asian brand strategy how asia builds strong brands

Asian Brand Strategy HOW ASIA BUILDS STRONG BRANDS Martin Roll Martin Roll Asian Brand Strategy HOW ASIA BUILDS STRONG BRANDS © Martin Roll 2006 All rights reserved. No reproduction, copy or transmission of this publication may be made without written permission. No paragraph of this publication may be reproduced, copied or transmitted save with written permission or in accordance with the provisions of the Copyright, Designs and Patents Act 1988, or under the terms of any licence permitting limited copying issued by the Copyright Licensing Agency, 90 Tottenham Court Road, London W1T 4LP. Any person who does any unauthorised act in relation to this publication may be liable to criminal prosecution and civil claims for damages. The author has asserted his right to be identified as the author of this work in accordance with the Copyright, Designs and Patents Act 1988. First published 2006 by PALGRAVE MACMILLAN Houndmills, Basingstoke, Hampshire RG21 6XS and 175 Fifth Avenue, New York, N.Y. 10010 Companies and representatives throughout the world PALGRAVE MACMILLAN is the global academic imprint of the Palgrave Macmillan division of St. Martin’s Press, LLC and of Palgrave Macmillan Ltd. Macmillan® is a registered trademark in the United States, United Kingdom and other countries. Palgrave is a registered trademark in the European Union and other countries. ISBN-13: 978–1–4039–9279–6 ISBN-10: 1–4039–9279–7 This book is printed on paper suitable for recycling and made from fully managed and sustained forest sources. A catalogue record for this book is available from the British Library. A catalog record for this book is available from the Library of Congress. 10987654321 15 14 13 12 11 10 09 08 07 06 Printed in China iii CONTENTS List of figures vii List of tables viii List of illustrations ix About the author xi Foreword xiii Preface xvi 1 INTRODUCTION 1 Lack of value creation 2 The eroding low-cost advantage 3 Less than 10 global brands originating from Asia 4 Reasons for the lack of strong Asian brands 5 A new paradigm for the Asian boardroom 9 The scope of the book 11 Notes 12 2 BRANDING – THE DRIVER OF A SUCCESSFUL BUSINESS STRATEGY 13 Perceived risk 16 Branding drives shareholder value 16 Brands and market capitalization 18 Brands’ contribution to stock market performance 19 Growing significance of intangible assets 20 The need for brand-driven organizations in Asia 21 Boardroom mindset and beliefs 23 Skill sets 25 Resources 27 Notes 29 3 TRANSFORMING HOW WE UNDERSTAND ASIAN CULTURES AND CONSUMERS 31 Introduction 31 From a homogeneous region to a mosaic of cultures 32 From exotic Asia to modern urban Asia 33 From separate countries to connected ones 35 From American images to prominence of Asian images and music 39 Opportunities in subcultures 41 Transforming how we view Asian consumer psychology 46 The importance of in-groups in Asian cultures 48 Being different like everybody else 50 Conclusion 52 Notes 53 iv Contents 4 ASIAN COUNTRY BRANDING 56 Export branding 57 Generic country branding 60 Future opportunities 67 Conclusion 71 Notes 71 5 CELEBRITY BRANDING IN ASIA 74 Endorsements 77 Celebrity endorsers in Asia 82 Celebrity endorsement models 85 Challenges in celebrity branding 88 Celebrities in India 91 Conclusion 92 Notes 94 6 ASIAN BRAND STRATEGY 96 Aligning the brand 96 Brand management model 97 Brand audit 99 Brand identity 101 Brand strategy 103 Brand implementation 112 Brand equity 117 Brand valuation 124 Conclusion 127 Notes 127 7 SUCCESSFUL ASIAN BRAND CASES 129 Branding is the face of a strong business strategy 129 CASE 1 Singapore Airlines 130 Background 131 Brand philosophy 131 Brand communication 135 Brand strategy 135 Future challenges 137 CASE 2 Amanresorts 138 Background 139 Brand philosophy 140 Brand communication 144 Future challenges 145 CASE 3 Shiseido 145 Background 146 Brand philosophy 147 Brand strategy 149 Future challenges 150 CASE 4 Samsung 151 Contents v Introduction 152 Brand philosophy 153 Brand communication 155 Future challenges 157 Notes 160 8 ASPIRING ASIAN BRAND CASES 161 CASE 1 Jim Thompson 162 Background 162 Brand philosophy 164 Brand strategy 165 Brand communication 165 Future challenges 167 CASE 2 Li Ning 169 Background 170 Brand philosophy 171 Brand communication 174 Future challenges 174 CASE 3 Jet Airways 176 Background 176 Brand strategy 177 Brand communication 179 Future challenges 180 CASE 4 Giordano 182 Background 182 Brand philosophy 184 Giordano’s competitors 187 Future challenges 188 Notes 189 9 10 STEPS TO BUILD AN ASIAN BRAND 191 1. The CEO needs to lead the brand strategy work 193 2. Build your own model as not every model suits all 196 3. Involve your stakeholders including the customers 197 4. Advance the corporate vision 198 5. Exploit new technology 200 6. Empower people to become brand ambassadors 201 7. Create the right delivery system 203 8. Communicate! 205 9. Measure the brand performance 211 10. Adjust regularly – be your own change agent 212 Notes 213 10 ASIAN BRANDS TOWARD 2020 – A NEW CONFIDENCE IN THE BOARDROOM 215 Implications for successful brand strategies in an Asian context 215 Challenges for aspiring Asian brands 216 The global brand landscape will change significantly 219 Branding in the Asian boardroom 222 Cost advantage is meant for investment – not short-term profit making 224 Can the West maintain its branding edge? 225 Conclusion 227 Notes 235 11 CONCLUSION 236 Note 238 FUTURE CHAPTERS 239 Appendix: Interbrand brand valuation 240 Journals, periodicals, newspapers and press agencies 242 Bibliography 243 Index 249 vi Contents vii LIST OF FIGURES 1.1 Four scenarios for value creation through branding 4 3.1 Maslow’s hierarchy of needs and the Asian equivalent 47 3.2 Power distance versus individualism/group orientation 48 3.3 Independent versus interdependent self 49 4.1 Country branding initiatives 61 5.1 Celebrity benefit involvement model 78 5.2 Celebrity brand impact model 88 6.1 Brand alignment model 97 6.2 Brand management model 98 6.3 Brand performance analysis chart 100 6.4 Asian brand growth matrix 105 6.5 Touch point model 112 6.6 Example of a touch point model for an airline company 116 6.7 Brand metrics performance model 122 6.8 Illustration of the net present value brand valuation method 126 9.1 The brand boardroom model 195 LIST OF TABLES 1.1 Asian brand leadership model 10 2.1 Nine characteristics of a strong brand 13 2.2 Potential perceived risks involved in a purchase 16 2.3 Contribution of brands to shareholder value 18 2.4 Impact of brand performance on financial ratios 20 2.5 Branding excellence model 22 2.6 Asian boardroom audit 28 3.1 Blueprint to change the way we think of Asia 32 3.2 Differences between low and high power distance countries 52 4.1 Benefits of branding places 57 6.1 Benefits of a brand audit 99 6.2 Brand equity model 118 9.1 10 steps to build a successful Asian brand 192 viii LIST OF ILLUSTRATIONS Singapore Airlines will be the first commercial airline to fly the Airbus A380 132 Singapore Airlines’ main brand ambassadors, the Singapore Girls, in Central Park, New York City 133 Ms See Biew Wah, SIA check and training stewardess, gets that Balmain touch from the French couturier and Madame Madeleine Kohler 134 Paradise on earth – sea, sun, and luxury at Amanwella (Sri Lanka) 139 One with nature – luxurious Aman-i-Khás (India) 142 Jim Thompson’s main store in Bangkok,Thailand 166 Interior of Jim Thompson’s house in Bangkok, now a public museum 168 Li Ning’s store front in Wuhan, China 172 Jet Airways:The Joy of Flying 177 Jet Airways focuses extensively on the service aspect to distinguish its brand from other local competitors 179 The signature store front of Giordano 183 HSBC’s adaptation to local cultures 206 HSBC’s adaptation to local cultures 207 BritishIndia’s signature store front 209 BritishIndia’s unique store layout and design 210 The brand portfolio managed by Banyan Tree 227 The ocean view from one of Banyan Tree’s villas in the Maldives 229 Serene ocean view at Banyan Tree’s Seychelles resort 232 ix [...]... contacted at: contact@asianbrandstrategy.com or via www.asianbrandstrategy.com FOREWORD A strong brand is able to help a company differentiate itself from its rivals, stand out from the competition, influence a consumer’s purchase decision in the company’s favor, build customer loyalty and boost the company’s financial performance Asian Brand Strategy explores these issues focusing on the Asian market environment... the strategic aspects of branding in Asia In Asian Brand Strategy Martin Roll has succeeded in tackling head-on many of the challenges illustrated He has also included in the examination and application of branding many critical factors in the Asian environment such as culture and corporate structure Asian Brand Strategy demonstrates how successful brands are helping top-tier Asian companies to penetrate... global brands with a strong Asian heritage But given the size and volume of Asian business today, it is evident that Asia could build many more prominent brands and capture more financial value from better price premiums and customer loyalty Branding can become an important driver of shareholder value for Asian companies in the future, as this book will illustrate Reasons for the lack of strong Asian brands. .. instrumental part of a brand strategy Chapter 5 discusses how to involve celebrities and other endorsers, and their ability to support Asian brand building Chapter 6 is dedicated to brand strategy It provides frameworks for aligning the brand and an entire brand management model Chapters 7 and 8 illustrate case studies of successful as well as aspiring 11 Asian Brand Strategy 12 Asian brands The two chapters... building and managing brands in an Asian context through a selected portfolio of Asian brands The multiple and diverse brand stories can inspire the Asian boardroom and serve as discussion points when crafting future brand strategies Chapter 9 is a step-by-step guide to brand building for Asian boardrooms, and discusses the processes and systems needed to successfully manage brands Finally, Chapter... with branding for many years, I was familiar with many Japanese brands But I found it hard to recognize any brands from other Asian countries This observation has lasted, although admittedly more Asian brands have been developed throughout the 1990s Yet Asia only represents a fraction of all the strong brands in the world, and today there is still a huge imbalance between East and West in terms of branding... millions Moreover, branding and brands do not operate in a vacuum, but are closely linked to developments in society, to people and cultures 9 Asian Brand Strategy 10 Third, managers wanting to succeed in Asia need to abandon the idea of the oriental Asia of the past Asian consumers are all vying for an Asian type of modernity that has nothing to do with colonial imagery TABLE 1.1 Asian brand leadership... which is strong brand equity in the market Despite Asia s size and economic growth, it has not seen the emergence of many strong and international brands Less than 10 global brands originating from Asia In a study measuring the financial value of worldwide brands conducted by Interbrand and Business Week in 2004, one important finding was that only Introduction four of the top brands originate in Asia. 9... systematic monitoring of branding investments and performance It is only then that Asian brands will become truly great The scope of the book This chapter has discussed the implications for a new Asian business landscape, where Asian companies can step up and capture more financial value through brands Chapter 2 looks at branding and how the discipline relates closely to business strategy Branding can drive... large Asian companies recognized as brand leaders On the other hand, it is more than 75 percent for Western branded consumer goods companies, which own the most prominent brands In addition, Asian firms tend to use price to push sales, thereby undermining both the implicit guarantee of the consistency of the offer and the quality perception that are essential to brand building As a result, few Asian brands . Asian Brand Strategy HOW ASIA BUILDS STRONG BRANDS Martin Roll Martin Roll Asian Brand Strategy HOW ASIA BUILDS STRONG BRANDS © Martin Roll 2006 All rights. tough Asian competition; non-branded or branded. These are worth watching. Asian Brand Strategy offers first-hand insights into Asian consumers, markets and companies’ efforts to build strong brands. . West. Martin Roll can be contacted at: contact@asianbrandstrategy.com or via www.asianbrandstrategy.com xii About the author FOREWORD A strong brand is able to help a company differentiate itself