The success of Chinese brands is mainly the success of marketing. This is the "trap" faced by Chinese-style brands. Chinese-style marketing has two essential characteristics: one is learning and imitating products, and the other is vigorously using advertising and promotions in promotion, and using price wars in competition.

Product classification based on brand building

Products meet needs, and needs are hierarchical. Simply put, the degree to which a product satisfies needs is the effectiveness of the product. The effectiveness of products in meeting needs can be roughly divided into three categories:

1. Products that meet daily needs.

Except for substandard or shoddy products, this can be done. If you are not so particular, in addition to products that are harmful to health and life, you can even do fake and shoddy products. China's "double-low" products (low price, mass quality) have mainly fulfilled this mission for a long time in the past.

2. Products that improve the quality of life.

Those Chinese products that have moved from "double-low" to "double-level" (medium-high quality, medium-priced), leading companies in all walks of life, have undertaken this mission.

3. Products that change lifestyles.

This is why multinational companies can operate globally. Our lifestyle today is not left to us by our ancestors, but is the result of multinational companies’ marketing in China and the result of their products entering and occupying the market. Of course, this is also the result of Chinese companies quickly adapting to the purchasing power of Chinese consumers through learning and imitation.

Therefore, if Chinese companies do not establish independent innovation capabilities, they will not be able to create a new way of life. If they cannot create a new way of life, they can only help multinational companies continue to support the way of life they create. Then, Chinese companies will always work for multinational companies.

And if multinational companies see that your work level is very high and will eventually threaten them, they may not even give you the qualification to work. They can look for India or even Vietnam.

The essence of Chinese-style marketing

Chinese-style marketing has two essential characteristics:

The first is to learn and imitate products, and the second is to promote Use advertising and promotion vigorously, and use price wars to compete.

Because of the time difference, the "leader" in the learning and imitation actions can maintain relative product advantages; due to the difference in strength, who can proactively and coherently launch advertising wars, promotion wars and price wars? , whose "marketing" is more powerful and effective.

Because of the different abilities of learning and imitation, Chinese-style marketing results in two cost-effectiveness ratios: "double flat" and "double low".

China's leading enterprises in the industry basically maintain a "double-level" level in terms of price-performance ratio; small and medium-sized enterprises basically maintain a "double-low" level. Compared with the high (monopoly) profits of multinational companies, China's leading companies earn average profits, while small and medium-sized enterprises basically earn low profits or even small losses.

Looking at the history of world economic development and the process of economic revitalization in developing countries, no country has achieved such great economic achievements through learning and imitation like China.

But it is precisely because Chinese companies gain satisfactory benefits from learning and imitation, and because of the huge differences between the Chinese economy and the economies of developed countries, there is huge space for learning and imitation and it lasts long enough. Most Chinese industry leaders Enterprises have not truly established innovation capabilities in their rapid development. Therefore, when the space for learning and imitation is suddenly compressed, Chinese companies generally fall into a lack of innovation. China's economy has also fallen into downward pressure.

The essence of Chinese brands

In competition, those Chinese companies that take the lead in learning and imitation have not only established leading market and industry positions, but also established Gained brand status.

China's brands, from a construction perspective, are mainly based on the following elements: advertising, promotion, market share, performance, industry status and brand awareness. Although it is also based on products, the contribution of products to the brand is far less than the above factors.

Therefore, in essence, Chinese-style brands are well-known trademarks or trademarks with better market performance and better performance.

Well-known brands of this nature have two weaknesses: first, they cannot obtain high monopoly profits; second, they have no brand advantage compared to multinational companies and no product advantages compared to local companies (the products are homogeneous). change).

The essence of the brand

The foundation of the brand lies in technology patents. This is what branding is really about.

Due to technology patents, product exclusivity is formed; on this basis, product prices that support high monopoly profits are established through advertising, promotion, and sales; on the basis of price recognition, we strive for market share and high amount of monopoly profits. The monopoly on the market and high prices stem from the uniqueness and non-replicability of the product.

Compared with Chinese companies, the real secret of multinational companies' brand building lies not in marketing methods, but in convincing, high-quality, unique, and high value-added products. Such proprietary products are derived from technology patents.

Because only in this way can the huge advertising investment, promotion investment and sales investment in brand building in the later period be guaranteed to be recovered.

Brand building is a large-scale, long-term, forward-looking and consistent strategic investment. Without the support of unique products and patented technologies, it is impossible to achieve the expected brand benefits from these efforts.

The benefits of a strong brand are composed of three aspects of value. Technical value (no need for productization, huge profits can be obtained just through technology transfer. For example, Fiat engine technology is to cars), product value (workmanship, design, performance and quality) and brand value (psychological, emotional, cultural ).

Building a "strong brand" without core, independent patented technology is either a fantasy or a flash in the pan.

Brand Path

I have always believed that among the marketing ideas proposed by Mr. Liu Chunxiong and I, the most valuable is "Path Thinking" and the "Brand Path" proposed thereby. . Unfortunately, we didn't do this part well enough, and as a result, it had basically no impact.

In summary, we divide brand building into three stages. The fundamental reason for the difference in the role of brands among enterprises is that they are at different stages or in different positions at the same stage due to different capabilities.

The first stage and three positions.

Product stage

Three positions: mass products, affordable products, and reputation products.

Popular products refer to products that have no special features and are ordinary products on the market. That is the above-mentioned "double low product".

Affordable products refer to products that have some differences or features, are stable in the market, and have a relatively high market share. That is the above-mentioned "double flat product". Such products correspond to "well-known brands". Maybe not today, but as long as we remain consistent, we will be in the future.

A prestige product is one that is unique and widely sought after. This type of product corresponds to a "strong brand". Maybe not today, but as long as we can be consistent, it will be in the future.

The second stage and three positions.

Name stage

Three positions: word of mouth, name, and named purchase.

The "word of mouth" here is not the same thing as the reputation of a strong brand. It means that although it is not famous, people who have consumed it start to praise and recommend it. If this process can continue, the "name" will become known to more and more people until a named purchase is formed.

The third stage and location.

Brand stage

Three positions: well-known brand, strong brand, and national brand.

When a name is sustained and spread widely, it becomes a well-known brand.

Until this time, it can still be achieved through learning and imitation. Moreover, if the product is not supported by patented technology, other competitors can also achieve it through learning and imitation, then the company will stop at being a "well-known brand". The fate of such an enterprise will either continue to move forward through independent innovation, or it will go from glory to mediocrity, and then to an existential crisis.

If you want to become a strong brand, you must innovate independently, and you must make your products unique, unparalleled, and unmatched by your competitors. This is difficult to achieve, because it almost requires that your product has no defects. At a minimum, it must have more advantages and fewer defects than its competitors.

Motorola didn't do it, Nokia replaced it; Nokia didn't do it, Apple replaced it.

As long as the opponent can reach it, he will at least fall into hand-to-hand competition. There will be no winners in this kind of competition, only bruised survivors. The reason why multinational home appliance brands have basically withdrawn from the Chinese market is that Chinese home appliance companies have caught up. Let students reach their goal, which is what the old Chinese saying goes: "Teach the apprentice to starve the master to death."

Due to the strong support of products, strong brands dare and must spread widely to make their influence ubiquitous and give the brand emotional, psychological and cultural personality. Because it no longer just meets basic needs, nor just improves life, but leads and supports lifestyle? The world will become more colorful and exciting because of its products.

All developed countries have some brands that make people think of them when they mention this country; when all powerful brands are mentioned, people know which country they belong to. Without such a brand, a country's economy cannot enter the ranks of developed countries.

China is not yet a developed country, so China does not have such a brand, and the reverse is also true. Without such brands, China has achieved world-renowned economic achievements, thanks to large-scale "Made in China". The collective efforts of Chinese enterprises have not created an international brand, but they have polished "Made in China", which can also be regarded as a national brand. But it only benefits mass products or affordable products.

These words are only a basic description and basic circuit diagram. The future will unfold separately.

Getting out of the trap of Chinese brands

The most paranoid thing about Chinese companies’ brand awareness is that “brands are higher than products”. In practice, it is manifested as "emphasis on brand rather than product". Even those of us who are "productists" only emphasize that "products are the foundation of a brand."

In fact, no matter how good the product is, it has a life cycle. What really makes a company's products prosperous is not the good products themselves, but innovation, which is the patented technology from generation to generation.

This is precisely the weakness of Chinese brands.

Most Chinese brands do not have patented technology support. The core technologies of many industry leading companies are purchased or imitated. The success of Chinese-style brands is mainly the success of marketing. Compared with the global market, it is neither the success of products, nor the success of R&D, nor the success of patented technologies.

This is the "trap" faced by Chinese brands. If Chinese brands cannot overcome this trap, then Chinese companies will no longer be brilliant and the Chinese economy will have big problems.

After 2004 (China allowed private businesses to run businesses for 30 years), for Chinese companies, "how to sell" is no longer a problem. The question comes back to the original point: What to do? How to do it? Supply-side reform, in summary, is actually two basic questions: What to do? How to do it?

Without the technology and advanced business concepts of developed countries, it would be unimaginable for China’s economy to achieve today’s achievements. Without the strong and rapid desire to learn and imitate as well as the persistent efforts of Chinese enterprises, it would be unimaginable for China's economy to achieve today's achievements.

Why is it that among developing countries, only China has achieved what can be called an economic miracle through learning and imitation? I think the most important thing is that Chinese companies do not simply imitate, but constantly improve and innovate.

Improvement and innovation probably fall into the category of "constructive imitation". If they can go one step further, that's "innovation." Improvement and innovation probably belong to natural progress, while innovation belongs to revolutionary progress. Improvement and innovation are steps uphill, while innovation is a hurdle.

There is only one way out of the trap of Chinese brands, and that is for brand companies to unswervingly carry out technological innovation and form patents that competitors cannot imitate.

Competitive advantage cannot be established through marketing technology alone. Only by establishing advantages in products and in the technology that determines products is the real advantage.

I feel very regretful that in the tide of public opinion to solve the problem of Chinese enterprises, this voice is very weak; in the efforts of Chinese enterprises to get out of the predicament, this behavior has not risen to a strategic level and has not become a priority for enterprises. .

It is necessary to point out that the culture of a strong brand is not simply corporate culture, but national culture. Otherwise, it will be difficult for it to rise to the level of a national brand. If a powerful international brand emerges in China, it must have distinctive Chinese elements and the Chinese culture they carry.

It is also necessary to point out that what can make Chinese brands become powerful international brands is not first of all Chinese marketers, but Chinese scientists and outstanding engineering and technical personnel. As a super salesman, the Chinese Prime Minister sells the creations of Chinese scientists and engineers.