li:before{content:"o "}ul.lst-kix_list_1-0{list-style-type:none}.lst-kix_list_1- BrandZ is the world's largest brand equity database. Created in 1998 and continually updated. BrandZ is an invaluable resource, containing data on brands gathered from interviews with over 150,000 people every year in up to 400 studies around the world"> brandZ | Report -
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Significant growth opportunities await Chinese brands in overseas markets

Great opportunities await Chinese brands in overseas markets

Brand building efforts will accelerate progress

Chinese brands are rapidly expanding globally and increasing in brand value, often faster than brands from any other region, including North America.

The number of Chinese brands in the BrandZ™ Global Top 100 increased from just one (China Mobile) to 14 over the past 12 years, while the number of North American brands (mostly US) increased from 50 to 57. Similarly, the value of Chinese brands in the BrandZ™ Global Top 100 increased 1,444 percent over the past 12 years, while North American brands, increased 239 percent.

Despite this progress, Chinese brands still lag North American brands in total value. The 57 North American brands (55 US brands) in the BrandZ™ Global Top 100 account for 71 percent of the ranking’s value, while the 14 Chinese brands account for just 14 percent.

The number of categories represented in the BrandZ™ Global Top 100 by Chinese brands increased from one (telecom providers) 12 years ago, however, to seven today. The banks category is most represented, with four brands, followed by technology, with three brands.

In the 2019 BrandZ™ China Top 100, the technology category dominates the list of brands with the greatest proportion of revenue derived from overseas business. Six of the Top 10 Brands in Overseas Revenue are technology brands. Only three other categories are represented in the Overseas Top 10: oil and gas and home appliances, with one brand apiece, and airlines, with two brands.

To maintain or accelerate their overseas impact, Chinese brands must strengthen their Brand Power, a BrandZ™ measurement of brand equity. Although the 14 Chinese brands that rank in the Global Top 100 score high in Brand Power, 218 on an index where 100 is average, they lag behind the “Fearsome Five” (Amazon, Apple, Facebook, Google, and Microsoft), which score 294.

Chinese brands need to improve in each of the three components of Brand Power—Meaningful, Different, and Salient. They especially need to strength Difference and Salience. The 14 Chinese brands in the BrandZ™ Global Top 100 score 130 in Difference, compared with 176 for the “Fearsome Five.” In Salience, the Chinese brands in the Global Top 100 and the “Fearsome Five” score 158 and 188, respectively.

The 86 brands in the China Top 100 that do not appear in the Global Top 100 scored relatively high in Brand Power and its three components—Meaningful, Different, and Salient. But they need to score even higher, especially in Difference and Salience, to appear in the Global ranking.

Brand Implications

  • Chinese consumer brands now have an opportunity to leverage the overseas presence established by Chinese business-to-business brands that have been implementing Belt and Road initiatives.

  • Chinese brands should go where they can win, which often is in the emerging markets of Southeast Asia and Africa.

  • The success of technology brands, and China’s leadership in artificial intelligence, have helped create a more receptive overseas environment for Chinese brands across many categories and have opened up opportunities in Europe and North America.

  • Young people, especially those that have experience with Chinese internet games, are a receptive customer group that views Chinese brands as innovative.

  • Until now, most Chinese brands have had limited experience competing successfully against Amazon, Apple, Facebook, Google, and Microsoft outside of China. Chinese brands lag the “Fearsome Five” in Brand Power and especially in Difference. Chinese brands will need to rapidly strengthen these metrics—especially Difference—to compete successfully abroad.

  • Trade tensions will ebb and flow with the political winds. Meanwhile, Chinese brands need to understand the differing characteristics and nuances of overseas markets and focus on making their products and services—and communications—relevant to these new customer groups.