Chinese,Brands,Seek,Respect,th marketing Chinese Brands Seek Respect in the International Market

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We partlyagree with this statement, as certainly having broadcasted national brands toan audience of million people is a great branding exercise, but we stillbelieve that the brands that are going to benefit the most are the one thathave invested beforehand into brand building in face of internationalcompetitors.In fact, there are still a few but very pressing problemsChinese brands have to deal with before being able to take full advantage ofthe positive influence the Olympics are bringing about.It is no news to say that the “Made in China” label is often associated with brands ofpoor quality and low value. Even though the Olympics showed a highly developed China, this moniker still weights on the locallyborn brands. Just think about the recent product recalls that have broughtconsumers to become even more skeptical about buying products manufactured in China. Not to mention the influence the currentmilk powder crisis will have on the “China Brand” both at home and abroad. Tsingtao,for instance, have had almost a fatal blown when the barley grown in China was found to be heavily polluted withpesticides making it unsuitable for use. Consumers only started to gain trustin the brand after Tsingtao began to importits barley. Secondly, Chinese brands seem to have been relegated toniche markets and have failed to expand. Looking again at Tsingtao we can seethat the brand has been in the USmarket for thirty years but has been unable to break out of a niche of only0.04% of the market.The problem here is that Chinese brands tend to lack of adefinite brand identity. Inan effort to expand to a larger consumer market Tsingtaowent through a major redesigning process in 2007 aimed at supporting moreeffectively the brand positioning. The new design revolved around the bottlelabel, thought to be more contemporary while still maintaining the signaturepagoda medallion and red and green color pallet thought to be representative ofthe "Asian cool," or the fusion between time-honored traditions andthe cool aspirational culture of the Western world.” Still, as the brandre-design have not been associated with a strong definition of what the brandstands for, Tsingtao still find itself stuckin a niche market.Stressing the Chinese heritage cannot by itselfdifferentiate the brand enough to make it successful in the long run.Furthermore, Tsingtao has very limitedvisibility outside of Chinese restaurants and grocery stores which make thesearch cost too high and reduces considerably the brand capacity of winning newbrand loyalist. So what can make Tsingtaounique? Tsingtao has something different than other Chinese beers:it was founded by a Germanycompany. Some suggest that the Chinese brewery could brand itself as a “ChineseGerman” beer thus borrowing from Germany’s strong reputation for beer.Though this may not be the be all and end all suggestion Tsingtaohas to figure out what will differentiate itself from its competitors otherthan their Chinese heritage which so far has not proven to gain them a highermarket share. If Tsingtao doesn’t make enough of an example,look at Haier. By being associated with low qualityrefrigerators Haier is having difficulties breaking out of the low cost compactrefrigerator segment targeted to college students. Haier has been selling lowprice and has not spent many efforts into building a strong internationalidentity. Without brand recognition Haier is unable to enter the high endsegment in Americabecause it is all about brands in the upscale market. After all, it is justnormal that those people buying a two-thousand dollar refrigerator would chooseGE over the brand that makes low cost refrigerators. In a market where productslook increasingly similar it is vital to have a strong brand to get yourproduct off the shelves and into your customer’s homes. Haiers association oflow quality products and their lack of strong marketing capabilities leave thema relegated market share. As Chinese brands move from being low cost OriginalEquipment Manufactures (OEMs) to creating their own strong global brands theyhave realized the importance of brand building. However, creating strong,valuable brands will take a long time. Overcoming the association of cheap andpoor quality can not be changed with the snap of fingers. Furthermore, as newcompanies or other countries start to capitalize on low production costs,Chinese brands realize that they can no longer use their low price advantage ifthey want long term success in the international market. After all there ismore to a brand than just a cheap price tag. “A product is something that is made in a factory; a brandis something that is bought by a customer” says Peter Schweitzer the presidentof J. Walter Thompson. China is used to manufacturing products for exports butas they start making more and more products for themselves they then can offermore than just a low price. A brand is not created by only using a low priceadvantage. The consumer who bases his purchasing decision only on the price isgenerally not loyal to the brand and most of the time does not even know thebrand name. The Road Ahead Chinese companies have become successful by entering lessdeveloped markets first which helps gain brand awareness before entering maturemarkets. This allows companies to understand the international market in a lesscompetitive environment and comprehend how their brand is perceived indifferent countries. Yin Tongyao, CEO of Chery, is very vigilant when goingoverseas. Tongyao’s philosophy is “We always start small. If this works, we’llincrease our investment. You always need a nurturing period if you want to takeroot in a local market, so I don’t expect exceptional sales in any country.” Buildinga brand is a very expensive and time consuming endeavor but it is vital forChinese companies to invest. The 2008 Beijing Olympics has been the opportunity forChinese company’s to showcase their brands. For Instance, Beijing Urban Construction Group hopes fortheir 19 Olympic related facilities to have gained worldwide publicity causingforeign companies to come to them for new contracts. Tsingtao has been the official domestic beer sponsor of the Olympics. Thisopportunity has gained Tsingtao tremendousawareness internationally but only time will tell if this will be enough forthem to gain a stronger market share internationally. As Tsingtao’s brandcampaign is heavily associated with Chinese culture they have planned thatwhile watching the Olympics a bottle of Tsingtaowas to be in hand. The Olympics have also marked their one hundred year oldanniversary – lucky coincidence to make them able to display to the world theirstrong Chinese heritage and associate the brand with the Olympics values.In the increasingly competitive global economy the role ofthe brand has never been greater. Chinese brands are learning how to positionthemselves internationally. By looking at Tsingtao, Chery, Haier, and theBeijing Urban Construction Group we see that these companies are successful byensuring that their products sent overseas are of highest quality, startingsmall when entering markets overseas, creating brand designs that translatewell over many different countries, and using their Chinese heritage in theirbrands image. It is no doubt that it will take Chinese companies time to gainbrand recognition but by continuously managing and creating brands that arestrongly differentiated, Chinese companies have a real good shot to becomemajor players in the international market.