Branding in China - Positioning and Communications

It is no surprise that when it comes to branding in Asia many companies are focusing their resources on the Chinese market as China has what businesses want, a huge market willing to consume. Some might argue that even China's population of approximately 1.3 billion is a clear incentive, this figure is not a good representation of the market because a significant part of the population still lacks the economical resources that would enable them to go on shopping sprees. However, just to put the market into relation, if only 1% is really affluent and 10% has some disposable income this still represents 13 million and 130 million of potentially consume hungry buyers.

The challenge now lies on how to capture a share of this market where a large number of foreign companies are already facing difficulties in establishing their brands in a highly competitive environment. It should be noted that often those challenges are not due to a bad product or service, instead, cultural insensitivity in their communications and unclear brand positioning strategies are playing the trick on these marketers.

One of the reasons for those difficulties is that marketers commit simple mistakes as using models and messaging concepts not suited for that particular market. Clarins made such a mistake in their male grooming products ad by using ethnically diverse metrosexual models that represented an image the typical Chinese male could not identify with. This simple example makes clear that if a company wants to establish their brand in the Chinese market they have to make sure that all variables in their strategy are aligned and that particular cultural traits of their target segment are accounted for. Paul Temporal exemplifies this in his book "Branding in Asia" with the following statement: “Every image and every phrase included in a company’s communications, the way the advertising looks and the style of language used, every touch added to the product, every niche addressed, every service provided must focus on the strategic platform, that is, its personality and positioning”.


As previously mentioned there are more variables that need to be considered to succeed and clear positioning of the brand is another crucial factor that marketers need to get right when entering a market that is not very forgiving due to its extensive product offering.Positioning a brand as a premium-, mass product, or something in between should be on the agenda from the beginning to avoid confusion during later stages of the PLC and having to re-adjust multiple aspects of the marketing strategy.

This seems to be a no brainer taught in every Marketing 101 class, but even successful companies commit such rookie mistakes from time to time. Just to mention one, Buick, a famous US car company, tried to capture a new segment of the Chinese market and decided to offer a low cost model that would appeal to less affluent Chinese baby boomers. The formula worked at first, but with time it turned out that there was a flaw in their strategy and overall sales fell sharply. The problem was positioning! With their low cost model they had diluted their brand image to the extent that consumers which were interested in Buick vehicles as a status symbol felt no longer attracted by the brand. On the other hand, the segment that bought the low cost model was also disappointed as Buick had only been able to offer the car at an economical price by using inferior materials, not representative of the standard expected from a Buick vehicle. This mistake illustrates how easy it is to dilute a company’s highly respected brand image by choosing the wrong positioning strategy.

The lesson to be learned as a marketer is that you have to know exactly who your “real customer” is and what your brand stands for, particularly when entering a foreign market as complex and competitive as the Chinese one. However, on the other hand it is interesting to learn about the complexities of cultural branding and cases like these give us something to talk about. How about you share some of your experiences with all of us?