3 Things Chinese Companies Need to Do to Build Successful Global Brands

by | Jun 8, 2015 | Uncategorized

The emergence of China as an economic powerhouse is one of the most significant global events of the past few decades. Although a near majority of Americans think that China is the world’s leading economic power, a recent survey by Millward Brown showed that only about 6 percent of Americans can name a single Chinese brand. And those who can tend to have negative associations for Chinese brands, including “inferior quality,” “unsafe” and “imitation.”

Chinese companies have been focused on their large domestic market to date. But many of China’s biggest companies increasingly are eyeing the global market and the vast growth opportunities associated with global brands. Successfully marketing global brands, however, is different than successfully marketing brands within China.

While some branding experts like David Aaker believe it will take decades for Chinese companies to develop brands strong enough to compete successfully on the global stage, I’m confident the Chinese could accomplish it much more quickly if they just did the following three things:

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1. Change Executives’ Mindset

The first thing Chinese companies need to do to build successful global brands is change their executives’ mindset. Nearly all dominant Chinese companies achieved success in China by managing functional factors (product features, price, etc.), usually within a trading mindset. Building successful global brands requires switching to a brand mindset – where deliberate, methodical construction of a positive brand image is critical, where product features are merely “table stakes” and where price is less of a marketing tool, if at all. This can be accomplished relatively quickly by hiring executives with global brand-building expertise and then listening to and learning from them.

2. Practice Brand Management

Global brand owners have developed tried-and-true brand management tools and techniques that Chinese companies need to integrate into their organizations as a way of doing business. This is a bigger challenge than the first because it affects how the organization operates and is structured. And for a domestically successful company, it requires a visionary management team to change up the organization enough to move toward the practice of brand management. However, with executive permission and protection, brand management can be implemented by hiring the expertise from around the world and allowing the organizational changes to take hold.

3. Embrace Western Brand-Naming

Perhaps the hardest and most controversial thing Chinese companies need to do to develop successful global brands quickly is to develop brand names that look and sound more global or “Western.” For example, even though Hisense is the number one TV brand in China, the name – despite technically being “Western” – comes across as an Asian, if not as a Chinese brand to a Western customer. It is too literal and functional to be a successful global brand name, at least in any accelerated time frame.

Similarly, Ascend Mate 2 by Huawei, a Chinese product brand by a Chinese corporate brand with global aspirations, are similarly suboptimal brand names for the global marketplace. Can they become global brands like Galaxy by Samsung? Of course, but is that worth the time and money required to make them so?

Chinese companies can quickly and successfully compete in the global brand marketplace if they follow these three steps. Simple? In theory only. Strong execution, as always, is essential.

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Frank Schab
An experienced marketing and branding strategist, Frank has been helping clients optimize the value of their brands through insightful analysis and effective strategy for more than three decades. Along with holding positions at General Motors and Pfizer, Frank served as a Managing Partner at Interbrand New York and VP of Global Brand Research at Opinion Research Corporation before co-founding Six Degrees. His brand-building work in various sectors including hospitality, medical device, pharmaceutical, automotive and technology has taken him to 17 countries on four continents. Frank holds a doctorate in psychology from Yale University and speaks fluent German.

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