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This week I went to a business lunch and at one point the topic turned to the troubled Australian manufacturing sector. The woman I was sitting next to, a partner in a law firm, commented on how New Zealand seems to have such a strong manufacturing base compared to Australia and is behind many well-known brands.
(She mentioned Mountain Buggy, the children’s pram. Which just goes to show how the residual brand value outlasts reality, given that those prams have long been manufactured in China and owned by former competitor phil&teds.)
I was already part way through writing this piece and, having spent last week in New Zealand meeting with business owners including those from the manufacturing sector, I asked the lunch group whether they had heard of Sistema.
Many around the table thought Sistema was an Australian company manufacturing in Australia. Impressive nods all round when I told them the $100 million business was in fact producing everything in Auckland.
Sistema Plastics is a genuinely compelling case study on how to build a successful brand.
Unless you’re from the Tupperware fan club, who knew that plastic food storage containers could be so darned functional and funky?
I’ll tell you who knew. The people at Sistema.
Reading and listening to interviews with the co-founders Brendan Lindsay and Allin Russell, you very quickly piece together that the success of this plastics brand is no happy accident.
The fact that Sistema is producing 100 per cent locally in New Zealand while building a global brand, exporting to 59 countries and experiencing year on year growth of between 80 to 120% is truly remarkable. In 2012, they had an estimated 44% market share in Australia.
Australians are not easily impressed and are spoiled for choice in every product category. But those who know Sistema are impressed.
One of my Australian clients, also a local plastic packaging manufacturer, directed me to a video Sistema has on their website showcasing the technology in their Auckland factory. This was in the course of a discussion on noteworthy brands.
In the manufacturing industry, a business meeting on the topic of brand can be highly entertaining. Too often there is truly little differentiation and very little evidence of product development led by market strategy or any marketing strategy.
Russell hits the nail on the head when he says competitors are often industrial in their thinking. He believes Sistema is a marketing, not a product company and over the years they have invested heavily in their business, including detailed market research, different operational models in each country, new technology, production capability and staff.
They design in ranges rather than single products – making it very easy for shoppers to buy multiple products from the same brand. This makes supermarkets like Coles and Woolworths very happy because, you guessed it, shoppers buy multiple products from the same brand.
Lindsay has committed to manufacturing Sistema in New Zealand and local production has given them total control over the process start to finish.
The ‘Made in New Zealand’ stamp has resonated strongly in international markets and has also been a point of difference from the plastics that everyone assumes are made in China. But the big factor in Sistema’s success is the way the company seeks to understand trends and buyer behaviour in their category in every market that they’re in, with ranges on shelves that are considered responses to what a shopper needs.
Bella Katz is a brand and marketing consultant who has worked with a number of Australian and New Zealand manufacturers. She is also a freelance writer and speaker on the topic of brand. Bella does not work with Sistema Plastics and writes opinion pieces on brands good and bad.