On the question of which of the top 100 brands are “doing it right” or “doing it wrong” in China now, here is my own biased list (based on the Business Week top 100 brand list) and comments. (I have lived and worked in China for 17 years and have seen hundreds of different western companies attempt to make a success in China, so I think I have developed a pretty good nose for these things now).In my view, the companies that are doing it right in China now, will reap long term rewards, and those that are doing it wrong will be left behind or have to play catch up later in the game. Maybe the basis of a good long term “China investment” strategy? You decide.(Note, these comments are only based on my opinion about what they are doing in China, not the rest of the world.) 1 COCA-COLA: Doing it right. They are everywhere and doing it right. But they need to straighten out their organization and reduce the internal politics, otherwise this in-fighting can really get out of control and hurt their business. Politics are something the Chinese people are very good at playing. So, better to not let them have this “avenue for self-expression” and rather to focus on the business of selling products.2 2 MICROSOFT: Doing it wrong. Annoying everyone as usual with their pushy style. Note to Bill Gates: Don't annoy Chinese people or the Chinese government. They are experts at keeping score and will make you PAY when the time is right.3 3 IBM: Doing it right. Yeah, surprisingly, their whole consulting approach is working. 4 4 GE: Doing it wrong. Maybe on the industrial side, they will make a fortune selling equipment to China, but as a consumer brand, they are non-existent.5 5 INTEL: Doing it right. Well done to date. High brand recognition and high preference. They are not really known as an American company, so this makes their future more predictable in China.6 8 NOKIA: Doing it right. Good phones and good innovation. 7 6 DISNEY: Doing it wrong. Hong Kong Disney is not doing well, and there have been too many PR mistakes. Also too slow to get something going in Shanghai. Also licensing their poor little Disney characters to death and not monitoring the quality of the licensees at all. Very risky!8 7 McDONALD'S: Doing it right. But they will feel the ups and downs as China attacks them periodically on the health issue. Chinese kids are bound to get chubbier over the next few years and McDonalds is going to unfairly bear a lot of the blame. That said, McDonalds has a nice steady growth strategy and tighter quality control of their restaurants than KFC.9 9 TOYOTA: Doing it wrong. Sleeping at the wheel. The anti-Japanese feeling of China is not much help either.10 10 MARLBORO: Doing it wrong. A real drag. Not doing much and also not realizing that Chinese people like the taste of Chinese cigarettes, not western cigarettes. So why not just change the flavor of Marlboro and keep the nice western brand? 11 11 MERCEDES-BENZ: Doing it wrong. Too slow and too German (I think I just said the same thing twice). Great brand image but they are really missing the boat to sell more cars. They should also realize that the back seat is where the boss sits, so the back seat should be where the stereo/AC controls are placed.12 13 CITI: Doing it wrong. Suppose they are tied up by regulations.13 12 HEWLETT-PACKARD: Doing it wrong. More well known for their CEO troubles than actually selling products. Very political organization on Beijing is near meltdown. 14 14 AMERICAN EXPRESS: Doing it wrong. Where are they? They barely even service their American card holders traveling in China and they are missing the boat entirely on developing a local base. Maybe the regulations don't allow them to launch their card, but they should still be building their brand via other methods like a premium catalog for mail-order.15 15 GILLETTE: Doing it right. Tight organization and just taken over by the monster P&G, the most successful western company in all of China!16 17 BMW: Doing it right. Great brand recognition and ramping up quickly in China production. They will replace Mercedes as the best German brand in China.17 16 CISCO: Doing it ? I know nothing about them.18 44 LOUIS VUITTON: Doing it right. Nice stores and good brand building. They are letting the fakes die a natural death and not letting it bother them so much. Anyways, the fakes also help to build the brand in the short term. Would anyone in China know LV brand if there were no fake products being sold in the market? I doubt it.19 18 HONDA: Doing it wrong. Sleeping and the cars are too small in the back seat where the boss sits. Also they are too southern China focused. 20 21 SAMSUNG: Doing it so so. I suppose they are the best effort at branding that you can expect from a Korean chaebol. But that does not mean they are doing it well.21 25 DELL: Doing it wrong. Would be nice if they actually made their products available in the market via a serious distribution network.22 19 FORD: Doing it wrong. Nearly comatose. Forget it, Ford, The race is nearly over and you have just left the pits. Maybe you should buyout Geely? First go read the famous book called “Beijing Jeep”, then think about it.23 22 PEPSI: Doing it right and wrong at the same time. Beverages are all wrong. Foods are all right.24 23 NESCAFE: Doing it right. Well done, mass image. People really call this stuff “coffee” here in China. Sure, Starbucks may educate the top 50% of the people, but there will still be another 50% that wants powdered dirt as a hot drink mix.25 26 MERRILL LYNCH: Doing it ? Not sure on this one.26 24 BUDWEISER: Doing it so so. Lot's of sales but can they ever make money? Also their brand is well known but what does it stand for in China?27 28 ORACLE: Doing it ? Don't know, but they have a really cool brand name in Chinese. Sort of a translation of their English brand.28 20 SONY: Doing it wrong. Somehow they are just not pulling off the “superior quality” trick here. Maybe it has something to do with the pervasive anti-Japanese feeling in China.29 33 HSBC: Doing it wrong. Pushy bank that charges fees for opening their front door and supplying oxygen in their branch offices for lowly consumers to breathe. Prepare to get stomped by the local Chinese banks that also have bad service attitudes but are much cheaper to deal with than HSBC.30 31 NIKE: Doing it wrong. They seem to have no brand strategy in China other than to be paranoid about fake products. Wake up guys, and start building the brand before it is too late.31 29 PFIZER: Doing it ?32 UPS: Doing it wrong. Too slow to enter and too slow to get moving.33 27 MORGAN STANLEY: Doing it ?34 30 JPMORGAN: Doing it ?35 35 CANON: Doing it right. Focus on products and little mention of their Japanese culture in a strongly anti-Japanese market. Smart.36 34 SAP: Doing it wrong. The SAP scam (bad product, high price, German attitude) will get busted by strong local competition in the ERP field (Yong You, King Dee, etc)37 37 GOLDMAN SACHS: Doing it ? 38 GOOGLE: Doing it wrong. PR problems aside, they don't seem to be doing much while Yahoo and locals run ahead.39 36 KELLOGG'S: Doing it wrong. Doing nothing of interest. As usual in Asia, Kellogg's has convinced themselves that selling cereal in Asia is impossible. I would say they are wrong, but anyways, at least I can say they are doing it wrong now.40 38 GAP: Doing it wrong. The local fake Gaps (Net, Giordanno, Sparkle, etc.) are more well-known than Gap. Too late guys. Game over. Also Zara has jumped in the market as well.41 43 APPLE: Doing it wrong. They can not seem to open and maintain a decent brand shop to sell the products. I-pod is doing well, but that will not be enough. Even Sony has stolen their “cool” position in the PC market.42 40 IKEA: Doing it right. Wow. Very good. Also smart that they lowered the prices a few years ago. Short term sacrifice will reap long term benefits for them.43 NOVARTIS: Doing it wrong. They seem to be drifting and cannot decide what to do in China.44 45 UBS: Doing it ?45 39 SIEMENS: Doing it right. Nice high-end brand image.46 41 HARLEY-DAVIDSON: Doing it wrong. Doing it nothing. They should get their brand licensing business going at least. Look at Ferrari for a good example to follow.47 42 HEINZ: Doing it wrong. Aside from a lousy brand name in Chinese, they just are not moving fast enough or big enough while the field is open to dominate. 48 47 MTV: Doing it wrong. Getting rocked by fake-MTV “Channel V” out of Hong Kong.49 59 GUCCI: Doing it right. Good brand recognition and nice classy build up of the sales network.50 46 NINTENDO: Doing it wrong. Sleepy. Japanese-sounding name doesn't help.51 50 ACCENTURE: Doing it ?52 49 L'OREAL: Doing it so so. Great success with Maybelline, but why not push the L'oreal and Garnier brands harder and faster? Why buy local skincare brand Mininurse and then shut down the regional channels that it relied on? Why buy Yue Sai and then tell everyone that this “Chinese brand” is now owned by a French company?53 65 PHILIPS: Doing it wrong. What a big mess of companies! Now they are implementing in China the ultimate in corporate suicide…shared services!54 51 XEROX: Doing it wrong. Fuji-Xerox. The Japanese connection does not help.55 60 EBAY: Doing it so so. Interesting to watch them get outmaneuvered by a local guy (Taobao/Alibaba). But eBay money will go a long way to putting this upstart back in his place.56 48 VOLKSWAGEN: Doing it wrong. The downward slide has started. Should have built up better brand values when the going was easy. Too late now!57 52 WRIGLEY'S: Doing it right. This market is more boring that watching someone chew gum, but Wrigley's is finding a way. Competitor Cadbury is overly centrally controlled by the Europeans, i.e. clueless.58 61 YAHOO! : Doing it right. Something to do with their Chinese heritage I think.59 58 AVON: Doing it wrong. Lots of positive press about the new opening of the market to direct marketing, but Avon is reacting too slowly and inflexibly while Amway runs circles around them.60 56 COLGATE: Doing it right. Pretty good fight with Crest. Smart and flexible approach.61 54 KFC: Doing it right. Growing fast and Chinese-ifying their menu. They make truckloads of money on their bland Chinese soup product with a 95% gross margin. Risk is that they will get a little too wild and lose quality control.62 53 KODAK: Doing it wrong. Stores are a mess. Digital age is here and Kodak refuses to budge. Grudgingly adding digital processing to China stores but in a very haphazard and sloppy way.63 55 PIZZA HUT: Doing it right. When you have to wait in line for 20minutes to get a table at Pizza Hut in China, you know they are doing something right. Chinese-ification of the product has worked well, while at the same time, the Chinese people still consider them as quintessentially western. Nice trick to pull that off.64 57 KLEENEX: Doing it wrong. The local and Hong Kong senior managers that have left this company over the last few years are not very good, so you can imagine what the ones who stayed behind are like.65 64 CHANEL: Doing it right. Classy and smooth build up. Stick with the classics and don't budge in this category. To launch a new Lychee fragrance perfume would be a very bad move. Fortunately, they have resisted this temptation.66 62 NESTLE: Doing it right. Same as Nescafe in a sense. They move fast and launch lots of new products. 67 63 DANONE: Doing it wrong. The Lu cookie success will soon fade and then they will be left to fight against local giants Guangming and Mengniu.68 66 AMAZON.COM: Doing nothing as far as I can see.69 67 KRAFT: Doing it wrong. Come on, there are lots of things this company could be doing to convert people to western food ingredients, but are they doing any of these? No.70 68 CATERPILLAR: Doing it right. Not so difficult to succeed when there are construction projects everywhere…literally everywhere!71 69 ADIDAS: Doing it wrong. Sleeping. 72 70 ROLEX: Doing it wrong. Sleeping.73 76 MOTOROLA: Doing it wrong. They should thanks the gods for the Razor launch. Without it, they would be near dead. 74 71 REUTERS: Doing it ?75 72 BP: Doing it wrong. Bad corporate image despite the fancy logo design by Landison. Much too complicated of a story to tell and bad Chinese brand name.76 74 PORSCHE: Doing it wrong. Doing it nothing while Ferrari drives circles around them with sales outlets, real car sales, Pr events, plus good classy licensing program and stores.77 ZARA: Doing it right. At least from a PR point of view, the Chinese are highly anticipating the opening of the first store in Shanghai. Good location also. But will the consumers be disappointed after all the hype when they find that Zara is just selling Gap/Net/Giordanno clothing?78 77 PANASONIC: Doing it wrong. Billboards do not make a brand image.79 81 AUDI: Doing it wrong. Their brand slogan should be “Gee, I wish I could have bought a BMW”. Back seat of the Audi A6 is like a prison for the boss who pays the bills. Suspension on the A6 might work in Germany on the autobahn, but on Chinese roads it is hell on wheels.80 80 DURACELL: Doing it right. But fakes are a real problem that they need to tackle. In this category, fake products do not help like they do in the luxury category.81 75 TIFFANY & CO: Doing it wrong. Nothing special despite the blue box. Opened first Shanghai store in unwisely selected Jiu Guang mall.82 79 HERMES: Doing it so so. 83 78 HERTZ: Doing it so so. Sloppy cars, confusing forms, must have a signed written approval from Hu Jin Tao to rent a car, etc.84 NEW HYUNDAI: Doing it wrong. Hey, it's another Korean brand. What do you expect? Why can't the Korean companies build off the huge success of their soap operas in China? It seems like a no brainer!85 90 NISSAN: Doing it wrong. See Toyota. 86 83 HENNESSY: Doing it right. Well sculpted image via mix of bars, karaoke, and clubs. Smart.87 88 ING: Doing it ?88 86 SMIRNOFF: Doing it so so. Not as good as Hennessy.89 91 CARTIER: Doing it right.90 84 SHELL: Doing it wrong. Focusing on marketing engine oil to lowly paid drivers who do not own the car they drive or care.91 87 JOHNSON&JOHNSON: Doing it so so. They were doing it right before, but they have seemly gone to sleep recently. To many Taiwanese senior managers posted to China?92 89 MOET & CHANDON: Doing it wrong. Haven't explained champagne to the Chinese people clearly yet.93 95 PRADA: Doing it so so. Not as good as LV.94 NEW BULGARI: Doing it so so. Not as good as LV.95 93 ARMANI: Doing it so so. Not as good as LV.96 85 LEVI'S: Doing nothing of interest.97 NEW LG: Doing so so. Laneige cosmetics is doing surprisingly well, but electronics needs a real brand position.98 97 NIVEA: Doing it right. Slow steady build up of the retail facings and low level of advertising are smart strategies. They are in a very nice position for the future. They miserably failed in their first attempt in China, so you have to give them credit for figuring it out this time.99 98 STARBUCKS: Doing it right. Very right! But they'd better clean up the mess they have created in Beijing with a bad licensee before they expand further. Shanghai model is highly successful.100 99 HEINEKEN: Doing it right. Nice brand name in Chinese. Heavy focus on bars. But will they ever make any money in China? It will take some time for the industry to change.Any questions or comments are welcome!Thomaswww.innovatize.com
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