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Branding in China

Here’s a rather educative article about China’s branding challenge. But reaches some odd conclusions.

Firstly let’s look at what it says.

Using Huawei’s example it talks about China has companies that have significant market share in the category in which they operate. But they are not well known to the consumer.

A couple of reasons it mentions include

1. Intense competition at home and weak IP protection means that there are low/no margins to invest in brand building

2. The Chinese companies are focused on b2b ie they sell to other businesses

The article references marketing razzle dazzle like those of Nike and Google.

And that is kind of where I believe the article loses its plot and is stuck in archaic thinking.

Firstly if a company like Huawei sells to other businesses and all those companies know of and regard it well then it is achieving its purpose. It doesn’t need Nike style campaigns talking to me. They may be smart in focusing their attention on the people who really need to know and think highly of them.

Secondly Google’s razzle dazzle is quite different from Nike’s. Nike’s was ‘top-down’. Make a product that is not uniquely differentiated and imbue it with great brand values and back it with a superlative campaign consistently.

Google started with a great product. And they built their brand bottom up. I don’t recall any great ads from Google, save some clever recruitment ads. Their brand was built through Word of Mouth and PR.

Which leads me across the Himalayas to India. Another great factory. But of services. It is an identical situation as China. Large companies facing intense competition at home engaged in services to other large companies.

Yet we know Infosys, Tata and Wipro as big brands. No marketing razzle dazzle.

High quality service with outstanding use of PR and Word of Mouth.

Many years ago I was having a chat with Nandan Nilekani (yes name dropping!!) when he was at Infosys and I at Ogilvy. He sneered, and he can sneer well, at the old fashioned way of building brands through ads. He told me then, that Infosys didn’t believe in advertising as the route to build brands. Fast forward and anyone in the IT services business knows that Infosys is one of the most powerful brands in that market place.

Jump across to Acer. After years of being a supplier to other PC manufacturers, Acer decided to go out on its own. Today it is the No 2 PC manufacturer in the world. Again no marketing razzle dazzle. Good product. great distribution. Low prices and huge dollops of PR.

The point of this post, and yes there is one, is my angst that there is such a wide spread belief that the way to build a strong brand is through some fantastic advertising campaign. That is so passe.

Brands like Acer, Infosys, Google and I would say Huawei are striking examples of bringing new thinking to this space.

And China is getting there. Slowly. But they are.

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