Strategic brand management

Even in China, brands have to be managed by four parameters:

Competence.
Image / Identity.
Appearance.
Benefit.

While many Chinese brands often can use their culture-rich origin in the fields of image / identity and appearance, Western brands often excels 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 always have to offer an additional symbolic and social value.

Identity based positioning

The positioning of a brand should be based on identity, that means on the historically grown substance of the company, its products and brands. The development and maintenance of artificial images become less successful. In most Chinese markets there are too many similar images such as modern, technologically leading or distinctive, and the permanent and dynamic changes of the Chinese economy destruct brands faster than they can be established - wasting both time and money. They are like colorful but short-lived soap bubbles, bursting in a turbulent environment.

Identity is different because of relying on solid history and personality and therefore offering 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. This favors their intention of expansion and diversification clearly.

Strong product brands can be found everywhere in China, mostly in foodstuff, drinks and pharmaceuticals.
Most Chinese large-scale enterprises apply a strategy of an umbrella brand by using the company name as the umbrella brand.
Placebo brands that simulate a not existing effect and therefore an illusory world are found in pharmaceuticals, drinks, foodstuff and even 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 historically grown substance which already has an authoritarian character.
Brand strategies targeting on the alter ego of consumers are seldom in collectivist China and most likely found in youth brands.
Even fantasy brands can be found in China. These brands exclusively exist because of imagination while the function of the product is only of secondary importance.