Building a trusted brand in China

In a country where harmony is an explicit and politically directed theme underpinning all areas of social and economic development, there are two pervasive concepts that are struggling to achieve just that.

When I first moved to China in early 2006, an experience I had in my “local” bank presented an acute example of the type of relationship a company had with its customers. On the forms counter, where one applied for a credit card and other banking services, there was a sign in Chinese that read “don’t cheat.” I found it amusing as I did provoking. Two years on, and the issue of trust has multiplied exponentially. From financial institutions to food products, from personal health and beauty products to toys and medicines, trust is an overriding factor that drives purchase decisions, brand preference and loyalty. And it is now a critical issue for many.

Why? Not just because numerous high profile cases of unforgivably poor quality control and greed fuelled commercial gain at any expense have rocked national pride and trust in a broad swathe of products and services, but also because simply, many local companies over look the importance of authenticity and trust – fundamentals of brand building. And I’m not talking about advertising, which is just an element of brand building; I’m talking about the core brand fundamentals that businesses need to address effectively in order to help support their business strategies. After all, companies don't build great businesses by doing 'branding' brilliantly. They build great brands by doing business brilliantly, and by understanding the role of branding within this much bigger picture.

I believe there are three fundamentals that drive all companies, and their services and products. They are:

1. Growth. A brand is clearly positioned but it often needs help to grow – to build market share, stave off competition, innovate or extend.

2. Direction. A brand needs help in setting a direction – such as how to reposition its corporate or product brand in an increasingly saturated China market.

3. Protection. Companies need to protect their brand, which is being threatened by copy cats, poor quality control, and a lack of understanding or commitment from their employees or other key audiences.

Everything a brand does within and around heir brand world needs to be managed, consistent, and true to the brand itself. If a brand fails to establish credibility with all its stakeholders – internal and external – it will fail, or at least sustain damage that will dilute its commercial performance. Additionally, it needs to sustain its brand promise by consistently providing an appropriate experience, as Apple and LVMH do so effectively.

However, in the rush to get to market and sell, sell, sell, many Chinese brands take brand shortcuts, choosing to focus on short term gain rather than long term loyalty. One should never forget that consumers in China are increasingly becoming savvier; more and more demanding of their brand relationships, and more and more sophisticated in their choices. This rapidly changing complexity presents many challenges, and through the multitude of messages received via various fragmented mediums, and the presentation of a vast array of similar products, consumers have to make choices every day. And they do; and more often than not they are driven by their emotions.

Destroy a consumers’ trust – like the Häagen-Dazs affair in 2006 – and it takes a long time for a brand to recover. Brands cannot blame third parties, administrative failures or government when consumers experience fault or problems. They must take responsibility for managing their own brands through all scenarios and commercial climates. From Roewe to Shuang Huan, brands need to work harder, and become smarter at integrating their brand strategy with their business strategy to build and sustain trust in order to ensure optimum health and commercial success.