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Luxury Strategy Brand China Survey,Response To Chinese Brands
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  • 1. Special Topic Building Global Brands
  • 2. Why develop brands?
    • Higher profit
    • Greater longevity
    • More potential for product extensions
    • Higher stock price
  • 3. Leading global brands
    • Coca-Cola
    • Microsoft
    • IBM
    • GE
    • Intel
    • Nokia
    • Disney
    • McDonald’s
    • Toyota
    • Marlboro
  • 4. Brand Image Ranking 22 9 Honda 3 23 Rolls Royce 92 3 Pepsi Cola 4 20 IBM 85 2 McDonald’s 23 6 Toyota 14 7 Nestlé 5 8 Disney 9 5 Kodak 2 12 Mercedes-Benz 1 4 Sony 6 1 Coca-Cola/Coke Esteem Share of Mind Firm
  • 5. Huge opportunity for China
    • Two-pronged strategy:
      • Buy established brands
      • Develop own brands
  • 6. Conditions now ideal for brands
    • Capital:
      • China now has the necessary capital to build brands
    • Regulations:
      • Chinese government now supportive of building brands
    • Market:
      • Chinese consumers now have discretionary income to invest in brands
      • Chinese consumers now more sophisticated and demanding of quality
    • Production:
      • Some Chinese manufacturers now have excess capacity
    • Brands:
      • China has domestic brands and the beginning of global brands
  • 7. Example: Lenovo
    • 27% market share of computers in China
    • Bought IBM PC division for brand name
      • Rights to IBM logo for five years
    • Building own brand based on
      • Customer service
      • Innovative and entrepreneurial spirit
      • Accuracy and truth-seeking
      • Trustworthiness and integrity
      • Changed name to go global
        • Selected blue as brand color
        • Using 2008 Olympics as springboard
  • 8. Example: Bird
    • China market leader in mobile phones
      • #8 mobile phone brand in world
    • Building own brand based on
      • Phone fashion leader
      • Product innovation
      • Design and ergonomics
      • Fast response
      • Comprehensive distribution
  • 9. Example: Haier
    • Chinese appliance giant
      • Ranked most valuable Chinese brand
    • Bought Maytag for brand name
    • Building own brand based on
      • Local brand name in each market
      • Products adapted to different consumption styles
      • Entering niche markets
      • Speed and differentiation
      • Sponsoring Australian basketball team
      • Joint ventures with Fujitsu, Hitachi, Sanyo
  • 10. China itself is a brand
    • Chinese brand survey
      • Online survey by Interbrand
      • 243 international brand executives
    • Question #1: Does “Made in China” help or hurt Chinese brands?
      • 79% believe it hurts
  • 11. Brand China
    • Question #2: Provide three words that represent your impression of Chinese brands today.
    • Ranking Attribute Rating Attribute
    • 1 Cheap 6 Innovative
    • 2 Poor value 7 Lack of track record
    • 3 Poor quality 8 Dated / old
    • 4 Unreliable 9 Largely unknown
    • 5 Unsophisticated 10 Aggressive
  • 12. Brand China
    • Provide any comments on Chinese brands and their future for competing internationally
      • “Need to overcome the lack of quality perception”
      • “Need to enhance communications to grow awareness”
      • “China is well positioned for brand success”
  • 13. Brand China: Survey conclusions
    • Chinese brands suffer from negative perceptions of quality.
    • Attributes of prestige, trust and safety are not associated with Chinese brands (innovation and reliability are good).
    • Need to move away from being low-cost, original equipment manufacturers to creating and managing dominant global brands.
    • Chinese brands are competing solely on tangible dimensions like quality and price. They will compete more effectively once they inject personality and emotion.
  • 14. Response to Brand China
    • Distance company from Brand China
      • Shanghai Automotive Industry Corp (SAIC) bought Rover
      • Fast and less expensive
    • Change perception of Brand China
      • Shanghai Tang promoting their line of luxury fashions as “A Chinese lifestyle brand that’s relevant”
      • Slow but ultimately more beneficial
  • 15.  
  • 16. What country is the parent?
    • Firestone Tire
    • Burger king
    • Rolls-Royce
    • RCA Electronics
    • Dr Pepper
    • Gerber
    • Holiday Inn
    • Japan (Bridgestone)
    • Great Britain (Diageo)
    • Germany (Volkswagen)
    • France (Thomson SA)
    • Great Britain (Cadbury)
    • Switzerland (Novartis)
    • Great Britain (Bass PLC)
  • 17. What is a brand?
    • “ The sum total of all that is know, thought, felt and perceived about your company, service or product.”
            • www.brandingasia.com
    • “ A name, term, sign, symbol, or design, or a combination of these intended to identify the goods or services of one seller or group of sellers and to differentiate them from those of competitors.”
            • Kotler and Armstrong 2006
    • “ A ‘liking’ or a ‘friendship’ relationship between the customer and the brand.”
            • General Foods
  • 18. What is brand equity?
    • “ The positive differential effect that knowing the brand name has on customer response to the product or service.”
            • Kotler and Armstrong 2006
    • “ A brand that has strong positive associations in a consumer’s memory and commands a lot of loyalty as a result.”
            • Solomon 2006
  • 19. A brand has a personality
    • A brand is the personality of your service / product
    • A good brand is seen as a friend
      • Trustworthy
      • Dependable
      • Understanding
      • Caring
  • 20. Brand Personality
    • 5 dimensions of brand personality
            • Aaker 1997
      • Sincerity
      • Excitement
      • Competence
      • Sophistication
      • Ruggedness
  • 21. Brand Personality
    • Sincerity
      • Down to earth, family oriented, small town
      • Honest, sincere real
      • Wholesome, original
      • Cheerful, sentimental, friendly
    • Example: Coca Cola?
  • 22. Brand Personality
    • Excitement
      • Daring, trendy, exciting
      • Spirited, cool, young
      • Imaginative, unique
      • Up-to-date, independent, contemporary
    • Example: Pepsi?
  • 23. Brand Personality
    • Competence
      • Reliable, hard working, secure
      • Intelligent, technical, corporate
      • Successful, leader, confident
    • Example: IBM?
  • 24. Brand Personality
    • Sophistication
      • Upper class, glamorous, good looking
      • Charming, feminine, smooth
      • Wealthy, condescending
    • Example: Mercedes?
  • 25. Brand Personality
    • Ruggedness
      • Outdoorsy, masculine, Western
      • Tough, rugged
    • Example: Nike, Marlboro?
  • 26. Brand Personality: Levis
    • Original
    • Masculine
    • Sexy
    • Youthful
    • Rebellious
    • Individual
    • Free
    • American
    • Exciting and rugged?
  • 27. A brand has a name
    • A truly global brand name is…
      • A translinguistic device - sounds & writing
        • Lenovo, Sony
      • Consistent underlying core themes
      • Executed for at least 15 years in a similar manner across a very large number of countries
      • Consumer needs are consistent for the product category worldwide (airlines vs. coffee)
      • Ad spending of at least $200 million per year world-wide and more probably $.5 billio
  • 28. Recommendations for international brand names
    • Simple spelling and short
      • 2 or 3 syllables
    • Easy to pronounce in any language
      • Not Printemps
    • Avoid unintended meaning in target languages
      • Not Nova by Chevrolet.
    • Loss of original meaning not a major problem
      • Local consumers give name new meaning (which may fit intended local positioning)
      • Carrefour
  • 29. Unfortunate brand names
    • Coors "Turn it loose"
      • in Spanish "Suffer from diarrhea"
    • "Pepsi Brings You Back to Life"
      • in Chinese "Pepsi Brings Your Ancestors Back from the Grave"
    • Clairol’s "Mist Stick“ (a curling iron)
      • in Germany mist is slang for manure
    • Gerber baby food had cute baby on the label
      • in Africa, companies routinely put pictures on the label of what's inside since most people can't read
    • Soft drink in Korea (Pocarino?): “Sweat”
  • 30. A brand is a friend
    • A friend is…
      • Comfortable
      • Enjoyable
      • Caring
      • Honest
      • Dependable
      • There for you when you need them
      • Someone who treats you with respect
  • 31. Brand Friendship
    • Consumer research comparing 2 brands
    • Company A Company B
    • Sophisticated Easy going
    • Arrogant Modest
    • Efficient Helpful
    • Self-centered Caring
    • Distant Approachable
    • Disinterested Interested
    • Which would you like as a friend?
  • 32. How to build a brand
    • A commitment from top management
      • A visible president like Branson?
    • Consistent quality control to demonstrate reliability
    • Clear differentiation of product / service
    • Strong promotional program to gain positive recognition
      • Consistent message: visual and verbal
      • A promise that is desired and believable
      • An emotional appeal
    • Adaptability to local conditions (“glocal”)
  • 33. Measuring Brand Equity
    • Awareness : Aided (fill in blank) and unaided recall (multiple choice / top of mind)
    • Associations : words associated with the brand name
    • Attitude : general liking, inclusion in consideration set
    • Attachment : loyalty to brand (over generations?)
    • Activity : advocating brand to others, spreading word of mouth
  • 34. Measuring brand equity
    • “If a Coke bottle were a person, what kind would it be?”
    • “If you met that person, what would they say to you?”
  • 35. Need to monitor brand
    • Brand tracking
      • Growth in awareness, familiarity, commitment, etc.
    • Brand reputation
      • Loyalty, satisfaction, trust
  • 36. Positioning
    • Research to determine how brand is perceived compared to competition
    • Determination of where brand should be placed to compete most effectively
    • Research to determine success of repositioning
  • 37.  
  • 38. Copiers
  • 39. Digital Camera Brands
  • 40. Automobiles