In the post, Can Chinese Firms Build Globally Competitive Brands? author Joel Backaler talks of how Chinese companies are generally unwilling to do what it takes to create a global brand. And Backaler, who wrote a truly excellent book, China Goes West: Everything You Need to Know About Chinese Companies Going Global on Chinese companies expanding internationally, knows these things.

Backaler starts off his post by saying how he likes to start his talks on Chinese companies going overseas by borrowing the following joke from China public relations veteran David Wolf:

For many Chinese firms, “branding” means designing a new logo, “marketing” is the equivalent of purchasing ads on China Central Television (CCTV), and “P.R.” does not stand for “public relations” but rather “pay the reporter.”

Though conceding that this joke is a “generalization,” Backaler sees this joke as illustrating how for many Chinese companies, “marketing is still considered to be an expendable expense:”

Rather than a series of strategic activities that strike the right balance between driving short-term sales today while building a brand that’s a long-term strategic asset for the future, it is all too often focused on the next product launch. This is in part due to the fact that China’s business environment has historically rewarded a singular focus on short-term sales without needing to concentrate on the intangible aspects of branding and marketing. The result is a series of firms that are very large – 95 companies on the Fortune Global 500 ranking originate from China – yet relatively unknown outside of China.

But Backaler sees this changing and he notes how in his book he dedicates “an entire chapter to Chinese firms building globally competitive brands, either through their own efforts or by acquiring long-established brand names from the West.”  He then declares himself “optimistic that Chinese firms will build global brands through their own efforts.”

A couple of weeks ago, I attended a book opening for China’s Superconsumers: What 1 Billion Customers Want and How to Sell it to Them, by Michael Zakkour and Savio Chan (another excellent book, BTW), at which these two authors noted how no Mainland Chinese company is among top 500 international brands.

When will a Chinese company break the top 500. One year? Three years? Five years? Ten years? Never? I’m thinking at least ten.

What say you? What do you see as the factors militating against China developing top brands? What do you see as the factors that will lead its companies to do so?

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Photo of Dan Harris Dan Harris

Dan is a founder of Harris Bricken, an international law firm with lawyers in Los Angeles, Portland, San Francisco, Seattle, China and Spain.

He primarily represents companies doing business in emerging market countries, having spent years building and maintaining a global, professional network.  His work has been as varied as securing the release of two improperly held helicopters in Papua New Guinea, setting up a legal framework to move slag from Canada to Poland’s interior, overseeing hundreds of litigation and arbitration matters in Korea, helping someone avoid terrorism charges in Japan, and seizing fish product in China to collect on a debt.

He was named as one of only three Washington State Amazing Lawyers in International Law, is AV rated by Martindale-Hubbell Law Directory (its highest rating), is rated 10.0 by AVVO.com (also its highest rating), and is a recognized SuperLawyer.

Dan is a frequent writer and public speaker on doing business in Asia and constantly travels between the United States and Asia. He most commonly speaks on China law issues and is the lead writer of the award winning China Law Blog. Forbes Magazine, Fortune Magazine, the Wall Street Journal, Investors Business Daily, Business Week, The National Law Journal, The Washington Post, The ABA Journal, The Economist, Newsweek, NPR, The New York Times and Inside Counsel have all interviewed Dan regarding various aspects of his international law practice.

Dan is licensed in Washington, Illinois, and Alaska.

In tandem with the international law team at his firm, Dan focuses on setting up/registering companies overseas (via WFOEs, Rep Offices or Joint Ventures), drafting international contracts (NDAs, OEM Agreements, licensing, distribution, etc.), protecting IP (trademarks, trade secrets, copyrights and patents), and overseeing M&A transactions.