Strategic brand management

Companies working in China need to manage their brands based on four standards:

Competence
Image / Identity
Appearance
Benefit

While many Chinese brands can use their culture-rich origin in the fields of image / identity and appearance, American brands often excel in terms of functionality and greater benefits. However, many companies do not recognize that brands have to combine traditional Chinese and modern Western assets to succeed in the Chinese market. The buying pattern of Chinese consumers is strongly influenced by the symbolic and social characteristics of a brand. In China, successful brands must offer an additional symbolic and social value, in addition to practical, functional benefits.

Identity based positioning

The positioning of a brand should be based on long-lasting corporate identity. In the dynamic Chinese market, artificial images boasting a modern or high-tech brand have been too common and short-lived.

Instead, brand identity relies on a solid history and personality and offers a stable and sustainable basis for brand management. Identity is closely related to Chinese feeling, thinking and acting, which is influenced by history and tradition.

Multiple brand strategies

In China, various kinds of brand strategies are used. Chinese companies increasingly concentrate on abstract forms of branding. In doing so, they are able to change brands easily, supporting expansion and diversification. Some examples:

Strong product brands can be found everywhere in China, mostly in food, drinks, and pharmaceuticals.
Most large-scale Chinese enterprises use the company name as the umbrella brand.
Placebo brands that simulate non-existent effect are found in pharmaceuticals, drinks, food, and other articles of daily use.
Fashion labels or cosmetics are often brands functioning as symbols. They stand for specific social groups or a particular lifestyle.
Only big and traditional Chinese brands can act as an authority. These brands outshine all competitors due to their historical reputation.
Brand strategies targeting the alter ego status of consumers are unusual in collectivist China and more typically found in youth brands.
Fantasy brands can be found in China. These brands exist exclusively to feed the imagination with the product function of secondary importance.