Branding in China: Lessons from the Foreign Brand Success and Failure Stories

Abstract

Context/Rationale: China’s role in the global economy is on the rise since their entry to WTO in 2001. Given its market size, potential and complexities, China presents an attractive market opportunity for many multinational companies, as well as some unique challenges in building and expanding a brand. Numerous foreign firms have ventured into China, yet many of them failed miserably despite their years of expansionist brand experience.Purpose: This research intends to identify the critical success factors and potential causes of failure for the foreign brands in the Chinese market.Methodology: A case study approach has been used for this study and select cases were identified for the purpose of analysis and discussion. These cases comprise of brands that represent different countries of origin, industries, product categories and value propositions, so as to enable generalizations. This research is based on a review of extensive secondary information which constitute of information gathered from review of reports from leading consulting agencies, journal articles, news papers and blogs by prominent business strategy opinion leaders.Findings and Suggestions: The research throws light on the major challenges that hinder the growth of foreign brands in the Chinese market and has made suggestions to overcome these hurdles based on the best brand practices used by their Chinese rivals as well as foreign brands like KFC, P&G, Carrefour and many others that have succeeded in China.Originality/Value: Though there are a multitude of researches that discuss the economic aspects of entry of foreign firms to China, there are only a quite few studies which explore the scope of branding in the Chinese market. This paper tries to fill this gap by identifying the major reasons that caused the success or failure of different foreign brands in China.