Big Brother Begins Branding - Asian governments embark on branding initiatives
By Stanley Liu, General Manager, Taiwan
sliu@golinharris.com
Asia has long been the destination many of the largest Western companies have turned to for production outsourcing. Lower manufacturing costs and companies eager for business readily produced products for big name Western brands.
However, as costs have risen and margins drop, and as outsourcing has shifted from one low-cost nation to the next, branding has come to be seen as a necessity in the new economy in Asia. As governments across Asia realize the value in branding, and the power of brand value, they are increasingly taking a more prominent role in developing domestic brands.
Several Asian countries have implemented "branding" initiatives; government programs designed to spur domestic companies in developing their own brands. GolinHarris, along with IPG sister company FutureBrand, conducted an internal study to further mark the rise in branding.
GolinHarris and FutureBrand studied the national branding initiatives across five Asian countries: China, Korea, Malaysia, Singapore, and Taiwan. Research quickly revealed that each nation already has internationally famous brands, and that government's role is to now encourage other domestic manufacturers to develop into new potential blockbuster brands.
In China, the government has earmarked RMB 700 million (US$87.5 million) for its Brand Promotion initiative. Buffering this national branding program are efforts conducted by regional governments, which hope to reap the economic rewards of strong brands.
China hopes its branding efforts will help the country "compete with the increasing globalization of industries and services" against other nations. The government assists companies by: sponsoring branded companies in attending international exhibitions; helping branded companies place advertisements in select markets; and by aiding companies in setting up marketing agencies and sales channels. Regional governments provide prizes to top brands in a measure of direct investment.
Korea's decades-old governmental policy has already paid dividends, as global consumers readily turn to consumer electronics makers LG and Samsung. The two conglomerates, along with Hyundai and Daewoo, previously received direct government investment under their chaebol structure.
Now, the government is promoting its "Vision for Brand Power Korea 2010" plan, which centers on having 70 percent of total Korean exports come from brand name companies, and to place more than 10 Korean brands among the world's 100 most recognized brands list by 2010.
The government hopes to achieve these ambitious goals by providing brand education and access to branding expertise. Already Korea has set up a Brand Management Centre to deliver brand consulting, best practice, market trends, and consumer analysis to interested parties.
Malaysia has taken a different path, as it not only props up domestic brands, but has branded the country as a whole for tourism in its "Malaysia, Truly Asia" campaigns. The combination looks to turn the companies that provide the sights, sounds, and smells one sees on a vacation into global brands tourists take home with them.
To this end, Malaysia created its National Branding Task Force. The task force has the enviable challenge of formulating and reviewing national strategies to support potential brand growth, and will identify and approach companies to undertake brand-building activities. In addition, the task force will assist in reviewing and creating incentives to fund brand-building initiatives.
The city-state of Singapore already serves as a regional hub for many of the world's largest companies, but the goal of its BrandPact initiative is to further increase the strength of its domestic brands.
Singapore hopes to invest SGD 20 million (US$13 million) to promote the brand value of more than 5,000 domestic companies. The government will provide direct funding and sponsorship as part of the initiative. Other key programs include access to branding expertise and promotional activities such as the "Enterprise 50" list of promising domestic companies.
In Taiwan, efforts are underway to create an environment conducive to brand building. Taiwan is well known for its IT sector, with brands such as Acer, Asustek, and Trend Micro; but the island is competitive in many other industries, as diverse as yachts, bicycles, sporting goods, and even high-tech clothing.
The island's government last year kicked off its seven-year US$61 million "Branding Taiwan" campaign to encourage industries to shift from design manufacturing into brand manufacturing. Key to this progression will be: design training; establishing a brand evaluation system; and marketing efforts raising awareness of Taiwanese brands.
These five countries are not only representative of efforts Asia-wide, but also are helping create a template for future countries to follow. The potential exists for marketers to jump in and help grow new Asian brands from the bottom up - an exciting challenge for anyone in the region. While the process will be slow, the enthusiasm and government commitment ensure long-term success.
GolinHarris maintains a network of 10 offices across Asia to help Western brands enter the region and grab market share, and to strategically assist local brands in stepping onto the global stage.
By Stanley Liu, General Manager, Taiwan
sliu@golinharris.com
Asia has long been the destination many of the largest Western companies have turned to for production outsourcing. Lower manufacturing costs and companies eager for business readily produced products for big name Western brands.However, as costs have risen and margins drop, and as outsourcing has shifted from one low-cost nation to the next, branding has come to be seen as a necessity in the new economy in Asia. As governments across Asia realize the value in branding, and the power of brand value, they are increasingly taking a more prominent role in developing domestic brands.
Several Asian countries have implemented "branding" initiatives; government programs designed to spur domestic companies in developing their own brands. GolinHarris, along with IPG sister company FutureBrand, conducted an internal study to further mark the rise in branding.
GolinHarris and FutureBrand studied the national branding initiatives across five Asian countries: China, Korea, Malaysia, Singapore, and Taiwan. Research quickly revealed that each nation already has internationally famous brands, and that government's role is to now encourage other domestic manufacturers to develop into new potential blockbuster brands.
In China, the government has earmarked RMB 700 million (US$87.5 million) for its Brand Promotion initiative. Buffering this national branding program are efforts conducted by regional governments, which hope to reap the economic rewards of strong brands.
China hopes its branding efforts will help the country "compete with the increasing globalization of industries and services" against other nations. The government assists companies by: sponsoring branded companies in attending international exhibitions; helping branded companies place advertisements in select markets; and by aiding companies in setting up marketing agencies and sales channels. Regional governments provide prizes to top brands in a measure of direct investment.
Korea's decades-old governmental policy has already paid dividends, as global consumers readily turn to consumer electronics makers LG and Samsung. The two conglomerates, along with Hyundai and Daewoo, previously received direct government investment under their chaebol structure.
Now, the government is promoting its "Vision for Brand Power Korea 2010" plan, which centers on having 70 percent of total Korean exports come from brand name companies, and to place more than 10 Korean brands among the world's 100 most recognized brands list by 2010.
The government hopes to achieve these ambitious goals by providing brand education and access to branding expertise. Already Korea has set up a Brand Management Centre to deliver brand consulting, best practice, market trends, and consumer analysis to interested parties.
Malaysia has taken a different path, as it not only props up domestic brands, but has branded the country as a whole for tourism in its "Malaysia, Truly Asia" campaigns. The combination looks to turn the companies that provide the sights, sounds, and smells one sees on a vacation into global brands tourists take home with them.
To this end, Malaysia created its National Branding Task Force. The task force has the enviable challenge of formulating and reviewing national strategies to support potential brand growth, and will identify and approach companies to undertake brand-building activities. In addition, the task force will assist in reviewing and creating incentives to fund brand-building initiatives.
The city-state of Singapore already serves as a regional hub for many of the world's largest companies, but the goal of its BrandPact initiative is to further increase the strength of its domestic brands.
Singapore hopes to invest SGD 20 million (US$13 million) to promote the brand value of more than 5,000 domestic companies. The government will provide direct funding and sponsorship as part of the initiative. Other key programs include access to branding expertise and promotional activities such as the "Enterprise 50" list of promising domestic companies.
In Taiwan, efforts are underway to create an environment conducive to brand building. Taiwan is well known for its IT sector, with brands such as Acer, Asustek, and Trend Micro; but the island is competitive in many other industries, as diverse as yachts, bicycles, sporting goods, and even high-tech clothing.
The island's government last year kicked off its seven-year US$61 million "Branding Taiwan" campaign to encourage industries to shift from design manufacturing into brand manufacturing. Key to this progression will be: design training; establishing a brand evaluation system; and marketing efforts raising awareness of Taiwanese brands.
These five countries are not only representative of efforts Asia-wide, but also are helping create a template for future countries to follow. The potential exists for marketers to jump in and help grow new Asian brands from the bottom up - an exciting challenge for anyone in the region. While the process will be slow, the enthusiasm and government commitment ensure long-term success.
GolinHarris maintains a network of 10 offices across Asia to help Western brands enter the region and grab market share, and to strategically assist local brands in stepping onto the global stage.