Building a brand in the international market

Editor's note: "CEConlines Autumn Management Forum: Building Brands in the International Market" was held in Shanghai on September 26, 2005, with more than 100 people from all over the country The middle and senior managers of famous export enterprises participated in the forum.

At the forum, Bryan Stanton, a senior brand expert who has helped many Japanese and European brands successfully enter the US consumer electronics market, delivered a keynote speech entitled "Building a Brand in the US Market", Provide suggestions and reference opinions for Chinese export enterprises. In addition, He Chunsheng, general manager of Advantech China, Weng Rongdi, president of Langsha Group, and Zhang Lin, general manager of Chery International, shared with the participants their experience in exploring brands in the international market.

It is not overnight for Chinese enterprises to enter the international market, and their position in the global manufacturing industry cannot be ignored. However, from consumer goods to household appliances, the internationalization of products through OEM production methods has put most Chinese companies in the embarrassing situation of "bumper harvest" rather than "bumper harvest". In the most representative textile and apparel industry, we can see such comparative figures: last year, the market share of Chinese textiles in the world was about 28%, while the average profit margin of the entire industry was less than 2%.

The extremely low brand recognition in the international market is generally regarded by the management academic community as an important reason for the meager profits of Chinese enterprises. In the "Top 100 Global Brands in 2005" selected by the American "Business Week", none of the Chinese brands were selected. In the past 20 years, the Chinese goods that have flooded out of the country have been blurred, and it seems that only low quality and low price are synonymous with them.

As China's integration into the global economy accelerates, Chinese business managers are more eager than ever to learn how to build their brands in the international market and create more additional profits. At the "2005 Autumn Management Forum of CEConlines", senior consultants from the United States and senior executives of China's outstanding export enterprises pointed out that the products of Chinese enterprises have reached or are expected to reach the world-class level in terms of performance, quality and price. , but most managers also lack the marketing skills and management capabilities to build brands in the international market.

In their view, Chinese brands must do five required homework before going abroad: careful brand positioning, appropriate brand name, in-depth brand promotion, rational channel cooperation and complementary brand acquisition.

Careful brand positioning

The brand is in the initial stage of entering the international market, and its popularity is limited. At this time, the price is often the biggest factor affecting the purchase choice. It is precisely because of this that most Chinese brands overseas are positioned in the low-end market, hoping to quickly grab the beach with a cheap image, occupy a certain market share, and then develop to the high-end.

With regard to this situation, Stanton believes that brand positioning before entering a new market is actually the most difficult part of the entire brand marketing, and decision makers should consider it more carefully. Taking the consumer electronics market in the United States as an example, he explained that the marketing methods required for products of high, medium and low-end brands are different. If the initial positioning is unsuccessful, it cannot be easily reversed by changing the content of the advertisement or changing a channel provider.

High-end products are characterized by beautiful appearance, high-quality product accessories and assembly, and very advanced product features. The price factor is not important for such products, so choose limited channels for sales, and carefully design sales displays . Advertising of brand image rather than product function is particularly important for such brands; mid-range products, well-functioning, durable, require a competitive pricing strategy, advertising that takes into account brand image and product function, and training of sales staff, For product demonstrations at the sales floor; while low-end products have only some basic features, its marketing relies on price-driven and the widest possible distribution channels to achieve. In the US market, if the brand is established with a low-end image at the beginning, it will be very difficult to extend to the high-end market later.

He Chunsheng suggested that Chinese companies should consider the relationship between price and grade in a different way. He believes that low price does not mean low quality or low grade. Only by entering the international market with products of first-class quality and design can we have the premise of getting rid of the low-end brand image. "If Advantech and European and American industrial computer manufacturers produce products of the same quality, then if Advantech's price is 10%-15% lower than theirs, it is equivalent to a 10%-15% increase in competitiveness."

responsible for Chery Zhang Lin of overseas marketing of automobiles is deeply touched by this statement. After successfully entering developing countries such as the Middle East and Southeast Asia, Chery Automobile began to try to enter the US market this year. "Our current predicament is equivalent to the Japanese cars or Korean cars that existed more than ten years ago." Zhang Lin pointed out that Toyota, Honda and other brands entered the European and American markets with low-price strategies at first, but this is not the core of brand marketing and corporate management. .

“Korea Hyundai, despite its low price, was initially very sluggish in the North American market for nearly a decade because the quality was not completely up to par. Now they are making a comeback, and after improving their quality, they are among the top and second in the mid-range brand rankings, so they have gained a lot of recognition in Alabama. Great success. So low prices may not necessarily lead to a market, but from the very beginning, we must win more customers with product quality, convenient channels and after-sales service. And then further build their emotional awareness of the brand, Only in this way can we get out of the predicament of low price equal to low grade step by step."

Currently, Chery is planning to provide American consumers with a 100,000-mile quality guarantee, hoping to establish a quality image. Because everyone knows that if the car doesn't meet high quality standards, Chery won't be willing to risk high marketing costs in the US market by enacting higher mileage guarantees than Korean cars.

Chinese companies in other industries are also realizing this. For example, Huawei, which is often accused of "regardless of cost", pays attention to product development and innovation according to the needs of customers in different countries while maintaining low prices. The large amount of R&D investment and customer-centric after-sales service every year give people reason to believe that this is not a self-willed "low-end" enterprise, and therefore has gained recognition from the international market and respect from its peers. This year, Huawei, as the only Chinese manufacturer, was shortlisted in the list of eight suppliers for BT's network transformation in the 21st century, and the brand has begun to truly internationalize.

Appropriate brand name

Haier is recognized as the most successful international strategy company, and its promotion slogan "Haier and Higher" has impressed people in Europe and the United States. In the past two years, there has been a wave of "renamed" English names among Chinese brands, such as Lenovo's "lenovo" and Amoi's "Amoi". Behind these changes are actually the brand's ambition to enter the international market.

The right brand name is often a multiplier. Stanton believes that those brands that have achieved rapid success in the American market, such as SONY founded in the 1950s, NIKE in the 1970s, and NOKIA, which was founded just 15 years ago, all have one thing in common: short, easy to read and easy to read. Let consumers remember.

Japanese brands have taken some detours in this regard. For example, when Panasonic entered the U.S. market, many people did not understand or read the first Japanese name Matsushi-ta; the English name National was already registered by others. It was finally renamed Panasonic, and now Panasonic's products around the world have switched to this brand.

Stanton believes there may be two problems with Chery seeking to enter the U.S. market. One is the pronunciation, which is homophonic with cherry (cherry), which reminds people of another kind of car defined by fruit: the lemon car. In the US, cars that are returned by consumers are called lemon cars, and this negative association is not good for Chery. On the other hand, GM's Chevrolet, known simply as Chevy in the US, is already a household name. Therefore, if Chery wants to use Chery in the US market, it may face the risk of being sued.

Currently, Chery is negotiating a joint venture with a U.S. auto dealer. Products entering the North American market will use a brand-new brand with a new design. Instead of using the Chery name, they will settle for the next best thing, including the "Chery" factor. in it.

Stanton therefore advises Chinese companies to be more careful when creating their own brands in international markets. Professionals must go to the main target market to examine whether there is ambiguity in the local language; and to investigate whether a local company has already registered the name.

In-depth brand promotion

After the brand positioning and name are established, how to carry out effective promotion? Advertising is the main promotion method adopted by Chinese companies in the international market, and most of them still stay at the level of product advertising.

He Chunsheng believes that this approach is still in its infancy. Whether it is computers, cars or socks, it is not enough to just tell consumers the features and functions of products in advertisements. He said product advertisements are meaningless, unattractive, and give the impression of being too superficial. To become an international brand, it is necessary to complete the in-depth promotion from product advertising to brand value advertising. Only by conveying the connotation and value of the brand and obtaining emotional recognition can we truly receive a long-term effect.

Stanton likens "product feature promotion" and "brand image promotion" to "push marketing" and "pull marketing," respectively. The former is only an aid to salespeople, while the latter often makes customers who buy products feel a strong sense of pride and identity, making them more active in choosing the brand's products. He also suggested that the promotion of brand image can be done through public relations, which is often more effective than advertising. Especially in markets like the United States, where the media industry is very developed, there are more than 5,000 daily newspapers, more than 2,000 TV stations, and thousands of magazines. Consumers are closely related to the media in their daily lives. "If you want to attract the market's high attention to the product and establish a word-of-mouth effect, you should maintain a good relationship with the media in the early stage of entering the market. Using public relations to promote is not only more acceptable, but also saves huge advertising costs.

Langsha has used various public relations methods when building its brand in the domestic market, including sponsoring fashion events in different seasons, public welfare undertakings, etc., to combine products and brands. Weng Rongdi believes that it is not easy for the socks industry to make a brand, and it is even more necessary to study the culture and consumer psychology of the local market in the international market. At the same time, when you can't afford high advertising costs, you can also choose some professional magazines to do appropriate publicity.

The establishment of an international brand and the consistency of image promotion are also critical. The brand has entered Advantech in 29 countries, and this is ensured from the organizational structure of marketing. He Chunsheng said that Advantech has three market departments: corporate market, product market and regional market. The regional market department is located in the local market, and the marketing personnel formulate different product promotion strategies according to the needs and characteristics of local customers. However, the advertising involving the overall image of the brand is provided by the marketing department of the headquarters of the company with a unified plan. Regardless of the United States, Europe, or Japan, each market strictly follows it and conveys the same brand connotation. Otherwise, Advantech will not be able to condense a strong international image.

Rational channel cooperation

Using its own brand to enter new markets, there are two options. One is that the enterprise independently formulates an advertising strategy and bears the various promotion expenses incurred; the other is to choose a channel provider and the two sides cooperate to build a brand.

For most Chinese enterprises, the first method is expensive, difficult to invest for a long time, and difficult to manage. Therefore, Stanton suggested that companies, especially consumer brands, should try their best to choose distributors that suit them and use their resources to promote them. Taking the US electronic consumer market as an example, he analyzed that retailers control more than half of the sales share, and there are three types: national chain stores such as Wal-Mart, Macy's, etc. Long-term advertising in the media; regional chain stores, with stores in several states or territories, and their advertising targeting the areas where they have stores; and independent retail with one or several stores in a geographic area business.

“From the perspective of brand building, each retailer has its own advantages, and the key is to choose rationally according to the marketing goals and resource utilization.” Stanton said that building a brand through a retailer can Achieving good yield for less cost has become the choice of most American manufacturers. According to the purchase amount of the dealer, the two parties negotiate to pay a certain proportion of advertising funds. Among them, the manufacturer as the brand owner has the control to determine the brand connotation and tone, while the dealer is flexible by virtue of its understanding of the local market. Develop a strategy.

Weng Rongdi and Zhang Lin both agree with the practice of cooperating with distributors to build brands. They said that when there is no brand, the company does not have a huge marketing network, and it is very difficult to do direct sales. Therefore, it will only do direct sales in strategically important markets, and most countries rely on the strength of local distributors. Chery Automobile has established cooperative relations with nearly 100 dealers in 25 countries in the past two years.

Zhang Lin believes that companies do not have to blindly choose the most well-known and powerful large-scale local distributors. Because the influence of its own brand is not enough, and the manufacturer's right to speak is not strong, the loyalty of the dealer is often very low, and they will not try their best to help you promote the brand. On the contrary, it is some small dealers that have just emerged, and it is easy for both parties to form a consensus on joint entrepreneurship. Chery's continuous increase in sales in Syria, Iran and other Middle East countries in the past two years has benefited from this rational channel selection idea. "Low-cost, high-quality and well-communicated local sales networks are the three essential elements for Chinese companies to build brands in the international market."

Complementary brand acquisitions

Compared with the gradual entry of private brands into the international market , direct acquisition of brands in the local market may be a shortcut. The most sensational international merger and acquisition event this year is Lenovo's acquisition of IBM's personal computer business. In the past few months, Haier's plan to acquire Mattel, a large-scale home appliance company in the United States, has also attracted much attention. Although it did not succeed in the end, its intention to enter the high-end home appliance market in the United States is clear at a glance.

The wave of mergers and acquisitions by Chinese companies in the international market may have just begun. So what problems should international brand mergers and acquisitions pay attention to? Stanton believes that an ideal M&A target should also have a good brand reputation, sales channels and human resources in the international market. These companies often lack competitiveness in product prices due to high manufacturing costs, and these features complement Chinese companies. "You have to figure out what you're acquiring, is it a complete company that is still in operation, or is it a bankrupt company with only brands left; does this company have its own factories, or does it outsource production; and does it have hidden debts? Although some American companies are in trouble, their brands are very mature, and their potential value may be higher than the stock market value." Weng Rongdi added that in the process of brand mergers and acquisitions, we should also pay attention to retaining local management talents. Langsha has invested 5 million US dollars to acquire an American hosiery factory, and has plans to launch acquisitions in different countries in the next ten years. "Different countries have different cultures, and different brands have different design styles. Only by managing local brands and involving local talents can better results be achieved."

He Chunsheng and Zhang Lin both hold comparisons on brand acquisitions cautious attitude. He Chunsheng reminded that several well-known acquisitions in the IT industry, including HP's acquisition of Compaq, were unsuccessful. Although mergers and acquisitions are easy to attract attention, they are extremely challenging to operate. He believes that "any global well-known brand must first have a very successful local market." Otherwise, when a small enterprise acquires a large enterprise, and a low-civilized enterprise acquires a highly-civilized enterprise, it is more likely that due to differences in culture and values, management The lack of capacity and other problems lead to brain drain.

Zhang Lin also said that successful mergers and acquisitions does not mean that it is done once and for all. After all, brand mergers and acquisitions are only a means, not an end. Chinese enterprises must be fully prepared for actual combat, and cultivate an open international perspective and an inclusive mentality, in order to respect each other with their European and American partners, and to maintain the vitality of brands after mergers and acquisitions.

Looking back at the growth history of world famous brands, it took 50 years or more for American brands to become world famous brands, more than 40 years for Japan, and less than 20 years for Samsung and LG to become the world's top 100 brands. front row. It's not an unrealistic dream to catch up later. Chinese companies are trying to complete the creation process of world famous brands in a shorter time.

Building a brand in the international market

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