Business / Economy

Playing up the difference

By Amy He (China Daily) Updated: 2014-01-14 07:16

As Chinese brands expand their operations globally and face rising consumer demand domestically, they must begin to differentiate themselves from stiff competition at home and abroad, according to an analysis from brand-management experts.

"Chinese brands now match or exceed foreign brands in China in all the elements that comprise brand equity, except one - difference," analysts with brand and communications research firm Millward Brown said.

In a new report, BrandZ Top 100 Most Valuable Chinese Brands, analysts said that brands in China can match foreign brands in "brand equity strength" - which measures performance, relevance and presence - but are still lacking when it comes to creating "bonding" value, which measures a customer's emotional engagement with a brand that ultimately translates into brand loyalty and advocacy.

Home brands in the country are seen as being "well- known" and "well-priced" but not sufficiently different enough from each other, an advantage that foreign brands in China enjoy.

In addition, Chinese brands trying to build an international presence are faced with the challenge of low awareness overseas and with changing the perception of "Brand China" abroad. According to Millward Brown, only 20 percent of customers worldwide can name any Chinese brands, and people associate them as being government-backed and poorly made.

The report, released annually, ranked the 100 most valuable brands in China according to a formula based on financial value and brand contribution (price, convenience, availability and distribution). State-owned enterprises and financial institutions dominated the top 10 spots on the 2013 list.

Millward Brown said that market-driven brands grew at a faster rate in 2013 than State-owned enterprises did but that SOEs still dominate the highest-valued brands in the country. In the list of 100 brands, 71 percent of the ranking's total value was occupied by SOEs, while 29 percent was made up of market brands

It is because the country is rebalancing - dealing with a changing economy and the side effects of the rapid growth that took place in the last three decades - that brands are especially essential to competitive success, David Roth, CEO of The Store WPP (Europe, Middle East, Africa and Asia) and leader of the BrandZ project, said in an introductory note to the report.

"The report's findings mean that Chinese entrepreneurs have been developing market-driven companies and valuable brands across many product and service categories for some time," he said.

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