Seizing the tiger by the tail

While many Chinese brands are looking at how they can use the Olympics to reach local audiences, the Games also provide a great launch pad for Chinese brands that want to go global.

 

But are Chinese companies really ready to seize the tiger by the tail - to take advantage of this once-in-a-lifetime moment when the world's eyes are focused on what they can offer.

 

Interbrand, DDB's sister agency, has listed the world's top rising China brands in their latest Emerging China Brands Report. There are a number of stars including Lenovo, Huawei, Haier, Chery and Tsingtao. Lenovo and Tsingtao in particular, who are both Olympic sponsors, have embraced marketing, investing time, money and intellectual energy to create brands that resonate with consumers around the world, commanding greater margins and prestige.

 

However, while many Chinese brands are achieving increasing recognition in a global marketplace, they do not have the same awareness or profile globally as their Western counterparts. Recently, Forbes published a list of global 2000 publicly held companies. The list contained 70 Chinese companies and 65 of them, many of them "distribution" brands, had no profile outside of China.

 

The fact is that for many Chinese companies there is no strategic imperative to build a global brand for their company. With a huge domestic consumer base on their doorstep, why spend money on branding and marketing to an international audience when the immediate opportunities are so overwhelming?

 

Others accept the need for brand building, but do not have the experience, the institutional knowledge nor the understanding of and commitment to the creative branding process and vision.

 

Part of the issue has been the approach of Chinese companies. A generation ago many Japanese brands were in the same position. They built global markets by concentrating on product innovation and technological products with ever-increasing reliability and quality. By contrast, many Chinese brands have taken evolutionary steps rather than radical actions. Often Chinese brands seem to focus more on process, than on attitude and ideas.

 

In China, branding is too often seen as a look and feel, rather than a concept that, in the case of McDonald's, for example, has an intangible value beyond the company's capital assets.

 

And unlike the Korean brands, which realised their brands were assets to be invested in with aspirational imagery that would attract a global audience, many Chinese brands still think branding is a giant billboard during the Olympics.

 

It is time for Chinese companies to really think about what image they want to portray in the global marketplace. They then need to take the bold step and invest more in conceptual thinking and generating ideas that really resonate with consumers around the world.

 

Over the next 10 years, China will transform from being an investment-led economy to a consumption-led economy. It's the change from "Made in China" to "Sold in China"; from "distribution-led" branding to creative-led branding.

 

With rising labor costs and South East Asia and Africa usurping China's position as the factory of the world, China must shift its focus to value-add industries. Branding and marketing become critical ways of realising this added value.

 

In countries such as Denmark, Sweden and Finland, a well-resourced state invests massively in its citizens to make sure they have the skills and focus they need to do high value-added things.

 

In China, companies need to take up this challenge. China has an opportunity to create a new creative paradigm - one that takes the best mass communication practices that have been carefully honed since the days of Mao Zedong and combines them with fresh ideas, fresh thinking and fresh concepts. There should be debate and discussion about what constitutes a good Chinese brand - perhaps even a "Branding Olympics" where creativity takes centre stage.

 

At DDB, we are seeing tremendous development of our young local creative talent, which bodes well for the future. Recently, our creative team was chosen to represent China at the Young Creative Cannes Competition - the advertising equivalent of the Olympics.

 

In addition to being a great honor, it is this sort of opportunity, where local talent can pit their creative skills against the best in the world, that will help China develop a creative industry that supports the development of strong Chinese brands. And it will be a creative industry that does it their way, leapfrogging the West in certain areas and assimilating best practices in others.

 

For Chinese companies to really take the tiger by the tail on a global stage, they need to embrace creativity to win the hearts and minds of global consumers. As DDB's founder Bill Bernbach once said: "Creativity is the most practical thing a businessman can employ." The time is now for Chinese companies to seize the day and use the Olympics as an opportunity to "come-out" and show their marketing prowess with as much pride as their sports people will soon show their physical skills.

 

Dick Van Motman
President & CEO
China & Taiwan
DDB China