A Brief Discussion on 1.7 Million Chinese Brands That Are Numerous but Not Strong
Release Time:
2012-03-30 09:59
Source:
Economic Participation in Politics
According to the China Trademark Association, the total number of trademark registrations in mainland China has surged to the top globally, reaching over 2.2 million, with foreign-funded enterprises accounting for 20%, and the remaining approximately 1.7 million registered trademarks belonging to Chinese companies. Thus, the total number of brands in the Chinese market can be considered the largest in the world.
Does having 1.7 million trademark brands mean that China has become a major brand power? Certainly not. In reality, these 1.7 million brands are 100% at a disadvantage compared to strong international brands. Regarding this, the "2010 China Enterprise Brand Management Capability White Paper" aptly states: "Many Chinese entrepreneurs... still understand brands at the level of Western countries in the 1950s, which is merely a stage of blindly pursuing the quantity of brands."
The author once participated in a sample study of over 1,700 Chinese enterprises and found that the characteristics of brand management in Chinese companies are "three strengths and three weaknesses": strong awareness but weak strategy, strong products but weak image, strong investment but weak output. It can be said that Chinese enterprises generally recognize the importance of brands in awareness, but this awareness is not well reflected in actual strategic planning, with strategic planning capabilities lagging far behind awareness. In short, most Chinese companies are at a loss both in understanding the basic rules of brand competition strategy and in mastering the strategic points of brand marketing.
Therefore, facing the current state of brand management in Chinese enterprises, at this stage, entrepreneurs should not increase or acquire new brands but rather significantly streamline the number of existing brands, focusing energy and resources on prioritizing the creation of strong flagship product brands. Otherwise, efforts may be counterproductive or even lead to the embarrassing situation of having trademarks without brands, spending a lot of money but achieving little effect.
In fact, the issue of brand quantity has long been settled in the development of Western brands. From a practical perspective, the principle of "more causes confusion, less brings clarity" is not unfamiliar to entrepreneurs. However, habitual thinking makes them believe that "10 brands with 1 success" is more likely than "1 brand with 1 success," especially when seeing the dazzling multi-brand strategies of Fortune 500 companies like Procter & Gamble and Unilever, which is very appealing. But the reality is harsh: among 1.7 million Chinese brands, none leads the world.
Little do they know, a brand is a boutique project; brand quality is not built by quantity or luck. This requires entrepreneurs to calm down and base brand positioning on facts and data, meticulously planning marketing. Taking Procter & Gamble's entry into the Chinese market as an example, the positioning and strategic formulation of any one of its brands took 2-3 years of research, and building and marketing took 3-5 years, with human, material, and financial investment 2-8 times that of product design and development. Its multi-brand success is justified and conditional, while knockoff imitation often only results in "Dong Shi imitating Zhao."
In summary, China's brands are not too few but too many, many but not strong! It is recommended that our entrepreneurs learn the three-stage layout strategy of "subtraction," "addition," and "multiplication." For many enterprises, now is the "subtraction" stage, which should streamline the number of brands, concentrate efforts on building advantageous product brands, focus on research with planning as a supplement, and build strong brands with the mindset of boutique projects. Only after this can they enter the "addition" and "multiplication" stages to truly become branded enterprises.
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