China's top 50: Much progress but more to do

Peter Walshe and Peking Tan

The recently released China Top 50 ranking once again confirms the value of a strong brand and highlights the remarkable growth of China's economy over the past decade. But it also provides an opportunity to define some of the specific challenges currently facing Chinese brands.

While they are growing well at home, China's developing brands face a very different environment outside of China. In developed markets, these brands need to sharply increase their levels of awareness and penetration. But beyond that, to actually achieve profitable growth, Chinese brands need to provide consumers with an experience that is meaningfully different.

As we have seen in previous years with the BrandZ Global Top 100, the share prices of strong brands greatly outperform the average. This year's China Top 50 ranking provides another example of the value of this "brand gap." (See Figure 1.) While the MSCI China Index registered a 6 percent loss over the past 15 months, the China Top 50 brands were up 20 percent.

The new china: fertile ground for brands