Why You (And Your Brand) Should Care About Brazil’s Crisis

It is public knowledge that Brazil is experiencing one of its deepest crisis with politics and economics since the return of democracy, some 30 years ago. And all of this in a year when the country welcomes the next Olympic Games, as discussed by colleague and DJE Global Fellow Drew Cary, who is currently living and working in Brazil.

Although I am currently living and working in the U.S., the events in Brazil have an impact on my perspective of the different markets, especially during an election year in the United States as the debate around campaign funding remains a trending topic.

Brazil and the U. S. are both democratic nations, however, the two countries face different realities with regards to trust: Brazil ranks at No. 76 with regards to perception around corruption, while the U.S. holds the #16 position, which is still not great but a bit better. The lack of trust in the Brazilian government is increasingly a problem that politicians need to resolve. According to 2016 Edelman Trust Barometer, Brazilian’s trust business more than the government (64 percent vs. 21 percent). Although the U.S. experiences a similar lack of trust in government, the level of distrust between the two is much smaller (51 percent vs. 39 percent).

With this context, the role that companies play in society is very centralized. Below is a snapshot of what is occurring in Brazil and why you should care about it:

  • Brazil is the eighth most important economy in the world and, as such, most of the largest global corporations have operations in the country and are paying attention to the country’s future. Brands are focused on remaining relevant to consumers as people are being more mindful about their expenses, in a general, and the over-consumerism is part of the past.
  • The country is hosting the Rio 2016 Olympic Games and is the focus of the world’s attention. People across the globe have concerns about the success of the games and whether the infrastructure that is supposed to host the event will be ready on time. They also wonder if this negative moment with the economy will cause violence on the streets. The political tension brings many questions to a situation that should be about achievement and celebration. Marketers from all over the world are now finalizing their communications and activation strategies to join the conversation around the Olympic Games. As the crisis put a red light on marketing budgets, many official sponsors have even considered not investing via sponsorships. The solution for both brands and the Committee revealed companies would offer products and services to the Olympics Committee in exchange for a sponsorship share. 
  • Brazilian politics is experiencing a period transformation. The Lower Chamber of the Brazilian Congress recently approved an impeachment trial against President Dilma Rousseff. Messaging in the media has fuelled speculation around the voting results amongst politicians, analysts and the population at large. Citizens have also expressed their opinions on social media, which provides a perspective that can help inform communication strategies. This is a decisive moment for Brazil that will have an impact on its future so companies should be aware and paying attention to anticipate what is to come.
  • There is also the ongoing fight against the Zika Virus, which has created incertitude for tourists planning to attend the Olympics. Brands have an opportunity to connect with consumers by providing education on the situation, clarity and solutions to overcome the challenge. For example, new killer mosquito billboards equipped with a device that emits a lactic acid and carbon dioxide solution, mimicking the smell of human sweat, have been instituted in two locations in Rio to attract and kill Zika-carrying mosquito This will be increasingly important as the World Health Organization reports the number of detected cases of the virus is on the rise in new countries.

 The debate in Brazil is nowhere near final and the world is paying close attention, with media coverage around the globe focusing on the issue. Even without knowing when the crisis is going to end, Brazil is an enormous consumer market and brands should pay attention to consumer behaviors in order to remain relevant in their lives.

Jaqueline Januzzi is a senior account supervisor originally from Edelman Significa and currently based in Chicago as a Daniel J. Edelman Global Fellow.