BEIJING: In the eyes of Chinese consumers, local brands are now as competitive as global ones, as new research shows them scoring more highly on important factors that create competitive advantage.
This finding emerged from the latest brand ranking study conducted by WPP and Millward Brown. The BrandZ Top 100 Most Valuable Chinese Brands showed that Chinese brands are performing well in terms of building brand awareness and in connecting with consumers on both a functional and emotional level. Where they have work still to do, however, is in the area of differentiation.
Overall, the value of the 100 Chinese brands has risen 13% to $525.6bn in the last year despite China's slowing economic growth – GDP increased 6.9% in 2015,down from 7.3% in 2014.
And, said BrandZ, for the first time in the six years it has been doing this research, market-driven brands – those that are owned by entrepreneurial companies – contributed more than half (51%) of the value of the Top 100, a development it suggested was further evidence of China's transition to a market economy.
"These brands have taken full advantage of their freedom to innovate and generate value from technology," it said.
Leading the way is internet giant Tencent, which grew its brand value by 24% to a total of US$82.1bn, keeping it at number one in the BrandZ ranking, ahead of China Mobile, in second place worth US$57.2bn, and Alibaba in third, with a value of US$47.6bn.
Tencent has held on to the top position through its successful "Connection" strategy which links users with content, services and hardware that enhance their lives, the study noted.
It has monetised its social WeChat platform by partnering with JD.com to develop profitable new big data-backed marketing solutions, while its TenPay product is now China's number two online payment platform.
Brands that are innovative and unique grow eight times faster than their rivals, the study said. And the highest performing brands all have a strong mobile presence, not simply as purveyors of products and services, but as partners that help consumers make a better life for themselves and their families.
Data sourced from BrandZ; additional content by Warc staff