Dominic Fitzsimmons
Dec 11, 2008

Live Issue... Only brands can rescue Brand China

At US$44 billion in infrastructure and hosting costs, the Beijing Games represents an investment that dwarfs many nations' financial crisis stimulus packages.

Live Issue... Only brands can rescue Brand China
But as impressive as the Games may have been, they came in a year when China contended with natural disasters, ethnic unrest, product safety scandals and the ugly side of rampant nationalism. So how effective was the world’s most expensive rebranding campaign?

Throughout the world, the Games themselves were clearly seen as something that added positive attributes to Brand China, a fact that prompted FutureBrand to rank it as number one in the Rising Star and Most Impressive Year of its recent Country Brand Index 2008 report.

“The Olympics was a very important part of projecting the right image for China. They really gave China a proper stage for creating a more in-depth projection of the culture and history, and less just the business side or the negative,” says Po Cheung, managing director of FutureBrand, China. “The effect is that more people now see beyond a Communist regime, or the perception of an enclosed and poor country with not much happening”.

Craig Briggs, MD of Asia, Brandimage, Desgrippes & Laga, agrees. “Now is the time to build Chinese brands, for Chinese consumer products to start moving onto the world stage; it’s time to move from production to seduction,” he adds. With that in mind, the product scandals that have followed the Olympics have undone much of the good work.

“The milk scandal was a major setback because it was a reminder that you still cannot trust a product made in China just because it is made in China,” says David Wolf of Wolf Group Asia.

“A significant amount of the positive brand impact China got from the Olympics has been blown because of the way that product and food safety issues have been handled and I think that is devastating for the reputation of China abroad as well as the potential market for Chinese exports,” agrees Alan VanderMolen, president of Edelman Asia-Pacific, naming the melamine in milk and lead in toys scandals as being the most damaging. “When you force consumers to question fundamental assumptions that they’re making about the safety of the stuff they are giving their kids, it’s pretty devastating for an exporting nation.”

VanderMolen notes that with the global financial crisis on the horizon a loss of consumer confidence comes at “a pretty abysmal time” for the world’s largest exporter.

Although this role as exporter means Chinese firms will feel the pinch, some in the industry feel that it also offers the perfect opportunity to innovate. Briggs argues that Western firms will slow down in innovation and reduce their R&D expenditure, making it a good time for Chinese brands and entrepreneurs who are producing for Western brands to think about doing their own brands. “This will accelerate the Chinese transformation from a production economy to more of an innovation and branded economy,” says Briggs.

Ultimately, says Wolf, it’s down to China’s brands to take the next step. “The solution for Brand China is not going to be any sort of Government initiative. It was not Japan’s Ministry of International Trade and Industry that made Brand Japan - it was Sony, it was Toyota, and it was Nissan.”

Got a view?
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Source:
Campaign China

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