CHINOPHOBIA - THE METAMORPHOSIS OF CHINESE BRANDS
CHINOPHOBIA - THE METAMORPHOSIS OF CHINESE BRANDS
Tuesday, 27 October 2009 09:36
Over the last decade mainland China has strengthened its ties with the rest of the world, relaxed protectionism and embraced competition as a facet of their development. As a result, China has emerged as one of the fastest growing economy in the world enjoying double digit growth figures year on year.
In Africa just like the rest of the world, a Chinese brand is often discounted as cheap in price hence quality thus the fear of a Chinese brand – brand chinophobia. In a recent study carried out by Interbrand a global brand management firm, china has 20% of the world’s population and with that said, there is going to be a host of very bad products, very good ones and some in between.
In Kenya, China made its very first official entrance in 2005 when President Kibaki led a delegation to China for talks on expansion of trade and better bi-lateral relations between Kenya & China. This was followed a year later by a landmark visit by the Chinese premier to negotiate amongst other things, exploration of oil in Kenya. The last straw to the mud hat of relations was the Qaunzough route started by Kenya airways.
These events geared business people in both countries to increase the value of business transacted proportionately.
A Chinese brand – a critical look
It is important to note the pace at which Chinese brands have grown, which is quicker by comparison to other nation’s adoption of branding including Japan and South Korea. Japan was not always in the holy grail of global brands, they once suffered from what I like to call brand Japanophobia which stood for a business culture of low quality and purely functional goods.
After Japan adopted branding in order to break ranks with the global brands of the 70’s, the results were outstanding with brand champions of the like of Toyota born and eventually managed to enter the lucrative American market, and challenge predominantly giant brands like General Motors.
Today Japan and South Korea account for a large proportion of global brands like Toyota, LG, Samsung, Nissan, NEC, Panasonic, and Sony among many others. China is taking note.
What Japan and South Korea learnt and adopted in a period of about 50 grand years is taking China a much shorter time in the brand creation & metamorphosis cycle. The threat of global Chinese brands is real and is here with us today.
In Kenya Chinese brands have made their presence felt in the following sectors:
• Motor vehicles brands like Dongfeng & FAW
• Phones with ZTE (Solar powered phone), Dorado
• Home appliances like Haier
• Telecommunications equipment like Huwaei & Lenovo
• Road construction brands such as China construction
There are two interesting brands in China that really catch my attention. In 2004, IBM the iconic business machines manufacturer sold the Lenovo brand to a Chinese manufacturer & in 2009 while everybody else in the world was shedding off cost centers during the recession, China was busy acquiring brands. In a dramatic move, General motors sold the Hummer brand to Sichuan Tengzhong for an undisclosed figure.
Chinese companies are beginning to understand the value that branding can play for their products and the contribution branding can make to their profitability. This is only the beginning; I feel there is more to expect in terms of brands & branding from the land of Mandarin people.
By Herbert Kamau
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