Expanded report probes vibrant forces reshaping China’s brand landscape
Value rise a record 30 percent in turbulent year
If you want a quick snapshot of the forces reshaping the brand landscape in China, stand on just about any street corner in central Shanghai and observe the scene: men and women rushing to work, often stopping first at a food outlet or coffee shop—a Starbucks or Luckin Coffee, its Chinese competition; people streaming in an out of malls carrying shopping bags imprinted with global and Chinese brand logos; and all this activity happening amid the rush of traffic dense with delivery men on cycles and carts darting and weaving as if their livelihood depended on maximum speed—because it does.
Some of the Chinese brands producing all this market energy did not exist just nine years ago, when we launched the BrandZ™ valuation and analysis of China’s Most Valuable Brands. One brand that did not appear in our first Brand™ China report is Alibaba. Since joining the ranking in 2015, following its IPO, Alibaba has steadily moved up, and this year it reach No.1. The rapid rise of Alibaba contributed to the transforming changes in the Chinese market. Today, all brands need to work harder just to remain relevant. As noted in this report, many brands have met the challenge, often with transformative ideas and memorable, creative communications.
We expanded the 2019 report to create a more comprehensive and nuanced picture of this changed Chinese. Consumers are wealthier, more sophisticated, rational and emotional about purchasing, and extreme in their expectations for convenience, including fast delivery. Over 800 million Chinese are online and using their mobile phone to conduct the daily business of their lives: ordering food, hailing cabs, shopping, and making cashless payments. We added four new categories this year—consumer finance, entertainment, lifestyle platform, and transport. And 17 newcomers joined the ranking. A modification to our eligibility criteria qualified unicorn brands that have their most recent valuation publicly available.
The Top 5 Newcomers illustrate how online-offline integration and the consumer convenience phenomenon more advanced in China that any other country market worldwide. The Top 5 Newcomers are: Xiaomi, among the world’s leading smartphone makers; the ride hailing app Didi Chuxing; Meituan, the online services leader; Ele.me, Alibaba’s food delivery business; and Lufax, an online peer-to-peer lender. The dynamism created by brands like these forms a counterpoint to the year’s much more familiar narrative of geo-political tensions and stock market fluctuations. Despite these real issues, the value of the BrandZ™ China Top 100 rose a record 30 percent. And our BrandZ™ Stock Portfolios continued to vastly outperform China’s MSCI Index, demonstrating how valuable brands deliver superior shareholder returns.
One more point about this dynamism. You don’t have to be in Shanghai or another coastal city to observe it. Your street-corner vantage point could in Wuhan or another lower tier city. The pace won’t be quite as frantic, but consumer interest in brands and the presence of brands will be obvious. Less obvious, but vital for brand building, are the nuances: Although street corner scene in coastal and inland cities will look similar, brands success will depend on gaining insight about the hidden differences in consumer attitudes and shopping habits. Experience in the lower tier markets gives Chinese brands an advantage. The other major opportunity for Chinese brands is overseas growth. Our recent BrandZ™ research, in collaboration with Google, revealed growing acceptance of Chinese brands among overseas consumers, but a lag in awareness that Chinese brands need to address.
Knowledge, analysis, and insights
The constant activity in China can seem random and chaotic, and decoding it into the insights required to build sustainable brand value can be daunting. That’s where we can help. Our WPP companies have been engaged in China for over 30 years. Today, 14,000 people work across China in Beijing, Shanghai, Guangzhou and many other cities and provinces. We’ve pulled together these resources to create this report, which provides knowledge, analysis, insights, and recommendations for successful brand building in China. We’ve organized all this material to be both useful and easy to access. Here’s a quick preview of what you’ll find in the articles below:
Part 1 Introduction Start here and return as needed for summaries of the information contained in the report, including the trends that make the information comprehensible and actionable.
Part 2 Market Intelligence Understand the report in context of changes—in migration patterns, shopping habits, technology, and more—that impact the brand valuations.
Part 3 Thought Leadership Gain perspective from some of WPP’s most experienced brand experts on New Retail, brand experience, digital, media, and other topics.
Part 4 Brand Building Observations Move from analysis to action with five specific market observations and brand building recommendations.
Part 5 The China Top 100 Examine brand trends across 24 categories with commentary from C-Suite executives at two BrandZ™ China Top 100 brands.
Part 6 Brand Building Best Practices Get insights and tactics from WPP China experts on social media, expanding abroad, and other key challenges.
Transformative ideas and outcomes
At WPP in China, we provide expertise in advertising; insight; branding and identity, direct, digital, promotion and relationship marketing; media investment management, retail and shopper marketing; and public relations and public affairs. One of our key WPP strengths—and a benefit for our clients—is that when we say we cover the world of brands, that’s exactly what we mean. We operate over 3,000 offices in 112 countries. WPP’s proprietary BrandZ™ database includes information from over 3.7 million consumers about their attitudes about (and relationships with) 128,000 brands in 454 categories across 51 country markets. All that produces more than 5.2 billion data points.
We have assembled an extensive library of BrandZ™ reports and I invite to you access them with our compliments here at www.BrandZ.com. Here are just some of the reports you will find there: The BrandZ™ Top 100 Most Valuable Global Brands; BrandZ™ Top 100 Most Valuable US Brands; BrandZ™ Top 50 Most Valuable Latin American Brands; BrandZ™ Top 50 Most Valuable UK Brands; BrandZ™ Top 50 Most Valuable French Brands; BrandZ™ Top 50 Most Valuable German Brands; BrandZ™ Top 50 Most Valuable Indonesian Brands; Top 40 Most Valuable Australian Brands; BrandZ™ Top 30 Most Valuable Italian Brands; BrandZ™ Top 30 Most Valuable Dutch Brands; BrandZ™ Top 30 Most Valuable South African Brands; and the BrandZ™ Top 30 Most Valuable Spanish Brands. Gain access to all these reports here at www.brandz.com.
We have the data, knowledge, experience, insight, determination, and single-minded purpose to help you create the transformative ideas and outcomes necessary for building valuable brands. To learn more about how to harness our passion to work for your brand, please contact any of the WPP companies that contributed expertise to this report or feel free to contact me directly.