Warc Blog

Chinese firms face trust gap

13 September 2013
DALIAN: Chinese multinationals enjoy widespread trust among domestic consumers but this falls off rapidly overseas, particularly in developed markets, a new survey has said.

Edelman, the PR firm, interviewed 5,400 "informed online respondents" in nine developed and emerging countries and found, China Daily reported, that Chinese firms had an 83% trust rate in their own country, but could only attract 50% in other emerging markets and a mere 24% in developed markets.

Germany (19%) and France (22%) were among the most disinclined to embrace Chinese companies, while the important US market (26%) was little better.

In fact, respondents in developed markets were more likely to trust South African (31%) or Indian (28%) firms.

Edelman attributed this "trust gap" to a lack of familiarity with Chinese brands and concerns, again especially prevalent in developed markets, that such companies were closely linked to the Chinese state.

Some Chinese businesses have bucked the trend, however, with Lenovo achieving a 72% consumer awareness rating in the US and Air China a 63% rating.

As well as distrusting Chinese companies, there was a marked reluctance among respondents in developed countries to see them entering their own markets: just 33% were willing to see a Chinese company buy a company in their domestic market, and only 38% wanted a Chinese company to get access to their market.

"This is a big problem," said Richard Edelman, president and chief executive officer of Edelman.

"'Branding China' is not helping if Chinese companies want to go global," he added.

A leading brand strategist recently argued that Chinese firms needed to address their weaknesses in branding and marketing if they were to succeed abroad.

David Aaker, vice chairman of Prophet, said most lacked a history of brand strategy and management, in part because of current or past state-ownership. In addition, top managers were not trained in marketing and tended to be focused on operations, costs and delivering functional benefits.

And Millward Brown research has suggested that Chinese marketers should adopt an outward looking perspective with less reliance on Chinese culture as a selling point.

Data sourced from China Daily; additional content by Warc staff

 
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