Want to Be a Brand Leader in China? All You Need Is to Advertise

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HONG KONG-Advertising is the preeminent factor consumers in the People's Republic of China use to identify brand leaders, according to a new report by D'Arcy Masius Benton & Bowles, China.

The findings contrast with the patterns revealed elsewhere around the world by DMB&B research and has major implications for agencies and advertisers, said DMB&B Hong Kong Managing Director Barry Jones.

Studies in other markets have found advertising ranked no higher than sixth as a factor in driving brand leadership perception.

In these markets factors such as quality, trust and standing the test of time, governed consumer judgments of brand leaders rather than advertising.

The agency's 290-page "1994 Leadership Study in Guangzhou, Shanghai and Beijing" addressed perceived brand leadership in 15 categories. The study was conducted with in-person interviews among 600 people in January and February of this year.

Products surveyed ranged from powdered milk and baby foods to personal computers and automobiles. The report suggests foreign products are perceived as superior to local products in all but two categories-beer (Tsing Tao) and toothpaste (Hei Mei).

"The findings confirm the obvious: that China is an immature market," said Mr. Jones. "But the meaning for foreign companies is that they need to focus above all on their advertising in terms of volume, weight, ubiquity and quality because Chinese consumers are learning about new products principally from advertising."

He added many marketers realize that the window of opportunity to develop brand loyalty will remain open for only a short period because once product preferences are set, they are hard to change.

"A manufacturer's immediate objective should be to achieve dominance in advertising presence followed by distribution and presence on shelves," he added.

Mr. Jones said it was important to recognize that the survey results had no relationship to sales.

"Rolex is regarded as the leading watch [in China] and Mercedes the leading car, but out of the whole population how many Chinese people own a Rolex or drive a Mercedes? Only 2% of the 600 people we surveyed owned a Rolex," he said.

Mr. Jones said he was suprised in three specific areas: the speed at which foreign goods had become perceived as leaders; the wholesale rejection of Chinese brands; and the apparent fact that advertising played such a dominant role in shaping perceptions.

"Looking down the list of brand leaders as perceived by Chinese buyers, it seems clear they are simply adopting Western brands," he said.

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