Brands change for China

13 April 2011

BEIJING: International brands are willing to adapt their products and services to suit the Chinese market, a joint report from Forbes Insights and the World Federation of Advertisers (WFA) has revealed.

Marketing to the New Chinese Consumer, for which 300 China-based executives were polled, revealed that 63% of non-Chinese marketers believe they need to change their brand's fundamental attributes for local consumers.

Meanwhile, just 27% said they would extend their global brand into the Chinese market with the same attributes already established in other markets, and 2% said they would create an entirely new secondary brand for China.

When executives from international advertisers were asked about their key branding goals of 2011, 32% said they would be focusing on building brand awareness, while 36% said they would try to create positive brand perceptions.

Another 36% will prioritise increasing sales or revenues.

Global advertisers are increasingly focusing on China, which has experienced impressive economic and adspend growth over recent years. Latest Warc forecasts indicate that Chinese adspend will grow by 12.5% this year, following a rise of 13% in 2010.

New opportunities for international marketers are also likely to be found beyond Beijing and Shanghai, the survey indicated.

Around 80% of the executives polled said that second- and third-tier cities would provide the highest growth over the next three years, while 42% of non-Chinese marketers cited expanding into new regions as one of their "primary marketing goals".

The media mix for upcoming campaigns will remain largely traditional, as China's internet penetration rate is relatively low when compared to other large Asian economies such as Japan and South Korea. Around 420 million Chinese - a third of the population - are online.

TV ads will feature in the 2011 marketing plans of 79% of respondents, while online will feature for 69%, and print for 60%.

International executives remain cautious about their prospects for ultimate success, with 58% agreeing with the statement that, within China, local brands have an advantage over global brands.

A slightly higher proportion (64%) of Chinese executives said the same.

Data sourced from WFA/Forbes/Warc; additional content by Warc staff