14 Brand Considerations for Advertising in China

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The Digital Marke.ng Experts

14 Brand Considerations in China Looking at the Chinese Brand picture and recognizing the landscape is the same but different to the West.

© 2011 SinoTech Group (China) Limited

The Eastern Factor

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Marketing appeal in China hs different elements

•  Brighter colors •  Lots of information •  Celebrity endorsements •  Advertising that reflects a glamorous

lifestyle.


Same Brand Model.. Chinese Context


Same Brand Pathway…

Bought Media

Owned Media

Earned Media

(Social)

Listen: Leverage social analytics and understand your motive and influence universe.

Learn: Uncover patterns of traffic, influence, conversation and engagement and use them to extend or power campaigns.

Participate: Define & execute an engagement strategy. Engage through media combination, measure & refine.


Same Brand Framework

Brand Advantage

Strategy Plan Execu.on

Insight Concept & design

Design development Produc.on Implementa.on Health

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Brand archite

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Brand idea

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Valida.

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Finished

art

Technical spe

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Brand guidelines

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Project m

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Tend

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Quality control

Procurem

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Review

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Review

success a

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Defin

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Planning

Key brand interview

Visual audit & analysis

Strategic inves.ga.on

Compe.tor analysis

Measure


But… consider the Chinese perspective

•  Consumers around the world have different taste profiles and different wants and needs, and it’s really important that companies recognize these differences across all types of industries.

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Brand Evangelists


Tailoring Products for China

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Tailoring Products for China

•  Another example: biscuits and sweets snacking tends to be a "cold weather phenomenon", meaning that sometimes consumption tends to slow down if the temperature gets very hot. With this insight, Oreo IceCream is developed. The fillings in the biscuits have different ice-cream flavours. It give out an amazing cooling sensation in the mouth as though the customer is eating an ice cream. The product is very successful in China.

•  Companies a global understanding of trends, but they should be also very local in the understanding of what the consumers need.

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Case study: Oreo biscuits in China In China, the market for Oreo biscuits was relatively small a few years ago. Why? Oreos are too sweet for the Chinese palate. Kraft did an enormous amount of testing and re-configured the flavour profile and today, they quadrupled the China Oreo business in four years and it is now the number 1 biscuit in China.


1. Brand Evangelists


•  A clear brand strategy promotes convergent thinking by uniting stakeholders behind a common vision.

•  A large portion of people who work for an organization are often not directly employed by it, and if they aren't aligned to the brand's vision and values, the brand promise will be eroded.

•  Companies are making increased efforts to involve employees in managing the company's image. For emerging markets where a service culture is rare, this is even more vital.

1. Brand Evangelists


1.Brand Evangelists

–  Starbucks achieved its success not only by providing brilliant coffee; it also won the hearts and minds of the consumers through a brilliant service strategy.

–  This Strategy aims at instilling all of Starbucks’ brand values into their employees –  The healthy staff attitude created pleasant contact experiences for the

customer, and in turn they spread their good experience at Starbucks with others. –  At Starbucks, employees are not called workers or staff, they are referred to as

partners, since they are seen as important contributors in the success of the business and therefore are stakeholders to be considered.

–  Starbucks offers many services to the employees, which range from training and education to personalized benefits packages.

–  Starbucks is one of the best companies in the world to work for, as rated by Fortune Magazine.

Case Study: Starbucks

Starbucks is without a doubt, one of the most successful retail stores in America, and one of the most prominent brands in the world.


1.Brand Evangelists

–  Unlike other airlines Kulula focused on being less formal and providing a fun and friendly experience for their passengers.

–  The overall idea of Kulula was transferred to its employees; firstly by giving them uniforms that are designed for greater comfort and functionality, this reflected more open and casual brand values. Secondly the staff was trained to provide more than just service that was not just good, but also appropriate to the brand, and when suitable – customers are addressed by their first names and staff were encouraged to make the most of their personalities and sense of humour.

–  Although safety and professionalism are always tops – the in-flight antics of the staff prove to be an amazing source of word-of-mouth references.

–  Kulula.com have received prestigious awards, thanks to the innovation of the staff, who are completely aligned to the brand.

Case Study: Kulula.com

Kulula.com is a South African based airline company, and has proven to be one of Comair’s greatest success stories. Kulula is a Zulu word, translated to mean “easy” - this captures the essence of the brand.


2.The Rise of Regionalism & Anti-globalization


2. The Rise of Regionalism & Anti-globalization

•  Emerging markets are no longer soft targets. Some really strong local brands are rising to challenge the giants.

•  The clever global brands will marry global best practice with local relevance, with special focus on Eastern Cultures.

•  They'll redesign global images and messages for specific local markets. It may be too late for Nike and Coke in Asia where local brands, Li Ning and Yan Jing Beer are grabbing the high ground….fast.

•  Yan Jing Beer although not a world-wide leader – yet. Yan Jing’s popularity grows day by day, and can now be found in larger retailers.

•  Li Ning is Nike’s number 10 competitor worldwide, and is moving closer to poll as China grows economically.



Case Study: Beijng Beer Drinkers What upholds the Beijing beer drinkers’ brand loyalty is the favourable taste the domain brand able to offer; its ease of access at an affordable price; and the symbolic values that are closely attached to the personal traits and beliefs of Beijing consumer segment markets.

In 2001, 89.4% of beer consumers in Beijing drank only the brand of YanJing, which was numbered as second after the national leader brand TsingTao in China. A successful domain brand is built on a good local brand essence. It is the ability of Yan Jing brand to bring forward a set of local values so closely attached to the personal traits and beliefs of segment beer consumers living in Beijing (92%). This proves that no matter how ‘Goliath’ the brand – if its values don’t correspond with the people, it will most probably be beaten by local ‘Davids’.



–  The reason for the brands success is not only because of quality or price, the reason is that – Li Ning means something more than just sports apparel, its background is distinctly Chinese and this creates resonance within the consumers life. Li Ning is perceived by Chinese consumers as a down-to-earth, value-for-money brand, with the likes of Nike and Adidas being regarded as premium designer labels.

–  Analysis shows that well over 50% of Nike’s non-loyal consumers switch to local brands while less than that switch to other foreign brands.

–  Nike sees Li Ning as it’s number 10 competitor worldwide and is moving up the polls FAST.

Case Study: Li Ning

Li Ning is a China-based sports goods company, created by the famous Chinese Olympic gold medalist of the same name. Li Ning is leader in the Chinese market with a brand loyalty of 53.4%, while Nike and Adidas follow with 39.8% and 39.1% respectively.


3. Forget the X&Y Generation: Experience Matters


3. Forget the X&Y Generation

•  Marketing is obsessed with youth.

•  The advertising and communications industry is growing old trying to stay young. Yet experience matters.

•  The size of the older generation is growing while the younger generation is shrinking.

•  The wrinklies have the spending power, and this dramatically affects to whom and how we plan both our marketing strategies and our products.



•  The purchasing power and consumption levels of China's 143 million elderly people are on the up

•  Consumption by seniors will likely reach 1.4 trillion yuan (US$175 billion) by 2010 and 4.3 trillion yuan by 2020, accounting respectively for 11.39 percent and 15.43 percent of the country's total

•  Currently about 11 percent of China's population is over the age of 60. Chinese seniors make up half the total elderly population in Asia.

•  In terms of consumption, the aging population will have a huge influence on China's future social and economic development

•  Boost the development of industries that serve the aging population, such as pharmacy, health care, insurance and tourism," he added.

•  China will remain an aging society throughout this century



–  The contrast between younger age groups, who download most of their music for a low-cost or for free.

–  Virgin constructed sections that appeal to older consumers, such as: a jazz section, which was reconstructed to look like a 1930’s jazz club; a “mind, body and spirit” section, which is focused at relaxation and spiritual growth as well as physical well-being.

–  Although Virgin did not only plan to sell the mature customer only old music, instead the already existing information kiosks also served a purpose of recommending new artists to older people who are similar to their favourite musicians.

–  The experimental store is outperforming the company’s other 21 U.S. locations. Several sites are set to get the same makeover.

Case Study: Virgin Megastores. Virgin began to recognise the importance of appealing to older music lovers, by analyzing the ticket sales of concerts such as the Eagles, which are the one of the biggest-grossing acts at $100-plus ticket prices.


•  A massive por.on of the market capitalisa1on of top companies is comprised of intangibles -‐ primarily brands.

•  Research shows that over 15 years, heavily brand-‐dependent companies consistently outperformed the FTSE 350 by between 15 and 29%.

•  Research also shows that marke1ng ac1vity can add up to 25% to a company's share price.

•  Performance-‐based remunera.on for brand managers must follow.

4. Brands as Assets


5. Brand Extension: DIVERSIFY OR DIE!


5. Brand Extension

•  Versace hotels. The Ferrari Laptop. Caterpillar watches. What next?

•  Brands face compe..on from the most unexpected quarters. And if their brand is iden.fied with a single product, they're at the greatest risk. Chances are they'll go out of fashion or someone will replicate or improve on their product.

•  Compe11on no longer has boundaries. It comes from any organisa.on that wants to leverage its brand profile and reputa.on.


5. Brand Extension

–  However cigarette companies began to diversify there brand offerings in order to survive.

–  An example of this occurred in Malaysia, tobacco companies took advantage of the indirect advertising loophole and promoted their new services, that in turn promoted the sale of cigarettes – Marlboro, Peter Stuyvesant Travel, Benson&Hedges Bistro and Dunhill Accessories.

–  In countries such as America were tobacco advertising is not banned, the brand-stretching into clothing for both adults and children, boosts not only current consumer loyalty but also increases the instances of new consumers. Research proves that children who wear clothing with cigarette brands on them are 4 times more likely to smoke than other children.

Case Study: Tobacco Industries In many countries, tobacco advertising has been banned, putting a hold on all marketing communications and therefore creating a huge threat for all tobacco companies.


6. Dream Merchants:

“Enterprise survivors in chao.c .mes will create a cause, not a business.” (Gary Hamel)


6. Dream Merchants

•  Great brands transcend product format.

•  It's not about what the product is, but more about the beliefs the brand expresses. True brands connect with the consumer.

•  They're in the relationship business.

•  Think Absolut vodka. The success isn't about taste. It's about personality, identity and association.


•  To transform Nippon Paint from an ageing 'trustmark' into something that is both respected and loved, campaign was set out to connect with this new generation of consumer through an age old and powerful emotion - love.

•  This ‘attraction' strategy over the traditional ‘attention seeking' strategy, was set to trigger the imagination.

•  The core of creativity living in the colourful paint was encouraging the consumer to bring it to life by painting their dreams and creating their own unique space.

6. Dream Merchants

Case Study: Nippon Paint (China) Nippon Paint launched a new marketing strategy to connect with customer on a more personal level and create a personality that appeals to the target customer


Case Study: Vespa

–  Vespa is a word –rather, a concept – which is absolutely interna.onal, and which represents the dreams and the desires for freedom of en.re genera.ons.

–  The Vespa acer 50 years is s.ll world-‐renowned for it’s con.nual style, elegance and revolu.on.

–  “Dolce Vita” – Life is Sweet, the Italian phrase has become synonymous with the brand.

–  Vespa is more than just a scooter; it is a way of being, of thinking and of expressing the joy of living.

–  The very name Vespa evokes memories of youth; transports the mind to thoughts of free .me, beau.ful weather, the pleasure of driving in the open air with the sun and wind on the skin -‐ as shown by Gregory Peck and Audrey Hepburn, riding a Vespa around the Colosseum in the 1952 film Roman Holiday, or the sensual Anita Ekberg escaping the paparazzi in the famous shot from Fellini's masterpiece, La Dolce Vita.

–  It is extraordinary that the Vespa, having been involved in so much fashion, never passed out of fashion. At first it was green and not wondrously beau.ful, a symbol of transforma.on from war to peace. Then it became white and elegant, a product that imposed the ‘s.le italiano’: from necessity to style, the recipe for the good life. Then it dressed itself in silver and was transformed into a myth of elegance, youth and adventure.

–  Truly an Esperanto among objects, the Vespa, ini.ally presented as solid (it is s.ll made of metal), long-‐las.ng and adventurous, appealed to pioneers during the '40s and '50s. In the 60's it reflected the Italy of change, of pleasure-‐seeking children, and was transformed into a toy with real performance, expressing novelty, modernity and an.-‐conformism. In the '70s and '80s it turned into an object of nostalgia; and in this decade, with technological innova.ons and the 1996 launch of the sleek new Vespa ET2 and ET4, it has become revolu.onary, riding with all its appeal intact into the third millennium. For very many people, the Vespa is the perfect combina.on of style, design and elegant func.onality. The Vespa is .meless: it transcends the capriciousness of fashion.

6. Dream Merchants

© 2011 SinoTech Group (China) Limited © 2011 SinoTech Group (China) Limited

7. Brand Karma

"The next big thing in brands is social responsibility. It will be clever to say there is nothing different about our product or price,

but we behave well." Wally Olins


7. Brand Karma

•  It will also be clever to demonstrate just how well your brand behaves. It must go beyond words. Consumers aren't fooled by greenwashing.

•  Increasing acceptance of triple bottom-line reporting and the move by many companies to align themselves to philanthropic causes will produce more truly ethical brands.

•  Brands of the future will stand for product quality and desirable image and will have to signal something wholesome about the company behind the brand.

•  Cause branding champions such as: The Body Shop, Aveda and Ben&Jerry’s, have only gained from their social involvements.


7. Brand Karma

–  Social involvements include: constructing wetlands which treat the effluent from the Bulwer Island refinery – this approach not only treats the pollution created from production- but also creates a wildlife habitat.

–  It was important to integrate BP’s social responsibility into the new brand – the image is meant to show the difference BP makes, and in turn differentiates the brand by positioning it favorably in the mind of the market.

Case Study: BP

With the launch of the new BP brand, along with it’s new slogan “Beyond Petroleum,” it became important to create a new image – constructed around environmental concern.


7. Brand Karma

–  Ben&Jerry’s always made sure that the raw materials bought to produce

their ice-cream, was never at the cost of the local producers. At one time Ben&Jerry’s hired homeless people to come and work in their stores.

–  They boycott any milk or cream treated with synthetic hormones, such as rBGH.

–  They also care for the environment – by ensuring that their wastewater doesn’t pollute the water and kill wildlife.

–  From the fact that Ben&Jerry’s have always done business with such social mindedness, and have a value of $326 Million today, proves that it does indeed pay to be good.

Case Study: Ben&Jerry’s Ben&Jerry’s social responsibility programme was more than just giving donations, it was integrated into their everyday business processes.


8.Brand Rejuvenation:

• Brands that have prospered have retained their core values, but have reinterpreted themselves to remain relevant.

• Style lifecycles are becoming shorter. Think Madonna - the queen of brand rejuvenation. Think Burberry.


8.Brand Rejuvenation

improve is to change; to be perfect is to change ocen.” Winston Churchill


–  Almost 200 years ol the trademark red,camel,,black and white checkered patterns are still well received by hippest pop icons of today.

–  From Ernst Shackleton who wore Burberry to protect him from the Antarctic freeze, to Prince William, Kate Moss and Ja Rule.

–  This evolution proves that a brand must adapt to suit the times and even the oldest of brands can remain fresh and

8.Brand Rejuvenation

New.

Case Study: Burberry

This London-based brand began in 1856, and has moved from being a functional form of clothing to a luxurious fashion brand.


9. Straight Talk.

•  Don’t widen the gap – close it!

•  Deal with complexity through simplicity.

•  Declare war on complicated systems, procedures, products, services and design. Confusion is alienating.

•  Demystify your offering and your communication.


9. Straight Talk.

Case Study: Nando’s –  Nando’s has flourished in it’s home

market, South Africa, and continues to grow internationally in neighboring African countries and further abroad in Europe and Asia.

–  The simplicity of communication has always been a major competitive advantage for Nando’s.

The simplicity in it’s mass communication, has always carried across the values of hospitality, fun and the warmth of a traditional Portuguese experience. Apart from it’s mass communications, Nando’s also keeps it simple with regard to communication of it’s offerings – simulating McDonald’s in this respect. The simple truth of the brand is defined and unambiguous, making the Nando’s brand ring true to the public.


9. Straight Talk.

–  Nokia spoke to the world in human terms and not in technological jargon.

–  People understood Nokia products because they could ‘connect’ with the brand better than any of it’s competitors.

–  Nokia also avoided the mistake of diluting it’s brand with hundreds of sub-brands, giving individual products a generic brand personality, only numeric descriptors are used – which don’t actually appear on the products themselves.

–  The clear and concise phrase of “human technology,” leaves the rest of Nokia’s competitors talking gibberish.

Case Study: Nokia Nokia is the number one cell phone brand world-wide, and this position was gained mainly through their unique brand identity.


"I wish more and more .me was spent on designing an excep.onal product, instead of trying to psychologically manipulate percep.ons through expensive adver.sing." (Phil Kotler)

10. Has advertising had its day?


•  Designers will become the brand custodians of the future. What good is a great advertising campaign if the product image is weak? Good design is everything.

•  Advertising agencies have seen their share of marketing spend slashed to around 50%.

•  Strategic companies are being recognised. The trend is to be more tactical, more strategic and taking long-term responsibility for the brand.




While it could not compete on the level of it’s two competitors with regard to mass media, it had to find other ways of communicating the service offered in order to create hype strong enough for market penetration to be successful. CellC used one of the most innovative below the line campaigns ever seen in the South African cellular industry. Their ‘Paint the Town Red’ campaign

Case Study: CellC

In the South African market, competition was stiff between the two only cellphone providers, mainly MTN and Vodacom. When CellC entered this highly competitive arena, it was foreseen as having little or no chance of survival.

penetrated the lives of the consumer, by going to grassroots level, they communicated to the consumer in completely unique ways. By linking their communication to social responsibility, they achieved differentiation by being more human and caring.


The technology revolu.on has moved from hi-‐tech to high-‐touch.

11.Ethnic craft and culture:


11.Ethnic craft and culture

•  The human element is back. China is fashionable. •  There's a groundswell of apprecia1on for the value of

Chinese art and crac.


12.Women Rule:

"Tomorrow belongs to women."

Tom Peters


12. Women Rule

•  Women own the present and the future. They make the majority of purchasing decisions from homes to holidays, cars to consumer electronics.

•  Branding needs to reflect this. Why the masculine DIY stores? Why are female products designed by men?

•  Successful brands will be sensitive, intuitive, empowered and understanding.

•  Bridgestone is just one of the traditional male brands that have recognised the importance of women.


12. Women Rule

–  Other analysis shows that all female investing clubs are the most common kind of club, and outperform both co-ed and all male clubs.

–  Charles Schwab, has definitely taken advantage of this overlooked market, by creating “Women Investing Now,” which provides women with a suite of tools and resources connecting women to the investing world.

–  The main aim of this project was to instill confidence within potential women investors, since most of them lack the belief that they are capable of investing.

–  3 months after it’s inception, “Women Investing Now”, attracted over 5000 women to it’s first educational seminar.

Case Study: Charles Schwab

Research proves that women actually out perform men at investing, as they are more focused than men.


13. Brand Traditions

•  Known fact: People appreciate tradition.

•  Tradition has a strong enduring impact on people, by being heartwarming thus stirring emotion.

•  Simple current brand practices can evolve into powerful

traditions that integrate into popular culture, and resonate within the consumers lifestyle.

•  Perfect in today's modern consumer culture, demographics – more singles who are away from home.

•  Sears created a new tradition out of an ordinary period – ‘The Autumn of Love’, which boosted sales compared with the same period in previous years.


14. Sensory Branding:

“Where sense is wan.ng, everything is wan.ng.”

Benjamin Franklin


14. Sensory Branding

•  Brands have moved from just appealing to 1 or 2 senses, to appealing to all 5 - or even 6.

•  With each sense activated, memorability of your brand increases exponentially.

•  Sense has in fact become so important that new trademark legislation, actually places copyrights on less traditional sensorial appeals – smell, taste, touch.


14.Sensory Branding

–  These jeans promote collagen production and fight the free radicals, which actually slows the aging process.

–  The smell and feel of the jeans are completely different to anything on the market, these unique appeals quickly accelerate the jeans to a completely new level of awareness in the consumer’s mind.

–  The jeans were initially launched in Japan where they were sold out within 24 hours, now the jeans have spread like wild fire through the East and have also began to move into European markets.

Case Study: WOW! Jeans

Wow, transcended typical jean sense appeals. They produce jeans impregnated with arginine, an amino acid said to keep the skin youthful. Fatty acids in the fabric used to make the jeans, developed by Teijin Wow, also moisturize the skin, smell nice (who needs perfume anyways?) and fight bacteria.


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© 2011 SinoTech Group (China) Limited 52

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14 Brand Considerations for Advertising in China

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