Observation 2: Familiarity with Chinese brands varies widely by country
Local factors determine levels of awareness, consideration
The awareness gap between Chinese brands and other brands is narrower in France, Germany, Spain, and Australia. The consideration gap is narrower in France, Germany, and Spain. Conversely, both the awareness and consideration gaps are wider in the US, the UK, and Japan.
The reasons for these differences are complicated and usually market specific. The higher awareness and consideration levels in Australia probably reflect the large presence of Chinese ex-patriots. After the UK and New Zealand, China ranks third as the country of birth for Australians born abroad. In addition, Chinese companies sometimes use Australia as a proxy test market for the US because of similar consumer attitudes and lower media costs.
The receptivity to Chinese brands in Spain suggests that they resonate with the value-driven priorities of Spanish consumers, who are open to niche brands in categories where Chinese brands are present, such as smart phones and other mobile devices.
Conversely, the wider awareness and consideration gaps in Japan reflect the higher quality expectations of Japanese consumers and a preference for local goods. The wider gaps in the UK and US result from market competitiveness and other factors. UK consumers may be curious about new brands, but conservative about trying them.
Chinese brands typically begin their expansion in Asia or Southeast Asia, where they are relatively well known. Our research reveals some of the challenges and opportunities that await Chinese brands beyond those markets. These new findings should help Chinese brands more effectively plan their international expansion.
Spanish consumers seem more aware of Chinese brands than Americans. But nuances are important. Building awareness in the US can require substantial investment. However, Chinese brands entering the US already have a strong foundation. Although Americans are unfamiliar with most Chinese brands, they use Chinese products all the time. But the products are marketed as western brands. The challenge for Chinese brands is to accelerate presence in the US by more aggressively promoting Chinese brands, or by partnering with market leaders.
Western consumers overall are impressed with the wide diversity and innovativeness of products coming from China. This impression is stronger in Europe compared with the US, and it is especially pronounced among young people, according to a recent BrandZ™ study of China’s image worldwide, which also found that Chinese brands still need to address consumer concerns about product quality.