both multinational and local brands are facing significant supply chain challenges. For multinational companies, disruptions in the global supply chain have been exacerbated by the boycott. Local brands, on the other hand, struggle with scaling up production to meet the new demand, often facing shortages of raw materials and logistical hurdles.
Experts suggest that to sustain this momentum, Pakistan needs to ensure that local players are globally competitive. This involves implementing quality checks, certification standards, and inspection requirements rather than relying on high tariffs and import restraints. In this respect, Cola Next is strengthening its supply chain and distribution networks. “We are expanding our lines and have become very active in terms of our media spend,” says Janjua.
Addressing the question of sustainability, Khan is of the opinion that “although BDS might be a temporary factor, it is time for Pakistani consumers to favour local products over international brands.”
“In markets like Turkey, local brands are prevalent across all categories, including food, personal care, and electronics. Although the initial quality may be slightly lower, consistent demand and a supportive consumer base will help local products achieve the same standards as imported brands,” he continues.
As Pakistan grapples with emerging market trends, there is a cautious recognition of the need for nuanced policy responses to balance economic interests with geopolitical realities. To rejoice at empty restaurants or products taken off the shelves would at best be a short-term win at the expense of future economic growth. Nevertheless, for Pakistani brands, this is their moment to shine. Jokes and memes already abound because of the increased demand and limited supply of local products. “I’m trying to find myself and a new favourite burger. Both are hard to do,” quipped one Instagram user.
As local brands capitalise on this momentum, the broader potential for Pakistani businesses to thrive amidst global boycotts has come to the fore. The question is to ensure the sustainability of this surge by addressing supply chain challenges and maintaining high-quality standards to compete with multinational brands effectively. In the meantime, as Pakistani consumers continue to express solidarity with Palestine through their purchasing decisions, it is crucial they continue to support local industries for the longer term to ensure their competitiveness.
Mindful consumer choices can contribute to economic self-reliance and a more robust local market, ultimately benefiting the national economy.
Umair Mohsin is a former traditional and digital advertising professional now working as a banker.
umair.mohsin@gmail.com
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The data indicates a growing commitment to the boycott among Pakistani consumers, driven by solidarity with Palestine and resentment towards Western complicity in Israeli aggression.
Many Pakistani consumers share Sahar’s sentiments. Another consumer, Usman from Lahore, switched from buying international soft drinks to local brands like Gourmet Cola. “It’s a small sacrifice to support a just cause,” he says. These personal stories underscore a broader national trend of shifting consumer preferences.
As a result, there has been a surge in demand for local alternatives, particularly in categories like soft drinks, juices, dairy products, and packaged goods. Local brands such as Cola Next and Candyland are experiencing increased sales, and some previously struggling local brands are seeing a revival.
In fact, local brands such as Cola Next have seen a remarkable surge in demand. “Everybody is asking for Cola Next. They are not saying, give me any Pakistani drink; they are saying, we want Cola Next,” says Alamgir Janjua, GM Marketing, Mezan Group. This heightened demand has led to supply issues, prompting the company to guide customers to locations where their products are available.
Speaking about his company, Ehtisham Khan, COO, CandyLand Pakistan, says, “We serve two markets; confectionery and chocolates. Demand for chocolate has increased due to growing public support for local brands. However, the confectionery market has not experienced a similar rise in demand, as it is already dominated by local brands and international brands have struggled to gain a foothold.” The surge in support for local brands has not gone unnoticed by other Pakistani businesses.
There are, however, concerns about the sustainability of this trend. As the intensity of the interest in the conflict wanes, there is uncertainty about whether Pakistani consumers will revert to their previous purchasing patterns. Dr Adil Nakhoda, an economist and associate professor at the Institute of Business Administration (IBA), in an interview with Dawn, highlighted the fact that the boycott could potentially impede economic activity and diminish demand for goods. He pointed out that many local products lack quality due to inadequate certification and standards. Moreover, multinational chains also source products locally, thereby impacting domestic industries. Nakhoda warned that without a comprehensive understanding of the supply chain and better quality control for local products, the long-term impact of boycotts might be limited.
Indeed, both multinational and local brands are facing significant supply chain challenges. For multinational companies, disruptions in the global supply chain have been exacerbated by the boycott. Local brands, on the other hand, struggle with scaling up production to meet the new demand, often facing shortages of raw materials and logistical hurdles.
Experts suggest that to sustain this momentum, Pakistan needs to ensure that local players are globally competitive. This involves implementing quality checks, certification standards, and inspection requirements rather than relying on high tariffs and import restraints. In this respect, Cola Next is strengthening its supply chain and distribution networks. “We are expanding our lines and have become very active in terms of our media spend,” says Janjua.
Addressing the question of sustainability, Khan is of the opinion that “although BDS might be a temporary factor, it is time for Pakistani consumers to favour local products over international brands.”
“In markets like Turkey, local brands are prevalent across all categories, including food, personal care, and electronics. Although the initial quality may be slightly lower, consistent demand and a supportive consumer base will help local products achieve the same standards as imported brands,” he continues.
As Pakistan grapples with emerging market trends, there is a cautious recognition of the need for nuanced policy responses to balance economic interests with geopolitical realities. To rejoice at empty restaurants or products taken off the shelves would at best be a short-term win at the expense of future economic growth. Nevertheless, for Pakistani brands, this is their moment to shine. Jokes and memes already abound because of the increased demand and limited supply of local products. “I’m trying to find myself and a new favourite burger. Both are hard to do,” quipped one Instagram user.
As local brands capitalise on this momentum, the broader potential for Pakistani businesses to thrive amidst global boycotts has come to the fore. The question is to ensure the sustainability of this surge by addressing supply chain challenges and maintaining high-quality standards to compete with multinational brands effectively. In the meantime, as Pakistani consumers continue to express solidarity with Palestine through their purchasing decisions, it is crucial they continue to support local industries for the longer term to ensure their competitiveness.
Mindful consumer choices can contribute to economic self-reliance and a more robust local market, ultimately benefiting the national economy.
Umair Mohsin is a former traditional and digital advertising professional now working as a banker.
umair.mohsin@gmail.com
Read Comments
Related Stories
“In markets like Turkey, local brands are prevalent across all categories, including food, personal care, and electronics. Although the initial quality may be slightly lower, consistent demand and a supportive consumer base will help local products achieve the same standards as imported brands,” he continues.
As Pakistan grapples with emerging market trends, there is a cautious recognition of the need for nuanced policy responses to balance economic interests with geopolitical realities. To rejoice at empty restaurants or products taken off the shelves would at best be a short-term win at the expense of future economic growth. Nevertheless, for Pakistani brands, this is their moment to shine. Jokes and memes already abound because of the increased demand and limited supply of local products. “I’m trying to find myself and a new favourite burger. Both are hard to do,” quipped one Instagram user.
As local brands capitalise on this momentum, the broader potential for Pakistani businesses to thrive amidst global boycotts has come to the fore. The question is to ensure the sustainability of this surge by addressing supply chain challenges and maintaining high-quality standards to compete with multinational brands effectively. In the meantime, as Pakistani consumers continue to express solidarity with Palestine through their purchasing decisions, it is crucial they continue to support local industries for the longer term to ensure their competitiveness.
Mindful consumer choices can contribute to economic self-reliance and a more robust local market, ultimately benefiting the national economy.
Umair Mohsin is a former traditional and digital advertising professional now working as a banker.
umair.mohsin@gmail.com